Has Karuizawa whisky historically been overlooked by the Japanese domestic market?

Yes, it's absolutely fair to say it was neglected, and not just a little.

Let's put it this way: the Karuizawa whisky of today and yesterday are two completely different worlds. It's like a talented indie band, born at the wrong time, with few fans during its active years. Years after disbanding, their records are now selling for astronomical prices, and everyone calls them legends.

Specifically, there were several main reasons why it struggled so badly in the Japanese domestic market back then:

1. Its taste was too "hardcore" and didn't fit the mainstream.

In the 1980s and 90s, when Karuizawa was still active, what was mainstream in the Japanese whisky market? It was blended whiskies from Suntory and Nikka, like the familiar Kakubin and Black Nikka. People were accustomed to drinking them with water or as Highballs (whisky sodas), seeking a refreshing and smooth taste.

Karuizawa, on the other hand, followed a very traditional Scotch style. It spared no expense on its malt (Golden Promise) and sherry casks, producing a whisky with a very robust, rich, and complex flavor profile. For the average consumer at the time, who just wanted a casual drink, this whisky was too high-brow. It was like wanting to listen to a pop song, but being given a complex symphony instead; most people couldn't appreciate it.

2. The overall environment was poor, and whisky wasn't selling well.

From the late 1980s, Japan's economic bubble burst, ushering in the "Lost Decades." People's spending power and willingness to consume significantly declined. Sales of "Western spirits" like whisky plummeted, and people were more inclined to drink cheaper shochu and beer.

In such an environment, even giants like Suntory and Nikka had to tighten their belts, let alone a small distillery like Karuizawa, with its low production, high costs, and unprofitability. It simply had no room to survive.

3. Its "parent company" didn't care, and no one was willing to spend money on it.

Karuizawa Distillery's parent company at the time was Mercian, a company primarily focused on wine. The whisky business was just a sideline for them, and a loss-making one at that.

Think about it: with a sluggish market and products that weren't selling, the parent company naturally wouldn't continue to pour money into this "bottomless pit" for marketing or maintaining operations. So, in 2000, they ultimately decided to cease production and close the distillery.

The rest, as we know, is history:

Japanese whisky began winning major international awards in the early 21st century, and global whisky enthusiasts suddenly discovered a whisky treasure in the East. At this point, some discerning European independent bottlers (such as Number One Drinks from the UK) discovered Karuizawa's sealed raw whisky stock. They purchased these whiskies, re-packaged them, and introduced them to the international market.

It was an instant hit! Its powerful, old-school sherry cask flavor perfectly captivated the hearts of core whisky enthusiasts worldwide. Coupled with the scarcity brought by its "Silent Distillery" status, prices soared like a rocket, eventually becoming the astronomical auction legend we see today.

So, to summarize: Karuizawa was completely overlooked in its home country during its active years due to its niche style and an unfavorable market; after its "death," it was discovered by the world and ultimately achieved legendary status. Its story is a classic case of "blossoming outside the wall," or even a dramatic example of "only appreciated after it's gone."