News Release

Suntory Spirits Limited Business Strategy for 2017

The 2016 sales of Suntory Spirits Limited, the Japan business of Beam Suntory, exceeded the prior year due to the favorable performance of products such as Jim Beam, Torys (Classic), -196ºC Strong Zero, Horoyoi and canned highballs.
In 2017, Suntory Spirits Limited will aim for further business growth by continuing to develop and strengthen its key strategic brands in core categories including whisky and RTD. Furthermore, in order to help consumers enjoy even higher quality products, Suntory Spirits Limited will conduct activities focused on quality, as well as actively promoting the value added by the ways to enjoy our products.

Whisky
● Review of 2016
The whisky market in Japan is estimated to have grown further, due to a sustained increase in the popularity of highballs. Suntory Spirits Limited capitalized on this trend by promoting Kaku highballs made with Kakubin and the value and quality of premium whiskies, as well as the new value of Jim Beam, Torys (Classic), Chita and other products. The company’s whisky sales in Japan grew by 2% year-on-year.

Suntory Spirits Limited promoted Kakubin as an ideal drink to pair with food. Along with an increase in on-premise places where high-quality Kaku Highballs can be enjoyed, increased demand for drinking at home benefited the entire Kakubin brand, including canned Kaku Highball. Jim Beam showed extremely strong growth with a 37% year-on-year volume increase, thanks to active promotion of “Beam Highball,” which is served in a mug at on-premise establishments. As for Japanese premium whiskies, Chita was well-received for its smooth taste, while Hibiki and Hakushu received numerous awards in international spirits competitions, highlighting the excellent reviews our products receive abroad.

● Strategy for 2017
As a leading company in the field of whiskies, Suntory Spirits Limited will aim for continued growth by communicating the appeal of Suntory whisky to consumers through activities to promote the value of premium whiskies, along with efforts to drive new demand with our strategic brands including Kakubin, Jim Beam, Torys (Classic) and Chita. 2017 will mark the 10th year since we launched an all-out promotion of highballs. Under our “Suntory Highball Manifesto,” we will undertake extensive activities to remind consumers of the fine taste of highballs with an even greater focus on their excellent quality.

▼ Kakubin
With an aim to sell 3.6 million cases*¹ (up 2% year-on-year), we will accelerate the on-premise promotion of quality Highballs and also promote ways of making delicious Kaku Highballs at home. In an effort to further increase brand value, we will also strengthen marketing activities for the overall Kakubin brand including canned Kaku Highball.

*1 One case has a volume of 8.4 liters.

▼ Jim Beam
We will aim to improve brand recognition and desirability by continuing to air popular television commercials featuring television personality Rola and strengthening activities to promote “Beam Highball.” We will also seek to expand on-premise consumption occasions by promoting compatibility with food. We are targeting sales of 750 thousand cases of Jim Beam in Japan (up 33% year-on-year).

▼ Torys (Classic)
In December 2016, Suntory Spirits Limited gave Torys (Classic) a design renewal to increase its appeal to a broader range of consumers. We will aim to achieve sales of 1.2 million cases (up 39% year-on-year) through efforts such as new television commercials and promoting highballs at retail stores. We will also seek to attract new consumers and increase fans of the Torys brand through communication activities for Torys and also canned Torys Highball.

▼ Chita
Ever since its launch in September 2015, Chita has been well-received, particularly at on-premise drinking establishments. So that it can be more conveniently enjoyed, a 350mL bottle will go on sale on 17^th January. Through television commercials and online videos featuring actor Takeru Sato, we will continue to promote the smooth taste of Chita and the appeal of “Kazekaoru Highball” made with Chita, and aim to sell 80 thousand cases (up 44% year-on-year).

▼ Premium Whiskies
We will actively engage in promotion of the value and quality of our whiskies by communicating our company's unique whisky craftsmanship and commitment to quality through brand communication and seminars using our distillery as our base.

