Honesty with customers is important, even when it's difficult. That doesn't mean you can't fashion a compelling good story, as marketers like to do.

If you want an example of how stories can help marketing, J Peterman is the single best example I can think of. Their use of obviously fictional backgrounds to create a sense of romance for their clothing and accessories is stunningly good.

Peterman has used its approach successfully because people love stories. We're hard-wired that way. But everyone expects to know when they're hearing a story. It helps them enjoy it. When you wipe the lines between reality and fiction clean and you don't tell them, they get angry. No one likes being played.

That's what makes the recent Daily Beast story about so many "craft" spirits coming from a single large Indiana plant so disturbing from a business view. It's a grand example of many companies trying to dupe the public.

For those who hadn't yet heard, it turns out that there are more than four dozen whiskey brands that slap their labels on the product from a single distillery: MGP. That isn't to say their products are bad. Some are reportedly quite good, aged 15 years in the barrel.

And there's nothing inherently wrong with private labeling products. It happens all the time. Go to an electronics retailer, wholesale club, or grocery and you'll find plenty of items made and packaged under the store's house brand. Costco private labels bourbon, for that matter.

Where many of the smaller labels go wrong is by moving out of the realm of story and into old-fashioned lying. They pretend that they make the products themselves. Some say that they're buying third-party whiskey to jumpstart their business while they get equipment, learn to properly distill, experiment with recipes, and let something age for years.

Yes, it takes a long time to get a real whiskey brand going. How much easier to buy something off someone else's shelf, pour it into your bottles, and have at it. And, again, there's nothing wrong with that, so long as you're on the up and up. But when you create an elaborate story to fool consumers, you're running an operation that, while perfectly legal, still smells of a con. Here's how Daily Beast described one label:

Templeton Rye, by contrast, has built its successful brand on being a product of Templeton, Iowa. They tell an elaborate story about how their recipe was used by the owner's family to make illicit whiskey in Iowa during Prohibition, and how that rye had become Al Capone's favorite hooch. They publish a description of their "Production Process" so detailed it lists the temperature (124 degrees) at which the "rye grain is added to the mash tank." They brag that they focus their "complete attention on executing each step of the distillation process." And yet, for all this detail, the official "Production Process" somehow fails to mention that Templeton doesn't actually do the distilling.

Somewhere on the company website is a link to a YouTube video that admits "the most difficult task when we started this company was identifying a distilling partner who was interested in working with us and who could produce a product to dad's exacting standards."

Oh, please. The exacting standards used for Al Capone? Or the existing exacting standards of a professional distillery that's happy to sell product to any bottler?

When it comes to building relationships with customers, authenticity is everything. That includes a story. Be an authentic story teller. That includes knowing that customers deserve the truth. If you have to hide what you actually do, chances are you don't have what it will take for the long run.

Published on: Jul 31, 2014
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