Evolving Drinks Brands

Evolving Drinks Brands

Evolving Drinks Brands banner

I recently read and shared an article in Forbes by Patrick Hanlon called, “Why Brands Must Evolve” that is so spot on that it has led to a number of interesting conversations in the past week with some of my clients and partners who own brands in beer, wine and spirits. As one who spends a lot of time thinking about new brands, as well as igniting established brands in new ways, Patrick’s thoughts really resonated with me. I don’t think there is a better industry than beverage to illustrate his points about what is going on with brands. Brand proliferation is happening across the board making “breaking through the clutter” ever more difficult. At the same time, the reason this is happening if fundamentally that there is demand for new brands. As I wrote in “RE: Is Craft Beer In A Bubble”, there is a big and growing market for new brands in beer, but also in wine and spirits. Not everyone will succeed and in fact many new brands will fail. To the big brand manager, the fundamental challenge has also never been so big – how do you keep a loyal following when your following gets gigantic. I think about an Iconic brand like Patron Tequila. I was a distributor for Patron as it passed between different sales companies and was a very difficult sell. Five years from the time it launched, Patron was doing about 55,000 cases. Now that is a nice little brand, but nothing would have screamed, “This brand is on fire!” Then, it did catch on fire and became the very symbol of luxury. Check out Patron case sales for the first 10 years:

Patron sales first 10 years

Patron is an amazing brand and continues to outsell all of the other super premium tequilas (and frankly all other spirits brands at $40/750ml bottle and higher). They have a huge and loyal following. However, as brand manager for Patron today, the things one has to do to market the brand are quite different than in the early years. How does one keep the “cool” factor going when you are the largest brand in your category. There are dozens of new entrants who are going after their market and have the advantage of being smaller (think Avion, Casamigos, Don Julio) and bringing a new “cool” factor to the market. Clearly there are many that succeed at this but being true to your brand and your audience while changing things up can be quite difficult. Absolut Vodka was THE luxury brand of the late 1980s and early 1990s. It was the “it” brand among the “it” crowd.

Andy Warhol Absolut IMG_6541

Pernod Ricard paid over $8 billion to acquire the brand a few years back. How does Pernod now manage a giant brand that was formerly the top luxury vodka in a market with such massive proliferation of brands that the high-end vodka category has experienced. I’m told there are 800 vodkas in the Beverage Media New York book. Pernod recently announced a new bottle. Absolut is one of those brands that defined itself by its bottle.   Changing the bottle is a big move even in subtle ways. Adding the big A is a pretty big move. Large companies don’t usually make big moves, but staying relevant in a crowded market sometimes requires big moves.    Pepsico made an even bigger move a few years back with their Gatorade brand. I thought at the time, it was fairly risky, but it appears to have paid off (does anyone know details?).

gatorade new gatorade old label

Patrick’s article certainly cites a number of great examples of big brands that have managed to evolve over time and keep or even build on their past successes. “…the challenge for brands has evolved from creating awareness to creating meaning.” How do you keep creating meaning at scale like Nike, Apple and Disney have successfully done.  They each connect to their consumers and continually create meaning.

The wine market has evolved so dramatically, that I have to look up many of the brands on the grocery shelf today and I have been involved in selling $100s of millions of wine over the years. Why? New brand proliferation to attract the millennial consumers.

barefoot wine logo Meiomi wine

Take a look at the top 10 domestic “Hot Brands” put out by Marvin Shanken’s Impact Databank:

  1. Barefoot
  2. Black Box
  3. Bota Box
  4. Liberty Creek
  5. Boggle
  6. Apothic
  7. 14 hands
  8. Barefoot Refresh
  9. Gnarly Head
  10. Meiomi

Four of these are Gallo Brands, but none say Gallo. All have interesting, contemporary labels. To succeed in this hyper-competitive market, every brand must have a number of things. Great branding is vital, without it your brand is lost and has no chance. Great liquid that fits the taste of your target market is key, without it they won’t buy a second time. Distribution is essential, a brand cannot become relevant if consumers can’t find it. But how does a brand build a real following of consumers who care? That is, how do we create meaning? That is the question every new brand team needs to answer.

 

To quote Patrick again: “We want the added value of believing in something. The added value of belonging to something: being a part of something that hard-wires us to a larger community of “people like me””

 

Seth Godin in his fantastic book “Tribes” articulates this concept well.

