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What does premium mean? Or super-premium?


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#1 Ian Chadwick

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Posted 24 May 2007 - 01:00 PM

We've all read the PR and the ads about some sell-described premium, super premium and ultra premium tequilas. Are these just just empty advertising buzz words, or do they actually mean something?

There is no industry definition, but according to DISCUS (The Distilled Spirits Council of the US), there is a price break definition for these names, based on wholesale price per case (a case is nine bottles). I've added a per-bottle wholesale price to make it easy (retail prices will be anywhere from 33% to 100% higher than the wholesale):
  • Value: <$90 (bottle: <$10)
  • Premium $90-$120 (bottle $10-$13.33)
  • High-end premium: >$120-$200 (bottle $13.33-$22.22)
  • Super-premium: >$200 (bottle >$22.22)
In my mind, price isn't necessarily the best delineator. I would think that something else would have to be considered: aging, limited production, agave age or sugar content, production method, handmade bottle, etc. Higher price is the natural result of these factors, rather than the other way around.

Also, by this scale, some fairly low-end - dare I suggest mediocre? - tequilas are being labelled as "premium" - especially since it does not distinguish between mixto and 100%. That seems a little self-defeating if everything above a 'value' brand is 'premium' or better.

And finally,, if this were adopted on a wide scale, could some retaillers or distributors not simply shift the perceived value of any brand by pricing it into the next category? Add a couple of dollars to a bottle and suddenly it's super-premium?

How would YOU define premium and similar terms?

#2 Wichie13

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Posted 24 May 2007 - 01:16 PM

For me Premium is all about taste, process and ingredients. Maybe a bit about quantity and rareness.... but mostly taste. Price has nothing to do with it for me except for pushing some tequilas out of my reach to acquire, and decide for my self if it is premium.

#3 jim

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Posted 24 May 2007 - 01:35 PM

i thought a case was 9 ltrs, or 12 750s, as for what makes a premium i think it should be about quality, the distributors however may not feel that way, Tito's vodka was insistent that their bottle be sold in the middle of the road, not high end even tho they distill six times and consider themselves to be a premium brand
just my 2 cents

#4 CaliTequilaSipperGirl

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Posted 24 May 2007 - 01:41 PM

Ian

Thanks for the legwork ...... those numbers are ABSOLUTELY ridiculous!

I've adjusted your table to also include retail. While they may report 33% - 100% increases from wholesale to retail, they are stretching it. It's typically in the 25-45 range for a store (depending on the type of store) and 60-70 range for a restaurant (a restaurant should try to recoup their cost of a bottle in 4-6 shots, depending on the cost - higher priced tequilas often require a 6 shot float). Maybe Khrys could shed some light on the accuracy of the percentages. So, I am going to select 32.5% as median


[*]Value: <$90 (bottle: <$10) (Retail: <$13.25)
[*]Premium $90-$120 (bottle $10-$13.33)(Retail:$13.25 - $17.66)
[*]High-end premium: >$120-$200 (bottle $13.33-$22.22)(Retail:$17.66 - $29.44)
[*]Super-premium: >$200 (bottle >$22.22)(Retail:$29.44 +)

So basically, what this basically says is that everything we all drink is a Super Premium. Now, my rankings

Value (Well) < $30 Retail
Premium $30 - $60
Super Premium $60 - $100
Ultra Premium $100+

#5 Vange

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Posted 24 May 2007 - 02:25 PM

Wow, that scale does seem skewed, but it makes sense if you are talking about a spirit such as vodka. (which in the US is the most heavily consumed spirit, I think) The BEST vodka I have had to date is $75 USD (Jewel of Russia Ultra), but for $25 Chopin is almost just as good. Both are thought of as ultra premium vodkas. To me, the scale absolutely depends on the spirit. Now tequila is very different than many other spirits in that there typically isn't a direct correlation to longer age vs price. There is if you are talking about blancos, reps, and anejos, but how about if we just consider the anejo category. A 5 year aged CNA is $70ish USD when a 3 year aged DJREAL is $300+ USD.

When trying to fit the US Distilled spirits concil scale into the SMSW, tequila, fine wine, cognac worlds it really doesn't work. It would work for gin, vodka, and some others.

What was my point here????

To me, to label something as premium, super premium, ultra premium is probably different for each person. I try and keep a mental scale for each spirit. I try to rate and compare spirits of the same types.

#6 lirubis

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Posted 24 May 2007 - 02:56 PM

The selling price is what most people take as the reference point when it comes to "labeling" a tequila into such categories. However, the sense of VALUE is as subjective as every person has individual preferences. I conducted an experiment about 3 years ago, where we took 5 "premiums" (forget about the super-ultra-mega-hyper prefixes, they are just marketing BS) and 5 "standard" 100% agave specimens, and well...the results proved NONE, not a SINGLE one of the 18 tasters (from seasoned veterans to trained aficionados) failed to pick the 5 "premiums" (this was a BLIND taste, based only on TASTE perception). Among the "premiums" we had HSS, JCRF and Rey Sol. Those who did best got 3 right!

