Rum is ready for a rebound. Though it may not seem promising when looking at the top players alone, as all of them saw case depletions decline in 2022: No.-1 brand Bacardi was down 2.9%, No.-2 Captain Morgan decreased 1%, No.-3 Malibu declined 7.7%, No.-4 Admiral Nelson fell 3%, and No.-5 Cruzan slipped 9%, according to Impact Databank. Thankfully, the super-premium end of the rum segment offers a different outlook, showing a category poised for future growth. “While most volume in the rum category is under $25, we’re seeing a shift to super-premium,” says Sam Salameh, vice president of Breakout Growth Brands for Diageo, whose rum portfolio includes Captain Morgan, super-premium label Zacapa rum from Guatemala and, most recently, Don Papa, a super-premium rum from the Philippines that the company purchased earlier this year. Captain Morgan may have posted losses last year, but Zacapa was up 11.5% to 73,000 cases, indicating that the super-premium end is indeed where action is happening, even if these brands still make up less than a quarter of the overall rum pie. “We find ourselves in prime positioning to capture that consumer mindshare and desire,” Salameh adds.
In October, Brown-Forman Corp. acquired the Venezuelan aged rum Diplomático, which according to Impact Databank was up 2% in 2022 to 56,000 cases. “Diplomático is part of our Emerging Brands Group, and as such we’ll focus on broadening its distribution and reach within the U.S. and enhancing our marketing support,” says brand global marketing director Edouard Beaslay, who notes that Diplomático has been growing at a 22% annual compound growth rate between 2019 and 2022, with growth particularly strong in Florida, the brand’s top market, and Georgia, which has a strong potential, in addition to California, Texas, and New York. “Consumers are noticing super-premium rum for its enhanced quality and diversity, and this is reflected in double-digit sales growth,” he adds. “They’re looking for products that have an interesting story to tell in terms of provenance, quality, craft credentials, and complete transparency in terms of good practices with the environment.”
At the Northern Florida retailer Wine World, the best-selling rum brands include Malibu Coconut ($15 a 750-ml.; $28 a 1.75-liter), Bacardi Superior ($14; $23), Captain Morgan Spiced ($15; $24), Sailor Jerry ($17; $24), and Blue Chair Coconut ($22 a 750-ml.), and these labels account for just under 50% of all rum volume at the chain. However, there are several premium and super-premium labels that also do well and fall within the store’s top 30 best-selling rum SKUs, including Papa’s Pilar ($45), Wray & Nephew Overproof ($25), Diplomático Reserva Exclusiva ($33), and Bumbu ($39). “The majority of our rum sales are with the big brands in the $14-$28 range, but we do tremendous volume at the top of this price range with a Panamanian rum called Navigator, which is priced at $27; since we began carrying it in the fall of 2022 it’s become one of our top sellers,” notes director of sales Shaun Brown. “In a few more months I think it will surely be in our top ten because since October it’s only behind Captain Morgan in terms of dollars generated for rum. This is a small brand closer to the premium space than everything else in that top 50%, and we believe that its emergence in our stores is a strong indicator that the future growth of the rum category lies in the premium space.”
Trending Upward
Brown notes that the largest demographic of rum customers at Wine World are young legal drinking age consumers who mix the spirit into fruity, sweet cocktails—these are the ones driving sales of the chain’s top rum brands. But there’s an emerging second demographic of consumers seeking high-quality expressions for sipping or spirit-forward cocktails. “These folks are often branching out from the Bourbon chase and learning that they can find some of the finest rum in the world a little easier than some of the Bourbons they’ve been hunting,” he says. “Cask strength and true age, non-solera method rums are gaining some momentum with customers who either are or soon will consider themselves enthusiasts.”
Puerto Rican rum brand Don Q aims to appeal to both of these sets of consumers. For the younger demographics who tend toward flavored rums, the brand is soon releasing a new orange flavor, Naranja ($15 a 750-ml.), and for those seeking sipping rums, there’s the Double Barrel Aged Cask series, which includes Cognac ($80), Port ($80), and Zinfandel ($80) expressions. In 2022 Don Q was up 4.5% to 275,000 cases, according to Impact Databank. “Aged rums in particular have become a popular choice among consumers seeking a spirit that’s rich in flavor, complexity, and history,” says Vannessa Cendan, marketing manager of Don Q rum for Serralles USA. “The aging process imparts unique characteristics to the rum, such as smoothness, depth, and a wide range of flavors, making it a sought-after option for both sipping and cocktails.”
