No Age Statement Whiskies and the Power of Good Storytelling

Following Martin’s very entertaining presentation to our class on Monday, I thought I might look further into two of the Scotch Whiskies he brought for us to taste: the Macallan 12 and the Highland Park Dark Origins.  One aspect of the comparison that I found particularly interesting was the age statement vs. no age statement (NAS) distinction.

First, some background on age statements.  Unless it is expressly stated otherwise, one should assume that every single malt (really, single distillery) Scotch one buys with an age statement is actually a blend of whiskies of different ages.  It is common practice to blend in this manner, for a variety of economic and aesthetic reasons.  However, according to the regulations governing Scotch, only the age of the youngest whisky used in the blend may be stated on the label.  It is entirely up to the distillery/blender to determine how much of the youngest whisky will be used in the final blend.

Next, some numbers:

Macallan 12 Y.O. (Sherry Oak)

Strength: 43% ABV

Price: $51 at BevMo

Macallan 15 Y.O. (Fine Oak)

Strength: 43% ABV

Price: $105 at BevMo

Highland Park 12 Y.O.

Strength: 43% ABV

Price: $47 at BevMo

Highland Park 15 Y.O.

Strength: 43% ABV

Price: $90 at BevMo

Highland Park Dark Origins

Strength: 46.8% ABV

Price: $79 at BevMo

Comparing the Macallan 12 to the Highland Park 12 shows that, on the “low” end of the range, the Macallan brand commands a higher price than Highland Park (8.5% more expensive).  This difference increases dramatically in the more expensive expressions.  At 15 Y.O. Macallan is 16.7% more expensive, at 18 Y.O. it is 59.7% more expensive ($230 vs. $144 per bottle), and at 30 Y.O. it is 487% more expensive ($3400 vs. $700 per bottle, adjusting for the Highland Park’s higher ABV of 48.1%)*.  I think this speaks to the point Martin made in class about the more or less inexplicable explosion in demand for Macallan over the last decade or so.

Anyway, with regard to the NAS whisky we tasted, if we assume that price increases linearly for Highland Park whiskies with age statements between 12 and 15 years, and that the youngest whisky in the Dark Origins blend is somewhere within this range, 43% ABV Dark Origins is priced like a Highland Park with an age statement of roughly 14 years.  Of course, since the distillery does not disclose the content of the blend, we don’t know how old the youngest component is (or the average age, which in this case is likely similar).  But this age is certainly less than 14 years, and probably considerably less.  Assuming that storage costs remain roughly the same each year, that advertising costs for Dark Origins are not significantly greater than average for a Highland Park, and that the whisky sells well, moving the average age down makes for a more profitable product. 

Just for the sake of argument, let’s say that the average age of the whisky in Dark Origins is 13 years.  How does Highland Park go about selling a 13-year-old whisky for the price of a 14-year-old whisky?  Tell a better story!  If you look at the narratives surrounding both the Macallan and Highland Park distilleries they are remarkably similar, and, in my opinion, pretty dull.  Macallan’s story has six “pillars” (a nice old estate house; small stills; high initial ABV; sometimes-sherry-oak casks; no artificial coloring; and high quality spirit).  Highland Park’s story has five “keystones” (hand-turned malt; aromatic peat; cool climate for maturation; sherry oak casks; six-month harmonization period).  Beyond this, neither distillery really bothers to tell much of a story for their age statement whiskies.  The Macallan Sherry Oak 12 is “a dram to be enjoyed with friends,” while the 25 Y.O. is “a distinguished dram for a respected gentleman.”  The $3000 30 Y.O. is “reminiscent of an orange grove.”  The $3000 40 Y.O. Highland Park is “the culmination of years of our finest whisky making experience.”

Contrast these one-liners to the Dark Origins story.  Dark Origins celebrates the founding of the Highland Park distillery by Magnus Eunson at the end of the 18^th Century.  Eunson was a beadle (church officer) by day, whisky smuggler by night, and a “born character, brimful of pawky humour and resource, which extricated him from many a scrape.”  The Dark Origins product page links to a very thematic YouTube video filled with shots of full moons and dark alleys.  Black and silver are used extensively on the packaging, and a shady-looking smuggler guy is depicted on the box.  The heavily-sherried spirit is described as having a “beautiful dark color,” with “dark fruit” flavors and “deep, dark spice notes.”

I don’t know how well Dark Origins is selling, but given that Highland Park has been producing Viking-themed NAS whiskies for a while it is probably safe to assume they are not losing money on it.  Keep in mind: if Dark Origins is in fact a 13 Y.O. whisky, its ABV-adjusted price is about $2 higher per bottle than a (hypothetical) 13 Y.O. Macallan.  Yet another example of the power of good storytelling.

* I considered the Macallan Fine Oak and Sherry Oak offerings interchangeable for the purposes of this analysis.

Sources:

Scotch Whisky Regulations (see document p.13).

http://www.scotch-whisky.org.uk/media/12744/scotchwhiskyregguidance2009.pdf

Macallan six pillars (see document p.9)

http://www.themacallan.com/media/30704/final-tm-brand-book-spreads.pdf

Highland Park five keystones

http://highlandpark.co.uk/keystones/

Dark Origins Product Page

http://highlandpark.co.uk/shop/highland-park-dark-origins/