As we have discussed in this previous post, Sidney Frank is one of our heroes.
But just how did he hit paydirt on Jagermeister? Was it business genius, timing or just sheer luck?
Well, judging by this interview, given the year before his death in 2005, it was a combination of all three…
I noticed a few bars selling Jägermeister. I was looking for anything that had a niche… So I sent a telex to the president of Jägermeister in Germany and asked if he would see me. We went to dinner.
I said, “I’d like to have Jägermeister for the States.” He said, “We already have commitments for most of the country, but we still have Maryland to Florida left.” I said, “I’ll take it.” But the next year the importer from the East Coast didn’t pay his bills on time. So I got Jägermeister, eventually, for every place except the West Coast. The president had never been to the U.S. but he flew to the West Coast and asked the importer there to take him to Disneyland. They got lost, so he figured he didn’t know the territory. So I got the whole country in 1973.
We had no money for advertising, but we got a big break. The Baton Rouge newspaper said Jägermeister, to the drinker, is instantValium. Well, there are no drugs in it, but sales went from 10 cases a month to 1,000.
But the big thing I had, I came up with Jägerettes. I thought a pretty girl can always help you selling, and I noticed that one girl I had in California would go to 80 tables in a room and say, Open your mouth. She asked, Would you like a Jägermeister? And 80% of ‘em said yes.
After the runaway success of Jagermeister, Frank started looking for something new.
Grey Goose started because I figured that we were so popular with the bars and distributors were making a lot of money on us. I figured they’d go along if I came up with a vodka. The nice thing about vodka is you make it today, you sell it tomorrow; even Jägermeister is aged for a year… Just make it today, sell it tomorrow.
The big-selling high-priced vodka at the time was Absolut, which was $15 a bottle. I figured, let’s make it very exclusive and sell it for $30 a bottle. I said, France has the best of everything. I asked a distiller there whether they could make a vodka. They said sure.
We submitted two bottles to the Beverage Testing Institute, and Grey Goose won as the best-tasting vodka in the world. So we took $3 million, which was going to be our total profit for a year, and we put it into advertising. We made big, beautiful ads that listed Grey Goose as the best-tasting vodka in the world, and we indoctrinated the distributors and 20,000 bartenders, and when somebody would come in and say, What’s your best-tasting vodka, they said Grey Goose.
Seven years after that $3 million ad campaign launched the brand, Sidney Frank sold the rights to Grey Goose vodka to our old friend Bacardi for over $2 billion…
Not a bad result for a guy whose first entrepreneurial deal was building a ladder to the top of a rock near his home and charging people 10 cents to climb up and look at the view!