Come January, John Esposito will take control of the new Stoli. Effective January 1, 2014, Stoli Group USA will officially be in charge of its own fate in the United States for the first time, ending its U.S. marketing accord with William Grant & Sons USA.
Who better to take the wheel of this Stoli speedster? John Esposito has executive experience on all levels in the three-tier system of retail, wholesale and as a supplier. He started off working in his family’s liquor store business in New York City, just out of college. But it didn’t take him long to jump to the supplier tier. In 1977, he joined The Seagram Company, one of the most powerful liquor and wine companies of its time. He did well in his new company, ultimately rising to the position of vice president and national sales manager of The Seagram Wine Co. He would then transition to W. A. Taylor & Co. (Allied Domecq) in Miami, serving as vice president and director of sales.
From there, Esposito moved into his third level of experience, the wholesaling business. He would take the position as president of Premier Beverage Co., the Florida division of the distribution giant, Charmer Sunbelt. Arguably, by many, it is the toughest of the three levels in the system. Managing the distribution and keeping many suppliers happy at once is no easy task.
Now he had experienced all levels.
In ’92, Esposito decided to return to the supplier level, where he would stay. He joined Schieffelin & Somerset, the joint venture between Diageo and LVMH (Louis Vuitton, Moët Hennessy), as senior vice president of national sales. Within seven years he would be named the CEO of the operation. During his tenure, the portfolio, which included Hennessy, Grand Marnier, Moët & Chandon and Veuve Clicquot, experienced exceptional growth and sales surged to unprecedented heights. When the Schieffelin & Somerset joint venture was dissolved in 2004, Esposito was named president and CEO of the new Moët-Hennessy USA, early in 2005.
His next move played out in early 2006, when he became president and CEO of Bacardi USA. Bacardi had acquired Grey Goose vodka in 2004 and wanted to continue to expand, and maintain its upscale portfolio and its super-premium leadership position in the supplier world. Esposito contributed heavily to what Bacardi began years before — the transition of the company into a leading international business with a balanced portfolio of premium spirits including rum, vodka, Scotch, Tequila and other products.
Esposito has also spent a substantial amount of his time supporting charitable causes. Both The Boy Scouts of America and the United Jewish Appeal named him “Man of the Year.” He has also been recognized by the American Cancer Society and awarded the Dr. Louis Berger Memorial Award. Medgar Evers College also bestowed on him an honorary Doctor of Law Degree for his work in supporting education.
Now he and his staff face a fresh challenge, to bring the new Stoli Group USA to market and introduce their ideas and plans to their customers. in the Mix had the chance to interview John, just after their Stoli Group USA October kick-off concluded in Las Vegas.
Interview with John Esposito President
SPI North America, Stoli Group USA
ITM: John thanks for taking the time out of what must be very busy days, to talk with us. Stoli has always been represented by other companies in the United States and now you are finally independent. Are you ready and excited for February?
JE: Yes, we are very excited about the opportunity to take this iconic brand to market with our own team. We have been very fortunate to attract some of the brightest people in the industry to join us on this journey. Many of the team members have worked together previously, and all of us are here for one reason — to return this brand to the leadership position it has enjoyed for years. Personally, I am pleased that so many really great people share the vision and have come to join us.
ITM: As you know, the majority of our readers are national accounts. You’ve assembled an A-team of national account personnel — Mark Corcoran as vice president of national on-premise accounts, and Liz Lister as director of national on-premise accounts. What will their primary role be in the transition period?
JE: Understanding the needs of national accounts and the long lead times required, we placed a priority on finding top people who understand the channel and what is required for success. Having Mark and Liz join us early was a critical part of our plan. They are working closely with Grants to insure our continuity is communicated for existing programs and to let accounts know we are in business and ready to be a good, long-term partner in growing both of our businesses. They will have the ability to customize programs to fit the needs of their accounts. Since both Mark and Liz are well known and have great experience, it is easier for us to communicate with decision makers about our future vision.
ITM: Many of our readers will want to know what your plans are for new national account development growth in the hotel segment. Can you give us some insight into the upcoming year?
