Brand Creation Tuesdays & Thursdays, Week 1, The Client Agreement - Part 2

(Updated -some thoughtful feedback made me realise the article would be improved by adding the client perspective)

On Tuesday, I posted an article about the Client Agreement, laying out how to create a working structure for your relationship with your client when creating a liquor brand, whether the client is external, internal - or even if you are your own client, which I suppose is the most internal of internal clients. All of this also applies to repositioning an existing brand, too.

Today we'll go a little deeper on the Agreement, and add in some advice for those on the client side, too.

Strengths and Weaknesses

Nobody wants an average anything.

You wouldn't pay $1000 for a mobile phone that's just as good as any other.

But you DO pay $1000 for an iPhone, because it's so much better than almost any alternative.

Play to your strengths, and - as much as you can - delegate or outsource your weaknesses to people who are better at those tasks than you are; ideally, to people whose strengths are your weaknesses.

I'm not a graphic designer, a distiller, a procurement agent, or a logistics coordinator.

I could half-ass some of those jobs, maybe - but instead I outsource them all to people who are really, really good at them, so I can focus on what I'm really good at: coordinating everything that needs to happen (also known as herding cats), creating the brand itself, and writing a plan to launch and grow the brand.

One label designer I work with frequently has his label designs on the back bar of just about every cocktail bar in the world.

A US import firm I use has over successful 80, 000 COLA (label approvals) to it's name; how good do you think it's compliance department is?

The distillery which makes my brand, Old Duff Genever, as well as both a gin and a rum brand I just created for a client, has a department for third-party production which makes literally hundreds of other brands of just about every other type of spirit, from million-case household names to obscure brands, from Korean-style soju to traditional Dutch amaros - oh, and they've been doing this since 1777.

How is this part of the Client Agreement?

Transparency.

Be clear to your client how you'll work, who you'll outsource to, and what it will all cost.

And, cash flow might be very important to the client: lay out what it's going to cost, roughly, and, more importantly, when invoices will have to be paid and in approximately what amount.

McKinsey or Mary Poppins?

McKinsey, Bain, Boston Consulting Group, and all the other management consultants have a reputation for getting their hooks into a company and never, ever leaving, rotating their executives through their clients' C-suites and vice versa and invoicing for endless projects.

Mary Poppins, on the other hand, turned up, fixed the problem, educated her client as to how to fix their own problems in future - and then left.

Which kind of a brand creator do you want to be?

You've probably already guessed I veer more towards Poppins than McKinsey.

The brand you create should be able to stand on its own two feet after your contract has ended; in fact, it should be able to stand on its own two feet even if it is sold to another owner.

For a lot of projects I've worked on, a large chunk of the Client Agreement has been educating the client: about the spirits industry, about the category they want to enter, about what type of brand will appeal to which target audience within that spirits category, and about the on-trade, which is my speciality.

Don't skip this bit.

Some clients may just want to write you a cheque and then have you turn up with a container load of bottles six or eight months later, but in my experience a more lasting relationship is created by inviting clients into your world and both showing and teaching them what has to be done and how to do it.

Respect Your Client And Be Truthful

The Oxford Companion to Spirits and Cocktails was finally published last year, after ten years (!) of work by its editors, David Wondrich and Noah Rothbaum. It is the single most important book on the topic ever written (and for sure the longest, at 827 pages).

I wrote several articles for the Companion, and the editorial guidance to myself and the other 129 contributors was: write as if you were explaining something you're an expert in, in a bar, to your intelligent friend who happens to not be an expert on that particular topic.

Your client is that intelligent friend.

Perhaps they aren't expert in the spirits world, or the category they wish to enter?

Maybe they don't really understand the on-premise?

But I bet they're an expert at something you are clueless at. Respect that.

At the same time...don't bite your tongue. You're supposed to be helping them.

If you don't think a popcorn-flavoured whiskey is going to set the world on fire, tell them.

Lay out your arguments supported by research, and keep an open mind; you might be wrong. Nobody thought that Apple had the remotest chance of success when they entered, very late, the mobile phone sector; your client may not be Steve Jobs, but they might be on to something.

Be Brutally Honest

In Part 1, we already told you that nobody knows anything in the liquor industry.

Make sure your client knows this.

The spirits sector has been on a roll for decades, and the recent success of some celebrity-backed brands has led some people to think it's as easy as filling a few bottles and somehow getting them on a shelf or a backbar.

The world is full of stunning spirits, and indeed it is full of amazing spirits brands.

It is not full of people who know how to sell those brands.

Not even Germans gave much of a shit about Jagermeister until a college dropout named Sidney Frank came along and turned a bug - it tastes bitter and weird - into a feature.

