Applying the finishing touches

Ever wondered what a million litres of whisky looks like? Take the road past Dufftown on Speyside down to the Glenfiddich distillery, escape from the official tour party and explore.

The land there, owned by the Grant family, is the size of a small town and beyond the distillery buildings themselves it is mainly covered by warehouse after warehouse full of whisky, a million litres of it and the rest.

There is so much not only because Glenfiddich is the world's biggest malt whisky brand, but because it takes so long to mature. Glenfiddich now qualifies for a 12-year-old age statement which means the very youngest whisky used to make it has to spend at least 12 years sleeping in a warehouse, and there are much older whiskies than that.

The scotch whisky industry, you will gather, is not for the get-rich-quick. To be called a scotch of any kind it must be matured for three years. Yet the market is not without its spurts of innovation, as recent months have proved. William Grant itself is experimenting with a completely new idea, cask finish blends, and, coincidentally enough, The Famous Grouse has now done something similar.

Over the last few years, cask finishes have proved a good, and relatively fast, way to introduce new whiskies to the marketplace and stimulate a fresh interest in the category.

The process takes just a couple of months or so. The maturation of a whisky is completed in a cask that has already been used to mature some other drink - other than the traditional bourbon or sherry - and the wood gives a twist to the final flavour of the spirit that can be quite surprising.

Until a few weeks ago, however, the technique had only been applied to single malts. William Grant has traced the practice back to the 19th century when its customers used to order their malts finished in a particular cask.

Glenmorangie is credited with picking up the idea once more in the mid-1990s with a series of successful brands finished in a variety of casks including port and fino sherry.

The technique was adopted by other distillers, including William Grant for its Balvenie brand which most recently added an Islay finish.

One of the more unusual projects, completed in the summer, has been a Glengoyne Scottish Oak finish.

Edrington, which owns Glengoyne, experimented in 1995 with new oak maturation, building 3,000 casks out of American-grown wood for a consortium of scotch distillers.

Glenfiddich's Solera already uses a whisky finished in new wood as one of the three constituents of the uniquely blended malt, and the experience also inspired Glengoyne to exploit another marketing angle - the all-Scottish scotch - by using domestically-grown wood.

There were all kinds of complications involved in this, from getting the maximum yield out of the knotty Scots timber to drying the wood quickly enough to hit the launch date.

The local climate is rather damp compared to Kentucky or Spain and the natural air-drying method had to be supplemented in a kiln.

The casks were filled with 16-year-old Glengoyne and a limited edition of 500 bottles is currently retailing at, considering the trouble that's been gone to, a very reasonable £38.

In fact, the distiller admits it won't make much money from the stuff, but it is valuable in PR terms and in adding yet another layer of interest for the drinker.

Cask finishing brings a new dimension to a category that thrives on the enthusiasm for experiment and novelty among its drinkers - and its application to blended scotch opens up different possibilities.

While single malts have generally enjoyed growth in the UK over the last decade, they account for a tiny fraction of total scotch sales, and blends have struggled.

They are singled out, along with cognac, in a recent report by market research firm Key Note, as a product in desperate need of innovation and the Publican's Spirits Report, published earlier this month, confirms that whisky continues to decline as its core consumer ages and dies. Even in Scotland, vodka is comfortably the favourite spirit and only 39 per cent of licensees say whisky is more popular in their pub.

So far, the most aggressive attempts to turn this around in the blended sector have come from the market leaders. Since adding an age statement a few years ago, Bell's eight-year-old has consolidated its position and The Famous Grouse, Scotland's best-seller, continues to benefit from a perceived premium status.

The core Grant's brand has also showed gains since First Drinks took charge of the marketing.

There is a sense that scotch distillers have underestimated their consumers in the past. Research carried out by William Grant in the run-up to the Cask Reserves launch showed that whisky drinkers appreciate efforts at innovation and aren't quite as conservative as they have been portrayed.

"It didn't occur to us before that innovation would be interesting to consumers," said marketing manager Alec Guthrie. "When we showed them what we wanted to do, they wanted to know why we hadn't done it already.

"People have been turning to own-label scotch because they can't see much difference between the brands and so default on the basis of price."

The target market for the Cask Reserves, which come in two styles, ale cask and sherry cask, is split between this traditional price-sensitive whisky drinker, who will try them because they are offering something genuinely different, and younger "repertoire" drinkers who are keen to experiment.

The innovation will, Alec believes, take whisky into a new area of the marketplace and even begin "a fightback against vodka".

Chris Anderson, brand manager at distributor Maxxium, was equally optimistic about The Famous Grouse cask finishes, which come in Islay and Port Wood styles.

"They will give our existing consumers the chance to sample new variations on their favourite blend while the new packaging and premium image will help attract sales from other blends," he said. "We even anticipate attracting people who normally opt for a malt whisky."

Meanwhile, when you take that wander around the Glenfiddich site, one unpromising-looking shack deserves particular attention. It is a new distillery, named after the wooded hill that overlooks the plant, Kininvie.

One day we shall be able to taste that rare thing, a new malt whisky. When? When it's ready. In this industry, even the innovators have to be patient.