The first time Serge Chistov walked into the West Caldwell offices of R&R Marketing, a wine and spirit distributor, he spent 40 minutes pacing the reception area, just waiting to be seen.
He knew the company and what it could bring to his growing brand of vodka, Exclusiv. But the company had no idea who Chistov was. Sight unseen, he was just one of dozens of vodka companies vying for a piece of the New Jersey market every single year.
"I would say we probably get presented at least 20 new vodkas a quarter that want to come into the state and are looking for distribution," said Daniel Leto, a business manager at R&R Marketing.
So it was up to Chistov to convince R&R that his vodka was worth their time. In the end, he won them over — R&R is now the sole distributor of Exclusiv vodka in the state of New Jersey — because Exclusiv offers high-quality product for around $10 a bottle.
"It's a huge market, and this entry, at this price point, finds a consumer without any massive advertisement whatsoever," said Chistov, who immigrated to the U.S. from the former Soviet Union in 1989.
"It's a perfect formula," he added. "I mean, everybody that I know is looking for the best value that money can buy. That's the American way."
And Vodka is, hands down, America's liquor of choice. Perhaps it has something to do with the liquor's extreme mixability, the fact that it tastes like whatever you throw in the glass with it. Or maybe it's the sheer volume on the shelf.
Of the 50 top brand launches for R&R this past year, the top three were all vodkas. Bacardi Pineapple ranked No. 1. Exclusiv's cherry-flavored vodka came in at No. 2. And Ciroc was No. 3.
That level of popularity is mirrored nationwide: Five of the top 10 fastest growing spirit brands in the country are vodkas, according to Technomic, an online resource for food industry data.
But although the market is flooded, Leto said it is far from saturated. And future opportunities lie mostly in flavors.
To that end, Chistov, who lives in Manalapan, has recently come out with a cherry-flavored line, as well as the XO Napoleon flavor, which is a brandy-infused vodka.
"I think the public is ready for the experiments," he said. "This is something that is interesting and cool."
Chistov is not alone is his quest to capture part of the booming vodka market, not even in New Jersey. Other companies are angling for a piece of the action, with ideas that go beyond new flavors.
Mike Calleja and his partner, Drew Adelman, launched Devotion Vodka in 2009, building their brand on being both sugar- and gluten-free.
"(Vodka) is the largest category. It's 35 percent of all alcohol sales in the industry," Calleja said. "You have to be different to cut through the clutter."
Although vodka might not be the first thing that springs to mind when you think gluten, some brands are made from wheat, which could aggravate a gluten allergy. And some flavored vodkas contain added sugars, Callejo said.
Devotion, which recently opened an office in Red Bank, may not be the only vodka on the market that is both gluten- and sugar-free, but it is the first brand to labor through a lengthy approval process to get "gluten-free" and "sugar-free" printed on its bottle, Callejo said.
That is a point of differentiation for the company, which now has six different flavors that cost around $20 a bottle. And Devotion has doubled its sales every year since it launched. This year, it will sell around 30,000 cases, and sales for next year are projected to hit 50,000, Callejo said.
"Those two touch points, sugar-free and gluten-free, really set us apart," Callejo said. "We have to find those little niche things to separate us."
For Exclusiv, which is manufactured in Moldova, the niche has been putting high-quality product in a low-cost bottle. Exclusiv is on the shelves in 14 different states, and this year, the company sold more than 550,000 cases. That's up from 286,000 cases last year and 99,000 cases the year before that, Chistov said.
That success has come with next to nothing spent on advertising.
But that strategy will likely change in 2014, when Chistov said he is looking to start advertising to take the company to the next level: "We already have the core of the guys that are ahead of the curve. Now it's time to go after the total mass."
Leto, of R&R Marketing, agreed that — along with tapping into the popularity of pineapple — is the right move.
"If you want to be a big brand, you've got to act like a big brand," Leto said.
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