For the first time in a quarter-century, U.S. consumers drank less American whiskey last year than in the previous year—however, thanks to consistent premiumization trends, the category grew in dollar terms last year, according to Impact Databank. And despite overall volume loss of 1%, the $25-and-over Bourbon segment grew 3.5% in volume to 10.96 million 9-liter case depletions. This higher end of the category now accounts for more than one-third of total American whiskey volume in the U.S. as consumers continue to favor pricier labels. 

Suntory Global Spirits-owned Maker’s Mark leads the super-premium segment and it shows no sign of losing that title despite slipping 1% last year to 2.35 million cases, according to Impact Databank. The brand is followed by Diageo’s Bulleit, up 2.9% to 1.75 million cases last year; Brown-Forman’s Woodford Reserve, which grew 11.1% to 1.42 million cases, marking its 13th consecutive year of double-digit growth; Suntory’s Knob Creek, which held steady at 531,000 cases; and Suntory’s Basil Hayden, down 4% to 502,000 cases. All together, these top-five super-premium labels managed a 2.3% rise in volume last year. 

Marques Warren, owner of Downtown Spirits in Seattle, has certainly noticed Bourbon sales growing at his store, thanks largely to those consumers willing to spend a bit more on a bottle. “Historically Seattle’s been seen as a pioneer in the craft beer category, and there’s still demand for that, but as we’ve seen an influx of new residents from other parts of the U.S., and the money and tastes that come with them, as well as the influence of big tech salaries on the buying habits of customers who work near our store, we’ve seen a shift in demand and Bourbon sales have definitely benefited from that shift,” he says. 

Warren adds that despite its popularity, there has been a bit of a pullback recently in Bourbon on a macro level. “It’s tricky: Surveys tell us the younger generation is drinking less, but the data shows that Bourbon makes up the better part of 10% of our sales,” he says. “So maybe we’ll see a slowdown in demand. But the popularity of just about any category, save for vodka, ebbs and flows, so it’s only a matter of time before that pullback turns into a surge.”

Keep On Going

Although Tequila has been hot in recent years, Bourbon remains king across most retail markets. Downtown Spirits carries around 200 different Bourbon brands, more than any other category at the store, with bestsellers including Buffalo Trace ($32 a 750-ml.), Woodford Reserve Double Oak ($60), Maker’s Mark ($40), Bulleit ($35), and Michter’s ($54). “Bourbon enthusiasts are a diverse crowd,” Warren notes. “It’s easy to paint a picture of the Bourbon consumer as a white male in his 20s or 30s, with a stylish beard and some trendy outerwear. But the demand for and interest in Bourbon has never been higher for other demographics, like women and people of color, that have historically been an afterthought.”

At Cheers Liquor Mart in Colorado Springs, Colorado, Maker’s Mark ($26 a 750-ml.), Jack Daniel’s ($25), Bulleit ($31), and Tin Cup ($28) all do well, as do local Colorado labels, led by Axe and The Oak ($46) and the American single malt producer Stranahan’s ($55). “The American whiskey and Bourbon category keeps growing more each year and has become our main source of sales and profit—we carry well over 400 labels, with the next closest category being vodka at about half that number,” says owner Jack Backman. “Innovations that are working for us include flavors, high proof and barrel strength products, and pre-mixed Manhattans and Old Fashioneds. We’re also seeing people lean toward more ryes and wheated Bourbons. And anything allocated is a pretty easy sell and not price-sensitive.”

