The Grey Goose Effect…and What an Effect!
Why does Grey Goose Vodka cost $60 a bottle?
“Grey goose vodka (the only vodka I drink, and number one tasting vodka in the world as voted by consumers) was purpose made for the American market in 1997, and sold as a ‘premium’ product. It is distilled in Cognac, France with a specific distillation method introduced by its importer; the billionaire Sidney Frank. Grey Goose uses French winter wheat from the south of Paris, distilled in a continuous still and alpine spring water that has been filtered through the limestone plateaux of the Massif Central, which is why it is so special and why it can be sold in North America and Europe at a higher price than that of Absolut; its biggest competitor.
Oh, and I know they have to put the price up for the marketing of the product too of course, otherwise it wouldn’t be a very lucrative business would it?”
“The reason Grey Goose is so expensive is because you are paying for their marketing expenses. They spend hundreds of millions in advertising all over the world. I agree that it is a well-made vodka with high quality materials, but working in the industry myself, I know that the liquid actually costs them less than $2 after everything. Then you pay for the fancy bottle, the importer’s fee, distributor’s fee, wholesaler’s fee and marketing expenses, grey goose’s mark-up and you have a $60 bottle of vodka.
Grey goose is a good vodka, but I prefer a few other brands that you might want to try Ciroc, Kettle One, Stolichnaya.”
Sidney Frank, the man behind Grey Goose vodka understood that Americans want to pay more—You just have to give them a good story. How good was his story…pretty damn good. To put his amazing feat into context, in 2004 Sidney Frank sold Grey Goose to global rum Juggernaut Bacardi for USD 2.2 Billion and in doing so (in my opinion) proved the case for premiumisation for all time.
Want to make higher margins and boost profits? Start working on a great story. No, not a great story. Start working on crafting the greatest story for a product in your category the world has ever seen.
Tres Bonne Chance.
By Jim Wilkes