By Faye Shilton, Marketing Director, October 2024.

A window into the world of whisky

I was delighted to be asked to appear as a guest speaker on a podcast for Inside Marketing recently. The conversation got me thinking about what I’ve learned about the whisky investment industry since joining Whisky 1901 in February this year. Particularly through the lens of my 10 plus years’ experience in marketing and my background working for luxury brands. Below are my key insights into the whisky cask investment industry.

1. The value of luxury is priceless

My first role after graduating was in the gemstone mining industry, where I learnt a great deal about value perception when it comes to luxury goods. I saw how gemstones, which started out as rough pieces worth only £20 or £30 pounds, were crafted into jewellery that ended up selling for thousands. While many consumers never knew, nor perhaps even considered or cared about the cost of the raw materials in their jewellery, what was clear was the perceived value of those finished luxury items to the individuals.
The whisky market has some similarities to the gemstone industry in this respect. Scotch whisky comprises just three simple, natural ingredients: water, yeast and cereal. Yet rare and premium single malt bottles and matured barrels of Scotch whisky, are highly sought after and command impressive prices. At this level you are not simply buying a liquid. Like diamonds or other precious stones or metals, the real value of luxury lies in the craftmanship, history and rich heritage, not to mention the alcohol by volume (ABV) and ageing process in the case of barrelled whisky.

2. Trust matures like Scotch whisky

Reputation isn’t established overnight, especially in the luxury sector. Building trust takes time, rather like whisky cask investments which can take 10+ years to mature for optimum flavour profile, value and therefore return on investment (ROI). As is often the case in the gemstone industry, people want to see or experience a premium product firsthand. Whether that’s feeling the weight of a piece of jewellery or visiting a whisky cask in its natural environment i.e. in a distillery or bonded warehouse in Scotland. That’s why we invite our investors to visit, and even sample, their casks in our Lowland Bond facility in the town of Glenrothes in Fife whenever they wish.

In this business, we also know that people put their trust in people. That’s why we strive to foster personal relationships and rapport with our clients. We are on the journey with our investors. Right from the start of the relationship, we take time to understand their personal circumstances, budget, financial goals and risk appetite to guide them through the whole process. Nor is trust taken for granted. We always encourage our clients to do their due diligence and seek independent financial advice.

3. Partnerships and events are key

When it comes to marketing luxury products or services, like premium Scotch whisky or cask investment, forming strategic partnerships and sponsoring, or at least attending, the right events is key. In previous roles I was fortunate to form relationships with influential people that have travelled with me into the cask investment world. Sir Jackie Stewart OBE is one of them. Here at Whisky 1901, we’re delighted to collaborate with him again to support the charity Race Against Dementia founded by the Formula 1 legend and Scotch whisky enthusiast. As part of an event this month we donated a bottle of Edition One of our independent bottling line, The Collection, worth over £1,300 to be part of a silent auction. Partnerships with purpose are very important to us to ensure we always give back in some way. We’re proud to have helped a number of charities raise funds recently, including Action for Pulmonary Fibrosis and Leuchie House.

Also in the sporting world, earlier this year we secured a sponsorship deal with professional golfer, Ewen Ferguson and partnered with The Game Fair at Blenheim Palace, where we launched the first edition of our single cask bottling line, The Collection. The Game Fair was so successful in connecting us with new and existing cask investors that we’re planning to attend more events next year. I look forward to sharing three more insights into the whisky cask investment world in my next blog post. These include prioritising quality over quantity interactions with clients and potential investors, being creative in the corporate world, and why it’s important to never stop learning.

4. Prioritise quality over quantity interactions

Ultra-high net worth individuals (UHNWIs), many of whom make up our client base, move in unique circles, so it takes more than a few social media ads to win over and engage this discerning audience. When it comes to talking about whisky cask investments, quality interactions with small groups of investors are often favourable to addressing an audience with hundreds of people. Every cask investor has their own motivations and goals, whether purely financially driven, or otherwise, and it’s important our portfolio managers understand these on a more personal level to advise accordingly.

At Whisky 1901 we like to think of ourselves as a type of exclusive members club. We regularly host smaller, more intimate gatherings such as our London and Edinburgh whisky tasting events. You can also join our live Q&As on our Instagram channel where you can meet our team, ask questions, and gain insights about the whisky cask investment market. It’s this type of engagement that we believe sets us apart in this industry.

5. It’s possible to be creative in the corporate world

There’s a misconception that you can’t be creative in the corporate world. While whisky investment is not a regulated market, there are certain standards to comply with. Investment is a serious business, so transparency and ethics are essential. Nevertheless, there is still scope to be creative in both strategy and execution. After all, whisky is synonymous with craftmanship. Perhaps one of the more tangible examples of our creativity is the design of our first bottled Scotch whisky - Edition One of The Collection. We’re proud of the work that went into designing the product, from bottle choice to packaging, so much so that bottling is a service we offer our clients.

6. Never stop learning!

Here at Whisky 1901 our team motto is “we educate ourselves, before we educate others”. There’s so much to get your head around when it comes to whisky, and investment, but our team is committed to ongoing learning. From our CEO to our portfolio managers, everyone at Whisky 1901 holds an Award in Spirits from the Wine & Spirit Education Trust (WSET). Most of the team are certified by the Edinburgh Whisky Academy (EWA), myself included, as I have just successfully completed the EWA Introduction to Scotch Whisky course.

Being transparent and accountable is paramount in this unregulated market and it’s my job to ensure potential investors have confidence in our communications to make an informed decision on how to invest in whisky, that’s why I recently completed Advertising Standards Authority (ASA) and Committees of Advertising (CAP) training. But the best thing about learning is being able to pass on that knowledge. It’s a privilege to educate others about whisky and cask investment opportunities through various channels such as our whisky tasting sessions hosted by Keeper of the Quaich Matt Chambers, social media Q&As, podcast appearances and our media presence. I very much look forward to learning more in this exciting industry.