While I insist on using your organoleptic experiences define the "level" of every tequila you try, it is hard to deny the fact that the "visual" elements play a BIG part in value perception. HSS and Rey Sol, for example, are of very low organoleptic value for MY taste, yet they cost a LOT of money, so the VALUE factor for me is near zero. Yet, El Tesoro Blanco's old white label bottles, as simple and plain as they were, offer one of the BEST tequila experiences you could EVER get, for a LOT LESS money!.

When I see products like Tezon, Milagro, Cabo Wabo or Patron being presented as "super-ultra-whatever premium" tequilas...I just cant help it but roll my eyes back. Just marketing hype. Why? Just taste them....are they really the BEST you have tasted??

Me? I just go ahead an taste them, and let my tastebuds decide the "category" they deserve...

But COST will NEVER be the valid criteria to define the "premiumness" of a tequila...ever!

Just my .5 cents... B)

#7 gabe

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Posted 24 May 2007 - 04:04 PM

Al Lucero, in his book The Great Margarita Book, labels "quality" mixto tequilas such as Cuervo Especial as premium, and all 100% de agave tequilas as superpremium. (He makes no distinction based on price.) While this seems absurd to serious snobs like us, I think it does reflect the more common usage of these words to describe tequila. Hence, any tequila that wants to market itself as being in a class above ordinary 100% tequilas must adopt phrases like "ultra superpremium".

Of course, all of these labels are meaningless. Words like "Premium", "Superpremium", "Artisenal", "Limited Edition", "Hand Crafted" and such are complete bullsh*t and have no correlation to the quality of the tequila.

#8 DemeraraDrinker

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Posted 24 May 2007 - 04:26 PM

Premium and super-premium are probably more important to the bar owner than the consumer. Some bars try to standardize their prices and break their liquor into several price categories. These are usually (from low to high) well, call, premium, and super-premium booze. So you might charge $3.50, $4.50, $6.00, and $8+ for the categories so you don't have to juggle dozens of different prices.

For the consumer, its just a classification that is not very meaningful. A consumer should just drink what he likes (unless you're looking for something cheap).

#9 Attilio_Bettega

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Posted 24 May 2007 - 04:45 PM

I cannot honestly think of a single spirit in the USA that sells for under 10 dollars for 750cc's except the occasional store-brand generic on sale.

When buying larger sizes, you might get in the low to mid teens for the 1.5, 1.75 or 2.25 liter biggies.

#10 Mike Morales

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Posted 24 May 2007 - 04:58 PM

Lirubis is right :t_up: . The categories of Ultra, Super, Extra, etc., are really all about marketing--and positioning. :lightbulb:

If you look at the spirits industry as a horse race (think Kentucky Derby, Preakness, and Belmont), Vodka is the horse in the lead, with the rest of the field fighting for positioning.

The consumer in the stands is screaming for his favorite horse to come in, and the field looks tight. The only thing distinguishing each horse is its colors (labels, bottles, packaging). Some are even wearing the same colors! From the stands, it's anybody's horse race, but...

The jockeys (distributors, importers, and marketers) know the "fix is in." They know that if they are in the top 3 or 4, they'll be "in the money." That's why the field is so packed. Everyone is trying to closely align themselves to the leader. Some are even "acting as if" they were the leader! When the consumer is the one with the odds stacked against him, it can get quite confusing! :blink:

To make matters worse, the region in which you live also determines the price of your favorite booze. So if you have a bad seat at this horse race (think Hawaii, New Mexico, Canada, state owned liquor stores), as Ian suggested, a dollar here and ten dollars there, and every horse is a perceived leader (premiums to ultra premiums)! :growl:

Are there any winners in this horse race? Only the people in the Jockey Club (Mumpsimus, and other forums and clubs).

Here they study the racing forms--lineage (producer), training (methods of production), reputation, etc. Some of them even conduct their own fair races (tastings) with side-by-side comparisons of equal opponents. They share tips, strategies, and together, beat the odds against them.

With a clear view of the field, and a few stats, these seasoned bettors choose consistent winners--by a nose! ;)

#11 don Pablo

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Posted 24 May 2007 - 06:21 PM

Well, since it doesn't really mean anything, I don't mind sharing what it means to me: premium is something I enjoy sipping, super-premium is something I feel compelled to put in a fancy glass. I believe this response to be worth half a cent less than what lirubis said his was worth.

#12 chekm8

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Posted 24 May 2007 - 07:01 PM

I LOVE lirubis' post. Blind testing is the only way to go.