“Seth Godin argues the Internet has ended mass marketing and revived a human social unit from the distant past: tribes. Founded on shared ideas and values, tribes give ordinary people the power to lead and make big change. He urges us to do so.” Brands have to figure out how to reach their tribes and how to engage with them. Notice, I did not say create their tribes. This is an important distinction. I believe tribes are discovered not created. Brands who overtly try to create one typically struggle. If a following is not organic, today’s savvy consumers sense it.   I think brands can make themselves relevant and worthy of a following and then as that following begins to show signs of life can play a role in fostering and accelerating it.

 

I’d love to hear your stories of brands you think are doing this right.

 

Cheers,

 

Smoke

 

SUGAR SKULL RUM INVITES YOU TO LIVE… LOVE… AND CELEBRATE!

SUGAR SKULL RUM INVITES YOU TO LIVE… LOVE… AND CELEBRATE!

Hi I wanted to share that Sugar Skull Rum is now available in select markets through my company Taliera. Here is the Sugar Skull announcement..

 

SSR bottle lineup

FOR IMMEDIATE RELEASE

SUGAR SKULL RUM INVITES YOU TO LIVE… LOVE… AND CELEBRATE!
Brand new Rum sets sights on super-premium segment

Scottsdale, Arizona (October 6, 2014) … Cocktail lovers, it’s time to raise a glass! Sugar Skull Rum, a meticulously-crafted super-premium Rum made from fine Caribbean sugar cane molasses, is coming to a celebration near you.

“The premium and super-premium spirits categories have been growing consistently for most of the past two decades, outpacing the spirits market in general,” said J. Smoke Wallin, CEO, Taliera, LLC, exclusive global sales, marketing and distribution agent for Sugar Skull Rum. “Despite its size, the Rum category has yet to produce a break-out brand in the $25-30 price category. Sugar Skull Rum will be that brand.”

Sugar Skull Rum (SRP $27.99, 750ml) is an artisan Rum, made from the very best sugar cane molasses carefully sourced from growers’ farms throughout the Caribbean and South America. Our Rum is produced at partner distilleries in the Caribbean Islands, who use four-column stills to produce a clean and crisp base Rum, before it is brought into the U.S., where it is filtered, blended and flavored with natural ingredients to produce Sugar Skull’s unique taste.

Simply delicious and endlessly versatile, Sugar Skull Rum cuts across traditional product categories and will appeal to anyone who loves a great cocktail and a fun time. “It is a true crossover spirit that can be enjoyed straight, on the rocks or mixed in a number of innovative and traditional cocktails,” says Wallin.

At launch, the Sugar Skull Rum portfolio includes Tribal Original, Mystic Vanilla, Native Coconut, Madagascar Wild Berry and Hellfire Cinnamon flavors.

The brand’s distinctive name and packaging honor the Dia de los Muertos. Often mis-understood as a slightly morbid relative of Halloween, the ‘Day of the Dead’ is a convergence of European Catholic and ancient Aztec traditions that celebrate those who have left this world but mean so much to the people they touched.

“Sugar Skull Rum was founded on the principle that life should be celebrated and is at its best when we celebrate those who are important to us,” said Wallin. “We like being a part of what – and who – people love, so if there is a great time to be had, Sugar Skull Rum will be there. Join us!”

Sugar Skull Rum is initially available in Arizona, California, Nevada and Florida, with a selective rollout planned in additional major markets in early 2015.

About Taliera, LLC.
Taliera was founded in 2006 by beverage industry leader J. Smoke Wallin to incubate, acquire, and grow new and existing brands by combining core brand building expertise, relationships and capabilities with leading edge technologies and innovative business approaches. Taliera is the exclusive global sales, marketing and distribution agent for Sugar Skull Rum.

Sugar Skull Rum created by a group of serial entrepreneurs and innovative thinkers who dared to ask the question: “If not us, then who?” and “If not now, when?”

J. Smoke Wallin heads this team of leaders in the ice cream, beverage, sports, entertainment and hospitality industries, who have combined their expertise to create one of the finest super premium spirits to hit the back bar.

Sugar Skull is a celebration of life. It is the life we live, the lives we touch and those that have touched us. We celebrate them all. Live. Love. Celebrate. How do you celebrate? Sugar Skull Rum.

Media samples and hi-res images are available upon request.
Contact Laura Peet, PeetCom, Inc., lbptalk@aol.com, (917) 860-6285.

