journey | Ambrosia India

With offering some of the best global spirits and portfolio on offer and an aim to establish itself as the home for premium spirits across categories and create human connections while focussing on sustainability, Beam Suntory has major plans for India. In an interview with Ambrosia, Neeraj Kumar, Managing Director, Beam Suntory India talks about the journey, their aim and the Indian consumer. Excerpts:

You have been associated with the company for over 15 years. How has the company grown in India over those years? From then to Now?

Beam Suntory is a proud custodian of world-renowned spirits whose legacies can be measured in centuries. We are a leading premium spirits company and the world’s third largest as well. Over the last few years, we have introduced some of the world’s most exclusive brands from our global portfolio to the Indian consumers, providing an opportunity to access some of the most sought-after spirit experiences in the world.

We have also made our successful debut into the Indian whisky space with Oaksmith Indian Whisky inspired by Japanese craftsmanship. Apart from this we have also launched more than 10 renowned Japanese brands from The House of Suntory – Yamazaki, Hibiki, Suntory whisky Toki and Roku Japanese Craft Gin. We have strengthened our Scotch brands portfolio with Bowmore, Laphroaig Select and Teacher’s Highland Cream Reserve and continue to embolden our Bourbon whiskey portfolio with Jim Beam and Jim Beam Black Kentucky Straight Bourbon whiskey.

Our aspiration of reaching $1 billion in sales by 2030 continues to drive our premiumisation journey in India. We strive to deliver a portfolio that combines the best of the East and West, with an unwavering emphasis on quality. We have invested in capacity and our people capabilities and proud to be certified as a Great Place to Work in India, three years in a row.

The Indian liquor market is expected to grow by 7% annually in the 2021-25 period, with whisky and spirits among favourites. What do you think are the key drivers in India?

The increasing demand for luxury spirits and premiumisation among Indian consumers signals a greater emphasis on quality. With rising disposable incomes, exposure to global culture and a desire for premium products, purchasing habits are evolving, making India an appealing market for global and Indian brands.

The channel landscape has also seen a dramatic shift in specialist store infrastructure. In addition, consumers now enjoy world class on-premise premium experiences and cocktail immersion, specially led by whiskeys and gins. The Indian consumer base is expected to grow and is witnessing a trend towards premiumisation. We expect a greater thrust on new innovations across whiskies, gins and vodkas, presenting an opportunity for cocktail craft as well as beverages for refreshment occasions. These trends will continue to drive growth at the top and premium end of the market.

What is Beam Suntory’s strategy to expand the India market?

For Beam Suntory, India is a strategic market with a long-term growth ambition. The company continues to deliver strongly along its ambitious goal of reaching $1 billion in revenue in India by 2030. Our ‘Yatte Minahare’ spirit inspires us to dream big and our commitment to the India ambition is consistent with our objective to develop our business scale sustainably in India and join our other large markets like the US and Japan.

Beam Suntory aims to establish itself as the home for premium spirits across categories and create inspiring human connections, while maintaining an integral focus on sustainability. The company continues to develop its presence here with robust investments on capability building, capacity expansion and inspiring top talent to join our global talent pool. With the early signs of success with Oaksmith whisky, we have a long-term commitment to build a business of scale whilst driving premiumisation.

You mentioned that by 2030 the company would touch $1billion in annual revenues in India, is that objective on course? Can you share the revenues from India as of 2022 across categories?

The Indian market is advancing towards quality over quantity and our goals for the Indian market are in line with the consumers’ needs catering to their discerning palates. With leading brands like Teacher’s, Jim Beam and Oaksmith and a range of luxury and premium products, we are confident in our ambitious goal for 2030. Over the past two years, we have accelerated our current portfolio, gaining value growth outperforming peers in the market. Our portfolio has been crafted carefully for Indian consumers and guided by our competitive advantage of ‘East Meets West’. These include principles of ‘Gemba’ (real consumer and customer insights from the points of consumption) and ‘Monozukuri’ (an unwavering commitment to quality from Seed to Sip). Our consumer-first mindset will continue to develop our
portfolio to pioneer and leverage category, channel and consumer trends.

Since the launch of Oaksmith, it has become a very popular product. Can you share the market share, cases sold, etc. for the brand? Will the whisky be made available in the other markets as well?

After a successful launch in 2020 in Maharashtra and Telangana followed by expansion in over 20 markets, Oaksmith is at the helm of reinventing the Indian whisky segment. As a result of consumers tremendous response, Oaksmith has already sold 1 million cases since its launch, reinforcing Beam Suntory’s commitment to lead the growth and premiumisation of the Indian spirit’s market. With multiple international accolades behind its name, including the London Spirits Competition, we remain optimistic of this brand’s future in the market.

There is a major push towards sustainability in the industry. What are Beam’s plans towards the same?

Inspired by our Proof Positive commitments and Growing for Good vision, leaving a positive impact on the environment is central to Beam Suntory’s business and fundamental to its culture across every facet of the value chain. At the start of 2021, we made a global announcement to invest more than $1 billion to make positive impacts on the environment, consumers, and communities through our Proof Positive programme.

We have been making significant progress on this vision both globally and in India. Some of our local initiatives include

• Reduced dependency on single use packaging, starting with our range of Teacher’s and Oaksmith.

• Tree plantation project in Mumbai and Goa.

• Donation of USD 150,000 to NRAI to support workers in the F&B community during Covid-19.

