Booze Business | A blog dedicated to the business of spirits and wine

Roughing it — A Vodka Fable

September 3, 2010 No Comments

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.”

Absolut Tales

August 29, 2010 No Comments

The Gulfstream took off from Stockholm’s Arlanda airport with a full load of executives, all of whom had the satisfaction of knowing that the global distribution rights to Absolut were signed, sealed and delivered.

If you’ve ever flown on a corporate jet, you know how great it is. You board quickly and easily, take off on time (or even ahead of time) and generally are met on the tarmac a few steps from the plane and off you go.

Despite this great convenience, I’ve heard people complain about the absence of frequent flier miles, which always makes me laugh at the silliness of the thought. For me, however, this particular flight had one disadvantage — it was full of Seagram brass. Every one of the 14 seats was taken and there was no place to hide. And, every one of the 14 had 5 or 6 ideas about marketing and how best to grow the brand further. After all, we were taking over the brand from the legendary Michel Roux who grew the brand with a series of innovative and effective marketing actions.

While getting the brand elated us, we were also mindful of the daunting task ahead. Especially the marketing guy…me.

This was best summed up by the owner who, after laying out his thoughts and vision, said, “Arturo, I have four words for you — don’t f**k it up.”

Michel Roux was indeed a hard act to follow. Carillon Importers was part of a large corporation, but he ran the brand entrepreneurially, with vision and resources to take this fledgling brand to renowned marketing levels.

There is a great story about Michel’s brand champion efforts that I recently asked him to confirm. I wasn’t sure if it was true or a booze business myth.

It seems he was in the Detroit airport waiting to depart when he noticed a man wearing an Absolut t-shirt. Alarm bells went off in his head for two reasons. First, there were no Absolut t-shirts and he and didn’t want them, so clearly it was counterfeit. Second and most important, the man in question (according to Michel) must have weighed over 350 pounds and despite the triple XL size, it was a very snug fit.

Clearly bothered by his brand portrayed in such a manner, Roux stopped the man, told him he was looking for that particular t-shirt and offered him $100 to buy it. The man accepted the generous offer. They went to a souvenir store, bought a replacement and now Michel owned it.

The man left happy with this transaction and the Absolut t-shirt was promptly tossed in the trash.

True story.

In my opinion, the Absolut brand has gone through 4 periods in its development. The first era was with M. Roux and Carillon Importers. Next came the Seagram years and further, albeit different, growth. The third period was one in which the brand began to languish despite the efforts of some (but not all) capable people. Today, the ownership of the brand is in the hands of Pernod Ricard with the difficult task of once again polishing its luster.

I plan to cover the Absolut story from these vantage points in the future.

Borrowed Credentials or… Mention my name and it will sell

August 21, 2010 3 Comments

Borrowed credentials is a term I like to use when a brand “borrows” something or someone to identify with, such as a brand name or a person as the endorser.

The intent is the “approval” or “license” to give a brand some prominence. But, more often than not, it doesn’t seem to work.

Three categories will help you to see where I’m going:

A brand that has licensed the name from another business or category. Godiva, for example.
A brand closely identified with a star or celebrity. Such as, Ciroc.
(My favorite) A brand named after a star or celebrity.

So here we go…

Licensed Brand Name

The two that come most readily to mind are Godiva and Starbuck’s, both in the liqueur category. I gotta tell you that I thought Godiva would be a crack-of-the-bat homerun. And, I wanted to license Starbuck’s so badly, I could taste it. Alas, neither has set the world on fire.

Association with a star or celebrity

This is a mixed bag best characterized by the nursery rhyme… “There once was a girl with a curl in the middle of her forehead. When she was good she was very, very good but when she was bad she was horrid.”

So in the “good” category we have (not necessarily in order of goodness):

Ciroc and P Diddy (forgive me if I have the wrong name; who can keep up?). Probably the gold standard in celebrity links.
Crystal Head Vodka and Dan Aykroyd — talk about chutzpah.
Cabo and Sammy Hagar — (notice I didn’t say Cabo Wabo) good for you Skyy, it’s about the product not the star.
Red Stag and Kid Rock — the brand is a homerun with or without him. But he sure does help.
Margaritaville and Jimmy Buffett — remind me to tell how this came about. But even without Seagram and me, it’s doing well. But, Land Shark beer is doing even better.

The “not so good” entries I’ve come up with so far (let me know about any I’ve missed) include some that faded faster than a cold beer on a hot day:

901 Tequila and Justin Timberlake — run that by me again? I got it but I don’t get it.
Sobieski Vodka and Bruce Willis — it’s the price point, dummy. It ain’t about you. Even if you’re still involved.
Godfather Vodka — You got to be joking.
Conjure Cognac — by Ludacris. I totally agree but ludicrous is spelled wrong.
Armadale Vodka — by Jay Z. Why don’t you ask P Diddy how it’s done?
3 Vodka — by Jermaine Dupri. Enough said.
Mansinthe — by Marilyn Manson. I didn’t make this up, folks.

Named after a star or celebrity

My favorites by far. Do I hear a drum roll?

So far I covered the good and the bad. Here comes the ugly:

Trump Vodka. He doesn’t even drink for heaven’s sake. Could be a pilot for Celebrity Booze.
Willie Nelson’s Old Whiskey River Bourbon. Enough said.
Danny Devito’s Limoncello. Close but no cigars.
Jefferson and Sam Houston Bourbon. Not kidding; Google it.
Frida Kahlo Tequila. I love her and her work but… who dun it?

And the winner is…