In case you haven’t joined the Streaming Generation, or lived without cable TV for awhile, Mad Men is a series set in the 1960’s about a fictional ad agency called Sterling Cooper based in New York City’s famed Madison Avenue.
[Editor’s note: I still can’t believe I was born during the Eisenhower administration!]
Tequila marketing being my thing, naturally, I’m drawn to the product placement of distilled spirits on the historically accurate show.
Along with adverts concocted by admen for cigarettes, bras, and washing
machine manufacturers, spirits companies like Seagram’s, Jack Daniels, and Jose Cuervo were also a part of the advertising renaissance, and not just on American soil. These early Behemoths of Booze also took the fight offshore.
And nobody can tell you more about those challenges better than José Zevada.
I finally met the charismatic Pepe Zevada, the maker of Pepe Z Tequila, accompanied by Glynn Bloomquist, (CEO and Chairman), and Guy England (South Texas Market Manager), of Empresario LLC, the first Texas company to create, brand, distill, import, and market spirits.
With the elegance and charm suggestive of silver screen Latino Hollywood hunks like Ricardo Montalbán or Fernando Lamas, and peppered with jokes and anecdotes of the “glory days,” you get the sense that you’re reliving spirits industry history, Mad Men style.
Over a delicious lunch at the Iron Cactus Mexican Grill & Margarita Bar on San Antonio’s renowned Riverwalk, Pepe regaled us with episodes of his life as the vice president of Brown-Forman in Latin America, Mexico and the Caribbean. During that time, he traveled to 106 countries (Pepe speaks 5 or 6 languages fluently) introducing Jack Daniels to those parts of the world.
After 30 years with Brown-Forman, he went on to work as vice president for the classic spirits distiller Hiram Walker (Sauza, Kahlúa, Courvasier, Beefeater), until the merger of Allied Domecq.
To Make a Long Story Short
After persistent encouragement from friends in Mexico, Pepe Z Tequila was born shortly after José retired from 35 years in the liquor industry.
But, in the tradition of the three generations of Sauzas, Don Julio González, José Cuervo and Don Eduardo Orendáin, Pepe was determined to only put his name on a quality tequila.
To create a batch of Pepe Z takes over three weeks. He calls the blanco tequila the “mother” of the line, and claims that the selected agave is the key to a sterling product.
Pepe Z Tequila uses only lightly toasted virgin American Oak barrels (not charred) for its reposado and añejo expressions, and it is one of the lowest in methanol after distillation.
These time tested techniques have not only achieved an authentic, “old world” flavor profile, but it has also garnered Pepe Z some serious hardware in the form of medals and awards.
In the era dominated by contracted brands with glamorous images and no backstory, Zevada prefers to take a page from those legendary patriarchs of tequila and make every effort to meet and greet each of his customers, personally.
Part of the brand’s strategy is to nurture its relationship with its hometown of Austin, and then to solidify its embrace on the rest of Texas before conquering other states. This tactic has worked wonders as evidenced by the glowing testimonials given by his customers.
While his clients enthusiastically preserve their friendship with Pepe, Zevada gratefully acknowledges that, “My customers are part of the Z family.”
And, in a time where spirits are judged on perceived value, Pepe demands that his tequilas remain affordable, believing that luxury shouldn’t be so hard to come by.
Distinguished flavor, devoted friendship and defined family values is the method to Pepe Zevada’s effective–and infectious–“madness.”
Originally Published May 20, 2009 by M.A. “Mike” Morales on Cocktailmatch
Sauza–Expect Fake, er, Fresh
So I’m leafing through my June 2008 issue of New Mexico Beverage Analyst (based in Denver!), and I see this ad campaign for Sauza’s revamped mixto:
“Step into the refreshing and appetizing world of Sauza Gold and Blanco–a world where the Blue Agave is adored and nurtured. We gently extract the flavorful juices from the agave, and then double distill them for that smooth flavor and ultimate fresh experience you expect from Sauza Gold and Blanco. Whether it’s shots or cocktails, Sauza has your customers covered. Step into the unexpected, step into the world of Sauza Gold and Blanco, where you can always Expect Fresh.
Made with gently extracted Blue Agave for Freshness.”
I had previously posted elsewhere about Sauza’s 2008 springtime ad campaign that included their new look bottles, and is geared toward women and food pairing. Analysts at Sauza believe that women make up almost 50% of the tequila drinking market.
Notice the words “adored,” “nurtured,” “appetizing,” and “fresh.” The phrases “gently extracted,” and “ultimate fresh experience” also caught my eyes. Not to mention the deliberate capitalization of “Blue Agave.”
It never ceases to amaze how marketers who have no idea how tequila is produced, hack out mindless copy and charge thousands of dollars for it. It’s also interesting that after all these years, marketing and branding companies with no imagination still try to work the “romance” angle of tequila.
If this is Sauza’s attempt to lure women to their mixto brand, they had better try harder. How dumb do they think they are? How about an ad campaign based on reality?
Tequila production is harsh–very harsh–on blue agave, and has all the charm of your last mammogram!
First, its leaves are hacked off with a primitive blade, then they’re tossed onto a truck with hundreds of other piñas. Once at the distillery, they’re axed in half, then quartered.
Next, they’re baked or pressure steamed, pulverized under a huge grinding stone, or fed into a shredder.