• Donation of $600,000 to British Asian Trust, Confederation of Indian Industry (CII), National Restaurant Association of India and Government-led relief efforts to mitigate the shortage of hospital equipment supporting Covid-19 relief during the second wave.

What is your understanding of ‘Growing for Good’, can you break it down for us?

Our vision of ‘Growing for Good’ guides us to demonstrate a commitment to social responsibility and sustainability by promoting ethical and environmental-friendly working practices and behaviours. It applies both to the company and to everyone within the company and relays that the bigger we are, the greater our positive impact can be.

As a business that heavily relies on natural resources to make products that delight consumers around the world, we believe it is our responsibility to give back and leave the planet in a better way than we found it. To further define this vision, our long-term sustainability strategy – Proof Positive sets bold targets for us. Resting on pillars of nature, community and consumer, it guides us to make actional change within a defined timeline that protects the planet, offers education and expanded choices to consumers and gives back to our society.

The Ready-to-Drink brand sales has grown 16% driven by performance in Japan, Australia and the US, any plans for that category?

The emergence of the RTD (Ready to drink) market in India is growing at a fast pace and is bringing a distinct change in drinking behaviour. RTDs are popular since they come in various flavours and variants that are low in alcoholic strength and suitable for the refreshment and light experience. We are understanding the consumer needs and bringing forth products in response to their evolving preferences and will continue to monitor this space to guide our future business decisions.

Ironhill India in Bangalore is located in the IT hub near Marathahalli and is spread across a lavish 1.3 lac sq. ft. making it the largest microbrewery in the world. With installation art at every corner and an ambience to match, the new outlet will serve eight varieties of original craft beer. The space can accommodate more than 1800+ people at a time and makes a perfect venue for events, exhibitions and a night out as well that can be taken up with social distancing. Since the Bangalore launch the brand has established footprints with a swanky new outlet in Nellore and Rajahmundry as well. Teja Chekuri, Managing Partner, Ironhill India gives more details.

How did Ironhill India begin its journey?

Ironhill, the wonderland of breweries started its journey in 2017 at Vizag. We wanted to be the place for people from all walks of life to chill at, with our range of brews and hip ambiance. This was followed by Vijayawada, Hyderabad, Nellore, Rajahmundry and Bengaluru, with Ironhill Bengaluru being the largest microbrewery in the world. All Ironhill outlets have something unique about them that makes them stand out.

We are also, the biggest microbrewery chain in the country with a total of seven most happening microbreweries across Southern India and gearing up to other parts of the country.

Our aim from the beginning has been simple, to give our patrons a taste of the brewtiful life, with expansive spaces, galvanising ambiance, trippy music, bespoke food menu, and tasty brews to quench the thirst for magical experiences. We cater to everyone, from beer connoisseurs to newbies, regulars to one-offs, colleagues to friends, and we are just getting started!

How different are the challenges managing outlets in the US and those in India?

From a holistic perspective, it is about running all our outlets efficiently and professionally and, in that sense, there is not much of a difference. Where the difference does arise though, is in the culture, the rules and regulations, and the needs of our patron. However, we have learned and dealt with those differences with the aim of providing the best hospitality experience across the board.

Any reason for beginning your journey in the South of India?

Being from this part of the country, we saw the massive scope, the relatively uncrowded hospitality scene, and of course, the lack of awareness about, as well as presence of good microbreweries. So, we entered the microbrewery scene in the South with the sole aim of catering to the local demographic present here and introducing world-class craft beers and indeed a world-class hospitality experience to our patron. With the burgeoning demographic that sought magical experiences, it made complete sense for us to open our microbrewery in the south.

How different are your retail outlets from the competition?

We are all about the beer and food, however, that isn’t to say that our cocktails are far behind. We provide a holistic experience, with larger-than-life spaces, a majestic ambiance, music across genres, an extensive food menu that takes influences from local as well as world cuisine, you name it, and we have. We are all about crafting experiences that are as magical and as perfect as they come.

What is your game plan for India?

Now that we have a solid footing in the southern part of India, we are looking at aggressively expanding and establishing a pan India presence in the next three to five years.

What is the scope for expansion of your craft beer outlets?

We are in expansion mode, and you will hear about us soon from all parts of the country.

What was the impact of Covid on your business?

Undeniably, Covid put a spanner in the works and caused us losses. However, we have a very proactive team and that meant when normalcy was restored, we got back to business on a war footing. Having gone through the tough times relatively unscathed, we are now absolutely gung-ho about the future prospects, as of now business is brisk and we are hitting numbers that are even better than pre-pandemic times.

What kind of styles of beer do you offer at your outlets?

We believe in innovation and experimentation, and hence we launch new brews ever so often. There are staple brews of course like the Wheat Beers, Blonde Ales, Cider, etc, but we also have new beers every month based on the season, like the Mango Ale, Mango Saison, Kiwi Cider, Coco Brown Ale, to name a few.

What kind of food menu do you offer at your outlets?

We have a healthy mix of grub-inspired by local cuisine as well as world cuisine. We have ensured that we have an extensive menu, and we cater to the palates of people from varied backgrounds, so, it would be fair to say, that we have it all.

How important is location for your outlets?

Location is a prerequisite to running a successful business. Space, high footfalls, demographic, spending power, presence of competition, and many such factors are taken into account before deciding on the location of our outlets.

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