The Patron Way: From Fantasy to Fortune - Lessons on Taking Any Business From Idea to Iconic Brand: From Fantasy to Fortune - Lessons on Taking Any Business From Idea to Iconic Brandby Edelstein
How a billion-dollar business ascended from a forgotten dusty agave field in central Mexico
The Patrón Way details the unorthodox building of the brand, the extraordinary creativity and marketing ingenuity of Patrón's cofounder,/i>/p>/i>/b>
The never-before-told story of Patrón Tequila--the brand that revolutionized an industry
How a billion-dollar business ascended from a forgotten dusty agave field in central Mexico
The Patrón Way details the unorthodox building of the brand, the extraordinary creativity and marketing ingenuity of Patrón's cofounder, Martin Crowley, and his life partner, Ilana Edelstein, and the way Patrón single-handedly transformed the face of the liquor industry. Edelstein was involved in every aspect of the business--from the brand’s iconic bottle to designing the sexy and attention-getting outfits worn by the famous "Patrón Girls" at promotions and parties to running the back office.
Patrón is a tequila so sumptuous--and so brilliantly marketed--that it has become the world’s leading ultrapremium tequila and has changed the way the spirit is experienced: what was once "gasoline" slammed back in a shot glass is now poured from an exquisite hand-blown bottle into a chilled glass and sipped to attain a "Patrón high."
Today, Patrón has grown to over a billion-dollar brand, and it is the largest generator of revenue of all tequila brands. Edelstein combines the dramatic story of the company’s rise to success in an astonishingly competitive and sometimes cutthroat industry with practical business lessons about R&D and brand building that business leaders can put to productive use in any industry.
A tale of love, sacrifice, celebrity, dizzying success, and ultimate betrayal, The Patrón Way reveals for the first time all the details behind the intimate relationship and marketing genius of the "power couple" that transformed the spirits industry.
PRAISE FOR THE PATRÓN WAY
“The Patrón Way is a good chronicle of a luxury brand's path to success. . . . Ms. Edelstein dispenses useful advice to aspiring entrepreneurs."
The Wall Street Journal
“Anyone desirous of making sense of tequila’s current status will be well served by chugging The Patrón Way.”
"There are some good lessons for entrepreneurs launching a product. No doubt, the rise of Patrón is something many would love to emulate. And Ilana Edelstein was there from the beginning and delivers an inside view of the story."
New York Journal of Books
"Business lessons echoing 'know who the true tastemakers are, and use them wisely' are sprinkled throughout the book. . . . most readers will appreciate the informal 'tell-all' style that reveals an emphasis on doing some paperwork to cement their role in any business they help grow."
“I can honestly say The Patrón Way by Ilana Edelstein was a delicious cocktail of innovation and inspiration with a twist of tragedy for a bittersweet finish.”
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THE PATRN WAY
From Fantasy to FortuneLessons on Taking Any Business From Idea to Iconic Brand
By ILANA EDELSTEIN, SAMANTHA MARSHALL
The McGraw-Hill Companies, Inc.Copyright © 2013 Ilana Edelstein
All rights reserved.
Out of the Blue
Miles of dusty Mexican roads were getting monotonous. The love of my life, Martin Crowley, was just a few days into his monthly buying trip for his new company, Architectural Products Marketing (APM), and was sourcing exquisitely handcrafted tiles, carved stone, marble, ceramics, furnishings, and other architectural pieces from dozens of out-of-the-way factories and quarries in the countryside. The plan was to bring them back to sell to designers and architects building beautiful homes for the millionaires and billionaires living in Beverly Hills and along California's Gold Coast. APM's customers loved his unique and refined taste, and he was doing a roaring trade.
Martin knew exactly where to find the best artisans in Mexico and was an avid collector of objets d'art. He had an eye like no one I'd ever met and the ability to envision how any piece would work in interior and exterior design and landscaping. He was also a brilliant negotiator and could bargain down the price so that the product was practically being given away. But doing that required him to cover a lot of ground, and he was getting exhausted and lonely. To keep himself company, Martin had found a stone carved statue of a hotei—a bald, laughing Buddha with a big potbelly. This particular one had a missing toe, and Martin kept him on the car seat next to him. It must have brought him luck.
Whenever he went across the border, he always hired the same driver, Felipe, a local guy who spoke English well and knew the terrain intimately. Martin didn't speak Spanish, and perhaps that was just as well, because when he did speak to anyone Latino, his English suddenly had a Spanish accent. On this particular day of road travel, the pair found themselves in the mountains of Jalisco, about two hours from Guadalajara, smack in the middle of the country.