Every last once of blue agave juice is squeezed out, shoveled or siphoned into enormous tanks and fermented to a stinky, boyfriend’s-tennis shoe-smelling froth with mounds of sugar!
Can’t you just see the extra calories on your thighs, now?
What happens to the discarded chunks and fibers of the blue agave? Like an old girlfriend, they’re unceremoniously tossed back onto the ground as fertilizer, compost, if they’re lucky.
That upchucky feeling in your throat? Not very “appetizing” is it?
And that splitting headache the next day while you “stepped into the unexpected world of Sauza Gold and Blanco?” No—that’s not what “fresh” feels like!
Trade up from mixtos! Sip only 100% agave tequila.
A stand-up tequila will never leave you hungover!”
Just thought I’d set the record straight for the other 50% of the tequila drinking sector.
Originally published on TequilaAficionado.com Dec 3, 2006
In a relationship that the Animal Planet calls symbiotic–like the small fish feeding on scraps from a shark’s jaws, or birds picking the bugs off a hippo’s butt–Cuervo has benefited nicely over the years by partnering with major restaurant chains all over the US. They have single-handedly influenced thousands of tequila drinkers.
The Lonely Bull
In an informative article in the Los Angeles Daily News last December, Staff Writer Brent Hopkins recounted the humble beginnings of one of the oldest Mexican food restaurant chains in Southern California.
El Torito--which also celebrated its golden anniversary in December 2004–was the brain-child of ex-fighter pilot Larry Cano, whom Brent describes as having “…a few recipes and knowledge of an exotic sounding foreign drink known as tequila….”
In the late ’70’s and early ’80’s, it was the ultimate place to eat, drink, and party. I’ll admit, I was among those who enjoyed traditional Mexican food with more than one margarita and a round of shots.
According to the article, El Torito grew into an international powerhouse with restaurants as far away as Turkey and Abu Dhabi. After many changes in ownership, it has been streamlined to a manageable 69 locations.
El Torito has now begun to focus on its cuisine, but one look at the menu–which we’ll do shortly–tells you that that’s not the only thing management is emphasizing.
In a relationship that the Animal Planet calls symbiotic–like the small fish feeding on scraps from a shark’s jaws, or birds picking the bugs off a hippo’s butt–Cuervo has benefited nicely over the years by partnering with major restaurant chains all over the US. They have single-handedly influenced thousands of tequila drinkers.
Where other tequila houses like El Tesoro de Don Felipe and Cazadores visit bars and restaurants around the country, Cuervo’s version of a grass roots campaign is a little bit different.
In Part I, I promised a glimpse at Cuervo’s La Rojeña distillery, but first, more about me….
I had just moved to New Mexico from Southern California. My first job was in Customer Service with one of the largest paper, food, and chemical distributors in the state. Starting at the bottom, I figured the quickest way to becoming a darling of the company–a route salesman–was getting to know the old dogs.
Before my arrival to this company, one other product that it sold was liquor. When the family-owned operation sold out, half the sales force morphed into one of the two major liquor distributors in New Mexico. Those that stayed with the food and chemical division longed for the good ol’ days.
At one of the quarterly meetings’ mandatory dinners, 25 raucous salesmen (and a few of us from Customer Service) ran up a $3000 bar bill on the company’s credit card! During a round of Cuervo Gold shots is where I heard it first.
“This reminds me of the time at Jose Cuervo,” said one salesman.
“What a party that was!” agreed another.
Simultaneously, they described the beauty of the facilities, the grounds, and the tequila at Jose Cuervo’s La Rojeña distillery.
The hospitality at these Cuervo “education” junkets is legendary. Mariachis, food, and all the tequila you can drink. Not to mention a generous spiff to each salesman for every caseload sold, or every new account acquired.
“We used to send two delivery trucks a week to every territory,” lamented another salesman. “One with food, and the other full of booze!”
Ah, the good ol’ days!
Many tequila distilleries graciously open their doors to tequila aficionados. Corralejo, La Cofradia (Casa Noble), and Herradura’s Tequila Express, a train that takes turistas to their distillery, to name just a few. But no one does it better–or did it first–than Jose Cuervo.
From Applebee’s (The Perfect Margarita made with 1800), to here in Albuquerque, New Mexico with the Garduños chain of Mexican restaurants (with locations in Arizona and Las Vegas, too), to the popular El Torito. Wherever you live, in every major or minor market in America, there is sure to be a restaurant chain–or liquor supplier to that restaurant chain–that has fallen under the spell of La Rojeña.
To understand how deeply Jose Cuervo is entrenched in El Torito’s menu, you have to be aware of the “rules of engagement.” It’s called “the three tier system,” and it’s the key to the final segment of this series, so heads-up!
In order for a tequila producer–or any spirits producer, for that matter–to get his product to the US, he has to use an importer (Tier One). This importer is in charge of spreading the word to as many spirits distributors–state and national–as possible (Tier Two). Once distribution is secured, their sales forces are responsible for getting the product to their consumers–every bar and restaurant they service (Tier Three).
Like a computer virus, Cuervo can be found everywhere along these three tiers. At one time or another, every importer, distributor, and chain of bars or restaurants has been invited to enjoy the pleasures of tequila at La Rojeña.
Unfortunately, unlike wines, spirits, by US law, cannot be sold directly to the end user (you and me) by the producer. Let’s drown our sorrows over that one, shall we…?
