Could 2020 finally be the year for rum, or will marketers’ hopes once again exceed reality? Opinions on the vibrancy of rum’s near-term future are decidedly mixed. Add in the massive impact of the Covid-19 crisis, and it’s anybody’s guess whether rum can make waves this year.

Ryan Maloney, owner of Julio’s Liquors, said prior to the coronavirus crisis hitting full force that he was witnessing a “move toward premiumization” in rum at his Westborough, Massachusetts store. He’s not yet sure what that might mean for the category. “For the last ten years I’ve been hearing that rum’s ‘the next one,’” he says. “In the past it’s gotten lukewarm, but has never become red hot. But we’re seeing some things now that may start bringing it to the forefront. Some of the smaller players are getting recognition.” He points to Foursquare rum from Barbados as an example.

Charles Sonnenberg, owner of the Frugal MacDoogal Wine & Liquor Warehouse retail chain based in Nashville, also saw that upward blip, but he believes it was short-lived and is already waning. “I would say there was an inkling of a significant uptick in the interest in premium rums, somewhat similar to the interest in Bourbons,” he says. “The consumer was willing to pay a lot more money but wanted to know they were getting an aged rum. For the first time, where it came from made a difference for people. There was a desire for aged dark rums, and most people were not mixing rums—they were sipping them or on the rocks. We saw this picking up momentum during summer 2019. It seems to have flattened out, and at our stores we’ve seen no further growth. If anything, there’s been a return to more high-profile accepted rums in the category.”

Rum hasn’t experienced much growth over the past decade and has been in decline since 2011, according to Impact Databank. The falloffs each year have been modest, but have nevertheless taken a toll in a market where overall beverage alcohol consumption has risen.

In 2019, rum consumption dipped 0.5% to 22.5 million 9-liter cases, according to Impact Databank. The top five brands fared better than the overall field, with three of the top five gaining volume, and two declining. Bacardi, the top rum in the U.S., managed a 1.1% gain, a welcome turnaround after declines in recent years. Captain Morgan, at No. 2, faltered last year with a 3% slump to 5.47 million cases. Malibu and Admiral Nelson gained volume, while Cruzan’s volume fell 1.7%.

Big Brand Performances

Malibu had the strongest performance among the top five rum brands in 2019, rising 3% to 2.17 million cases. The brand has bucked the downward trend in recent years, turning in consistent growth that has added more than 250,000 cases since 2015.  One key factor in Malibu’s success is its seasonally strong position in the summer months.

“We see ourselves as a brand that was made for fun summer drinking occasions,” says Troy Gorczyca, brand director for Malibu. Brand owner Pernod Ricard hosts the “Malibu Games” each summer, bringing influencers together to compete in a series of seasonal games. “We create content that becomes almost like a video series that we bring to life through our social media channels,” Gorczyca says. “We serve up that content throughout the summer.” He adds that the summer vibe is also reflected in the brand’s flavored line, from the original Coconut to Pineapple to its newest launch, Strawberry. “We have flavors that are all about that refreshing taste of summer, and they can be mixed easily in cocktails like Piña Coladas or Strawberry Daiquiris,” Gorczyca says. “The flavors also go well with soda for a simple Malibu and soda drink.” The rise in daytime drinking occasions, especially in the warmer months, has also benefited Malibu, he notes.

Top-ranked Bacardi managed to gain volume in 2019, but the brand has lost more than 1.65 million cases since 2010. Its latest campaign focuses on celebrating individuality and freedom through dance. Along with a range of flavors and its flagship Superior white rum, Bacardi offers several aged and dark rums.

Captain Morgan had, until recently, been picking up some of the volume shed by Bacardi, but the brand lost volume in 2018 and again last year. In July 2019, brand owner Diageo inked a deal with Major League Soccer to become the league’s official spiced rum and exclusive spirits partner through 2022.

Admiral Nelson, another spiced rum, fared slightly better in 2019, with volume rising 1% to 982,000 cases. It’s one of the few major rum brands to maintain solid year-over-year increases in recent years. At No. 5, Cruzan Rum fell 1.7% to 843,000 cases. Ivan Hidalgo, Cruzan’s senior marketing director, acknowledges that although the market for rum is relatively flat, Cruzan is having success particularly in the on-premise.

“Island-inspired cocktails continue to resonate with consumers, so we are currently focusing on cocktails like the Mai Tai and the Piña Colada, which are two of the most commonly ordered rum cocktails,” Hidalgo says. “We also leverage our flavor portfolio with tiki cocktails. Our flavors continue to be introduced each year thanks to the interest from consumers; we’re bringing back our limited-edition Cruzan Watermelon for the second year in a row due to high demand.”

Progress At The Bar

Rum is often viewed as a summer spirit due to its prominence in island or tiki-style cocktails that combine fruit flavors with the spirit. “We always love to have the option of making tiki-style cocktails,” says Jason Jeffords, general manager at New York City’s Dolly Varden. “It’s hands-down one of the most fun styles of cocktails you can make. The saying in tiki is ‘what one rum can’t do, three can,’ so we focus on the art of blending rum styles to get our desired flavor. We like to start with rums that are on the sweet side and add other flavors to it to build out the profile. We then use that mixture as if it was a sugar or fat—it gives a drink body, texture, and flavor that syrups just can’t. If you get the right combo, you can add rum to just about anything. Right now, we’re focusing on stirred drinks.” One cocktail on offer is the Worth Wild ($16), a combination of El Dorado 8-year-old rum, Tequila, cold-brew coffee, and brown sugar syrup, topped with nutmeg-cinnamon foam.