JE: Hotels are more complex than restaurants, in the fact that there are many more opportunities for beverage consumption and more points of contact to interface with. That being said, the approach doesn’t drastically differ. You still must know what the goals of each department are. For example, banquets will have one goal while lobby bars will have a different one. The rise of outdoor venues, like rooftop bars and daytime experiences at pools, all offer different opportunities for enhancing the consumer experience with our brands. Knowing how our brand strategy fits with the units’ strategies allows us to develop unique programs fit for the accounts. We can become consultants to the account only if we understand their strategy; having experienced leaders like Mark and Liz join our team has been a great help in communicating to accounts.
ITM: How about the casual restaurant chains? They are a different breed than the hotels. Can you share some of the strategy you and your team have in mind for them?
JE: This highly competitive segment is not as complex as hotels, as the internal venues are usually either the bar or at the table. Given the competitiveness of the segment, accounts are always looking for ways to differentiate their brand from others. Most are looking for appealing, exciting drinks that are bartender friendly. Just as important, accounts are looking for innovative promotional ideas that will increase customer traffic. The combination of experience, history with the accounts and understanding how our brand strategy can support each account’s strategy will allow us to design more effective and profitable programs in the segment.
ITM: Will you be continuing to use brand ambassadors in the market, as in the past?
JE: Yes, they are an important part of our brand strategy. They offer the kind of expertise and support that make our programs more effective for our accounts. Their focus will be on supporting our distributors and being a resource for accounts training. They are a well-educated group of people who bring expertise and passion to the business and will continue to be a resource to both local and national accounts.
ITM: Will the average on-premise operator see any difference in the brand in the year 2014, such as with package changes, availability or new flavors?
JE: The first thing accounts will notice is that we will have a strategy. Over the past few years, the brand was guided by an ever-changing direction and, therefore, accounts could not count on the brand. We will have both consumer and trade communication programs, which will position the brand as the super-premium vodka category leader. We will have a good balance of consumer communication and tactical programming to deliver on the promise of communication. We are looking at our brand architecture to insure we have a look and feel for our brand that consumers will find appealing and interesting, without losing our history and heritage. Given our over 80 years of history, we will take some time before making changes to the label, which I expect will be more evolutionary than revolutionary.
ITM: When can we expect to see some new flavors?
JE: That is a more difficult question. In looking at the category, we are flooded with all kinds of flavor introductions and as a result, these flavors are having a much shorter “life span” with the consumer. Our focus has always been on the quality of our flavors, which is why bartenders today still use our core flavors to make many of their signature drinks. Recently, Stoli introduced a number of flavors and the process was not good; so, the first thing we will do is sort out what we have, and then look at innovation both from a flavor and other new-product perspective.
ITM: Let’s talk about the product this is all about – Stoli. Stoli’s distillation and filtering process is unique. I had no idea that after the third distillation, it is filtered four times through quartz sand and Russian birch charcoal. There’s a lot more to this vodka than we see, isn’t there?
JE: Yes. In spite of the changing distribution partners, the company has always focused on quality. Stoli is the original and long-lasting premium vodka for one reason — quality. We are one of the few brands that controls all elements of our production, from the production of the wheat, where we own our own fields, to the state-of-the-art alcohol production plant we built a few years ago, and on to our blending and production site in Latvia. For over 80 years, we have been producing this incredible product the same way and that is why it is the vodka against which all vodkas will always be measured.
ITM: The mother company, SPI, has many other brands. Will we see the Stoli USA portfolio diversify into other categories?
JE: Our focus is to get Stoli and elit on track, back to the top of the category. That being said, we have a long-term vision for the company, which includes either acquiring brands that fit with our premium approach, or working with agency brands that complement our core portfolio. The key to making these decisions will always be that whatever we do will be a benefit to Stoli and elit. As a startup, albeit a rather large one, we want to insure we keep the nimbleness and entrepreneurial spirit of a startup, so we will not overload the company with too many other priorities. With the ones we do take on, we want to be sure we remain focused and deliver.