On every table is a simple, hand-sized brown three ring binder. A painting of a jimador harvesting a blue agave–that looks coincidentally like a well-known photo taken at one of the Cuervo agave fields–shares the cover with the El Torito logo, a lonely bull, and the word auténtico. Desserts and drinks in one little package, all made with Jose Cuervo products.
There’s the classic Cadillac Margarita with a side of Grand Marnier. You can order this signature drink in different colors like Green (Midori Melon), Pink (cranberry juice), and Red (Rémy Red).
The Blue Mesa Margarita with 1800 and Blue Curacao. The Real Mex Margarita with Tradicional. And a series of popular tequinis with names like Buenas Noches and Agave Tequini.
To be fair, El Torito serves other very respectable blanco, reposado and añejo tequilas like…
Sauza Tres Generaciones…Don Eduardo…Chinaco…Corralejo…Herradura…Cazadores…and Quita Penas. Along with the Cuervo standard bearers, Gran Centenario, Reserva de La Familia, and even Don Julio (suspiciously missing from Cuervo’s Taberna del Tequila menu in the previous segment).
You can even wash down your dinner, drinks and dessert with a cup of Mexican coffee made with Tradicional and Kahlúa.
Each of the signature drinks is very reasonably priced from just over $5 to a bit under $7. Shots range from $5.25 to $10.50.
Although their menu tries to give equal time to other tequilas, when you check the bar, there’s no mistaking who’s on display…
In the final segment, I’ll take a look at where the marketing future of Jose Cuervo is headed. Here’s a hint…
You’ll be surprised to learn that it has nothing to do with tequila! Instead, it’s slick, high-tech, and chances are good that you already own one. And with it, Cuervo conquers the mystery of the missing “fourth tier.”
It was the beginning of my vacation, a sweltering Friday afternoon, and the start of the monsoon season in Albuquerque. I had to fly to Southern California, with a three-hour layover in Phoenix. I hate to fly in rainy weather. The forecast for Sky Harbor was even more harrowing. Thunderstorms–and guaranteed turbulence.
Arriving on time at Albuquerque’s International Sunport, and surviving the annoying airport security routine–removing my tennis shoes, emptying my pockets, and then putting myself back together (I swear, one day airports will just have dressing rooms!)–I had an hour to spare before my flight. I had earned a shot of tequila.
After all, I was going back to visit my folks for their 47th wedding anniversary, and we all know what it’s like to visit family!
Sidling up to Winners Sports Bar on the A Concourse, I discovered the tequila choices were pitifully poor–Sauza Hornitos, or Jose Cuervo Especial–and so was the choice of seats. Forced to sit next to a young couple that had obviously just met, I swallowed hard and ordered a shot of Sauza Hornitos. Not the most preferred, but it’s still 100% de agave.
Ordinarily, I order my shots in a snifter. I had to settle for a rocks glass, and icy stares from the couple next to me who were drinking micro-brewed beers. Seems every time the uninitiated catch me ordering tequila, they watch to make sure that I won’t go postal. It’s almost as if their fuzzy memories of toga parties with Jose Cuervo Especial seep back into their consciousness and are projected onto me.
Or maybe, those are just my memories of Jose Cuervo.
After spending a half hour on my cell phone explaining to my mother when my flight would arrive at LAX, I ordered another Hornitos to calm my nerves, and the bill.
“Eight dollars?” I shuddered. “For Hornitos?” I shook my head. Everywhere else in Albuquerque, better quality tequilas are priced much lower.
What’s the price of Hornitos go to do with this? Follow me to Sky Harbor….
Release Your Inner Lizard!
After a one hour white knuckled flight from Albuquerque to Phoenix due to the predicted monsoon turbulence, and the absence of both complimentary sodas and snacks, I was ready for three hours of serenity with some food on the side.
I lugged my carry-ons and zeroed in on the closest fast food joints. Chinese food, pizza, sandwiches, fried chicken–none appealed to me. From the empty looks of these places, they didn’t appeal to anyone. Then, I heard the music.
Loud, pulsating music blasted from what I thought was the only nightclub in an airport in existence, the Taberna del Tequila. “Catchy name,” I smiled. It wasn’t until I was deep inside the Taberna that I realized where I was.
Jose Cuervo, that behemoth of tequila companies, has taken their marketing to the next level.
First, they purchased an island and called it Cuervo Nation with Anna Nicole Smith as its Ambassador. In the last couple of years, in partnership with HMSHost Foodand Beverage company, they have systematically opened their own chain of restaurant-tequila bars in several airports across the country. McCarran International Airport in Las Vegas, Seattle-Tacoma, Detroit Metropolitan Wayne CountyAirport, among others, and Sky Harbor in Phoenix.
A meat market with a nightclub mentality, the only thing missing was a dance floor. Every table was occupied, and any available space at the bar was at a premium. The bar looked like a stage in a black velvet Elvis portrait from Tijuana, but there was no mistaking the star of the show–Jose Cuervo.
The back of the bar was black, with neon painted limes, saltshakers and shot glasses. The bar itself, surrounded by smokers, was lacquered with overlapping tequila labels from one end to the other. On either side, giant display bottles of Reserva de La Familia and Gran Centenarioblanco were elegantly displayed on shelves with empties of 1800 Añejo, Tradicional, and Agavero. Behind the bar, a four-paneled big screen television was showing a Diamondbacks’ home game.
