That S*it Will Never Sell

A fascinating book on innovation in the alcohol industry

David Gluckman has spent 45 years in the drinks industry (the British phrase for the Booze Business) creating such outstanding products as Bailey’s Irish Cream (along with Tom Jago), Tanqueray Ten, Cîroc and scores of others. His book, whose title is the heading of this article, is a fascinating guide to what it takes to innovate and launch new products in this industry.

David was born in South Africa and came to the UK and began working in advertising. His accounts included such companies and brands as Procter & Gamble, Kerrygold butter, and several Unilever brands. In the late 1960s, he became a consultant to IDV (International Distillers and Vintners—a company that ultimately became Diageo), and entered the world of brand development.

As a new products/innovation toiler myself, I found the book to be captivating and a joyful ride on the sometimes-turbulent road of brand development.

A review by Paul Walsh (ex CEO of Diageo) put it nicely, “David Gluckman has a ‘one-of-a-kind’ approach to new brand development, but amazingly, it works. You will enjoy this book.”

I sat down (virtually) with David and asked him about his experiences.

You’ve spent most of your career on innovation and product development, what are the biggest obstacles you’ve encountered over the course of your career? Who are the innovation villains?

Somebody once asked me why we had such a high strike rate getting brands onto the market at IDV.  My answer “No marketing people.” No middle managers asking to see alternative ideas to go into massive research programmes.  I can’t imagine major players like Sidney Frank or Abe Rosenberg doing concept testing.  We had a very small team of like-minded individuals and the beauty was that we reported to top management.  I sold the idea of Smirnoff Black to Denis Malamatinas in under 10 minutes. And Aqua Libra to Tim Ambler in 5 minutes.  Well, that’s because I knew him better.

After leaving Diageo I did a project for a large drinks company.  The budget was huge and I worked in parallel with a global innovation giant.  I delivered my work a month ahead of schedule and I thought the solutions were really good.  I think it was a case of ‘budget allocated, budget spent, end of story’.  Nothing happened. I would be happy to go and re-pitch the ideas to the company tomorrow.  At no charge. I am confident the ideas would work.

Which companies (or individuals) that you’ve worked with were most welcoming or encouraging to new ideas?

IDV was a ‘one-and-only’ when it came to fostering new brand development.  Baileys took about 5 years to become significant and yet the company tolerated us (Tom Jago and me) even with the odd expensive failure. Adventure seemed to be built into the IDV culture.  When Jago left and Tim Ambler took over the rate of development accelerated.  I think of all the people I worked with, Tim was the most inspiring.  He really knew the business and he was on the main board and could make things happen.  IDV also formally introduced Tom Peters’ ‘brand champion’ idea so top management from all over the company were taking leadership on new ventures.

What’s the biggest regret of your career? What have you done or worked on that you wished you hadn’t?

When I parted company with Diageo in 2005 I got together with two ex-colleagues to develop Coole Swan, a super-premium cream liqueur.  The category made sense because there was nothing above Baileys and we felt there was an opportunity for a product with lower sweetness and more modern, sophisticated packaging which broke with the Baileys’ template. I was as proud of that brand as with any I developed for IDV/Diageo.  The problem for me personally was that it took me out of my comfort zone and into marketing and finance – not part of my skill set. I still firmly believe that it will be a great buy for a company out there with muscle and resources. But I should have negotiated a brand development fee and a small piece of the action and left it at that.

Thinking about all the new products or innovations you’ve worked on, which are you most proud and why?

It would be easy to say Baileys or Cîroc because they were so successful. But for me the two intellectual challenges which were most satisfying were Smirnoff Black and Distilled Guinness.  In the Smirnoff case, the brand was on its knees in the US.  The idea of a premium version to compete with Absolut and Stoli was scarcely credible. The solution came from a word more familiar in the brown spirits sector—we set out to achieve and perfected ‘the world’s smoothest vodka.’ And the product delivered. Hard-nosed New York 40-somethings really could taste the difference.  And even when I told them it was from Smirnoff they said they preferred it.

