The cool packaging. The alluring lines of the bottle and the color of the liquid inside. From our phones and in our libraries we can read the tasting notes of experts, their colorful and sometimes overwrought language describing the tastes and smells we might have difficulty putting words to. We remember the charm and knowledge of the brand ambassador, or were in awe of the maker, the distiller or blender, who broke down the components for us in a master class and afterwards posed for a selfie for our social media accounts.
So much goes into the experience of whiskey that we either forget, or are unaware of, the one link in the chain that if it were to disappear, causes the entire experience to fall into a heap: the salesperson.
You’ve heard of Pappy Van Winkle, of course. Julian “Pappy” Van Winkle Sr. got his start as a salesman for the old W.L. Weller distillery in Kentucky, at a time when the definition of “bourbon” was still being debated. Later, as a distiller, he was quoted as saying “we make a fine bourbon at a profit if we can, at a loss if we must, but always a fine bourbon”. A sales guy.
Dewar’s Blended Scotch is what it is today because of the efforts of Tommy Dewar, maybe the most prolific and widely traveled whisky salesperson of his day. According to him, the whisky coming from Scotland lacked a certain flair, it needed a grounding, an emotional anchor that a consumer can attach themselves to. His father’s whisky needed the symbol of The Scotsman, a fully-battle-arrayed bagpiper that graced every bottle, turning whiskey from Scotland into “Scotch Whisky”. A sales guy.
All the whisky in Scotland in the 19th century was managed by a rich layer of middlemen who purchased raw spirit from the Highland distillers and sold it to the bonders and blenders close to the ports of transportation in the Lowlands to make the blended Scotch that ruled the early 20th century. And then another group left for France and created a market that is still today the largest importer of blended Scotch whisky. Sam Bronfman bought the Seagram’s distillery and name in Canada at the height of the Great Depression and rounded up third party “agents” who got his whisky across the border to the speakeasies of a thirsty US public. Later, the unheralded Harry Hatch, parlayed his whisky sales expertise into pulling off one of the greatest purchases of all: for a brief period, he owned the 4 largest distilleries in Canada.
Salesmen all, and the most maligned sector of business today. But if you are holding any object in your hands, whether a whiskey bottle, a medical prescription or an iPhone, a salesperson got it there for you. Someone had to make the phone call, write the email, get the pricing right, make the visit, do the pitch, ensure the delivery, and then set up the service conditions. In today’s whiskey industry, and in the larger alcoholic beverages industry as a whole, adding to the complexity is what is known as the “three-tier” system, a uniquely American hold-over from the temperance attitudes that provoked Prohibition. With minor variations, it works like this: a maker of alcoholic beverages can only sell directly to a state authorized wholesale distributor. That wholesaler (and their salespeople) in turn can only sell to the next tier, the “trade”: either package stores where the product is consumed “off premise”; or restaurants and bars, where the product is consumed “on premise”. Both are licensed to sell directly to the consumer, completing all three tiers. With 50 different states (and DC), there are 51 different variations of this and wending their way through it all are the salespeople.
Today, when we hear of or encounter salespeople in the liquor industry, either male and increasingly female, we still have a similar negative gut check: shady and dishonest or full of hyperbole guaranteed to separate us from our hard-earned dollars. And indeed, those archetypes surely exist. The bad rap on today’s whiskey salesperson is that they know nothing of the product and are only interested in making the sale in order to qualify for the rich incentives mandated by quotas of the current large suppliers: Diageo, Pernod-Ricard, Bacardi or Beam-Suntory being in the lead, and others following. The distribution field is dominated by 3 large organizations that distribute close to 60% of all wine and spirits: SouthernGlazers, RNDC and Breakthru, followed by a raft of mid-size and small wholesalers state to state. The overall feeling within the industry is that the salesperson has been relegated to the role of order-taker only. No promotional commitment, no passion regarding the nuances of the product, just get it in, on the shelf or behind the bar, and move on to the next account. It’s a sad reality that, for the most part, is true. But it wasn’t always that way.
“At one time, distributors had an allegiance to a brand. I had the owner of the distributor personally walk me into many of the accounts to make sure we got the brand in there. There was a tighter connection between the supplier and the distributor”. Giacomo “Jim” Butera would know, he is a third generation salesman. For over 30 years, “some of the happiest days of my life,” he was part of the sales organization of the old Austin Nichols Company that made Wild Turkey Bourbon and imported brands like Bailey’s, Metaxa and Campari. Jim now owns his own brokerage, Margeaux and Associates, but in those days, as a Vice President of Sales based in Texas, he participated in an organization that had more of a bottom up style of communication. “The top management would listen to what the field needed and make the appropriate adjustments, whether it was the point-of-sale materials or feedback from buyers on the brand’s qualities.”