Coming from the Cigar world, we did blind tests all the time. And it was clear (even with being able to compare size and color) that it's near impossible to tell what a cigar is because there were literally hundreds (nearly thousands) on the market.

I was given a blind test yesterday by a friend of mine (Jiboo can attest) with 2 blancos. We had just finished tasting the Blanco/Repo/Anejo of 7 Leguas. At first sip they were different, second sip they both sucked, third sip they were both ok. I was so confused. Turns out they were Partida and Patron. I could not distinguish them on the nose all.

Second up he gives me 3 darker pours. He says they are either all repo or all anejo...you decide. First is clean and decent. 2nd I almost spit out (it was horrible), and third was drinkable but not great.

Turns out they were 7 Leguas anejo, Jose Cuervo Gold, and Herradura anejo...respectively.

He tricked me a little bit with the gold but the point was made....when you remove the packaging and the "lineage", the taste is the only thing to carry it.

#13 Ian Chadwick

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Posted 24 May 2007 - 09:39 PM

i thought a case was 9 ltrs, or 12 750s,


A case of wine is 12 750ml bottles (9 litres) or sometimes six (a half case). My understanding is that cases of tequila are 9 x 750 ml. But if it really is 12 x 750ml, then the numbers change - to the lower. Which means a super-premium wholesales for $16.67 and retails at about $22. Ha!

Anyone able to confirm that?

#14 Attilio_Bettega

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Posted 24 May 2007 - 09:57 PM

I think price is very important. It is the standard by what expectations a product sets forth and how it is judged. I will be far more lenient on a tequila costing 20 dollars than I would on a 100+ dollar bottle.

I think at least part of the reason why ET Platinum is so loved is that it's so affordable... not to mention smooth and tasty!

There seems to be less controversy on blancos than anejos because when something is less expensive, people don't expect as much and tend to be more easily impressed, not that some of the stellar blancos out there wouldn't still be adored at twice the price!

#15 Ian Chadwick

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Posted 25 May 2007 - 06:28 AM

I think price is very important. It is the standard by what expectations a product sets forth and how it is judged. I will be far more lenient on a tequila costing 20 dollars than I would on a 100+ dollar bottle.

Yes... but should the spirits industry (not necessarily the tequila industry) set the dividing line between prices to determine whether a product is premium, or super premium?

Is El Tesoro de Don Felipe less of a product because it costs less than, say JCRF?

Is a 2-month reposado more 'premium' quality because it has a higher price tag than an 11 month old reposado at a lower cost?

Can a simple price increase propel a product up the ladder to super premium status without any changes to production methods?

Example: I drink a lot of cheap - but to my palette good - wines. They're cheap because they have not been discovered yet, so the price is low. I used to drink an excellent New Zealand white wine called Villa Maria. Wonderful nose, stony - even flinty - taste. Truly an enjoyable wine. It sold for about $8-$9 a bottle. Now it sells for about $15-16 because it became popular. Wine hasn't changed, just the price. So it now premium when before at $8 it wasn't?

#16 reifer

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Posted 25 May 2007 - 10:55 AM

Is El Tesoro de Don Felipe less of a product because it costs less than, say JCRF?

Not necessarily "because" it costs less but, it is not in the same category, IMO
Paradiso is on the same level as JCRF but not ETA
Call it what you want, but super premium works for me.

#17 anejo

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Posted 25 May 2007 - 11:48 AM

super premium I think of 1942 and ultra premium real comes to mind. do i think real is worth 3 times the money? no way jmo. i like tonala suprema reserva anejo 4 year just as much as any $100+ bottle and i paid only $47 for it @ bevmo. i would consider it a premium for sure and maybe an ultra, just my 2 cents.

#18 Fuzzy Logic

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Posted 25 May 2007 - 02:14 PM

i thought a case was 9 ltrs, or 12 750s,


A case of wine is 12 750ml bottles (9 litres) or sometimes six (a half case). My understanding is that cases of tequila are 9 x 750 ml. But if it really is 12 x 750ml, then the numbers change - to the lower. Which means a super-premium wholesales for $16.67 and retails at about $22. Ha!

Anyone able to confirm that?


Having bought a few cases of tequila I have found that the quantity varies. I was in on a case of Herencia Historico and that was 6 bottles. The same for Herencia de Plata Silver. The 2007 JCRF came in a case of 4.

When you get into higher end versions of products (cars, stereos, liquor, etc.) you never seem to get a direct correlation between price and value. Is a Bugatti Veyron (over a million dollars if you can get one) 60-70 times better than a Toyota Corrolla? You are paying as much for exclusivity as anything else. This is probably why Porsche is the most profitable car company and Patron is predicted to surpass Sauza as the number 2 tequila brand in the US by 2010 (Source).