On the walls, made to look like crumbling adobe church walls (like drinking at the Alamo!), were murals of their logos, from 1800 to Especial. On the far wall, spotlighted and larger than life, was the Gran Centenario angel. I quickly grabbed a waitress and ordered a reposado, no lime, no salt, in a snifter.
This time, I got the snifter!
What better place to introduce your products but in your own place? What better audience to introduce your products to, but to a sequestered one? Maybe there was something to this mega-marketing to travelers with long layovers?
“Show off!” said a buxom blond in her thirties. She sat at a nearby table with a younger man. Both had just met.
Behind them above the bar and the big screen TV, in large neon letters, was painted the slogan, “Release Your Inner Lizard.” Securing a corner of their table, I dropped my carry-ons and proceeded to make friends.
There’s something surreal about having a conversation with people who are ahead of you in the buzz department, particularly those who are traveling. I felt I was in the intergalactic cantina from Star Wars with aliens who had had too much to drink.
“So what do you do?” she slurred.
“I’m Han Solo,” I replied. “Captain of the Millennium Falcon. And you?”
(The kid next to her got it!)
Just then, the waitress brought me the bill. Ten dollars for a Gran Centenario reposado. Considering I had paid eight dollars in Albuquerque for a lesser quality tequila, the Taberna’s prices were more in line.
Life was good!
All Work & No Play is Totally Missing The Point!
So exclaimed the Taberna del Tequila’s menu.
Graced with a colorful collage of photos of mariachis and jimadores on the cover–presumably all taken at Cuervo’s La Rojeña distillery which we’ll discuss later on–the first half of the menu is conveniently designed without prices for any of their signature drinks, such as…
The Millionaire Margarita made with Gran Centenario reposado…The Striped Guavarita…and the classic Golden Popper made with Cuervo Gold, touted as the official initiation to the Cuervo Nation. (Anna Nicole, grab my toga!)
On the back cover were the credits to this Jose Cuervo Traveling Road Show. Tequileria Favorites describes each of this producer’s featured players, from Gran Centenario Añejo to Agavero.
Realizing I was hungry, and that Cuervo doesn’t cook, the remainder of the menu is taken over by The Blue Burrito Grill. They lease the kitchen and supply tasty Mexican food at reasonable prices.
Taking stock of my evening so far, I made new friends, enjoyed fine tequila, and was exposed to a hip, new version of a trendy tequila bar. I even had a great time!
The crowd at the Taberna del Tequila steadily disappeared to make their connecting flights. While I waited for my order of chicken soft tacos and a second snifter of Gran Centenario, here’s how some other customers anchored their relationships with Jose Cuervo–forever.
Within six minutes, five glasses crashed to the floor in different areas of the Taberna, a biker called the female night manager a bitch, and a red wine drinker tossed her cookies with no prior warning. Otherwise, it was a quiet Friday night in Phoenix.
Although a new concept in marketing, the Taberna del Tequila isn’t the only way Jose Cuervo is forging relationships with an emerging drinking public. In the following segment, I’ll explain how they’ve secured brand loyalty among established tequila aficionados using one of the oldest Mexican food restaurant chains in Southern California–El Torito.
With my itinerary (AKA Dress Code) in hand, and my presentations reviewed for the hundredth time, I arrived in Guadalajara on a very wet and rainy afternoon. Cloud cover obstructed my view on the landing pattern into the airport. Fluent in Spanish, I breezed through customs & immigration, baggage pick up, and found my way out to “Arrivals”.
Greeters en masse. There stood what seemed to be a sea of faces with anticipation, joy, and relief, painted across them as they awaited their parties to emerge from the Baggage Claim.
Men stood there, with every imaginable flower, from Calla Lily’s to Long Stemmed Ecuadoran roses, some single, some in ornate bouquets and arrangements. Women stood with freshly made up faces, and tresses of carefully coiffed hair, and their Sunday best…smiles abundant.
Greeting me was Gabriella, the company’s Marketing Director. A long, tall, elegant drink of water, with flowing dark hair to her waist and a lithe frame, I immediately felt “well-travelled-if-not-overdone” and though usually consider myself a stylish woman, I felt frumpy and wilted next to her. Dressed impeccably, she stood there with a sign “Jessica Arent” and a smile to greet me and welcome me to Guadalajara.
The ride to the office seemed to take no time at all, as we hit it off immediately. Telling me a bit about herself, Gabriella, shared with me her family background in the Fashion Industry, her rise in the company under the guidance of her father, her breakout into the Chinese Market, and Introduction into legendary product market launches in both Mexico and China through the family business. She shared that she was the oldest of ten, and the one upon whom the responsibility was laid when it came to family. She also shared with me how she came to be involved in the team developing this new tequila brand and product we were to spend the next week collaborating on.
As she chattered on, Guadalajara rose up around me, with beautiful architecture, and smart cars everywhere! Guadalajara is the capital and largest city of the Mexican state of Jalisco, one of only a handful of states from which Tequila can be made and called “tequila” (but you knew that, right?), and the seat of the municipality of Guadalajara. The city is located in the central region of Jalisco in the western-pacific area of Mexico. Guadalajara is the cultural center of Mexico, known for culture, and arts, Fashion and trends, it is often called “the Paris of Mexico” and is considered the home of mariachi music, of which there are reminders throughout the city.
