The Hindu Business Line : Old Monk rum losing steam as Celebration gains: <I>Impact </I>

OLD Monk, the world's third largest selling rum brand, is under pressure with sales declining for two successive years, 2002 and 2003. This comes at a time when its main challenger in the domestic market, McDowell's Celebration Rum, posted two-digit growth in the same period to emerge as the fifth largest selling rum in the world, according to the US-based global drinks digest, Impact International.

The latest figures released by the widely respected Impact International shows that Old Monk has slipped from 8.2 million cases in 2001 to 7.8 million cases in 2002 and dropped further to 7.2 million cases in 2003. The volume decline from 2001 to 2002 was about 5.5 per cent, while the slip from 2002 to 2003 accelerated to 6.7 per cent. Old Monk, owned by Mohan Meakins Ltd, is the third largest selling rum after Bacardi with 19.7 million cases and Tanduay with 12.9 million cases. Diageo's Captain Morgan comes fourth in the pecking order followed by McDowell's Celebration Rum.

In fact, Celebration Rum is the fastest growing among the top five rums with annual depletions vaulting from 2.7 million cases in 2001 to 4.1 million cases in 2003, according to Impact. This brand from the world's fourth largest spirits marketer, UB Spirits Division, reported 22 per cent growth to touch 3.3 million cases in 2002 and then bettered it with 24 per cent rise to reach 4.1 million in 2003. Captain Morgan is the only other brand in the top five to make any impressive gain when its volume sales went up by 9.5 per cent to cross 5.6 million cases in 2003 from 5.1 million cases in the previous year. Bacardi reported a moderate growth, while Filipino rum Tanduay remained almost stagnant.

Old Monk has been the biggest Indian made foreign liquor (IMFL) brand for many years. The 88-million-cases strong IMFL market is dominated by whisky flavour and Old Monk's leadership is mainly due to its cult status. It is widely seen as a recruit brand for consumers upgrading to hard spirits and also enjoys significant clout in the CSD channel meant for armed forces. If its decline continues unchecked, the brand is in danger of surrendering its top slot in the IMFL list to UBSPD's Bagpiper Whisky. The industry observers attribute Old Monk's lacklustre showing to lack of efforts to shore up its sagging brand equity.

"There has been no strengthening of the brand of late even though the residual equity of a brand like that will be phenomenal," industry observers said. Old Monk is the only spirits brand to figure in the celebrated ad guru Ian Batley's list of potential Great Indian Brands, which could tap the $550-billion world market. In recent years, Old Monk, known for its brand strength of toughness, had resorted to audacious price cuts in the State-controlled south Indian markets to drive volumes.

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