Lost in the passing landscape, Martin found himself flashing back to a conversation he'd had with his APM business partner and friend, the entrepreneur John Paul DeJoria, earlier that month. Martin and John Paul, or JP, as he is also known, had been drinking shots of Chinaco Tequila when they began speculating about which tequila the aristocrats of Mexico drank. As two men of curiosity and taste, they had this type of conversation regularly. Martin promised to check it out on his next trip to Mexico, and it just so happened that here he was, right in the heart of tequila country.
If he was going to find the finest tequila anywhere, this had to be the place. The highlands overlooking the valley of the Rio Grande provide the perfect conditions for growing blue agave—a plant from the lily family with a core that looks like a giant pineapple, a pina. Harvested and processed a certain way, agave is distilled for the production of tequila. But more on that later.
FIELDS OF BLUE
Welcoming a distraction, Martin instructed Felipe to stop at every tequila factory along the way to check out its product. They drove through miles and miles of rolling blue agave fields. God knows how much tequila Martin ended up consuming on this day trip. He lost count. But he was sober enough to remember one extraordinary place.
As soon as he entered the factory, he knew it was different. It was rather small and unusually clean, with wide open spaces and plenty of light and fresh air. Above all, there was a noticeable sense of calm. The property, situated near the highest point of the region, consisted of sparse old adjoining buildings on the side of a hill overlooking a muddy creek. The distillery had been owned by this family for generations, and they still made tequila the old-fashioned way, exactly as they had for 50 years. The place was a complete throwback. The factory had hardly been updated, and apart from a single customer in Japan, their tequila could not be found anywhere outside Mexico.
Its unique flavor was the result of the high-quality agave that was used and the love, method, and care with which it was made. The only ingredient used was premium Agave tequilana—Blue Weber agave—and nothing else. At that time, few, if any, factories produced pure agave. Something would always be added to dilute this expensive ingredient, or shortcuts would be adopted in an attempt to replicate the aged flavor, such as adding oak chips in the barrels to quickly create an oak color and flavor.
Martin took one sip of this tequila and knew he didn't need to visit any more factories. Nothing could possibly top this. He bought a few bottles, wrapped up the rest of his buying trip, and headed back to his funky little guest cottage in Hermosa Beach, California.
People assume that Patrón has been around forever, but it was late in the year of 1989 when Martin first discovered what led to this liquid treasure.
By then, we had been together only a few months, but it was one of those once- in-a-lifetime love affairs in which you connect instantly and on every level: physically, spiritually, and intellectually. We'd met in our middle years, already established and leading what we'd assumed were rich and full lives. I was a transplant from my native South Africa, having come to California in the late 1970s to pursue a free-spirited, independent life and live close to my cherished sister and brother-in-law, Sharon and Len. After growing up in a parochial community and chafing under the restrictive rules of apartheid, I relished my newfound freedom in America and saw opportunities to flourish around every corner, eventually building a thriving financial consulting firm.
Martin was a native Californian who'd left his broken home while he was still in his teens, seeking adventure in the Peace Corps, racing his sailing boat around the world, and building a small hotel and restaurants. He was a consummate connoisseur and entrepreneur who could turn any passion into a business. Not only did he flow with endless brilliant ideas, he followed through and actually brought them to life. Possessing more drive and focus than anyone I'd ever met, this was a man with an expansive imagination and the extraordinary ability to turn fantasy into successful tangible reality. Finding our soul mates seemed inconceivable to us, since we had lived our lives without giving it one thought. It was the first time either of us had felt so truly and completely loved, and our world suddenly got bigger, brighter, and better in every way.
We'd met through a mutual friend at a wine tasting. Even in that first flirtatious conversation we had, I learned so much from him about wine. Little did we know at the time that sipping only the very best was to be the beginning of a major theme in our life together.
After that first encounter, we were rarely apart. At this point, we were not yet cohabiting, but we might as well have been. When he wasn't at my place on the Marina Peninsula, I was at his. When he traveled to Mexico, we spoke several times a day. He'd been working so hard to build up his business and recover from a devastating bankruptcy. I'd missed him terribly and couldn't wait to see him again.