Vodka was Russian or at least Eastern European until a Frenchman, Michel Roux, came along with Absolut, from Sweden.

(And to underline how nobody knows anything: Absolut failed market research trials before its launch. Twice).

Sometimes the right brand and the right people fail just because of timing: Jim Beam had an excellent cinnamon whiskey that died a death a decade or more before Fireball came along in 2007 and shot (pardon the pun) to prominence.

All you can do is create a brand with the largest chance of success, and then cross your fingers and wish for a bit of luck.

Incidentally, this is why large firms - Diageo, Pernod, Bacardi - can't for the life of them create new brands.

They don't give brands the largest chance of success.

No only do the kind of clever MBA-toting people that get hired by these firms not want to work in R&D (because 90% of the budget goes right down the toilet), but they want to have their fingerprints on any brand that is created, just in case it's a success, and they want to cover their arses with research to underpin every decision that's made.

This results in death by a thousand cuts: any brands these firms do manage to create are crippled before they're launched by the endless rounds of "suggestions", usually from middle management, and justified by research, which in the liquor industry either tells you the bleedin' obvious (bourbon is growing!) or is flat-out guessing, which you could do yourself (Remember when 2015 was going to be "the year of acai-flavoured beverages?" Me neither).

David Gluckman , the ideas man behind Baileys, Tanqueray TEN and other million-case liquor brands, writes brilliantly about this very topic in his book, "That S*it Will Never Sell".

(The title of the book is what liquor industry experts told Gluckman about Baileys, which went on to be the largest liquor brand that's been created in the last fifty years)

Structure The Agreement

There are a million ways to write a contract, and you may already have your preferred way of working.

When I create brands, the contract typically includes the following points:

• Client owns all materials and concepts, including intellectual property, when the final payment has been made.
• A monthly retainer is charged, and retainers are deducted against your overall fee. This keeps the lights on for you (if you're a freelance consultant) and is more manageable cashflow-wise for the client
• Deliverables include: a complete brand book, graphic identity chart, complete label design, approved liquid, bottle, closure, case & divider, plus launch plan, 1st year commercial strategy, and all coordination with client and suppliers.
• Cancellation costs. Your work might be unevenly distributed across the project, both in terms of actual hours you log, and in terms of the unique expertise you bring to the table. If the project is cancelled halfway through, you may have done more than half the work. Structure your fee in increments, tied to deliverables, so if a project is cancelled, you can accurately and transparently charge for the work you have already delivered. Be A Good Client If you're the client, you should be a good client. What this boils down to is, be clear on what you expect from the person you've asked to create the brand: do you want McKinsey, or Mary Poppins? Meaning, do you want to outsource everything, or be taught how to do it yourself?I was once asked to create a liquor division within a successful luxury foodservice business, including developing the initial six liquor brands, training the staff and getting the division launched. I'd created two of the brands before it dawned on me that my client, despite our explicit contract and what I thought were very clear discussions, expected me to McKinsey it, while I was (and am) very much Mary Poppins. They hadn't hired any staff for this new division, and admitted they weren't planning to. They just assumed I would continue to do everything. I politely ended the project, and while their success continues in their core foodservice business to this day, they never did create a liquor division. (Still, I did get one memorable trip to Italy out of it, and I had a driver and Maserati Quattroporte at my disposal the whole time, so it wasn't all bad). Even if you want to McKinsey it - and any decent consultant will be fine with that, as long as you are OK signing off creative control - you, the client, will still have to do some work. You'll have to learn some of the terms your brand-builder uses, learn how the on- and off-premise works, study up on the liquor industry if it isn't your industry, and generally get a handle on how the whole process works. I usually get new clients of mine to read "That S*it Will Never Sell" by David Gluckman, "Mission in a Bottle" by Goldman & Nalebuff, and (this book is the best of all) I send them a hi-res PDF of the superb, but out-of-print "Every Bastard Says No: The 42 Below Vodka Story" by Geoff & Justine Troy, the founders. DM me if you want to know what other books I recommendPlus, listen to your brand-builder before you hire them. They aren't one-size-fits-all. Some specialise in the on-premise & cocktails (like me!), and thus know every drinks writer and head bartender from here to Fiji; others are expert in off-premise brand-building and have the mobile numbers of the buyers at all the major chains in their iPhone Contacts. Some are great at whiskey but not well-versed in rum; others are great at liquids and dry goods (bottle, label, closure, case, divider) but, let's be charitable, not great at creating brand personalities. Some can only create brands and haven't the foggiest how to get hold of bottles or brief a distiller.

That's it for this week!

I look forward to your comments.

Next post is on Tuesday, and next week we're talking about The Brand, on Tuesday and Thursday.

Want to talk about hiring me to create a brand for you, reposition an existing one, or educate and engage with the on-trade?

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