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Last Updated: Thursday, 4 December, 2003, 14:27 GMT
The battle of the brands
Sandy Murray
By Sandy Murray
BBC Scotland business staff

An agreement has been reached by Scotch whisky producers in the row over the Cardhu brand.

Its owner, the giant drinks firm Diageo, had changed the content of the whisky while retaining both the name and the style of packaging.

Cardhu advert
Cardhu proved a particular success in Spain
Rival producers worried that the move would confuse customers and damage the reputation of Scotch whisky around the world.

Now Diageo has agreed to alter the packaging used for Cardhu, including a change of colour for its box and label.

Like all luxury products, the image of whisky is at least as important to its success as practical considerations such as taste.

Single malts, each of them the product of just one named distillery, make up a fifth of the value of whisky exports.

But their popularity is growing and they represent the top end of the market.

Many whisky producers worry that, if their customers become confused about what counts as a single malt, the drink's magic will disappear.

Mix of malts

Diageo's decision to change the content of its Cardhu brand has been prompted by its success.

With demand for Cardhu continuing to grow, there was a danger that production of the single malt would fail to keep up.

Diageo's solution was to retain the Cardhu name, but fill the bottles with a carefully-selected mix of malts from more than one distillery.

Whisky of this kind is often called "vatted malt".
Scotch whisky is one of the UK's top five manufactured exports

What concerned Diageo's critics was the decision to describe it as "pure malt", which they felt to be potentially misleading.

If whisky drinkers around the world came to the view that malt whisky was little different from blends, producers would no longer be able to charge substantially more for the premium drink.

Blended whisky, traditionally cheaper than single malts, contains a high proportion of spirit distilled from grain.

Much of this grain whisky is produced in a high-volume industrial process, and in itself has few of the characteristics which make an individual whisky as distinctive as an individual wine.

The way in which whisky is marketed matters not just to those directly employed in the industry.

With international sales worth 2.28 billion, Scotch whisky is one of the UK's top five manufactured exports.

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30 Nov 03  |  Scotland

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