Bulleit hasn’t shied away from innovation. Earlier this year the brand entered the American single malt category with its 100% barley expression ($60 a 750-ml.) and also brought back the limited-edition Rye 12-year-old ($55), which was initially released in limited quantities in 2019. And the brand continues to see success with its ready-to-serve Bulleit Rye Manhattan and Bulleit Bourbon Old Fashioned, which Jesse Damashek, senior vice president of marketing for whiskey and liqueurs at Diageo, notes serve as “an amazing recruitment tool” for younger legal-drinking-age consumers. Other American whiskeys in Diageo’s portfolio include George Dickel, which grew 3% to 195,000 cases last year, according to Impact Databank, and the smaller brand Blade and Bow. Late last year Dickel released a limited-edition 18-year-old Bourbon ($510), and the Blade and Bow portfolio, meanwhile, includes a Kentucky Straight Bourbon ($50) and a 22-year-old Kentucky Straight Bourbon ($500).

Suntory’s top American whiskey labels also continue to churn out new innovations. Last fall Maker’s Mark introduced Cellar Aged ($150 a 750-ml.), its oldest expression to date, featuring 11- and 12-year-old Maker’s distillate, with the second Cellar Aged release expected later this year. And this summer, the brand launched the 2024 expression of its Wood Finishing Series, The Heart Release ($75). Also this summer, Knob Creek expanded its portfolio with a 10-year-old rye ($70) and a new limited offering, Knob Creek Bourbon x Rye ($45), a blend of Knob Creek 9-year-old Bourbon and 7-year-old rye. And in the spring, Basil Hayden re-released its popular limited-edition Basil Hayden Subtle Smoke ($50). As for Jim Beam, the brand launched a new global brand platform, “People Are Good For You,” last year. “It celebrates a moment of human connection by showcasing a community united in a spontaneous moment of joy—whether at a bar with close friends or ones you’ve just met—that reflects the welcoming spirit of Jim Beam,” says Regan Clarke, vice president of American whiskey brands for Suntory. “We were extremely excited to launch this campaign and we’re more excited to continue to build on its success and evolve the platform in 2024.”

Like at Cheers Liquor Market, highly allocated barrels do very well at Buster’s Liquors & Wine in Memphis, Tennessee, which offered more than 75 of its own barrel picks last year. “We owe much of our store’s success to investing heavily in Bourbon over the years long before this renaissance, and Bourbon now accounts for around 15% of total store sales,” says store president and owner Josh Hammond. The store’s expansive Bourbon selection of 400-plus labels includes top-sellers Woodford Reserve ($36 a 750-ml.), Maker’s Mark ($28), Bulleit ($28), and Wild Turkey Russell’s Reserve 10-year-old ($38), with rising stars including Penelope Toasted ($70) and Blue Note Juke Box ($40). “Unique finishes is the biggest trend we’ve seen in the last several years,” Hammond adds. “Examples include Penelope Rio and Valencia and Maker’s Mark Private Select Stave Finishes. And recently, a customer shared their Old Forester King Ranch Mesquite Finish, which isn’t available in Tennessee, and it was fabulous.”

Old Forester, from Brown-Forman, grew 13.5% to 485,000 cases last year, according to Impact Databank, and Caleb Trigo, Old Forester’s assistant master distiller, says that the brand crossed the 500,000-case mark this year. “We’ve had many exciting new releases within the last 12 months, most notably the newest edition to the Whiskey Row series, 1924,” Trigo adds. The limited-release 10-year-old Bourbon ($115 a 750-ml.) hit the market in January, debuting a new mash bill of 79% corn, 11% rye, and 10% malted barley. “In addition, we continue to release unique, creative batches of Old Forester via our 117 Series,” Trigo adds. “These small batch offerings are released three or four times a year at our distillery in downtown Louisville.” Portfoliomate Woodford Reserve debuted two new expressions in early 2024: Batch Proof ($150) and Double Double Oaked ($80 a 375-ml.). “The big story, however, was the one-time release of The Woodford Reserve Kentucky Derby 150 product,” says Woodford Reserve Master Distiller Emeritus Chris Morris. “Only 150 bottles were made of this unique, thrice-barreled Woodford Reserve expression presented in a Baccarat crystal decanter and retailing for $15,000 a 750-ml. It was a huge success and certainly made Kentucky Bourbon history.” Morris adds that the brand’s marketing philosophy is a classic one: “If it isn’t broke don’t fix it.”