Lush and green, I noticed lawn and foliage everywhere. Bougainvillea adorned doorway arches and balconies and palm trees lined the streets. Color and vibrancy was abundant, like an energy the city seemed to possess. We passed aromatic taco stands, with patrons lined up on makeshift counter stools pulled up to food carts. As we traveled through the city, the sky clouded and the heavens opened and the smell of the plants opening to take in the fresh rain permeated the air.
Unlike Mexico City, Guadalajara is on an eco-friendly green movement. Instead of gas guzzling trucks and SUV’s like so many other Mexican destinations, I saw bicycles, Vespa’s, smart cars, people walking, skateboards and rollerblades, and everywhere signs to adopt parcels of parks and land to keep them green.
Not knowing much about Guadalajara, beyond the reputation for rich soils and minerals for agriculture, I learned that Guadalajara has a humid subtropical climate that is quite close to a rainforest climate, featuring dry, warm winters and hot, wet summers. Guadalajara’s climate is influenced by its high altitude and the general seasonality of precipitation patterns in western North America. Although the temperature is warm year-round, and known for the “eternal spring”, Guadalajara has very strong seasonal variation in precipitation. The northward movement of the Inter-Tropical Convergence Zone brings a great deal of rain in the summer months, whereas for the rest of the year, the climate is rather arid. The extra moisture in the wet months moderates the temperatures, resulting in cooler days and nights during this period. My timing? Wet season. It was perfect. With my hair already responding to the 98 degree heat and the rich humidity and taking on a life and mind of its own, kinking madly, I was grateful for the rain cascading down around us.
Driving through this huge city, I came to understand that Guadalajara is built around 5 primary fountains. Had you ever wondered about the traditional Mexican Villages, towns and Pueblo’s that seem to be built around a central plaza and a fountain? Those fountains were not for architecture, but had a purpose; just as these 5 fountains of Guadalajara. Fountains were once wells. It was here you came to fill buckets for home water, baths, and cooking. Accordingly, the five central fountains served each community’s water needs. Today the Fountains rise up from beautifully landscaped medians that showcase majestic bronze sculptures telling compelling stories of the city’s rich history.
Unlike many colonial cities that maintain their original town plan, in the 1950s Guadalajara underwent a major project that changed the face of the city. Older buildings were razed to allow for wide avenues with new constructions, underground parking lots, and shopping centers. Fortunately, the most beautiful older buildings were left intact.
I was astounded by this incredible city. At the heart of Guadalajara is the cathedral. With its twin pointed towers and central dome, Gabriella shared that it is the most recognizable landmark on the Guadalajara skyline. The Cathedral is surrounded on all four sides by “plazas, an integral part of all community planning in Mexico, as culturally these are the central meeting places for all socializing in Mexican communities. “Plaza Guadalajara” faces the cathedral. Its central fountain depicts two lions with their paws resting on the trunk of a tree, the city’s coat of arms. To the south is the “Plaza de Armas” with its art nouveau bandstand and matching lampposts. The adjacent “Government Palace” has a lovely baroque facade and a spectacular mural painted by Jose Clemente Orozco in the interior main staircase. To the north of the Cathedral is the “Rotondo de los Jaliscienses Ilustres”. This green space has a central circular monument with seventeen ribbed columns; the statues surrounding it represent Jalisco’s illustrious sons (and one daughter), people from Jalisco who have made notable contributions in arts, science and politics.
Behind the Cathedral is the large “Plaza de la Liberacion”, deriving the name to commemorate Miguel Hidalgo’s abolishment of slavery. A statue of Miguel Hidalgo holding a broken chain commemorates this historical event. The “Teatro Degollado” is at the far east end of the plaza. Guadalajara’s Ballet Folclorico performs here in this beautiful neoclassical building dating to 1856, and Gabriella told me to prepare myself, as this was Sunday’s activity and I was in for the cultural spectacle of a lifetime.
Coming around the back of the theater, I saw a fountain depicting the Guadalajara city founders. The “Plaza Tapatio” begins here and stretches over half a mile to the “Hospicio Cabanas”, a UNESCO World Heritage Site. Everywhere I looked were picturesque arcades and promenades, bubbling fountains, charming restored colonial buildings, modern sculptures, and happy people greeting one another with hugs, kisses, or great big smiles. Baby’s clung to mothers, and children ran around in circles chasing one another.
I tilted my head back against the headrest and breathed deeply, while I listened to Gabriella continue on the points of interest as we wound our way to the offices and the rain began to subside.
All too soon we came upon a tall modern office building, and pulled in to park the car and head on upstairs.
We paused at the door for a moment, as the sounds of gregarious conversation floated out to us. She turned to me and asked “Are you ready to meet everyone?” as an endearing smile spread across her face. Opening the door the room came to a dead halt in all conversation as we walked in, and a roomful of momentary strangers all turned toward me to welcome me. I say “momentary” because Mexican culture speaks to empathy, and engagement and the art of drawing you in, no matter how shy you thought you might be.
One by one, these gentlemen stepped up to me with an outstretched hand, a smile and a kiss on the cheek in greeting. The impressive 27 year old CEO, the distinguished gentleman who clearly had a fascinating story that spread across his face and came through his smile, that was the COO, and the enigmatic and enthusiastic Tequila Maestro. I realized in short order I was among the elite of the Tequila world in Guadalajara. More distinguished and certainly refined than anyone I had met to date in the industry, the first impression of this team of “Tequileros” was nothing short of impressive. Graciousness and Gentility is what came through from this cast of characters in my Epic Tequila Adventure.