Distilled Guinness never got off the drawing board but the way the idea came together in my head was incredibly exciting. If you can have Jewish epiphanies, this was one. The discussion was about a Guinness Whiskey.  Should we take the brand into a new category?  On the surface, the only way was Irish and at the time (1998), Pernod-Ricard owned the market.  So, Guinness Irish Whiskey didn’t seem to make commercial sense.  Then out it popped.  The fruit of all those lengthy distillery visits.  Whisky starts life as a fermented product. A beer.  Then it’s distilled.  Why not simply distill Guinness? And call it that.  Distilled Guinness.  No SWA {Scotch Whisky Association}, no barrel-ageing, make it where you like and make it taste the way you choose.  We designed the pack the same evening and I was in a couple of focus groups a few days later. But it never happened.

What do you make of the craft (or small batch) product movement in the US and UK?

I never liked claims like ‘small batch’, ‘hand crafted’ which are all over the place these days. They are hollow claims, just hype. They don’t really mean anything.  I always liked brand claims that led to real benefits not stories. It was my advertising training working for Unilever and P&G.  Smirnoff Black was a palpably smoother vodka and Tanqueray Ten is made from fresh botanicals and has a fresher, cleaner gin taste. These are real product benefits. They could get drinkers to change their minds.

I’m not sure I agree with David on this last point inasmuch as the back story of a new brand must answer the trade’s question as to “why this and why now.” I think it’s the mix of what’s in the bottle together with the brand’s reason for being that often yields success.

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David Gluckman (L) and Joel Garner, a famous cricketer.

You can learn more about his book and buy a copy at this website.

It’s my second favorite book about the Booze Business. Can you guess which is the first? 😀

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Dad’s Hat Pennsylvania Rye Whiskey

A brand with a legacy

America’s first whiskey was made from rye, not corn, and Pennsylvania was where it was produced. In the late 18th century, pioneering farmers from Europe with distilling skills found that rye grain was easy to grow and made a very delicious spirit. The first American indigenous spirit was born.

(I’m far from a whiskey or spirits historian so for more detail I suggest you read some of the books and blogs by David Wondrich, Fred Minnick, Chuck Cowdery, Gaz Regan, and others.)

But, after Prohibition, the stills of Pennsylvania remained closed.

Starting in 2011, spurred on by Pennsylvania’s new distilling regulations, rye whiskey returned to the state and since has begun to flourish.

Enter Dad’s Hat

John Cooper and Herman Mihalich had known each other from their college days at Wharton. They kept in touch over the years as each pursued different careers—John as a sales person in tech and software areas and Herman in the chemical industry.

Along about 2006, each had grown tired of the corporate life and began thinking about “what comes next?” An article by Eric Asimov in the NY Times on November 29, 2006 pointed the way. It was headlined: All but Lost, Rye Is Revived as the Next Boutique Find.” They decided that they were going in to the booze business and, “bring rye back to where it belongs—Pennsylvania.”

Herman’s father owned a tavern (and at certain times, a speakeasy), so he felt right at home in the business. As Herman puts it,

“My Dad wore hats. Real hats. The kind you only see in old pictures or movies… Before he left the house each day, he’d carefully choose one from the rack and don it. The hat always seemed to fit his mood—or the occasion—perfectly. In those days, it was more than just fashion. A symbol of optimism. That we cared about quality, polish and finish. A subtle, personal signature. From an era when taking the time to do it the right way mattered.”

That became the credo and guiding principle for the distillery—to produce a rye that is true to its Pennsylvania roots and based on quality and a particular style.

So off they went to the Michigan State Artisan Distilling Program and by 2011 they were off and running.

I’ve met scores of startup and craft entrepreneurs and many (but certainly not all) subscribe to a philosophy that I call “build it and they will come”—meaning it’s all about the distillery, the process, and the end product. Only a handful think in terms of the drinker, the bar, the marketing, and sales.

