The venerable premium whiskey brand Maker’s Mark, which managed a transition to ownership by far downmarket Jim Beam without losing its cachet, is having so much trouble meeting demand (sound familiar, gun industry?) that it’s taking the approach that Kimber and SIG did under Ron Cohen: decontenting the product (“cheaping out”) to sell to less-informed consumers and amp up the bottom line. What they’re doing is reducing the proof of the whiskey, and promising the customers they won’t know the difference.
But Jim Beam executives, who stand to reap considerable bonuses, sure will.
Removing QA/QC from the Kimber and SIG lines, which may not have been done in any formal way, but sure looks like it has from the spotty quality of the guns being delivered, hasn’t hurt the companies, yet. Only the consumers. Because quality is a trailing indicator, a whiz-kid MBA can always cash out banked quality and be gone by the time the product’s reputation crashes. (Example: by the time customers realized that once-premium Kimber pistols had become hit-and-miss in the quality department, Cohen was already working his black magic on SIG).
The Beam managers are figuring they can pull the same slickee-boy tactics at Maker’s Mark:
Maker’s Mark just got a little less stiff. The bourbon brand, known for its bottles sealed with red wax, told customers today that it’s reducing the amount of alcohol in the beverage in order to meet rising global demand.
Bourbon, which is a form of American whiskey distilled from corn and other grains, has surged in popularity over the past few years. In its largest market, the United States, bourbon now accounts for 35% of all spirit sales as more Americans have developed a taste for high-end whiskey, which is typically aged in charred white oak barrels for six years or longer. In the 1960s and 1970s, Maker’s Mark was famously sold with the slogan, “It tastes expensive…and is.”
But international growth is what’s driving demand for bourbon makers like Beam Inc., which produces Maker’s Mark as well as Jim Beam, a cheaper and more popular bourbon. Beam executives earlier this month said Australia, Germany, and Japan were strong markets. Last year, the company warned it didn’t have enough supply to keep up with bourbon demand. It also raised prices.
In an email today to loyal customers, Beam executives said the company had decided that the only way to keep up with demand was to make its bourbon less strong, stretching the current supply. ”We’ve worked carefully to reduce the alcohol by volume (ABV) by just 3%,” the email said.
I’ve reached out to Beam to clarify whether the alcohol is being reduced by 3%, as the email says, or three percentage points, which would be more dramatic. The footer of today’s email suggests it’s the latter, describing Maker’s Mark as a 42% ABV beverage, which is also known as 84 proof; it was previously distilled to 45% ABV, or 90 proof. That would be a 6.7% reduction in the amount of alcohol.
So in other words, they not only watered Maker’s Mark, but then they tried to lie about how much they watered it. Boy, if that doesn’t let the world know what you think of your customers. what does?
Fortunately, Maker’s Mark going the way of Acme House Brand White Label Bourbon is no big loss to us. We don’t often drink a distilled malt beverage, but when we do, it’s whisky (Scotch) not whiskey (Bourbon). In the same way we adapted to SIG going nonlinear in the quality department by lifting and shifting our 9mm recommendations to makers that held the quality line, we can always adapt to any distillery’s cheaping-out on the product, next trip to the liquor store.
Forbes has a great story on watered Maker’s Mark, and how other long-time sippers are going to help them with their problem of excessive demand, by changing brands.