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Innovations in Packaging, Adding to the Consumer Experience

The total sales of Indian-made foreign liquor (IMFL) products were 388 million cases in 2022, up from 305 million cases in the previous year with demand in all major segments like rum, gin, vodka, whisky and brandy rising. The rise has been the sharpest in premium products with their portfolio now accounting for a fifth of all the whisky sold in India and consequently demand for glass bottles and packaging material has shot up.

The bottling and packaging segment is a key component and along with ENA it accounts for over 65% of raw material costs for IMFL operators, who have been requesting price increases from the respective state governments, to offset high input costs.

While excise departments have their own yardsticks to concede price rise, the alcobev industry has to think of ways of bringing down raw material costs. One of the ways is to push their supply partners to go for innovations in glass bottling and packaging. Already, we are seeing a number of new packaging and bottling solutions such as bag-in-box, ceramic glass bottles, bag-intube, whiskey pouches and more. But the premium segment cannot do away with glass bottles as glass has its own charm. Design comes in play here.

All in all, the market of the glass bottle and packaging industry is expected to grow phenomenally, even as some companies are giving up mono-cartons. Extensive R&D to introduce biodegradable and sustainable packaging materials due to rising environmental concerns are fast gaining currency and companies are becoming increasingly environmentally sustainable entities.

Value creation without cutting corners

In view of its importance, Ambrosia at its 2023 Indspirit Conference in Delhi, organised a session on ‘Innovations in Packaging for value creation: cut cost without cutting corners’. The panellists included Srinivas Mantri, Sr Procurement Manager, Beam Suntory India; Vinod Sharma, Assistant Vice President (Commercial) Alcobrew. The session was moderated by Bhavya Desai, Group Head & CEO, SAP Media Worldwide Ltd. who set the tone by stating that in a competitive environment, the alcobev sector had to come up with bottling and packaging innovations for enhancing customer experience.

Abnormal increase in alcobev sales

Mr. Vinod Sharma said that in the last one and a half years, there has been an abnormal increase in alcohol sales and companies need to religiously work on cutting costs in a highly competitive world, without compromising on quality. The alcobev sector is banking on innovation of reducing weight of glass bottle while ensuring that it is not susceptible to breakages.

He mentioned that in the last two to three years there have been several innovations / techniques in bottling and packaging. One is the NNPB (Narrow neck press and blow) technique which can reduce weight of glass bottle up to 10 to 12%. However, over 90% of glass manufacturers in India have not adopted this technology due to initial investment costs. There is no substitute for glass bottle, particularly with premiumisation gaining currency, however glass manufacturers in India do not have adequate infrastructure to make bottles the way some foreign companies do.

Smart caps becoming smarter

The other areas the industry could look at includes smart caps with multiple options now with HDPE and metal combinations. “Smart cap is becoming smarter by the day.” Similarly, shipper cartons there are so many different varieties of material.

Sustainability should be key

Bhavya Desai nudged the panellists to talk about sustainability in packaging and Prof. K. Munshi, former IIT faculty, said while cost cutting is a factor by reducing bottle weight, making it compact etc., the sector should emphasise on value addition and how the consumer is benefitted. He gave a Japanese example where a manufacturer was dispensing Sake in small glasses which could be reused. “Sustainability also means next use of the product.” Most of the packaging is now thrown in to the garbage, he said and urged the industry to ‘put their minds together’ on sustainable packaging.

Innovation officers in companies

Prof. Munshi said presently the onus on cost reduction is on the bottle manufacturer which cannot happen due to reasons best known for the manufacturer. Hence, there is need for the alcobev sector to collaborate with the bottle supplier with regard to innovation. Companies should have innovation officer on board and whose full-time job has to be on innovation and value addition.

No alternative to glass bottles in premium segment

The professor underlined the importance of ‘thought process’ and research. “Whatever new technology comes in, one has to look at shapes, colours, aesthetics, the feel etc. how to get the maximum flavour, how to hold the bottle. These issues need to be looked into in a professional way. The user experience has to be factored in. You see many a time, empty bottles are kept as souvenirs. And as Indian companies we should think of what Indianness we can bring to the product through shapes, colours, culture etc. and how it complements with the bottle and the liquid within.” There is no alternative to glass bottles for premium category of alcobev as consumers do not prefer premium liquor in PET bottles.