#19 Mike Morales

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Posted 25 May 2007 - 02:57 PM

Patron is predicted to surpass Sauza as the number 2 tequila brand in the US by 2010


If this prediction rings true, this explains the $80 million bet by Campari for Cabo Wabo. According to the news reports of Sammy's recent sell out...

...Last year, his company sold 147,000 cases, making it the second-best-selling premium Tequila in the United States...


Any guesses on which tequila was the best-selling premium last year?

Sounds like positioning to me. :lightbulb:

#20 CaliTequilaSipperGirl

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Posted 25 May 2007 - 03:35 PM

Patron will not surpass Sauza. In fact, I think Patron will start falling back. With the inception of lots of great new tequilas in the market, I see Patron starting to lose hold of their ranking in the 'premium' market. Once they aren't 'THE' tequila to drink, people won't want Patron Margs. They'll go back to Horny Margs :)

If you forced me to select a Patron product or a Cabo product ..... (exclusive of the uno and gp) I would go with Cabo.


I know that 4 Copas and Partida are really trying to make a run at Patron as well.

Patron is predicted to surpass Sauza as the number 2 tequila brand in the US by 2010


If this prediction rings true, this explains the $80 million bet by Campari for Cabo Wabo. According to the news reports of Sammy's recent sell out...

...Last year, his company sold 147,000 cases, making it the second-best-selling premium Tequila in the United States...


Any guesses on which tequila was the best-selling premium last year?

Sounds like positioning to me. :lightbulb:



#21 Mike Morales

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Posted 25 May 2007 - 03:48 PM

I know that 4 Copas and Partida are really trying to make a run at Patron as well.


In my upcoming blog/article/interview with Alfredo Vasquez of Fina Estampa conducted on the first Blue Agave Tour, he related that the leader, Jose Cuervo, was eyeing PatrĂ³n's every move. Since Cuervo owns the lion's share of the market, and Patron the rest, they had good reason to be nervous.

Now, it seems that there are a few strong brands out there gunning for #2! :fire1:

#22 Attilio_Bettega

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Posted 25 May 2007 - 08:36 PM

I think price is very important. It is the standard by what expectations a product sets forth and how it is judged. I will be far more lenient on a tequila costing 20 dollars than I would on a 100+ dollar bottle.

Yes... but should the spirits industry (not necessarily the tequila industry) set the dividing line between prices to determine whether a product is premium, or super premium?

Is El Tesoro de Don Felipe less of a product because it costs less than, say JCRF?

Is a 2-month reposado more 'premium' quality because it has a higher price tag than an 11 month old reposado at a lower cost?

Can a simple price increase propel a product up the ladder to super premium status without any changes to production methods?

Example: I drink a lot of cheap - but to my palette good - wines. They're cheap because they have not been discovered yet, so the price is low. I used to drink an excellent New Zealand white wine called Villa Maria. Wonderful nose, stony - even flinty - taste. Truly an enjoyable wine. It sold for about $8-$9 a bottle. Now it sells for about $15-16 because it became popular. Wine hasn't changed, just the price. So it now premium when before at $8 it wasn't?


Well, I agree 100%. El Tesoro happens to be my favorite brand, and it's not that expensive either. I would pay twice as much and still think it a 10/10 tequila. However, the price can really skew things. If a bottle of ETP cost 100 dollars, maybe I would be a little more hesitant!

I agree with your wine post as well. See my Vino Nobile di Montepulciano post (I am very emotional about this wine... we Italians are so extrovert and emotional, perhaps you canadians wouldn't understand it but at least you have a streak of european that you might not consider me totally crazy for being so emo). VNDM is amazing in its better years. I think it beats the better known Brunello di Montalcino by a landslide. The Brunello is more fruity, but honestly the noble wine is far more complex. However, the Vino Nobile is not as well known. I would think it an amazing wine at 100 dollars a bottle, but in the USA I can find it for 16-50 dollars and in Italy I can get it for 7-24 euro (depends on year, reserve class or not etc). It's world class at any price, but when I find myself paying for it at the bottom end of the price range (considering that at my current age of 28 I could invest the same amount in the stock market and have over ten times the amount when I am 65-70 years old when taking taxes and inflation into account) I feel much better about it.

I know you are the #1 of this website, and I respect your writings and insights very highly. If you are into value plays, may I most humbly suggest Gabbiano Chianti (the lowest rung, because there is a Riserva and a head honcho above that both of which are amazingly outstanding but also incredibly pricey) available in the USA for 7.95 USA per bottle. It's amazing. My mother fell in love with it a few years ago and it's all we drink now at the dinner table after having experimented with crappo wines that were slightly cheaper. It's really good, though in Italy it probably is worth only 2 or 3 dollars a bottle, but still, it's amazingly cheap for how good it is, especially for what you can find in North America.

Now... what would you be willing to pay for a bottle of the old El Tesoro (any age, especially Silver of Anejo)?