Bacardi similarly has a portfolio that ranges in price points and has lately put more emphasis on new releases that appeal to those seeking aged sipping spirits. In August the brand launched Reserva Ocho Rye Cask Finish ($33 a 750-ml.), the second installment in its limited-edition cask finish series, following the previous year’s release of Reserva Ocho Sherry Cask Finish. A new Cask Finish Series variant will debut every August through 2025, each year featuring a different flavor profile.
Like at Wine World, there’s a split between high volume players and smaller premium brands at the New Jersey-based chain Buy-Rite Wine & Liquor, though overall rum sales skew a bit higher, with the pricing sweet spot being $20-$45. Bestsellers include Bacardi Superior ($14 a 750-ml.; $21 a 1.75-liter) and Bacardi flavors ($17 a liter); Palo Viejo Light ($12 a 750-ml.; $22 a 1.75-liter); Barbancourt White ($15 a 750-ml.), 3 Star ($20), and 5 Star ($25); El Dorado 12-year-old ($37); and Diplomático Reserva Exclusiva ($34). “There’s a segment of consumers that come here trying to procure the $59-$99 category, albeit it’s a very small number and those are the more eclectic brands for a very well-informed consumer,” says spirits manager Vishal Sharma. “Serious rum drinkers get very happy whenever anything from Hampden Estate, Habitation Velier, Foursquare, or Worthy Park comes in stock—these could range from $90-$200 depending on the distillery they’re looking for.”
Brown-Forman’s Beaslay notes that the super-premium rum category has seen the emergence of many smaller players who are helping to showcase the diversity and quality of rum that’s long been associated with large volume brands. “Diplomático has been among the pioneers of a renewed category perception and of an energized cocktail culture, with a very positive impact on super-premium rum category growth around the world,” he says, adding that in addition to focusing on its core range, including the Reserva Exclusiva ($39 a 750-ml.), Mantuano ($29), and Planas ($29), Diplomático is also in the process of introducing its Prestige range with the Single Vintage ($125) and Ambassador ($250) expressions, which can be found in some of the most exclusive bars and retailers in the country.
Reimaging Rum
Despite the emergence of super-premium rum brands on the U.S. market in recent years, there’s still some work to do in shifting consumer perception and mindset around rum, notes Diageo’s Salameh. “For many consumers, rum is still a party drink, built for sweet and tropical serves. Much of our target demographic is swapping going out to a club for more intimate dinner parties and quiet cocktail nights, and currently their idea of rum doesn’t fit who they are now,” he says. “They want refined flavors, warmth, depth, age—all of those things exist within Zacapa, and these curious drinkers are thankfully starting to come around.” Zacapa’s range includes the No. 23 ($45 a 750-ml.), Edicion Negra ($75), and XO ($120) labels.
Salameh adds that competition within the category is certainly heating up as more companies are investing heavily in the super-premium and above segment. “We’re excited to see the category enjoying this growth and capturing the interest of spirits aficionados, and the products that are showing up are helping reinforce the narrative that there’s so much more to rum than consumers currently think,” he says. “Our biggest challenge is finding ways to break through the old narrative around rum. Consumers are calling for quality, and the category is answering. We just have to continue to seek out meaningful routes of connection with these enthusiasts—through education, engaging programming, delicious cocktails—and meet them where they’re at.”
Antoine Couvreur, managing director of Mount Gay Barbados rum, which celebrated its 320th anniversary in February, notes that the brand’s newest digital-led platform “Make Time for Taste” is focused on education. “We partnered with chef and TV personality Richard Blais to create content for consumers to learn how to elevate taste for every occasion as well as dispel myths and common misconceptions around rum,” he says. In late 2022 the brand also released its fifth limited expression as part of its Master Blender Collection, the Madeira Cask ($220 a 750-ml.). The sixth edition, Mount Gay PX, will be released later this year. Mount Gay’s core range includes Eclipse ($24), Black Barrel ($46), and XO ($50). “Through the years, the premium rum category has consistently been growing 2-4 times faster than the lower price tiers,” Couvreur adds. “This upward trend doesn’t seem to be slowing down, allowing brands like Mount Gay to push the boundaries on their innovations and drive reappraisal of what rum is. We’re working to help consumers reimagine rum, educating them on how rum is made, and moving away from the sugary vacation drinks rum is often associated with.”
