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Is vodka coming back? We ask three local craft distillers

July 11, 2023

Despite being one of the most popular spirits on the planet, vodka remains an enigma. Dominated by large brands, it's a segment that seems stubbornly resistant to the premiumisation trend that has swept the spirits industry in recent years.

But spirits are rising...

Recently, the IWSR released a report on the global vodka market which showed that while the global vodka category growth remains flat (and is expected to say that way for the next five years), the 'premium-and-above' segment volume rose by +6% in 2022, with +3% CAGR predicted between 2022–27.

Significantly, as the report notes, the growth in top-shelf vodka has come thanks to three significant trends.

  1. Increased emphasis on provenance and quality ingredients
  2. Innovative flavours
  3. The rise of premium, vodka-based RTDs.
Hellfire Distilling Potato Vodka. Source: Hellfire Distilling

What about craft vodka in Australia?

Kaddy Community has spoken to a cadre of Aussie craft vodka distillers to unearth some more insights into the local market, revealing plenty of enthusiasm.

Indeed, this whole article began fomenting in February when we chatted to Ruby Daly from Hellfire Bluff Distilling.

Daly, who famously launched the distillery by selling Hellfire Bluff Potato Vodka from a stall at the Salamanca Markets as a side project, has seen the vodka uptick for herself.

'The (distilling) business really didn't really take off until gin came along. Now, it's funny, it's flipping back to vodka again!' said Daly.

Notably, Daly's biggest challenge was educating customers about potato-based vodka.

'It really took a long time around educating our customers on how to drink it and how to understand what potato vodka is like'.

'We were kind of competing against these big players that had ruined vodka where it shouldn't have a taste, and then we produce this vodka that was really creamy and earthy, and people were like, "What is this?"'.

White Light Vodka. Source: Instagram.

Daly isn't alone in grappling with this challenge, as Brendon Mitchell of White Light Vodka notes.

'The vodka market is an interesting one- because despite being the top-selling spirit across the globe, there isn't a culture of education around it like with gin and whiskey', he said.

'This means people go for recognisable big-name brands without branching out to try local vodkas (as) it feels like a safer choice to pick up the same bottle you've been buying since you were 18'.

But Mitchell argues that local spirits are up to the challenge, arguing that they are 'just as good if not better than these big international spirits that flood the local market'.

He sees the problem as just part of a customer journey.

'We're trying to educate Australians on the complexities of vodka to help people choose amazing local bottles over big-name international brands,' he said.

Mitchell's brand has enjoyed plenty of success already, with White Light Vodka winning a swag of awards, including the trophy for Best Vodka at the 2018 ASDAs. He attributes this success to a simple motto.

'I think the main thing is we care - we really give a shit about vodka'.

'Whilst other distilleries may sell vodka as a secondary product to gin or whiskey, White Light focuses solely on making amazing, pure vodka'.

Karu Distillery Morita vodka. Source: Instagram.

A margarita, but with vodka?

Pure vodka isn't the only success story here. For Karu Distillery, the brand making waves is the pioneering Morita chipotle vodka which was recently named as the World's Best Infused Vodka at the 2023 World Vodka Awards.

As Ally Ayres from Karu explains, this vodka also comes with a wonderful origin story.

'Whilst scrolling through a bartender forum one evening, we noticed that bartenders were posting receipts for "1 X Margarita, vodka instead of tequila", which was a light bulb moment for Morita, (at that time) a Research and Development project on the back burner for us, and reignited its progress'.

'Coming from a background of successful gin distillation, we decided to take that approach with flavouring a vodka. We took the two chillis "Meco" and "Morita", which is that famous Chipotle flavour you associate with Mexican food, and paired it with lime zest, agave syrup, coriander seeds and green capsicum to create a versatile, savoury-style flavoured vodka'.

Indeed Morita is more than just another flavoured vodka, as Ayres notes:

'Having Morita win (at the World Drinks Awards) really solidified for us it isn't a gimmick product. Even though it's a lot of fun, it has a strong stance and purpose'.

The future of vodka?

Karu's success with adopting a gin approach in vodka production isn't an isolated example. More botanicals and intriguing flavours drive new products throughout the industry, like Ketel One's Botanical range, which taps into that same vibe with gin-like flavours like Grapefruit & Rose + Cucumber & Mint.

Otter Craft Distilling Lemon Drop Vodka. Source: Instagram.

Locally, we've seen the Otter Craft Distilling range's success, including a Lemon Drop Vodka that won gold at the 2020 AUISC. Lemon Drop is 'infused with Australian lemon myrtle, Davidson plum & apple to create a botanical Vodka with an intense lemon burst'.

Otter's vodka success isn't simply down to interesting flavours. Tapping into the trend for quality ingredients, the Otter team see traceability as an essential part of the formula, as co-founder Eduard Otter explained in a recent Local Heroes interview.

'One farm, one paddock, one malter and one distiller. We know each of our suppliers, and we all work hard to support each other and to share ideas and grow together,' he said.

Daly also sees an increased focus on provenance as a key USP at Hellfire Bluff, where drinkers can see a direct link between the potato farm and the finished vodka, all made on-site.

'We are a farm first, and we always tell that story first, and I think people really buy into it', she explained.

Hellfire Bluff Distillery (and potato farm). Source: Instagram.

Could a focus on ingredients help vodka catch up to gin? Ayres thinks so.

'I think with innovative flavours and infusion methods, it certainly can come close (eventually)', she said.

'Gin and Vodka shouldn't be compared to one another. You hear the phrase "vodka is just unfinished gin", which isn't true. It has its own complexities that can't be hidden behind juniper and other big botanicals, such as the raw material and mouthfeel'.

Finally, Mitchell believes that consumers will eventually come around to the purity of vodka.

'I think as people are starting to understand spirits better they'll be looking more at pure vodka'.

Discover more Australian craft vodka on Kaddy Marketplace.