Not long after arriving, I was introduced to the “juice”. There are no words to adequately describe this product line, other than “Epic”. Introduced by Jaime Villalobos Sauza, of the famed SAUZA TEQUILA FAMILY and proud 5th generation tequila aficionado, the nondescript “milk bottles” were opened one at a time and poured into tasting flutes. We collectively put our glasses to our noses with each sample, rolled our glasses to inspect “legs” and “crowns” and the Brilliance of the liquid in the glass, and one by one we tilted the glasses to our lips and drew in the liquid. Swilling for five seconds, inhaling deeply and swallowing, with a deep exhale, the notes and complexities of the distillations rose up, one after the other, promising a smooth, soft sipping experience and delivering a luxurious libation experience.
Dinner was soon offered by our personal chef, Josue Bañuelos (Now rated “THE WORLDS GREATEST CHEF” by this writer-I ate really well all week and lost weight!). As we sat down at the table, I took it all in. High above the cobblestone streets of Guadalajara, the pocket doors pulled all the way back so the soft breeze added to the “Al Fresco” mood. The delicately seared Sea Bass with a caper minieure sauce, fresh grilled asparagus with agave honey, and cilantro carrots plated on immaculate Villeroy and Boch White Bone China, the beautiful, carefully selected Reidel glasses, for the Chillean Chardennau chilled to perfection, all finished with a refreshing homemade Fresh Lemon Ice with red and black raspberries and mint; I began to understand the methodology behind the image of the brand. The first impression spoke volumes and the ideas began to formulate in my mind, like the flavors exploding in my mouth, so too were my pistons exploding with ideas!
Before I knew it, the evening had passed and I found myself on my way to my hotel to check in and settle in the for the night. I regretted emerging from the car, not yet done with the day, eager to see and learn and taste so much more, and dragged myself up to my room.
Unpacked and comfortably settled in to my room, I took a deep contented breath. I called the front desk and in Spanish asked for the wake-up call. I pulled the drapes on the traffic of Guadalajara, and submerged into the dark folds of the room, the breeze blowing the curtains in the window and sleep coming over me. I closed my eyes, eager for the next day to begin.
Read the continuation of Jessica’s Journey coming soon!
Jessica Arent has spent her career steeped in the Hispanic culture. Passionate about the Latin culture and experiencing roles that have taken her from television to digital marketing throughout the United States and Mexico, Jessica’s passion for Mexico runs in her blood. An accomplished writer, Mexico is where her heart lives and is the focus of her work and writing. Specializing in marketing Hispanic based products and services, Jessica will tell you there are few people in the world or places she has traveled, from Asia to Europe and in between, who compare to the Mexican culture. Building websites such as ALL ABOUT MEXICO and fostering the marketing endeavors of a number of tequila products, to name a few, Jessica sets out to inspire the world around her, one person, one relationship at a time, to know and understand the culture she calls home. Jessica is a partner at Intermountain Media, LLC, the Communications and Media Director of Terra Energy Resources Corp, and shares other travel and tequila adventures on her blog, Jessica’s Mexico.
Yes, we went there! The good folks at Hornitos were kind enough to send us some samples so we did what we do – Tasting & Testing. Look for our review of Lime Shot – and the reason why you absolutely must have this in your kitchen – coming this week!
According to Hornitos:
This Memorial Day weekend, master the art of cocktail-and-food matching—and just in time for all the warm-weather backyard festivities. Your readers can fire up the grill with Hornitos® and try some of these seamless pairings of mouthwatering food and thirst-quenching cocktails.
Hornitos® Lime Shot takes the process out of the whole tequila experience. No need for blenders or the lick it-sip it-suck it ritual, this shot already combines the salt + tequila + lime!
Serve the shot chilled and in a salt-rimmed shot glass for the ultimate Memorial Day experience.
This cool, sweet drink offsets spicy heat of your summer barbecue
• 1 ½ parts Hornitos® Plata Tequila
• ¾ part Lime Juice
• ¾ part Pineapple Juice
• ¼ part Agave
• Pinch of Cilantro leaves
Preparation: Add all ingredients to a shaker with ice. Shake and strain into a coupe glass.
Hornitos® Tequila Lime Shot Chicken
• 1 cup Hornitos® Lime Shot
• ½ cup orange juice
• ¼ cup chopped fresh cilantro
• 2 tablespoons minced seeded jalapeño chilies
• 1 ½ tablespoons chili powder
• ¼ cup honey
• ¾ teaspoon ground black pepper
• 6 boneless chicken breast halves
Preparation: Before adding chicken, mix all other ingredients in a bowl to form a marinade. Once mixed, place marinade in a large resealable bag and add chicken. Refrigerate overnight. Once prepared, place chicken on the grill (low to medium heat) and cook for approximately 15-18 minutes. Remove chicken from the grill and enjoy your Memorial Day barbecue!
Tequila Brands and Producers Have Already Sailed Into the Sucker Hole
For those new to the expression, a “sucker hole” is a colloquial term referring to a spate of good weather that “suckers” sailors into leaving port just in time for a storm to resume at full force and wreak havoc on the ship and crew.
