• Ad Age, Tuesday, September 19, 2006 12:45 PM

Diageo is testing ready-to-drink rum, vodka and whiskey cocktails in 12-ounce cans that have the same alcohol content as most beers. A test in Tampa involves four brands--Captain Morgan and Cola, Smirnoff Vodka and Lemon-Lime Soda, George Dickel Whisky and Cola, and Seagram's 7 American Whiskey and Lemon-Lime Soda. "They're selling very well, and we're pleased," says Bob Gibson, marketing director for ABC Fine Wines & Spirits, a chain of 150 Florida liquor stores. Gibson said Diageo has indicated that it intends to expand the test to a larger geographical area, and to a fifth cocktail, featuring Crown Royal whiskey. Diageo's apparently successful test could pave the way for a much larger, ready-to-drink spirits presence in the U.S.--a move that would serve as another offensive by spirits distillers into beer's traditional domain. It's also likely, however, to spur complaints by advocacy groups that pre-mixed cocktails may have appeal among underaged drinkers. Like beer, these new products are about 5 percent alcohol by volume, meaning that they can be sold alongside beer in convenience stores, gas stations and beverage depots. Ready-to-drink cocktails have been widely accepted in some overseas markets, such as Australia, where Beam Global Wine & Spirits sells 7 million cases of Jim Beam Bourbon Whisky and Cola each year.

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