Rum isn’t only a warm weather spirit, of course. This past winter at New York City restaurant Clay, bar manager Andrea Needell Matteliano offered a cocktail called Sweater Weather ($16), which she calls a “festive riff on a Sidecar.” The drink combines El Dorado 3-year-old white rum, Paul Beau VS Cognac, Golden Moon Dry Curaçao, house-made spiced cranberry syrup, and lemon juice.

Amanda Britton, mixologist at Bardo in Charlotte, North Carolina, says two of her eight signature cocktails on the menu are made with rum. The Stranded With Ginger ($15) is a “winter tiki” cocktail made with Ron Zacapa 23 Rum, Licor 43, Brothers Vilgalys Krupnikas honey spiced liqueur, house-made ginger and galangal syrup, molasses, cinnamon, coconut milk, fresh mint, and lime juice, topped with house-made mint and Krupnikas foam, while the Washed Away ($12) includes coconut milk-washed Muddy River Silver rum, house-made lemongrass syrup, and lime juice.

Muddy River rum is produced by Muddy River Distillery in Belmont, North Carolina. Like many bar professionals, Britton likes to support local brands when the quality is right. “The beautiful thing about Bardo is that we have a heavily curated bar,” she says. “We get to know these brands intimately and then educate our guests. I’m able to showcase brands, especially local ones like Muddy River.” Needell Matteliano recently added some of the rum offerings from Massachusetts’ Privateer Rum Distillery to the menu at Clay, and she’s also enthused about the quality of a few higher-end brands, including Agricole Blanc from Rhum JM and Haiti’s Boukman Botanical rhum.

Upper-End Enthusiasm

That’s the kind of enthusiasm marketers of smaller-volume, higher-priced rums like to hear. As a category, rum has been waiting for its moment in the spotlight. For now, it’s still mostly waiting, but marketers see slow growth for higher-end brands. “We have all seen the upward trend of luxury spirits—we’re seeing people trade up, seeking out those more elevated expressions,” says Katie Redlien, brand director of incubation brands for Bacardi North America. “Rum is no different. The premium-plus segment continues to expand with super-premium brands that feature flavor palates more akin to Scotch or whisk(e)y than the typical rum, leading the category’s growth. Consumers of top whiskies and Scotches are now gravitating toward these special rums for a sipping experience or to enjoy cocktails made from barrel-aged spirits.”

Venezuelan rum Santa Teresa 1796—which is distributed internationally by Bacardi—is looking to capture that momentum. “Bacardi has a recognized rum portfolio and Santa Teresa 1796 will help lead the premiumization of the rum category, recruiting new drinkers from premium whisk(e)y thanks to its rich and dry taste profile,” says Redlien. “We’ve had double-digit growth over the past few years that even outpaces the growth of our overall category.”

Campari Group is also bullish on the super- and ultra-premium rum sector, according to Sean Yelle, director of dark spirits for Campari America. “The growth at the high end of the category can’t be ignored, and we’re making big moves this year to make a sizeable impact with Appleton Estate, which will continue to drive the premiumization of the rum category,” Yelle says. “The brand has seen steady growth in the U.S. over the last half-decade, and we’re currently transitioning to a mindset of accelerating our growth now that our fundamentals are in place.”

Wray & Nephew Jamaican rum is also part of the Campari Group rum portfolio. “Appleton Estate and Wray & Nephew both exhibit positive indicators on the key trends we watch, such as premiumization, on-trade adoption, and awareness,” Yelle says. “The best news is that we still have so much momentum ahead of us—we’re not even close to maximizing our potential as a brand or category. While the bartending community has understood the brilliance of this category for some time, it seems that it’s now translating to consumers.”

Both Dolly Varden’s Jeffords and Bardo’s Britton say they’re doing their part. “As a beverage professional, I love to introduce guests to quality brands that make them rethink what rum is,” says Jeffords, citing favorites including El Dorado, Plantation, and Diplomático.

Britton agrees. “A lot of people come to Bardo and ask for the bartender’s choice, but rum is the base spirit that they choose,” she says. “It’s perhaps not quite as rapid-growth as some other spirits like mezcal, but there’s definitely an uptick. The bartending community here loves it and we always incorporate it on our menu because we want everyone else to love it too.”

Such testimonials are spurring confidence for marketers. “I truly believe that we’re in the middle of a rum renaissance with new bars that feature extensive rum menus opening around the country,” Redlien says. “There’s also a lot of excitement about the category in general from bartenders—there’s a renewed interest in premium rum as a conduit for creative cocktailing. One of rum’s greatest strengths is its versatility—no matter which spirit one generally prefers, they can find a counterpart in rum. We’ve all seen the incredible success story of Tequila and the development of the super-premium segment within that category. We see a very similar opportunity and path for rum over the next decade.”