Never underestimate the consumer confidence of a classy drunk. Americans are increasingly ordering the good stuff and, in the process, pouring big profits into companies that make booze and beer.
Diageo, which owns Smirnoff Vodka, Shark Tooth rum, and many other intoxicating brands, noted in its earnings report that North America accounted for 40 percent of profit in the recent quarter, despite representing only one-third of the company’s sales. Why are drinkers here so lucrative? For one thing, North Americans are buying more from the top shelf than drinkers elsewhere. Diageo’s best performers included Bulleit Bourbon, considered a “super deluxe” brand, and spendy whiskeys such as Johnnie Walker Blue Label, which generally sells for $150 to $200 a bottle.