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What changed was the times and the technology. “Computers are great in that we can get real-time data on sales and depletions; back in the old days everything was hand-written. But they destroyed the personalization and the relationships. I used to know everyone in top management of all the distributors, but now we’re just numbers,” says Butera. That same feeling was echoed by Arthur Shapiro, now an industry brand consultant, but once a top-level executive with the Seagram’s Corporation. “In the post-war period, consumer demand pushed the goods out into the marketplace and the salesman’s job was to satisfy that demand. But in the 80s and 90s, business turned to consumer polling and big data and marketing was ascendent.”
At one time in American business there was little or no distinction between sales and marketing, they were all part of account teams that took care of everything from surveying the field, to merchandising the product to closing the sale. Recruits were hired and trained to do the merchandising (from stocking the shelves to setting up displays to surveying the retailer’s needs) and gradually worked their way up to sales. In this way, they got to make the relationships that would later set the tone for sales and promotion. Brand strategies were set forth in a fashion very similar to what we witnessed on “MadMen”: creative and account people working together to build brands. After Prohibition, huge suppliers like Seagram’s, Pernod-Ricard, National, Heublein, Moet Hennesey and Hiram Walker worked hand in hand with import/marketing agencies like Schieffelin & Somerset and Sunbelt to build brands using advertising (liquor was heavily campaigned through magazines, radio and TV) and follow all the way through to the sale and promotion of each brand. There was a continuity of relationships to the degree that transcended business. “I was invited to their kid’s weddings”, quipped Butera.
Along with the arrival of big computing came the natural disruptions of the marketplace: National was consolidated, Seagram’s folded, Wild Turkey was assumed by Pernod-Ricard then later sold off to Campari. Tastes changed, people passed on, hierarchies were moved and melded together. Universities and grad schools produced marketers with degrees who never met a customer on their way to the C-level suites in corporations, and sales was relegated solely to the local distribution level, programmed by their marketing counterparts to hit quotas based on market research. The brand ambassador was introduced, once known as the “Good Will Man” from the old account teams and set in the middle to be the cultural educator or talented ex-bartender who could extol the virtues of a particular brand as long as the marketing budget could hold out. No longer the brand builder, the salesman’s job was just to get as much of the product as possible out into the marketplace and let the brand people worry about getting it off the shelves
Formal sales training programs, like the expansive one set up by Gallo Wine years ago, were reduced just to “brand education” conducted at a weekly general sales meeting by brand representatives or ambassadors. The profession of selling was traditionally something you learned from a supervisor, not by formal training. “You got hired, and the first week your manager took you out into the field, introduced you to accounts and you watched how he did it. Then the second week, you were on your own,” says Butera. In those days of long-term commitments, of hand-written orders and hitting every account in your territory every week, you got to know the owners, the buyers, the bartenders and staff of every account. Suppliers didn’t jump from one wholesaler to another or threaten them with leaving if an ever-increasing quota wasn’t met. But this was a “sink or swim” methodology, and turnover in wholesale houses was rampant as a result.
At the dawn of the 21st century, with the rise of the craft spirits movement and the expansion of whiskey brands from throughout the world, the whole world shifted again. Many distributors were holding onto the old thinking about sales in an environment that no longer supported it. One executive of a large distributor told me, “we’ve been working from an old paradigm. What we found out was that the large brands ruined our salespeople, and we weren’t paying attention to it” as their sales force slowly became order takers, not sales people. Many of the veterans were parlaying off the old “relationship” sale in an environment where the retail buyer or bartender was transitory, staying long enough and making enough contacts to secure a job with a brand. Newer salespeople came into the job with just the minimum “manager” training and if they were both lucky and hard-working, they could make a go of it for a few years before leaving for greener pastures.
Small brands competing with the multi-nationals now were forced out into the marketplace to take up the slack, becoming not just the brand experts but the relationship holders, promoters, inventory trackers and “good will men.” With this many free agents roaming through the aisles and setting up at bars, a combination of fatigue and confusion reigns. The chorus of complaints from both retailers and bartenders ranges from “I have no idea who my sales person is” to “this is the fourth brand ambassador for this brand” to “that visit was worthless, I can get just as much information from my phone.”
Now, Covid-19 has reduced the forces of many of the distribution houses and brands, furloughing many salespeople. Consolidations in the industry have reset much of the budgeting for promotional efforts and the engagement rules within the store or bar are constantly being re-written to match the devastation of an entire industry.
It’s a time for reflection, pivoting and re-invention of how a brand can go to market. It’s a time for the professional salesperson to re-emerge, schooled in a methodology that is flexible and yet tested by time. A relationship builder, a trusted confidant, a category expert, a person dedicated to the service of his or her customer and to the promotion of the brands within their domain. Sales is the oldest profession on earth, an honest interaction of value between two interested parties. That makes it the noblest profession as well. The new salesperson will endure and rise again to fill that space and we will all be the better for it.
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