For Herman and John, this broader view of the business means is that they have fully thought through the commercial and route-to-market issues. Take distribution for example. They don’t lose focus by opening markets indiscriminately (hoping to increase revenue) but by strategic expansion. They don’t over promise; they strive for consistency; and, believe that slow and steady growth is the way to go.

Herman Mihalich (L) and John Cooper (R)

The products—Local, sustainable, practical, and genuine

Dad’s Hat is a rye in the Pennsylvania Rye tradition. Period.

The rye comes from their close relationships with local farmers. The spent rye mash even goes back to the farmers to feed their livestock. Using high-quality ingredients, a grain bill of 80% rye, 15% barley malt and 5% rye malt yields a “flavorful mash that undergoes a week-long, controlled fermentation to develop complex flavor.”

The recipe was formulated at the Michigan State program over a two-year period and is based on traditional Pennsylvania rye whiskey.

The flagship is, of course, the 90-proof classic Pennsylvania Rye Whiskey, which, by the way, was recently awarded “Best in Class” by Whisky Advocate and named the Craft Whiskey of the Year for 2016.

There is a Straight Rye Whiskey (95-proof). Also, a Bottled in Bond 100 proof Straight Rye Whiskey aged four years.

But to me, their most intriguing products are the rye whiskies that are finished in vermouth and port barrels (also 94-proof). These came about when John and Herman were sitting around one day after work, drinking manhattans, and wondering about line extensions. The eureka moment was “what would happen to a Manhattan if the rye was aged (3 to 6 months) in a vermouth barrel?” I’ve tried it and, let me tell you, it’s amazing.

This idea also led to port barrel finished rye with an interesting taste. Both products use barrels from the Vya-Quady winery in the San Joaquin Valley of California.

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Dad’s Hat Pennsylvania Rye Whiskey sells for roughly $40 for a 750ml. The distillery and warehouse is located in Bristol PA in Bucks County and just across the river from New Jersey. There are tours which are held on most Saturday afternoons and well worth the visit.

Finally, a big shout-out to my friend Cliff Oldfield with whom I fought the Mongolian wars a few years ago. Cliff introduced me to John and Herman. He runs their sales in the NY-NJ region and is among the most effective salespeople I know these days.

Gentlemen: My hat’s off to all of you. (Please… I can hear you groan.)

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Inside The Bottle Updates: Barnes & Noble, Goodreads, and More

Thank you to everyone who has purchased Inside The Bottle: People, Brands, and Stories.

I’m thrilled by the positive comments and feedback. Thanks especially to those who took the time and trouble to write a review; it has increased the book’s visibility and audience. I am most grateful.

Your reviews are a powerful way to improve the visibility of my book inside the vast marketplace of Amazon and I appreciate all who have taken the time to write one.

Speaking of visibility, the book was recently picked up by Barnes & Noble which is an immense honor. You can now purchase the book via their website.

I have also launched an author page on an important book social network, Goodreads. If you are a member of that platform please follow my page, perhaps add the book to your reading list, maybe suggest it to your connections, and consider leaving a review.

Speaking of reviews, thank you to F. Paul Pacult and his Spirit Journal for this wonderful write up:

For anyone in the beverage alcohol business, blogger and former Seagram Executive Vice-President of Marketing, Arthur Shapiro’s new book is essential and often compelling reading. That’s because Inside The Bottle chronicles many of the salient events that happened from the late 1980s to the present in terms of beverage alcohol brand development, marketing strategies, consumer trends, and behind-the-scenes events.

Shapiro’s viewpoint is unsparing, insightful, and candid in its exposition. His lofty position within Seagram at a crucial time in its history afforded him a unique perspective on the crumbling of the Bronfman Empire. And, his opinions on brand marketing read like a tutorial.

A not-to-be-missed read by anyone who has ever championed a booze brand, taken a hankering to beverage alcohol history, or just enjoyed entertaining “dishing.”  

And last but not least, I want to point you toward a fantastic blog post by Miki Hickel (the illustrator and graphic designer of Inside The Bottle) about her experience putting the book together.

Didn’t order your copy yet? Purchase from the retailers below and check out my page on Goodreads.

 

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