Symbiotic relation between technology and design

While the big companies can bring in cost benefit partnering with the suppliers, the small players should leverage the flexibility they have by experimenting to the extent possible to offset costs. There is need for companies, irrespective of the size, to orient themselves to innovation and documenting it, even while adopting the best practices from around the world. Product development departments need boost. “Technology drives design. Development of technology takes a little longer, design is quicker but there is a symbiotic relationship between technology and design.”

Kaizen, continuous improvement to remove inefficiencies

Srinivas Mantri, Senior Manager, Beam Suntory India, talked about how the company came from a ‘Japanese thought process’ where continuous improvement or ‘Kaizen’ was in place. The idea is to keep removing the inefficiencies in the system. “Any innovation in our sector, it should factor in enhancement of customer experience and sustainability, giving back to the society, to nature.”

Beam Suntory is always working on these aspects, he said and mentioned that such processes had been implemented across different SKUs. “We have reduced the weight of the bottle, elevated the feel of the bottle, improved the label panels, reduced breakages.” Talking about glass bottles, he said, ‘see the liquid in the bottle, feel the bottle with hand and then taste the liquid… and also sound of the opening of closure…. consumer experience is involved and is demanding’. “The consumer wants something nice and something new.”

Bars display bottles, not mono cartons

He mentioned how in bars, one does not get to see mono cartons, but only bottles showing the liquid. Underlying the importance of thought process, Mantri said that from sourcing to the brand and to the consumer, there is an evolving journey, hence there is need to work with partners for continuous improvement. To engage the consumer, one needs to research who the consumer is and what we are giving to him or her, then comes tying up with internal and external partners. Importantly, consumer feedback has to be factored in and the entire process is on building the brand and consumer loyalty.

Anuj Bhargava, Managing Director, Kumar Labels, said there is a trend to remove mono cartons and when that happens, the focus is on the label on how it can be more attractive than the competition. Besides taste of the product, consumers pick the bottle for reasons such as the ‘look and feel’. Aesthetics is gaining considerable importance in this highly competitive market.

Sterling Reserve B10 Whisky Review

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Sterling Reserve B10 whisky is made by ABD, which is Allied Blenders and Distilleries, the largest manufacturer of IMFL spirit by volume. The whisky is priced at Rs. 1,350 in Maharashtra and it is available almost Pan India. The reason why this whisky is called ‘B10’ is because it is supposed to give the experience of 10 different flavours to the consumer. If you are more of a video person then you can check out the video review on top as well.

Before we start talking about Sterling Reserve let’s take a look at ABD. So ABD is a very renowned name in the industry and has been in the market for decades now. One of their best- known millionaire brands is Officers Choice, which also is a category leader in that segment. For ones who don’t know what a millionaire brand is, millionaire brand means that it sells more than a million cases in a year, which isn’t an easy feat to achieve.

Now what is interesting is that this is also a millionaire brand which means it automatically puts pressure on it to taste good. This whisky is placed in the same segment as Blenders Pride and Antiquity Blue. So basically, this is positioned in a category where you have some of the best premium and highest selling Indian whisky’s honestly. This whisky comes in two variants, B7 which is positioned in the popular category and of course this, which is the B10. If we talk about the blend of this whisky, then there isn’t much clarity about the age of the malts that have been used in this. But this uses imported Scotch malts, which means malts that have aged at least 3-year’s have been used. This is combined with the Indian grain spirits with the Scotch Malts used from different barrel origin including bespoke bourbon oak casks. Naturally there is neutral spirits that are used as well in this since it has Indian grain spirits as well. Now this whisky is also chill-filtered, which means it won’t change colour when you add ice or water to it.

Packaging

If we talk about the packaging of the brand, then it is very clear that ABD wanted to create an impact since it is a tough market and they have spent a considerable time on this packaging as well. In comparison with blenders and antiquity it is the only brand that comes in a canister, which shows how serious they are about this category. In terms of packaging, it gives you a feel of the premiumness like others as well. They’ve gone with the deep Purple as the base colour and I think it could be coz they want to stand out on the shelf and they’ve managed to achieve that as well to some extent. In terms of the bottle as well it is nice and reminiscent of Indian whisky bottles.

Nosing

In terms of the nosing you get some honeyed sweetness, nuttiness of the barley and a fruity and heathery nose.

Tasting

The ABV is 42.8% and it gives you that punch as you taste it. The flavours of oak are clear and also a sweet flavour also comes from the whisky. Although it feels like honey but it is more of vanilla. There is a fruit as well which I think it berries. The finish is meduim-longish and honestly it is difficult to identify 10 flavours honestly but the whisky does seem smooth.

