Sale of vodka grows and attracts new brands
Valor Econômico
A legion of Russian names, or allegedly Russians - such as Leonoff, Skarloff, Askov, Moscowita, Ninnoff, Zvonka or Rajska -, is invading the shelves of alcoholic beverages of bars and supermarkets throughout the country. Driven by the growth of the sales of the beverage in Brazil, popular traditional liquor manufacturers are launching or re-launching their brands of vodka and "ice" vodka. Even the brewer group Petrópolis has decided to enter in the category. Blue Spirit Unique - the vodka of Petrópolis - was launched last month and it is being produced by Dialcool Fabricação, Beneficiamento e Comércio de Álcool, in São Roque (SP). The brewery also launched an "ice" version of the beverage - category that also grows 30% a year -and with it hopes to take over the second place in sales in the segment still in 2011.
Today, the leadership among "ice" vodkas is held by Smirnoff Ice, of Diageo, which holds 70% of the market. The Diageo "ice" was the first to be launched in the country 11 years ago. At the beginning, more than 90% of the sales took place in bars and restaurants. Today, 60% are made in supermarkets. Regarding the vodka, the ratio between the sales in the "points of dose" (bars and restaurants) and at the markets is similar. Smirnoff is the leader among the national brands, with 30% of the volume. Orloff, by Pernod Ricard, holds 14.6%. Among the imported brands, Absolut, also of Pernod, is the leader with 77.3%.
But, according to Nielsen, 99% of the consumption of vodka regards beverages made in the country. "With classes C and D consuming increasingly more, a lot of people is stopping drinking the traditional cachaça and going with the vodka, in search of status", says the consultant specialized in the beverage market, Adalberto Viviani. "Those new consumers start in the category through the starting brands", he says. Such starting brands are the new brands of vodka that are arising.
Casa Di Conti, manufacturer of the Contini vermouth, is one of the companies that decided to bet on the market of 38.5 million liters a year (or R$ 1.2 billion/US$ 750 million) in the case of vodka, and 30.8 million liters (nearly R$ 300 million/US$ 187.5 million) in the case of the "ice" beverages, according to Nielsen. Founded in 1947, the company relaunched last year the Polara vodka (discontinued in the late 80s) and it is getting ready to launch the "ice" version in the second half.
Besides entering a growing market with good margins (the prices range from R$ 5/US$ 3.13 to R$ 55/US$ 34.40 for the national vodkas), the companies also increase the profitability of the distribution, delivering more products to the points of sale, says Cesar Rosa, President of Brazilian Institute of the Cachaça (Ibrac). In the case of the "ice" beverages, there is also a tax advantage. Distilled or fermented beverages from sugar cane or grain (such as cachaça and vodka) pay 60% of Excise tax (IPI). But there is a loophole in the law: fermented or distilled beverages with alcohol content below 8% have lower rate: 40%. That is the case of the "ice" products, which have, on average, 5% of alcohol content.