Top of the Tier
Wilson Daniels Takes the Ultra-Premium Approach


By Michael Harrelson



As any brand manager worth his country club dues can tell you, premium and super-premium spirits are red hot. And what is more, there is no end in sight to this mega-trend that is looking more and more like a spirits revolution with each new ultra launch and every New Year in the go-go, up-sold, on-premise channel of the 21 st century.


This on-going shift to the good stuff has brought back the boom times to spirits houses large and small worldwide. Fueled by the ferment for flavor, innovation in distillation techniques and the branding of the beverage and food experience brought on by accelerated competition for customers, the phenomenon also has made an already profitable beverage business all the more lucrative by comparison for owners and operators.


High-End Hooch

One company taking full advantage of this upwardly mobile motion in spirits is Wilson Daniels Ltd. While most beer, wine and spirits suppliers offer premium and super-premium brands in their varied spirits lines, the 25-year-old supplier based in St. Helena, Calif., may be unique in all the industry for its all premium and super-premium spirits portfolio.


From Cabo Wabo Tequila, a super-premium tequila owned by Red Rocker Sammy Hagar, to Bafferts Gin, a proprietary, super-premium spirit triple-distilled in London with fewer botanicals than any other gin, to Zaya Rum, an aged, luxurious spirit recognized by the International Rum Festival with its Platinum Award in 2002, followed by recognition it the premium category again in 2003, Wilson Daniels' carefully selected spirits portfolio begins where a typical supplier portfolio might leave off.


The exclusive focus at the high end extends to wines as well. Indeed the company –– founded by now retired entrepreneurs Win Wilson and Jack Daniels a quarter of a century ago –– owes its beginning to requests for distribution assistance by upscale wineries whose farmer/owners wanted only to be left alone to grow and harvest their grapes. Among domestic properties are select California vintages Schramsberg Champagnes, Burgess Cellers, Clos Pegase, Fisher Vineyards, Silverado Vineyards and many other. On the import side, the WD portfolio includes an extensive list of ultra premium brands, including Domaine De La Romanee (accent)Conti, Domaine de Triennes, Falveley, Kumeu River, Morey-Blanc and Zeni.


“Wilson Daniels' strategic approach is not be all things to all people, but more importantly, to target the individual brand strength to a specific channel of consumers,” says Lonnie Charleson, senior vice president and director of sales and marketing for a Wilson Daniels spirits division that he (arrived in) five years ago after more than 17-years with Brown-Forman. “For example, our premium tequila selection at Wilson Daniels has some products that are Mexican consumer oriented and others that are targeted at Anglo American consumers.”


What Wilson Daniels' spirits sales lack in volume, they make up for in price point says Charleson, who represented both the Jack Daniels and Southern Comfort brands in his days at Brown-Forman.

“The average retail selling price of Bafferts Gin is $21.99,” says Charleson. “That's our lowest-priced premium, and the products accelerate from there all the way up to $100 for a 750-milliliter bottle of a soon-to-be-introduced, rare anejo tequila from Sammy Hagar's personal collection.”


Proprietor and Agent

For Wilson Daniels, a company that employs close to 80 people at its headquarters in Napa Valley, the dynamics of building a high-end portfolio of spirits called for an approach radically different than the conventional strategy adhered to by many well-established spirits suppliers.


“The challenge for us in the spirits division was to create a different kind of sales and marketing company representing both proprietary brands which we own and also brands as an agent,” says Charleson. “In this day and age, so many products are smaller, new products. It's harder for them to break into that special relationship so that the retail establishment is willing to support the brand. To introduce new and small niche products, it is very expensive and requires a lot of patience.”


An example of this new supplier model in action is Wilson Daniels' on-going relationship with Cabo Wabo Tequila –– one that Charleson says has much in common with the company's initial experience in helping select, independent, wineries market, distribute and grow their brands.


“The spirits division started with Cabo Wabo, of course,” Charleson says. “It was a small, special brand owned by Sammy Hagar. He came to Wilson Daniels and asked us to be the supplier and the national distribution channel for Cabo Wabo in the U.S., Canada and the Caribbean.”


Though the day-to-day strategy may differ from brand to brand and owner to owner, Charleson says WD's role as agent/rep is clearly defined and well understood by everyone at the company.

“It's incumbent on us that we be very good listeners to the owners of the brand,” he says. “We work closely with the brands to develop strategies both long and short-term.”


Win/Win Relationships

If the stated goal at Wilson Daniels is a win/win relationship between brand and company, then Charleson has succeeded beyond all expectation for Wilson Daniels President Mark Sneed, who recruited him in 1998, and for owners Vernon Underwood and the Underwood family.


Charleson and company have taken Cabo Wabo Tequila, with its 100 percent Blue Weber agave, far beyond owner Sammy Hagar's initial intention to create a unique, hand-selected tequila for his Cabo Wabo Cantina in Cabo San Lucas, Mexico. Starting from bottle one about six years ago, the Cabo Wabo brand is expected to sell more than 100,000 cases in 2004, Charleson says. Other spirits releases, such as Bafferts Premium Gin and its Zaya Rum also are seeing positive growth in sales and account purchases in premium targeted markets.


Charleson also can point with pride to WD's work as agent for Tequila Cazadores, an import brand that entered the U.S. market in 1996 and came to Wilson Daniels in 1998 requesting Wilson Daniels' expertise in managing the U.S. market. Within a year of its first representing Cazadores, sales reached 20,000 cases in 10 states and shot to 150,000 cases in 42 states by the year 2001. And beyond the sales and distribution increases, the brand caught the attention of Bacardi, which recently purchased it for its own proprietary portfolio.


Just six years into it, the spirits division at Wilson Daniels already contributes approximately a third of the total sales of all alcohol beverages for the entire company. More than beginner's luck, Charleson attributes WD's success on the spirits side to subtleties such as recruiting the very best managers with restaurant and bar experience to the staff.


“Because of the entrepreneurial chemistry at Wilson Daniels, we continue to build our momentum each and every year. The professionals we have very carefully hand-selected have many years of experience in all of the distinct channels of alcohol beverage. “


He adds that strong on-premise events presence such as Wilson Daniels' participation each year in the Gordon Biersch Brew Pub/Las Vegas' Octoberfest celebration also has a major impact. The three-day event brings more than 20,000 people out to sample Cabo Wabo Tequila along with Gordon Biersch microbrews.


“That is a major consumer awareness draw….. It has made a big difference for our business as far as gaining new consumers.” NCB