Conclusion

So what do we think about the Sterling Reserve B10 whisky? For a price of Rs. 1,350 in Maharashtra it is already a very popular brand. It gives you that mix of nice flavours, smooth refines for the price and you really can understand why the people who have this brand swear by it and won’t touch anything else. It is not something that you can have on the rocks naturally like most of the whisky’s in this segment. But with water or a mixer of your choice is suited. Maybe you can try it next when you are going to have any whisky’s in this segment and let us know how it is in the comments.

IndSpirit 2021 Awards underline quality of brands and packaging: Judges

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After two years of Covid, Indspirit 2021 Awards evaluation got underway with all seriousness.

It was indeed nice to see the coming together of professionals, after a two year lull, for the Ambrosia wine and spirits tasting sessions, as part of the Indspirit 2021 awards which is happening on December 17 in New Delhi. Five judges for the Ambrosia Alcobev products tasting and four judges for the packaging awards huddled together for two days to judge 252 brands. The eminent jury tasted different brands in all categories of whisky, vodka, gin, rum, brandy, craft spirits, wine and beer and the jury on packaging evaluated on various parameters.

Eminent jury panel

The eminent tasting jury comprised Dr. Binod.K.Maitin, ex-USL and an independent consultant; Graeme Bowie, President – Malt Plant, Piccadily Agro Industries Ltd; Ajoy Shaw, Wine Maker and consultant; Sheetal Kadam, Wine & Spirits promoter and independent consultant; and Bernard Schaefer, a veteran judge from Germany.

The expert packaging jury consisted of Pranav Bhide, Leo Burnett Creative Director; Prof. K. Munshi, former Head of IIT Design department and independent consultant; Dr.Santosh Kshirsagar, Dean of J.J.School of Applied Arts; and Shekhar Ambedkar, Assistant Director and Head of the International Packaging Centre.

Scope for new entrants

The alcobev industry in the country largely comprises of Indian made whisky which accounts for a sizable share in boosting the growth of this sector. Across segments, domestically produced brands account for a higher share of consumer preference and there is still significant scope for new entrants to gain consumer preference.

The spirits industry in India with over 60% preference for whisky, offers great untapped potential for growth. There are several opportunities within the domestic sector markets for Indian whiskies to grow. There is huge country liquor consuming audience base that is seeking better quality products and have been upgrading over the years. India’s relatively young population sees newer individuals/consumers added each year to the legal drinking age – wherein Indian whisky could become the entry point for this audience. There has also been a growth of women whisky drinkers aided by on-premises and retail environments. All of these factors indicate the scope to fully explore the Indian spirits market.

Internationally, markets with a large Indian diaspora as well as those having similar palette to the Indian consumer see a strong preference for Indian whiskies. Some of the world’s top-selling whisky brands come from India and find much consumer love, globally as well.

What the judges have to say about the range

Dr. Binod Maitin says Indian whiskies are predominant among the top whisky rankings based on volume of sales. Indian whiskies have a distinct identity due to the tradition of blending with neutral alcohol produced from cane molasses to produce extra neutral alcohol (ENA). Economy whiskies are made with ENA and flavourings, premium blended whiskies contain Indian and Scotch malts, and single-malt whiskies use only Indian malts. Neutral alcohol from grain has also been adopted by manufacturers, particularly for premium whiskies.

Graeme Bowie, opines that there is huge improvement in quality of the products, even in the economy category. “There is passion for quality.”

Ajoy Shaw is impressed with the huge variety of spirits available for the Indian consumer. The discerning consumer looks for good value, good quality and a plethora of options. Similarly, Sheetal Kadam is delighted to see the expanding range of spirits in the Indian market. The portfolio is ever expanding and good for the consumer who is now spoilt for choice.

Bernard Schaefer, a veteran judge, is always in awe of the brands presented at Indspirit competition, however, some don’t exactly make the mark according to him. One good thing, he says is that there is constant improvement in the quality of products presented every year.

Sensory evaluation

Talking about the competition, Binod Maitin says, “Sensory evaluation is used as the primary means of flavour control in the industry. This chapter describes the origins of flavour in whisky and the typical sensory methods used both during production and in consumer research. The panel is experienced and harmonised. Mistakes in samples are pointed out. Samples are provided for references.”

