Episode 112: Disrupting a Highly Regulated Industry with Bob DeMars at Blind Barrels
Bobby DeMars, CEO and Founder of Blind Barrels, believes that great whiskey is meant to be shared. This is a foundational element of his company, which is a blind whiskey-tasting subscription service that is disrupting the industry’s current distribution model by showcasing American craft distilleries.
The popularity of American whiskey has been growing exponentially for years on a global basis. Distilleries in the US often offer tours and tastings to interested visitors who may have traveled thousands of miles to get there.
Most whiskey lovers know the big brand names like Jack Daniels and Maker’s Mark. However, there are thousands of small, craft distilleries in the US that are putting out delicious products, but the highly-regulated distribution system that has been in place since the end of prohibition limits their reach. One of the goals of the team at Blind Barrels is to expose more people to those craft brands.
Football and film
Bobby played college football at USC in Los Angeles, and he was the first player to ever get into the prestigious film school there. He went on to become a documentary filmmaker.
His most recent film, The Business of Amateurs, took the NCAA head-on to expose practices that college football programs use that are harmful to players. The film directly contributed to the recent Supreme Court decision that allows college athletes to make money off their name, image and likeness.
Navigating the regulations
When Bobby decided to create a subscription business for blind whiskey tastings, he wanted to make sure the experience was a special one for his members. He knew it was a good idea, he just needed to figure out how to pull it off.
He started with a phone call to an alcoholic beverage control (ABC) attorney, knowing that most lawyers will give a free hour-long consultation to a potential client. He was not encouraged by that first call, because most of the things he wanted to do weren’t legal.
He didn’t give up. He made free consultation calls with 16 other ABC attorneys, and he was eventually able to piece together a process he could use to turn his vision into a reality.
Partnering with smaller brands
Bobby worked into his process ways to partner with small, craft distilleries, rather than being a strict negotiator trying to squeeze them for every last discount. He tries to impress upon the distillery owners and representatives that it is quite expensive and takes a lot of extra touches for Blind Barrels to put their whiskey into its own bottles and send them to consumers.
Most of the distilleries Bobby talks to are small businesses where the owners have put it all on the line to chase their dream of crafting excellent American whiskey. Making whiskey is an expensive process, and it also takes a lot of time because whiskey has to sit in the barrel for years before it is ready to sell.
Many distilleries will source whiskey from big commercial distillers to get cash flowing while they wait for their product to age. Others will make vodka or other distilled spirits that can be sold immediately. Bobby understands these challenges and wants to be a champion for those businesses.
The tasting experience
Everything about a Blind Barrels tasting experience is custom. Every quarter, members get a branded, high-end custom box with custom bottles. They get four samples labeled A, B, C and D, tasting notes and a QR code that takes them to a reveal page where they can learn all about the spirit, including the age statement, the mash bill and information about how to buy a bottle.
The boxes go out at the same time to everyone, so people can make it a communal experience. They might get together with friends, or they might share a tasting experience with friends or family members in other states. If someone signs up in the middle of a quarter, they will get the current box immediately, then they will be put into the regular quarterly rotation with everyone else.
Because regulations on spirits sales and distribution vary by state, Bobby is not able to ship his boxes everywhere. They are in 44 states, with a goal to get into all 50, but right now there are some states that they just can’t get into.
Keeping down churn
Bobby’s eye for detail when it comes to delivering a quality experience to his customers has resulted in a churn rate that is much lower than the industry average. The custom bottles and packaging are so high-end, it’s hard for people to throw them away. There is also a feeling of being part of an exclusive club that keeps people happy.
Customer service is also high quality, and calls and inquiries are often answered by Bobby himself. He has talked personally to about half of his subscribers, and his goal is to eventually talk to all of them. He personally answers messages from the website, Instagram and Facebook. He believes that when people know they are speaking to the owner of the company, they know that the company cares about them.
Getting the word out
The nature of the business means Bobby relies heavily on word of mouth for growth. But he also gets a lot of new business from his PR and SEO efforts. He has hired publicists in the past, but he’s found that he is his own best publicist. Most, if not all, of the major stories written about the company come from him personally.
Bobby and his team have been actively doing SEO through their PR efforts by creating new content and by getting articles placed in different publications with backlinks. Social media is important, and they are growing at a rapid pace with very high engagement rates. He thinks their engagement is so high because not every post is trying to sell something. They might create a funny video or do a post on making a great cocktail.
Those videos let Bobby call back his experience with filmmaking, and he really enjoys how it brings everything full circle.
--
Ready to get started with Rebar?
Head to rebartechnology.com or email info@rebartechnology.com to schedule a call today.
