Shanken News: Tequila’s Ultra-Luxury Tier

With the upscale Tequila category firmly established by Patrón and others over the past decade, some Tequila marketers are now looking to take the spirit even further into the luxury stratosphere. Among them is Casa Dragones, which is growing strongly from a small base at a price point of $275 a 750-ml.

Established in 2008 by Bob Pittman (the former CEO of MTV and COO of AOL Time Warner) and Bertha Gonzalez Nieves, Casa Dragones is growing by double-digits throughout the U.S., U.K. and Mexico, selling 2,000 nine-liter cases in 2012. This year, the upstart is expecting to double its sales.

“Casa Dragones is competing against other high-end categories, like Cognac and Scotch,” says Gonzalez Nieves. The brand’s core offering is a handcrafted, 100%-agave Joven Tequila, created using a filtered blend of Silver and Extra Añejo expressions. The final product is packaged in hand-engraved crystal bottles, each of which is signed and numbered by hand.

In the U.S.—where it’s currently available in around 20 markets—Casa Dragones is primarily focused on the off-premise, which accounts for roughly 70% of its business. The brand is positioning itself on-premise as a food-pairing option in some venues, targeting the fine dining, upscale bar and nightlife sectors. In the off-premise, Casa Dragones is gaining traction in the gifting segment, offering consumers the option to personalize the bottle’s label with the recipient’s name.

In addition to competing cross-category with single malts and other luxury offerings, Casa Dragones is locking horns with fellow ultra-premium Tequilas like Patrón’s Gran Patrón Platinum ($200) and Gran Patrón Burdeos ($500), Herradura Selección Suprema ($300) and Partida Elegante ($300).