The story of O: Bacardi rum

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The country's largest rum runner is juicing up the fledgling flavored category with the summer launch of orange-seasoned Bacardi O.

Bacardi USA's O hits shelves in August and is positioned as a high-end option for the well-heeled club set, running about $12 or $13 per 750 milliliter bottle. The $10 million introductory marketing campaign breaks in September magazines, along with outdoor in New York, Los Angeles, Miami, Chicago and San Francisco.

The "Are You Type O?" campaign, from True North Communications' Avrett Free & Ginsburg, New York, shows alluring subjects framed by a giant orange oval. The work will run in titles including Conde Nast's Vanity Fair and Talk Media's Talk, along with Detour.

O, which has a slightly sweeter and smoother taste than the proliferating citrus vodkas, initially will be marketed domestically, with Canada and the Caribbean possibly following by fall, according to Joe Metevier, senior marketing manager at Bacardi USA. The brand's primary target is flavored vodka, although there are flavored rums in its competitive set, including six-year-old sibling Limon, coconut-flavored Malibu from United Distillers & Vintners, and Seagram Spirits & Wine Group's Captain Morgan spiced rum, which also has a coconut variation.

"Now that we see orange-flavored vodkas taking off, we're coming out with Bacardi O. ...That helps build our category and Bacardi's portfolio by positioning it for nontraditional rum usage," Mr. Metevier said. He adds that executives at Bacardi expect minimal cannibalization of the company's other rums.

Rum was the country's fourth-most-popular spirit last year, following vodka, Canadian whiskey and cordials, according to the most recent figures from industry publication Impact. Category sales have been on the upswing since 1994, when they bottomed out at 11 million cases; this year, they could exceed 16 million, according to Impact.

Flavors, moreover, are the most rapidly growing segment of the rum category. Captain Morgan and its Parrot Bay coconut-flavored variation rose 21% to more than 3 million cases, while Malibu was up 20% to more than 800,000 cases, according to Impact. Limon last year grew 6% to almost 1 million cases.

Bacardi hopes for similar success with orange. "Orange is probably the second-most-popular category [among] flavored vodkas [after lemon/lime]. Why not do it in rum?" said Tobi Dunn, executive group director at Avrett Free.

Absolut Mandrin vodka last year sold 300,000 cases (up more than 75%), and Stolichnaya's flavors, including Ohranj, sold more than of 300,000 cases (up more than 10%). Impact did not have a breakout for Skyy's Citrus but said it contributed to the brand's 35% jump to more than 1 million cases.

"There aren't many flavored rums," said Impact's research director, Frank Walters. "There is huge potential." Bacardi, which spent $26.5 million on measured media last year, according to Taylor Nelson Sofres' CMR, is considering other flavors, but none is imminent.

Mr. Metevier said focus groups indicated O primarily would be consumed straight or with ice, less as a cocktail. It's expected to appeal equally to men and women 25- to 34-years-old; women tend to drink rum in fruity concoctions such as daiquiris, while men opt for cola mixers. "We have the sophistication of vodka, but you can still have fun because it's rum," he said.

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