Sazerac takes a similar approach with its Buffalo Trace label, which was up 16.5% to 495,000 cases last year, according to Impact Databank. “We believe that if we remain unapologetically true to who we are, our people will continue to find us and tell their friends,” notes Sazerac global brand director Andrew Duncan. “We try to make the very best whiskey we can relative to price point—we don’t cut corners and we set our suggested retail prices at levels we believe to be fair compared to other competitive products in the market. We think this consistent approach over time has earned our brands a lot of loyal fans over the years.” Beginning summer 2023, Buffalo Trace has introduced a slew of new releases: In June 2023, it launched the Daniel Weller experimental line with the inaugural 12-year-old release made with Emmer wheat ($500 a 750-ml.); in September 2023, it introduced The Prohibition Collection, including 375-ml. bottles of Old Stagg, Golden Wedding, Three Feathers, Walnut Hill, and George T. Stagg Distillery Spiritus Frumenti ($1,000); in October 2023, it released Eagle Rare 25 ($10,000 a 750-ml.), the oldest expression from the Eagle Rare portfolio; and this May it announced Weller Millennium ($7,500 a 750-ml.), a first-of-its-kind, ultra-aged whiskey comprising a blend of vintage straight wheated Bourbon and wheat whiskeys that were distilled near the turn of the millennium and matured at Buffalo Trace Distillery for various lengths of time.

Heaven Hill’s heritage American whiskey brands for the most part held their share last year: Heaven Hill was steady at 245,000 cases; Elijah Craig rose 1% to 406,000 cases; and Evan Williams dipped just 0.5% to 3.1 million cases. This June Heaven Hill launched the Heaven Hill Grain to Glass line (each $100 a 700-ml.), with the inaugural launch including a traditional Bourbon, wheated Bourbon, and a rye, each of which features a new mashbill for the distillery. Elijah Craig, meanwhile, launched Toasted rye ($55) this July, and this year’s annual release of the Parker’s Heritage Collection—the 18th for the collection—was announced this August and features a 14-year-old Kentucky straight malt whiskey finished in reconstructed heavy toast Cognac barrels ($170). “While the secondary market has slowed, there’s still a drive for limited and allocated products, especially among those that have established themselves as perennial favorites like the Parker’s Heritage Collection, Old Fitzgerald Decanter Series, and the Heaven Hill Heritage Collection,” says Heaven Hill’s vice president of American whiskey Susan Wahl. “But the price hikes that were driven by Covid-19 and supply constraints are easing, so the environment is ripe for price promotion, which means most Bourbon consumers will be getting more for their money over this next year.”

Clearing Clutter

There’s no question that today’s Bourbon market is crowded. “It’s a fragmented category with many brands and also new brands still entering all the time, which makes it very confusing for the average consumer,” Wahl says. “We’re seeing consumers revert to trusted brands, which puts heritage distillers in a strong place for continued growth.” Wahl adds that while initially the craft spirits boom was a strong driver of interest in the Bourbon category, the landscape has changed. “We’re seeing closures or sell offs of local brands as the contraction of the entire spirits segment and increased interest rates have made it difficult for smaller distillers to sustain,” she says. “This has led to shelf opportunity for more established brands.”

Hammond of Buster’s believes the amount of new innovations and labels emerging in Bourbon will keep the category thriving for a long time. “But a downside to this is there seems to be too many distilleries in a saturated market, which means smaller distilleries will have difficulty competing against larger brands and will rely on online sales,” he says. “So, I see a bifurcated market between smaller and larger distilleries.”

