Find a hole and fill it

This blog has given me the opportunity to re-connect with friends and to make new ones like David van de Velde whose business motto is the headline for this posting.

In addition to being a very smart and affable fellow, David is an interesting entrepreneur and created Ketel One and Van Gogh Vodkas. In that regard, he changed the spirits industry.

I hope one day to write his full story but here are a few things that make him so interesting.

Let’s start with the motto. In an age of me-tooism, finding a hole and filling it speaks volumes about brand development strategies.

Not long after Seagram got Absolut Vodka, I kept hearing about this new brand, Ketel One, which was unique in its packaging, name, underlying concept and one other “outrageous” factor… a price at a significant premium to the category.

In addition, they concentrated on bartenders and servers and used videos and events to tell the story and even special olives for a martini. Everywhere I went at the time, all I heard was how we needed to learn from the Ketel One folks.

Many people think that the ultra premium vodka market was created by Grey Goose when, in fact, by the time Grey Goose came along, Ketel was already doing 200,000 cases.

David’s understanding of consumers is very impressive. He describes the target customer for high-end vodkas at that time as someone who wears Armani suits without pockets. Someone who walks into a bar and is holding the following – car keys with a Mercedes or BMW logo, an expensive cell phone and a wallet chocked full of goodies. No pockets. The question he asked himself is – would this person drink anything but a top shelf brand?

After Ketel One, he created Van Gogh vodka and brought the flavored category to new levels.

A little birdie told me he will be celebrating a milestone birthday this week so congratulations and keep finding and filling those holes.

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Crown Royal Part 2

The Crown Royal posting generated many emails and calls with additional comments, anecdotes and stories about the brand. I thought I would share a few.

They all amount to the same thing – the brand was built on creativity and consumer engagement with a large dose of cleverness.

Crown was one of the first brands to have outdoor ads that were “spectaculars,” defined as clever, out of the ordinary, with potentially strong stopping power. The most well known was an oversized, full dimensional bottle that filled an entire billboard. The caption on top of the bottle read “Not Actual Size.”  On the bottom it read “Too Bad.”

To gild the lily a bit a local team in the south decided to add two mannequins rappelling down the board as though trying to get into the bottle. Shortly after they went up they were stolen. Rather than get upset or simply replace them, a full-page ad was run in the local papers with the headline “Who are the dummies that stole our dummies?” The ad went on to explain that, “why would you risk your life to steal a mannequin when there was a giant bottle on the same billboard?” The result was great PR for the brand.

For many years Crown sponsored rodeo finals in Las Vegas until the cost of sponsorship became much too high. The event, with signage all over the arena, went to Jack Daniel’s. Not to be outdone, Reichardt and company decided that they were going to invest the cost of sponsorship they had been paying into ads and promotional activity and surround the event.  The result was that everywhere in Vegas that week – from airport signage to cab tops to billboards to bars – it was all about Crown not Jack. All at a fraction of what the event would have cost.

Finally, at one time Crown had trouble getting traction in California and the pressure was on. Cleverly, some local sales managers decided that moving product with just an attractive price to the trade was limiting. So instead they focused on a large Korean store, which resulted in massive window displays that came to the attention of Korean bottle club owners. They liked the package and price and started buying for their clubs. Next thing you know, Crown Royal is the number one item in Korean bottle clubs.

Moral of the stories… creativity and cleverness are byproducts of having fun with a brand and thinking outside the box.

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Crown Royal

Crown Royal has always been an iconic brand. But to me it’s been a bit of a mystery.

When I first met it as a consumer, it was the brand my grandfather served when company came over. Philadelphia Whiskey was his usual fare but his Crown Royal was special.

I’m not an historian on the brand but from what I can gather over the years, at the outset it had important equities but just needed a spark. The taste was great and unlike other whiskies at the time, unique packaging inside and outside, a back story about the royal visit to Canada and very aspirational look and feel. The spark occurred when oil workers from Canada working in the Gulf of Mexico (way before the current disaster) came to Gulf cities on their night off, with pockets full of money, and wanted the best whiskey they knew from home…Crown Royal.

As the story goes, this set off the growth and proliferation of the brand, primarily in the South.

It was marketed in the Seagram days in a classic brand-building manner. ‘Push’ and ‘pull’ efforts worked together successfully and the brand grew — even while vodka was growing by leaps and bounds.

The sales and regional marketing component, orchestrated by Jim Reichardt, was top of the game. All the activity was integrated and based on strategy, from the distributor focus to programming to ‘pull’ activity at retail. Above all, carefully thought through marketing innovations were introduced under Jimmy’s watch.

On the national marketing side, programs were developed to maximize the equity – especially the bag – and develop relationships with the core consumer. And, the advertising was that unique combination of creative excellence combined with brand recognition and sell. Not your average garden-variety ad campaign.

Everything on the brand was done for strategic reasons. The sole line extension (at the time) was Crown Royal Special Reserve whose intent was to protect the brand’s flank from above and make a price-value statement about the base brand. It was not to make a number. In fact, many worried about cannibalization of the base brand, which never occurred. At one point, both were growing at double digits.

Lately I’ve been looking at Crown Royal and how it’s doing. Last year was a tough one for the brand as it was for most high-end spirits. But I noticed the following in WSD the other day–

“…Furthermore, Trevor {analyst} believes the promotional support … behind Crown Royal ‘seems to be paying off,’ perhaps partly helped by its new, more expensive offering, Crown Royal Black.”

I also noticed that there are 5 Crown Royal products in the line.

I think my grandfather would have been confused.

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