September, 2010 | Booze Business: A Blog Dedicated to the Business of Spirits and Wine

Wine and Spirits Daily had a story last week entitled, IS TEQUILA THE NEW VODKA?

Good question.

The article quoted a writer at the Washington Post who said… “A new trend emerges: the proliferation of ‘ultra-premium’ tequilas targeted at a club crowd that slowly has begun to trade in Grey Goose for Patron.” The article goes on to point out that “various social indicators, such as Al Roker claiming on the Today Show that Tequila is the new Vodka.” (I must have missed the announcement about Al Roker as social forecaster. I thought he did the weather.)

A few observations:

Drinking Patron at clubs at the expense of Vodka brands like Grey Goose is not a new concept. They are often interchangeable depending on the mood and occasion. Both brands are at the top of the heap in terms of being icons.

Further, it’s not Tequila, it’s Patron. Generally speaking, among most consumers, the Tequila category has three brands…Patron, Cuervo and all others. Remember the old adage? Consumers drink brands not categories.

Tequila will grow as it continues to be the focus of new product introductions and in that regard, it will be the new Vodka. I don’t have the actual data but I’d bet there have been more new Tequilas introduced in the last few years than Vodka. The shifts in Vodka preferences from the high end to mid-priced and value brands make new Tequila entries more enticing.

So, among most consumers, Vodka will continue to rule. Whether Al Roker thinks so or not.

The Chairman of a global spirits company decided that he wanted to build a distillery in the land of his ancestors in Eastern Europe. After all, he reasoned, the communist regimes had recently fallen and since most countries in the region were impoverished, it would be economically beneficial for all. The country was known for its Vodka capabilities (not to mention consumption) and had the manufacturing infrastructure. With some upgrading and reasonable investment, world class Vodka could be produced and sold by his company.

Perhaps the rudiments of manufacturing infrastructure existed but everything else in the country was in a state of economic disrepair.

Nevertheless, the wheels were set in motion. The executive in charge of the European business unit was given the assignment of making it happen.

Things moved along well. A plant with capacity for expanded growth was found, production experts were engaged, top-notch grain was somehow located, distillation and formulae were worked out and the plant began to produce Vodka.

Proud of the achievement his idea set into motion, the Chairman decided that he would come to the country to officially open the factory and visit with the leaders of the newly democratized country. He also thought it would be a good idea to meet with the leaders at a lakefront villa or dacha.

This was a major problem for the executive in charge. Even the most lavish dachas were shabby and dilapidated and the Chairman and his entourage were used to the very best.

What to do? His colleagues in New York told him to spare no expense. The Chairman was known for his anger and disappointing him would be a career ender.

So, the head of Europe found a dacha, engaged workmen from the country and flew in top-notch carpenters and plumbers from England to assist. Floors and ceilings were repaired, electricity was enhanced, plastering and painting took place and the rundown dacha was transformed. Furnishings were rented and flown in.

About a week before the scheduled arrival, the team realized that getting food the Chairman enjoys was an additional problem. No worries … a container of provisions was purchased in London and also flown in.

All was set for the arrival of the Chairman after much last minute scurrying and concerted effort.

His private plane was met and, since it was late at night, the entourage was driven right to the dacha and went to bed.

The next morning the executive arrived at the dacha and was asked by the Chairman to join him at breakfast, which was an elaborate meal.

The executive (holding his breath) said, “So, Chairman, how did you enjoy your first night?”

To which the Chairman replied, “Oh you know me, I’m used to roughing it in these third world countries.”

Tequila Sunrise, Ascent, or Hype?

Roughing it — A Vodka Fable