Smaller brands are certainly feeling the pressure. “The Bourbon category is incredibly competitive and will only become more challenging in the coming years,” says Jon Newton, director of sales at Castle & Key Distillery in Frankfort, Kentucky. “In many ways, cutting through the clutter is the biggest challenge for a brand like Castle & Key. Retailers, bar owners, and restaurateurs only have so much space, and you really have to earn the right to shelf in such a saturated category. Additionally, we’ve seen some price compression and consumers are going to go back to staple brands. There is less experimentation than in previous years and that can be a challenge for the craft category.” 

Amidst this challenging market, Castle & Key is investing more into marketing in 2024 than ever before. “We’re pushing hard in the digital space using a combination of targeted paid media, as well as an upcoming influencer campaign, and we continue to have a strong grassroots push to reach consumers via festivals, pairing dinners, happy hours, and other public-facing activations,” Newton says. “I wish there was a ‘silver bullet’ marketing strategy, but I think 2024 is about getting back to the basics of brand building. It’s hard work, but we feel it’s the right approach.” The Castle & Key whiskey lineup includes a Small Batch Bourbon ($47 a 750-ml.), Restoration rye ($43), and Small Batch Wheated Bourbon ($60). Newton adds that he’s optimistic about the brand’s future despite the category’s challenges. “We’re projecting around a 22% increase this year,” he says. “This is going to be a heavy lift, but I believe the merits of the brand will get us there.”

Bib & Tucker Small Batch Bourbon, which was acquired by Deutsch Family Wine & Spirits in 2017, is another smaller brand making inroads on the market, growing 18.7% last year, according to Deutsch Family chief brand officer Dan Kleinman. The brand’s most recent innovation, Bib & Tucker Double Char ($55 a 750-ml.), launched last August and proved to be a major success. “It was the No. 1 new launch by volume and No. 2 by value in American whiskey priced above $45 a 750-ml., according to Circana,” Kleinman says. “Our team is currently working on new innovations to continue to expand the portfolio in the coming years, including a very limited 15-year-old crafted for the discerning whiskey collector launching this fall in select markets.”

Old Elk Distillery in Fort Collins, Colorado, has experienced remarkable success in the U.S. market over the past two years, according to CEO Luis Gonzalez. “We’ve achieved double-digit growth in both revenue and depletions, forming a robust growth pattern that we’re very proud of,” he says, attributing much of the brand’s success to its dedicated team. “Our production manager, Melinda Maddox, has done an incredible job of growing our Cask Finish Program and specialty releases, staying ahead of industry trends, and continually introducing unique products that resonate with consumers,” Gonzalez says. “And Greg Metze, our esteemed master distiller, has been instrumental in developing the mashbills that our customers have come to know and love. Our Port Cask Finish being named in Whisky Advocate’s Top 20 of 2023 is a testament to Greg’s expertise.”

The core Old Elk lineup includes a Blended Straight Bourbon ($40 a 750-ml.), Straight Wheat whiskey ($70), Wheated Bourbon ($70), and Straight rye whiskey ($70). Within this past year, the brand launched several new products, including the Port Cask Finish Bourbon ($90), Cognac Cask Finished Wheat whiskey ($90), and the limited-edition Cigar Cut Island Blend ($130). Later this year, the newest Cigar Cut expression will be released, called the Punch Cut ($130). “Competition within the Bourbon category is intense, and one of our biggest challenges is competing against larger brands with significantly bigger budgets,” Gonzalez adds. “But we recognize that focusing too much on competition will force us to constantly make changes. Instead, we like to focus on our values and stay true to what makes us unique—we believe our commitment to quality and innovation sets us apart.”

Downtown Spirits’ Warren believes Bourbon is still anyone’s game. “With so many brands flooding the market, it’s all about staying top of mind without sacrificing integrity,” he says. “Bourbon is, like agave spirits, very much about the narrative behind the brand. Is the distillery team led by women or people of color? Has it gobbled up positive reviews and awards? Is there celebrity involvement? Has it appeared prominently in something you watched on Amazon Prime? Whether it’s a new label or a well-reviewed classic, if it’s got the buzz, it’s got the buyers.”