Guillaume Lamy, managing director for Maison Ferrand USA, marketer of Plantation rum—which has a core lineup that includes Original Dark ($22 a 750-ml.), 3 Stars ($22), OFTD ($32), and Stiggins’ Fancy Pineapple ($35)—notes that strong investment in educating on- and off-premise partners on the diversity of rum-making worldwide is a leading contributor to the brand’s success. Part of this investment has included the hiring of a “rum community liaison” who is both a brand ambassador and a liaison between the brand’s production teams and the market. Last year the brand grew a remarkable 55.5% to 171,000 cases, according to Impact Databank. “We plan to grow a minimum of 20% this year in the U.S., allowing us to take Plantation close to 200,000 cases by the end of 2023,” Lamy asserts.
Tyson Buhler, national beverage director for the cocktail bar concept Death & Co., which has locations in New York City, Denver, and Los Angeles, notes that bars are helping greatly to change consumer perceptions about rum. “At cocktail bars rum is used in Manhattans, Negronis, and Old Fashioneds just as often as Daiquiris, and that’s helping to showcase its versatility and to introduce the category to more people,” he says. “Rum has been a staple in cocktails and punches as long as they’ve been around, so it’s certainly not going anywhere and I expect the category to climb. As more regions and producers lean into creating unique, specific rums from the place they originate, people will be able to find new and exciting products and the category will avoid becoming stagnant.”
Fresh Faces
Jason Asher, partner and vice president of beverage for Phoenix, Arizona-based Barter & Shake Cocktail Entertainment, is hopeful that more Bourbon drinkers will discover the quality to be found in the aged rum segment. “Many beautifully aged rums provide an alternative to American whiskey at a fraction of the cost,” he says, adding that as terroir-driven spirits like Tequila have grown, there’s opportunity to see similar growth in rum. “As the craft cocktail movement has continued to grow and bartenders are looking for new, innovative, and flavorful ingredients for their drinks, the rum category has seen a boom in the increase of different styles of rum representing numerous places of origin,” he says. “Many consumers are trying various brands and being surprised that the rum available on the market isn’t the rum they drank during their college days. I believe we’ll continue to see a larger selection of rums from all over the world entering the market in the coming years.”
Cendan of Serralles USA notes an increasing recognition among consumers that each rum-making country has its own distinct style of rum. “Consumers are becoming more interested in exploring rums produced in specific regions known for their quality,” she says. “The trend toward aged and premium rums, combined with an increased focus on origin, highlights the growing appreciation for rum as a complex and diverse spirit with a rich history and tradition.”
Plantation rum has taken note of increased consumer interest in countries of origin and how that affects terroir: In 2021, the brand released the Birds of Paradise collection, which featured several different vintages from a single distillery in one country, including Jamaica 2003, Fiji 2005, Peru 2006, Trinidad 2009, and Barbados 2011. These were so successful that the brand did another series in 2022, the Under the Sea collection, with Venezuela 2010 closing it out early this year. “The newest collection to be released in 2023 and announced this spring will be even more limited as we try to find one-of-a-kind rums from cellars to pique the interest of those who love rum and its diversity,” Lamy says.
Buy-Rite’s Sharma notes that as consumers have grown more aware of countries of origin, they’re supporting local producers more than ever, and this is an area that’s growing in rum. “Hawaiian rhum agricole from Kō Hana in California, Barrell Craft Spirits’ sourced rums, Motanya craft rum from Colorado, and Texas rum from Balcones Distilling are all making an effort to push this category,” he says. Buy-Rite itself is getting in the game: as of press time, the Jersey City, New Jersey Super Buy-Rite location plans to release its own locally made rum by this Memorial Day.
Similarly, Wine World is developing a rum distillery in Destin, Florida in partnership with Bo Walker, founder of Oyster City Brewing Co., called Crooked Island Rum Co. that’s slated to open in January 2024. “There’s a proliferation of new flavored rums and rum creams on the market now, but we’re not sure that this area represents a whole lot of opportunity to truly grow the category—it seems to be more about maintenance of market share in a very competitive space,” Wine World’s Brown says. “What’s more interesting to us is the emergence of American brands like Richland in Georgia and Privateer in Massachusetts and the push of people like Richard Seale of Four Square to create honest rums without deceptive age statements. We feel that a move toward high-quality products with transparent ages and origins is the future of the category and represents the best opportunity for rum to gain a larger share of spirits sales, mostly by peeling off some of the Bourbon enthusiasts who are a little fatigued by chasing allocated items.”