RTD
● Review of 2016
The overall RTD market in Japan is estimated to have grown by 12% compared to the previous year, due to expanding demand for alcohol to pair with meals. Leveraging this trend, our sales volume grew significantly, selling 65.6 million cases*² (up 14% year-on-year) to set a new record for the 12th straight year and drive the market.
-196℃ Strong Zero attracted many new consumers thanks to active promotions of its appeal as a drink to go with food, showing favorable movement with sales of 31.2 million cases (up 13% year-on-year). Horoyoi was well-received thanks to communication activities as well as its excellent taste, growing significantly with sales of 14.7 million cases (up 20% year-on-year). From the Kokushibori brand, Kokushibori Premium, which has been sold year-round since March, was popular among consumers with sales of 770 thousand cases (up about 2.5 times year-on-year). Canned highballs also performed well, in particular canned Kaku Highball, canned Torys Highball and canned Torys Highball Kiritto Koime, growing significantly with sales of 11 million cases (up 26% year-on-year).
Non-aru-kibun, a non-alcoholic RTD, was renewed in August. Its new television commercials and online videos were well-received, showing favorable movement with sales of 2.7 million cases (up 11% year-on-year).

*2 One case is equivalent to twenty-four (250 mL) bottles, excluding non-alcoholic RTDs.

● Strategy for 2017
With the total market for RTD beverages in Japan expected to continue growing, Suntory Spirits Limited will strengthen its efforts to capture demand for alcohol to pair with meals, cultivate demand for premium RTDs and create new demand by promoting the unique value of our brands, in an effort to further stimulate the market. We will aim for an RTD total of 70.7 million cases*³ (up 8% year-on-year). In addition, Suntory Spirits Limited will launch Asu-no Lemon Sour and other limited-edition products.

*3 Excluding non-alcoholic RTDs

▼ -196ºC Strong Zero
The Kajitsu Shikkari series with its strong fruity taste and the Amakunai series with its exquisite bitter and dry taste form two pillars in our efforts to promote the appeal of the brand as a drink to go with food and to increase the number of consumers. We will launch Bitter Orange flavor on 21^st March as an year-round product to enhance our lineup and actively introduce limited-edition products, with the aim of achieving total brand total sales of 35.7 million cases (up 14% year-on-year).

▼ Kokushibori Premium
With last December's renewal, the fine quality body and long-lasting aftertaste that are popular among consumers have been further enhanced. To expand demand for premium RTDs, we will launch Zeitaku Lemon on 31^st January as a new standard product and pursue aggressive marketing activities, aiming for total brand total sales of 1.68 million cases (up about 2.2 times year-on-year).

▼ Horoyoi
On 7^th March, Suntory Spirits Limited will newly launch Sukkiri Horoyoi Lemon and Sukkiri Horoyoi Aoringo, which feature light and refreshing tastes, to enhance the lineup of standard products.  We will also aim to further expand contact with consumers through communication activities featuring actress Erika Sawajiri and the introduction of limited-edition products, targeting total brand total sales of 15.4 million cases (up 5% year-on-year).

▼ Canned highballs
Suntory Spirits Limited will promote canned Kaku Highball's compatibility with food, as well as the appeal of the entire Kakubin brand, in efforts to increase demand. For canned Torys Highball, television commercials that feature actress Yuriko Yoshitaka and Uncle Torys will be continued, along with marketing activities that are linked with Torys (Classic), in an effort to attract more consumers.

▼ Non-aru-kibun
For more consumers to experience the enjoyable features of this non-alcoholic drink with an alcohol-like taste, White Sour Taste will be released as a standard product from 14^th March, and limited-edition products will also be introduced. We will also continue our communication activities featuring actress Ryoko Hirosue and comedian Ryuji Akiyama to further stimulate the market.

Liqueurs and Spirits
● Review of 2016
 “Lejay Fruit Jar Cocktail” for enjoying cocktails made with Lejay fruit liqueur in a jar, and “Gin Toni!! (gin and tonic)” made with Beefeater for compatibility with meat were actively proposed to increase occasions for consumption. In addition, the 2016 Beam Suntory the Cocktail Award was held with the aim of nurturing a cocktail drinking culture.

● Strategy for 2017
Suntory Spirits Limited will launch Shokuji-ni-oishi Gochiso Umeshu on 28^th February to promote the new value of an “umeshu liqueur with reduced sweetness to go with food.” On 28^th March, Funwari Kyogetsu Clear Lime, which features a refreshing taste with reduced sweetness, will be added to the Funwari Kyogetsu series. For the on-premise market, we will strengthen activities to promote Tequila Sauza Blue and “Sauza Farm Sour”, a new type of sour drink made with fresh fruits, vegetables and Tequila Sauza Blue, while continuing to promote “Lejay Fruit Jar Cocktail” from the Lejay brand and “Gin Toni!!” using the Beefeater brand for compatibility with meat.