Master of Malt reports 30% sales growth as gin soars

Gin has overtaken whisky as the largest category by volume at online retailer Master of Malt after enjoying huge sales growth over the past year. “It continues to grow and it occupies a large part of my day,” says head buyer Guy Hodcroft. “We’ve been watching it over the past few years catching up, and now it has overtaken, which is really exciting.

“We talk about a gin bubble, but there’s a lot of mileage in it yet. I live in a very alcohol-centric world – most of my friends are in the trade, my other half is –– so we talk about drinking gin all the time, but for many people it’s still new. Up and down the country there’s a lot of time still to go.”

A love of wine propelled Hodcroft into the drinks industry and he worked as a sommelier in Spain during his formative years in the trade. He set up and managed a Corks Out store in the north west of England for Ruth Yates and worked for Harvey Nichols in the region before joining Selfridges. Its head buyer, Dawn Davies MW, became not only his colleague, but also his landlord as he rented a room from her.

“She’s fantastic, a force of nature, and I mean that in a very positive sense,” he says. “I was there for three-and-a-bit years with her, and then she left to go to The Whisky Exchange, and I hung around for a year and then the job at Master of Malt came up and it seemed like a good time to move.”

Hodcroft’s background is in wine, but now spirits – and gin in particular – dominate his days in the trade. “When I was at Selfridges, Dawn and I did everything together – beer, wine, spirits as a team,” he says. “I have very fond memories of doing something like 72 beers before 8am and thinking, oh yeah, these are nice.

“Her successor as the head buyer at Selfridges was Terry Threlfall, who is still there now. He was sommelier at Chez Bruce for a number of years. His background is very much wine – an interest in spirits, but not vast. I said it makes sense for me to do the spirits side, and you to do the wine. It’s allowed me to enjoy wine again, and now obsess – these tannins aren’t very well managed are they, I think they’ve acidified, have they acidified? I can just not entirely geek-out about it and say, yes, that’s a nice glass.”

Having said that, he is now building up a wine range at Master of Malt. “It’s growing, from a very small base,” he says. “I’m trying to build a range. Nothing too esoteric, just classics done well at varying price points. Three Chablis – one entry-level, one mid-range, one high-end – Châteauneuf-du-Pape, Rioja, Chianti, nothing too weird and wonderful.”

Master of Malt is now owned by AB-Inbev, the world’s largest brewer, which also controls online beer retailer Beer Hawk. Hodcroft and his team also have a beer range, but you will not find the likes of Stella Artois, Budweiser and Beck’s in it.

“Beer is doing really well,” he says. “It tends to be craft. We do very well with UK-based breweries, and quite a lot of American and speciality Belgian, German and Italian breweries. Beer is in a nice place. The only snag is that I’m used to working with things without a shelf life, and I have to go, oh yeah, beer does expire eventually. But nothing has gone wrong yet.”

Shopper insights

The team at Beer Hawk say that AB-Inbev largely leaves them to their own devices, and Hodcroft’s take on the situation is similar. The brewer can benefit from Master of Malt’s shopper insights and it provides significant commercial backing, but he says that it does not heavily involve itself in operations.

Business is currently booming for Master of Malt, which was set up as a mail-order vehicle for Scotch whisky in the mid-1980s. The company has undergone several makeovers and Scotch is still a chief focus – it remains the largest category by value – but gin is now leading the charge in volume. Hodcroft reports that overall sales are up 30% at Master of Malt in the past year, with retail sales growing at 26% and sales to trade up 41%.

“There’s still a lot of space to move,” he says. “Just 2.5% of people buy their alcohol online, so there are clearly a lot more people we can try to reach. We are going great guns and there are some ambitious targets for this year. They are similar numbers.”

The firm engages in friendly competition with The Whisky Exchange, while both retailers are under pressure from the rise of Amazon. “Eighteen months ago it was selling more SKUs you find in multiple grocers, but it is moving more into the specialist sphere,” says Hodcroft when asked about the world’s largest ecommerce retailer. “It just means that we have to work a little bit harder and get what we do right – the virtual reality tours, the customer service, the Whisky Santa and all that kind of thing. If we do all of those things well, hopefully we can keep ourselves in front.”

Master of Malt is investing in content, hiring former editorial staff from The Spirits Business, including former editor Kristiane Sherry, plus author Henry Jeffreys, in order to establish credibility online.

“We have expanded the editorial content team over the past year and we have three people now doing distillery profiles and that sort of thing,” says Hodcroft. “I think we do well, the team knows its stuff and the tone is very important to us. We get a lot of suppliers who want us to use their tasting notes and imagery, but we say no, no, it needs to sound like we’ve written this. Some of the notes are a little bit off the wall, and we could probably update some of the older ones – one of the strong points of the site is that it is authoritative, but we don’t take ourselves too seriously. We realise we are selling alcohol to people. It’s not life and death, and it should be enjoyed.”

Hodcroft notes that mead sales are up 64%, suggesting it could be down to the popularity of Game of Thrones. Tequila and mezcal, vermouth, spiced rum and liqueurs are also highlighted as categories that are currently soaring.

“Our commitment is that we try to have pretty much anything,” he says. “If you’ve had a Lithuanian liqueur on holiday, we’ll probably have a bottle somewhere. Whisky will always be a focus, but we don’t pursue it to the detriment of other categories.”

On the wholesale side, he adds: “We are different to most other supply businesses. We don’t have anyone doing field sales. What stands out is the breadth of our range and the service. If you order by 6pm as a trade customer, you’ll probably get it by 9am the next morning. We will sell you one bottle or 50.”

Mezcal is a category that particularly excites Hodcroft right now. “Now you have got two major brand owners with mezcal in their portfolios – Diageo and Pernod Ricard – and it will be interesting to see what happens there,” he says. “Mezcal reminds me of wine and I love that about it. Different agave species give you different flavours, depending on where they are grown. There are hundreds and hundreds of varieties.

“Low and no alcohol, there’s a lot of space there. Seedlip has done incredibly well. Dawn and I launched Seedlip at Selfridges. We were the first retailer to sell it. It’s done very well. Ceder’s is nice stuff. People seem to be wanting it.

“Most of our sales go to bars, rather than a consumer buying them. There’s still space there for someone to go after that at-home consumer.”

Hodcroft says he feels privileged to work in the drinks trade and he is planning on a long career in the industry. “Very few people leave it,” he says. “I think once you are in it, you don’t suddenly say, I want to sell chairs for a living. I am very lucky that it’s my hobby, but it’s also my passion and I get to do it 12 hours a day.”

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