Graeme Bowie says the brands are fairly good, endorsing the same is Ajoy Shaw who feels that all brands can easily get a bronze medal and more. Sheetal Kadam believes that the quality is above average.

Technology driving change

Technology is driving change in operations and strategy – right from crop analysis to smartphones scanning product labels. Big data and analytics have also been major drivers for the alcobev industry when it comes to improving insights across the supply chain. Having in-place solutions to provide real-time insights can help identify the largest problems at hand and find ways to optimise production and maintain quality.

Analytics is beneficial

Additionally, when we look at operations and quality assessment, and analytics strategy can go a long way in helping run plants, raw material test analysis, blend inspection analysis, quality control, compliance, end of line quality analysis, hygiene assessment, and managing customer complaints. There are multiple visual and physical checks required across various stages, and because it is a restricted environment wherein companies are bound by various regulations, analytics can be extremely beneficial.

Quality of brands improving every year

Talking about the quality of brands on offer, Binod Maitin, who has created many succesful blends, says the alcobev brands are okay. Wines are a problem, he says because of storage issues. Graeme Hamilton opines the products are plausible. Ajoy Shaw believes all brands can do well in the market place. Sheetal Kadam says there is improvement to a large extent as there is demand for upgradation.

Packaging market to touch nearly $39 billion by 2026

The alcoholic drinks packaging market was valued at USD 29.84 billion in 2020, and it is expected to reach a market value of USD 38.87 billion by 2026, registering a CAGR of 5.06% during the forecast period (2021-2026). Globally, growth in disposable income, coupled with increased spending on recreational activities, is a major influencing factor that collectively lead to growth of alcohol consumption, which fuels the growth of the alcoholic drinks packaging market over the forecast period.

Major manufacturing companies in the alcohol industry follow attractive packaging formats, which include ceramic glass bottles, whiskey pouches, bag-in-box, bag-in-tube, etc. Changing consumer preferences are also affecting the market significantly. Over the years, growing awareness among the brand manufacturers about differentiating their alcoholic products based on the packaging is also expected to contribute to the growth of the alcoholic drinks packaging market.

Conventionally, European and American manufacturers are often referred to as the leading producers of alcohol beverages. However, with the rise in demand for Chinese beer and Japanese whiskey, Asia-Pacific is increasingly becoming a major market for alcoholic beverage production, creating a massive demand for alcoholic drinks packaging solutions.

Metal packaging growing market

Owing to various benefits offered by metal packaging, such as better hermetic sealing and high mechanical strength, there is a growing preference for metal packaging from the companies present in the alcoholic drinks packaging market.However, fluctuating raw material prices and implementation of stringent regulations on packaging materials used for alcoholic beverages may hinder the growth of the market.

Judging parameters

The judges looked at parameters such as unit pack, canister, graphics, new ideas and feel. This is what judges had to say on the brands that were presented for packaging, their sustainability and their comparison in the international market place.

Pranav Bhide said the first impressions of the packaging is its versatility. It is important for the brands to stand out. The buzz word in today’s world is sustainability. There is a sea change in the packaging of Indian liquor and it is towards Indianness. Indian brands can match international brands, but it is still not there.

Prof. K. Munshi says after two years of pandemic it is a nice feeling to be here for Indspirit and once again judging packaging. He felt that despite the pandemic entries this year are more and also there is qualitative improvement in packaging. “It was a tough time judging” and hoped that there would be more creativity. However, he felt there was no evidence of sustainable packaging. “Indian liquor industry needs to take help and take advice. Indian brand packaging has long way to go. We need to put in efforts in R & D and innovation.”.

Dr. Santosh Kshirsagar was of the view that this year’s packaging industry did not have much variety as compared to last year. “Indian liquor industry should have a different approach. Indianness needs to be reflected and must stand out in the market place. Sustainability is an extremely important world issue. We have not identified a value for it. It is not easy, but it is a fundamental issue. Caps of bottles are a sensitive issue.. There is a long tradition in design. India has traditional visual imagery. Futuristically it is possible to succeed with this imagery. We need to make a mark with packaging.”

Shekhar Ambedkar says he has seen at Indspirit a range of unique packaging and innovation. “There is uniqueness in materials and the future should be sustainable packaging and believes that regulation would help in that direction. This year there are very commendable glass bottles for beer, especially those with a special tint. Good design is also present. We have been matching international standards. Companies should work towards being unique and that will sell.”

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