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Sugar Barrel Rum's case study

Kevin Arango

Global Business Management, Georgian@Ilac

24W Global Market Research – 202

Ms, Lakhvir Sekhon

February 05, 2024

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Research Objective:

Understand the demographic profile of potential consumers for Sugar Barrel Rum in Australia.

The formulation of the objective of this research is based on the information presented in the following
paragraphs.

Alcohol Consumption Trends

According to (Alcohol Consumption, 2022, n.d.), more than one in four (26.8%) adults aged 18 years
and over exceeded the Australian Adult Alcohol Guideline in 2022. This includes those who either consumed
more than 10 drinks in the last week and/or consumed 5 or more drinks on any day at least monthly in the
last 12 months (on at least 12 occasions per year). Males were more likely to exceed the guideline than
females (35.8% compared to 18.1%). Young adults aged 18–24 years were more likely than any other age
group to exceed the guideline, with over one in three (36.1%) exceeding the guideline in 2022.

How Adults Exceeded the Guideline

Almost one in five (18.5%) adults consumed more than 10 drinks in the last week. Consumption
peaked in later years, with one in four (24.6%) people aged 55–64 years and one in five (21.6%) people
aged 65–74 years consuming more than 10 standard drinks in the last week. One in five (20.5%) adults
consumed 5 or more standard drinks on any day in the last year at least monthly. One in three (33.7%) young
adults aged 18–24 years consumed 5 or more standard drinks on any day in the last year at least monthly,
more than any other age group.

Table 1. visual breakdown by age group

Consumed >10 Consumed 5+

Age Group Total Exceeded
Drinks in Last Drinks on Any Day
(Years) Guideline (%)
Week (%) Monthly (%)
18–24 14.7 33.7 36.1
25–34 13.8 23.3 25.7
35–44 17.9 20.6 25
45–54 20.6 21.1 27.7
55–64 24.6 20 29.5
65–74 21.6 14 25.2
75 years and over 15.9 6.3 17.5
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According to (Weiss, 2022), australia probably wouldn’t exist without rum. A lack of coinage in the
early days of the colony of New South Wales meant that bottles of rum were used as official currency – as
well as a way to entice unruly convicts to work. Rum continued to strongly influence the economy, culture
and politics of the colony, and was even responsible for the only military takeover of an Australian
government, the Rum Rebellion of 1808. Yo ho ho.

These days, Aussies would rather PayWave than trade bottles of booze, but rum remains one of
Australia’s most popular alcoholic beverages, especially in Queensland, where most of the country’s
sugarcane (and therefore rum) is made. While whisky is the most popular spirit across Australia, rum remains
#1 in Queensland.

According to (Australia Spirits Market Size by Categories, Distribution Channel, Market Share and
Forecast, 2021-2026, 2023), the Australia spirits market was valued at $15.2 billion in 2021. The market is
projected to grow at a CAGR of more than 9% during the forecast period. The Australian spirits market was
led by flavored alcoholic beverages category in both value and volume terms. Vodka is forecast to register
fastest value and volume growth in 2021-2026, during the same period.

The Australia spirits market report provides insights on high growth markets to target, trends in the usage of
packaging materials, types and closures category level distribution data and companies market shares.

Economic Factors:

According to (Alcoholic Beverages Market Size, Share, Trends & Statistics, n.d.), disposable Income:
The spending habits on alcoholic beverages are closely tied to disposable income. As disposable income
increases, consumers tend to allocate more funds to leisure activities, including purchasing spirits like rum.

Young Adults and Workforce: In various developing economies, such as China, India, Singapore,
and Indonesia, spending on alcoholic beverages is increasing due to the rising number of young adults in the
workforce.

Urbanization and Economic Growth: Urbanization and economic growth contribute to higher
disposable incomes. As cities expand and economies thrive, consumers have greater purchasing power,
leading to increased spending on premium spirits.
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Cultural Attitudes:

According to (Aswani, 2020), sophistication and Craft Culture: the rum category is breaking away
from its traditional “rum-and-cola” image and establishing itself as a sophisticated spirit worthy of today’s
craft cocktail culture. Consumers appreciate nuanced flavors and quality in premium rums.

Social Symbolism: alcohol, including rum, holds significant cultural symbolism across different
societies. It is associated with celebration, festivity, and social bonding.

Changing Perceptions: consumer perceptions of rum are shifting. It’s no longer solely a party drink
but also a spirit to be savored and explored Brands that emphasize heritage, craftsmanship, and unique flavor
profiles resonate with modern consumers.

Analysis:

Economic Factors:

Disposable Income: Australians with greater disposable income are more inclined to spend on
expensive spirits, such as rum. As the economy expands and urbanization increases, disposable income may
rise, benefiting the rum industry.

Market Size and Growth: The Australian rum market is expected to reach US$97.7 million by 2024,
with an annual growth rate of 2.73%. This growing pattern is consistent with worldwide premiumization
tendencies. Australian customers like refined spirits and have a strong appreciation for craft culture. Sugar
Barrel Rum may promote itself as a premium artisan rum brand with distinctive flavor characteristics.

Social Symbolism: Rum is culturally significant in festivities, gatherings, and social bonds. Using
this symbology helps increase brand resonance.

Recommendations for Sugar Barrel Rum:

Target Demographics: Concentrate on metropolitan regions with high discretionary incomes. Tailor
your marketing efforts to appeal to young professionals and smart customers.

Craftmanship Story: Highlight Sugar Barrel Rum's history, workmanship, and distinctive cask
finishes. Highlight the brand's individuality.
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Cocktail Culture: Promote rum-based beverages for social gatherings. Collaborate with bars and
restaurants to develop signature drinks.

Distribution Channels: Maximize distribution via liquor shops, internet platforms, and
collaborations with local distributors.
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References

Alcohol consumption, 2022. (n.d.). Australian Bureau of Statistics.

https://www.abs.gov.au/statistics/health/health-conditions-and-risks/alcohol-consumption/latest-

release#cite-window1

Alcoholic Beverages Market Size, Share, Trends & Statistics. (n.d.).

https://www.fortunebusinessinsights.com/alcoholic-beverages-market-107439

Aswani, S. (2020, April 6). Rum adapts to changes in environment and attitude - IWSR. IWSR.

https://www.theiwsr.com/rum-adapts-to-changes-in-environment-and-attitude/

Australia Spirits Market Size by categories, distribution channel, market share and forecast, 2021-2026.

(2023, April 17). Market Research Reports & Consulting | GlobalData UK Ltd.

https://www.globaldata.com/store/report/australia-spirits-market-analysis/

Statista. (n.d.). Rum - Australia | Statista market forecast. https://www.statista.com/outlook/cmo/alcoholic-

drinks/spirits/rum/australia

Weiss, J. (2022, August 23). Australia’s Most Maligned Spirit Is Having A Huge Renaissance. DMARGE.

https://www.dmarge.com/rum-popularity-australia