Vanderbilt Business: How I Did It

Vanderbilt Business: How I Did It

Note: This is the first in a series that Vanderbilt Business (the Owen Graduate School of Management at Vanderbilt University) is doing on Alumni to share their stories.   Interestingly, I have subsequently left Lipman Brands and sold the majority of my interests in Napa Smith Brewery.  So it is already a little out of date in terms of what I do (the first question), however,  the rest of the Q&A is not.   That’s why the title is a little bit off.. I’m not done doing what I’m going to do (stay tuned).  I hope to encourage and inspire those who aspire to achieve their success in any way I can.  Hopefully this interview gives a bit of insight to some and is encouraging if you need it.  Kind Regards, Smoke

VBusiness-Masthead

 

LINK:

Have you ever wanted to ask someone questions about their career path? How I Did It asks those questions for you. Serial entrepreneur and beverage magnate J. Smoke Wallin, MBA’93, starts off this recurring series.

jsw at NSB pub

COPY OF INTERVIEW:
Q. What do you do?

I turn ideas into actionable things. Whether working on community issues, industry issues or business ideas, time and time again, I tackle a challenge by manifesting something that was not before.

J. Smoke Wallin
Wallin
In recent years, I have been looking for ways to acquire or create new brand businesses in the beer, wine and spirits space. This pursuit has taken many a twist and turn, and the process has not always been pretty. Today I run several businesses.

I am president and CEO of the Napa Smith Brewery and Winery in Napa, Calif. I acquired the brewery in late 2010 with some partners. We sell in 10 states and Sweden, the U.K. and Hong Kong.

I serve as managing director of Lipman Brands, a brand marketing and sales company. My task has been to build out the infrastructure (systems, process and people) for Lipman Brands to be a national selling organization.

I am chairman, CEO and founder of eSkye Solutions, a technology dot-com I started with a number of Owen alumni back in 1999. Though we have changed our business model a number of times, acquired numerous companies and sold our winery software division in 2007, we continue to build our national account pricing business with large retailers and brands.

And through my holding company, I am still engaged in various consulting projects for new brands, existing businesses and startups. This is a minor part of my job, but it keeps me in touch with new ideas, people and opportunities.

Q. What’s your educational background?

I started as an engineer at Cornell, then was in the hotel management school and then settled on agricultural economics (Cornell’s undergraduate business program). It turns out my time in hospitality management and the agricultural economics department—with a huge emphasis on the grocery and consumer packaged goods industries—gave me a great initial preparation for the beverage industry. At Owen I had a triple concentration in finance, marketing and operations. My view was I wanted to be a general manager/entrepreneur so I needed to learn about all those areas.

Q. What was your first job?

My first job out of Cornell was with Seagram in their management training program. After a summer at Seagram, I had the opportunity to join them full time or join their distributor, National Wine and Spirits. I joined NWS when it was doing $150 million annually. When I left 14 years later, we were a $1 billion operation.

Q. Tell us about your consulting and brand work.

With eSkye, we were doing business with beer, wine and spirits companies all over the world. At one point we had over 250 wineries making or selling their wine using our software. I ended up advising many clients on not just their technology but also on their distribution and business strategy.

I got a bit frustrated with trying to get an old, sleepy and successful industry to be creative in their business strategy. This inevitably led me to want to own my own brands so I could demonstrate my ideas in real life. Starting a new business takes a level of commitment that has to overcome huge obstacles. To make such a commitment, one has to be fairly passionate about whatever it is one does. I have been passionate about the brands business for some time now.

Q. What would you say was your big break or opportunity?

Growing up with a mom who was (and is) very independent-minded, hard-working and stubborn. Becoming a wrestler in high school and later at Cornell. No sport teaches better discipline and self-reliance. Select coaches, teachers and mentors along the way who saw potential in a kid with big ideas and no wallet.

Q. What was—or has been—your biggest challenge?

Overcoming financial distress when either markets or circumstances have gone against me at select moments. …The good news is, if you can get through those times and never forget them, it makes for a wiser, more humble perspective. This is something I think I was meant to learn.

Q. What was—or has been—your greatest thrill (or accomplishment if you’d prefer to answer that)?

Biggest thrills: Closing on a $110 million bond deal for NWS as CFO, closing on a $60 million equity deal for eSkye as CEO and acquiring the Napa Smith Brewery. Also a handful of sales closes over the years that were big enough to materially impact that particular business.

Biggest accomplishments: I would say seeing some of the people I hired, believed in and worked with go on to be very successful in their own right. That includes some Owen grads and many others along the way.

Q. If you could give one piece of advice, what would it be?

I’ll give two:

Don’t let fear prevent you from pursing your dreams. Nothing great was ever accomplished by someone who simply thought great things. It only happens in doing.
Enjoy the journey. I spent a lot of energy focusing on outcomes: raising money, IPOs, deals and sale closes. Those are important, but enjoying the process of getting there, each and every day, needs to be constantly remembered. This is where we spend most of our time and if that is so, how do you want to remember most of your time?

Easier said than done, but you asked for advice.

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