For both Tequila Brand Owners and producers of a certain size, their ship has already sailed, and the storm is now closing in on them. Some in denial, others looking through rose-colored margarita glasses, still believe they can navigate through to that glimmer of light on the horizon. However, the perfect storm of doom looms just past the horizon of hope, and will soon envelope and destroy most, if not all, in its wake.
Oh, and that’s the good news. The bad news is that only a few of the big and the very nimble will survive.
This is because of a number of factors, primarily that too many of us bought in to the Yankelovich and similar studies that declared premium and above 100% Agave Tequila brands as the next big thing.
While the premises of these market premonitions were undoubtedly true, too many of us jumped headfirst into the juice just before the world economic decline. Six hundred brands have turned into 1200 brands in less than five years. The growth of the market has been dramatic compared with other distilled spirits, yet, it’s still relatively small, ranked only 4th in US volume. It has not grown fast enough to accommodate all of the entries into the field.
Resistance is Futile – Change is at Hand for the Tequila Market
The Gravy Train Wreck Ahead
I’m sure that for many of you, in just reading the title of this article, your blood pressure has escalated, and you may already be misdirecting your anger at the author.
For others who have experienced the many similar economic paths to consolidation in the global beverage industry, you have already accepted that change has to occur, and you will soon better understand and appreciate the math behind what I am about to lay out, and why everything I’m about to outline here will happen in due course.
For those of you who have your personal fortunes riding on the Tequila Train, both prominence and profit may still seem to be so close that you think you can see the light at the end of the tunnel, or beyond the next bend. But, I’m sorry to say that for most of us in the biz, the light at the end of the tunnel is that of an oncoming locomotive. This will be a catastrophic collision, albeit in slow motion, that will drain your resources and your resolve.
What can be learned from the Russians? (Excerpted from JustDrinks.com)
The global economic crisis has had a significant impact on the Russian spirits market, changing market dynamics and briefly halting the much-lauded premiumisation trend, according to current research.
A recently released report from the International Wine and Spirit Research (IWSR) on Russia’s spirits market claims that the downturn has also led to “…disruptions across the supply chain, with many suppliers and distributors going bankrupt or halting production. For healthier companies, however, it has presented an opening to establish their brands and take market share…”
The Silver Tequila Clouds have a very Dark Lining (Excerpted from Global market review of Tequila – forecasts to 2013 www.researchandmarkets.com )
The history of the Tequila industry has been one of boom and bust. Sales rose during the 1940’s only to collapse again in the mid-50’s. Export sales rose steadily from the 1960’s onward, although domestic sales fell sharply in the 1980’s due again to an economic slump, and the severe Mexican economic crisis of the early 1980’s resulted in plummeting sales.
The market was again disrupted by a critical shortage of Agave beginning in the late ’90’s, which served to hold back the category’s international development as brand owners were forced to divert limited supplies to the core US market, and quality perceptions were damaged as some manufacturers moved from 100% to 51% (Mixto) Agave products.
Today, that dynamic is in reverse, and the market is in oversupply. More and more 100% Agave products are coming into the market. This is helping to raise quality perceptions, and in turn, demand is surging not only in core Mexican and US markets but across a number of other countries.
The outlook for the category has rarely been better, and Casa Noble Tequila president and COO David Ravandi commented, “Tequila is entering a stage of consolidation in the world markets. It is no longer a fad. The fact that 100% Agave Tequila exports have increased tremendously over the last two years is extremely positive for the product’s outlook in the years to come.”
US Tequila Importation is a Sucker Bet
“My cousin will make the best Tequila for you Mr. Gringo”
“So, my friend, you want a great Tequila brand? We will make it for you. Just fifty percent cash up front to start the process.”
Unfortunately, far too many have fallen for this old gag. Relying heavily on the forecasting reports of the early 2000’s that suggested that luxury Tequila would be the next big spirits category after vodka.
With dollar signs in their eyes, the believers drank the Tequila Kool-Aid, most of them spending way too much to buy a brand, custom molded bottles, etc. But the worst part was that this left little if any money for marketing. Many did not even understand brand marketing inflation was happening right under their noses.
It had started soon after Patron hit 100,000 cases in volume in 2001, and the cost to market a Tequila brand in the US went from $1 to $10M per year. Today it takes at least $20M per year just to play in the same ballpark as Patron’s $50M plus, Sauza’s $35M plus, and Cuervo’s $30M plus marketing budgets.
Who could have predicted that a “realistic” business plan for the next successful ultra-premium Tequila brand calling for only 10,000 cases in the first year would end in it’s investors taking a bath?
The problem with this equation is three-fold:
1) Pricing: Unlike vodka and white rum, 100% Agave Tequila is just too expensive to produce and bottle in Mexico. Unless, like rum, vodka and mixto Tequila, it is able to be shipped in bulk and bottled near the final consumer, the cost involved with 100% Agave Tequila is always going to be too high to attain critical volume and profit levels.
2) Volume: US mass volumes are best when a spirits category is between $9.99-29.99/750ml. One hundred percent Agave Tequila is currently profitable only at the upper ranges when higher volumes are attained.
3) Distribution: The US “3-Tier” Distribution System is at best an oligopoly, and 19 states run a monopoly. Of the 1200 plus Tequila brands, want to guess how many they want to carry? Well, after the top 20, you are very lucky to be “special order only”. If you are fortunate enough to live in the states of California or Arizona, where one can be both the importer and distributor, you will find yourself driving your precious Tequila brand around to each account in your car.
Without product volumes or market clout, you will be hard pressed to get even an appointment, let alone a vender number with the chain restaurants and grocery stores. These major chain stores like Chili’s, Chevy’s, Costco, Kroger, etc., drive at least 85% of the combined volume in all but the control states. Without access to the chains, your market becomes the handful of privately owned, “Mom & Pop” accounts that usually know that small independent distributors are easy prey for bending the law on consignment, stringing out payments, or not paying at all.
While driving your own brand around certainly makes time for the personal touch and focus, these hand-selling efforts prove to be the most inefficient ways to distribute one Tequila brand. Your glass ceiling to fame and fortune becomes that next level of chain distribution that can only be had by a state-wide delivery system of the large wholesale distributor.
With Tequila segment Pricing, Volume and Distribution all against you, one will need to have a lot more money than the brands of the past in order to simply survive in the US.
Tanks-a-lot for Nothing
Call the tank maker and raise your stocks of liquid now!
Unfortunately, most of the mid-sized Tequila distilleries have bought into the notion that Agave prices will go up in the very near future. They base this notion on the boom and bust cycle of the past, and like Lehman Brothers, believe that they have successfully timed the market.
Greedily, many producers are now mortgaged to the hilt in order to produce all the Tequila that they possibly can afford to store in stainless tanks or wooden barrels. Fear of the impending Agave price increase that has yet to happen (and may not for many, many years) has seemingly forced them all into a squirrel-like stockpiling frenzy.
Are they storing Blanco, like acorns, for the hard winter ahead? These stored nuts of liquid demise are in reality winds conspiring to produce the perfect storm for all but the most financially secure and/or nimble producers.
Copyright 2010 International Tasting Group (ITG), All rights reserved. Unless otherwise noted, ITG is the legal copyright holder of the material on our blog and it may not be used, reprinted, or published without our written consent.
“The World Health Organization (WHO) has shocked the duty-free industry by proposing a global ban on duty-free liquor sales, a business which was worth $6.3bn last year.”
The proposal to slow down alcohol consumption was actually published in December of last year, but will finally get onto the WHO’s Executive Board agenda between January 18-23, 2010. The Board is made up of health ministers from 34 leading countries, and if it approves the proposal, it will be presented to the WHO’s full annual General Assembly in May 2010.
Keith Spinks, secretary general of the European Travel Retail Council (ETRC) believes that the proposal will pass the Executive Board and into the General Assembly that is made up of 193 governments, and warns, “If this goes though, it will be a disaster for the industry.”
Should the World Health Organization ratify this proposal, there is an upside. According to Spinks, this proposal on liquor would not be “binding.”
“It is going to be up to each member country to decide whether to implement the proposal or not.” But, he adds, “My fear is that some countries will and some won’t, leaving us in a big mess.”
In 2005, the WHO tried to ban duty-free tobacco sales through its Framework Convention on Tobacco Control (FCTC). The FCTC was ratified by 165 countries worldwide, but has yet to be implemented by any country.
A quick review of the members of the World Health Organization may give a clue as to why.
Alcohol, Tobacco, and Tourism
All countries which are Members of the United Nations may become members of World Health Organization by accepting its Constitution. So, which countries are members?
Australia, the Bahamas, Costa Rica, Dominican Republic, Egypt, Finland, Germany, Hungary, Italy, Mexico, Switzerland, UK, and the USA, to name just a few. Most all of these countries have one or more international airports with duty free stores selling among other things, spirits, cigars, and cigarettes.
Not only do most of these member countries tout tourism as a major industry, but many also have their signature spirits (and cigars, in some cases) that define them. Examples are rum from Barbados, limoncello from Italy, and of course, tequila from Mexico.
Where duty free merchants pay inventory/business or other taxes, customers usually pay none. For these countries, tourism, and the profit made at duty free shops from alcohol and tobacco sales, is directly related to each other.
How much damage could the enforcement of this proposal do?
WHO vs. Patrón
As stated above, duty-free liquor sales from last year amounted to $6.3 billion in 2008. That accounted for 17.2% of the total global liquor business according to the Drinks International article.
In the April 2008 issue of Impact Magazine, it states that Patrón tequila was also penetrating the travel retail sector overseas, long a key channel for high-end spirits but one in which tequila was underappreciated. Patrón was aggressively growing its brand by sampling at very visible public relations events in key cities such as London, Athens, Hong Kong, Singapore and Sydney, all whose countries are members of the World Health Organization.
The Patrón Spirits Company, producers of Patrón tequila, claim on their website to be in over 100 countries and islands worldwide. Given that there are only 193 members of the WHO, the chances are good that Patrón is available in the duty free stores of most of these member countries.
Assuming that the same 163 countries that ratified the duty free tobacco ban in 2005 also decided to ratify—and enforce–the duty free alcohol ban, the results could be devastating not just for Patrón, but also for Sauza, Brown-Forman (El Jimador brand), and Jose Cuervo, as well as all spirits suppliers, duty free retailers, and airports.
While it seems likely that the World Health Organization’s Executive Board will ratify the alcohol ban proposal, it seems unlikely that any countries will actually enforce it.