When I walked in the door of his beach house, Martin didn't say anything about the tequila, but he had a gleam in his eye. I could tell he had a surprise for me, but there'd be no getting it out of him until he was good and ready. We had our usual reunion: incredible sex, twice; a gourmet meal Martin lovingly prepared; and a bottle of vintage red wine between us. We were relaxed and happy. It was good to have him back.
When I gently teased him for details about his trip, Martin gave me a sly smile, walked over to his still unpacked bag, and pulled out what looked like one of those dusty old decanters a pirate might have taken a swig from 200 years ago.
"Martin, there's a dead fly in the bottle!" I said, pointing to the deceased insect.
"I know. It's Spanish fly, the aphrodisiac," he replied suggestively.
"Really? Let's get it out. I want to try it," I said, knowing full well it was nothing of the kind.
"Forget the fly, honey; you have to taste this tequila," he said, pouring some into a brandy snifter and handing it to me.
"Please, baby, don't ask me to drink tequila. You know the mere smell of the stuff makes me gag."
It was true. As was the case with millions of others, a night of overindulgence in tequila years earlier had made me so sick that I wanted to die; it was the foulest hangover imaginable, and I never wanted to live through it again. I couldn't be anywhere near the stuff without heaving. Besides, hard liquor wasn't my thing; fine wine and champagne were my preference. But Martin's enthusiasm was infectious.
"Come on, hon. I promise you, this tequila is different. You've never tasted anything like it."
"Okay, but I am definitely not downing all of that."
"No, you are not going to shoot it. Just sip it like a fine cognac."
Reluctantly, I put my lips to the glass. What struck me first was the lack of nauseating, gasolinelike tequila fumes. There was a clean and intoxicating aroma to the liquid. I took a tiny sip, and as with fine wine, I let it linger in my mouth for a moment before swallowing.
"Wow!" was all I could say.
For Martin, that was enough. He knew how much I had hated tequila, so I was the perfect control group for this experiment. His discovery had passed the Ilana taste test with flying colors.
A few years later, in an interview with the Los Angeles Times, Martin described Patrón as so much more than just a taste; it was an experience: "It's a feeling you get—it's different from drinking vodka or gin. It's more of a psychotropic effect, whether real or imagined."
Martin was able to make his discovery because he was open to what the universe had to offer. His senses were alive, so the moment he tasted the tequila, he understood perfectly the value of what he had found. Many others would have enjoyed a drink, moved on, and forgotten about it, but Martin knew that what he had in his hands was incomparable and that if he felt that way, millions of others would too.
To this day, Patrón is the only spirit I drink, precisely for that reason. Its pure and delicious high cannot be compared to anything else. This is not some high-octane beverage for college kids on spring break. It is so much more refined. No matter how you choose to drink it—mixed as a margarita or sipped straight over ice with lime—you can taste the difference and always experience a cool, smooth finish. The burn that had become synonymous with tequila was gone. Patrón goes down clean and crisp, with no regrets the next morning.
We spent the rest of the evening and the early hours of the morning dreaming up ways this product could be marketed. As design junkies, creating and re-creating was something we loved to do together. Suddenly, we had a new project. Martin came up with the name, Patrón. He wanted a word that meant the same in all the Romance languages. Patrón means the good boss or godfather, the guy you go to when you want to marry off your daughter. We liked the aristocratic, dignified way it sounded. The word was easy to pronounce, easy to remember, and portrayed the idea of being the master.
We started modifying and redesigning the bottle. Our prototype was a rather crude and somewhat deformed phallic design with an uneven, elongated neck that was at an angle and a glass stopper. Martin and I were enamored with perfume bottles and packaging and had amassed an extensive assortment between us, so we hauled them out of the bathroom and studied their shapes and labels. We were taking the lead from the fragrance industry, which creates a sense of occasion through exquisite presentation. No one had ever spent that much on packaging in the spirits industry—it almost matched the price of the contents—but as far as we were concerned, it was necessary for the exterior to capture and accurately reflect what was inside. The brand needed a handcrafted look that would suggest that the package's contents were precious and rare. If additional investment was required to create a sense of luxury worthy of Patrón, so be it.
I found a green ribbon and tied it around the bottle's neck while Martin sketched possible labels. He had a little golden honeybee among his hodgepodge of trinkets (which I still have) and came up with the idea of using it as an emblem. Bees are magical creatures. Martin and I consciously tried to be in the moment, so "bee in the moment" wasn't much of a leap. It became one of our marketing taglines for Patrón. Purely as an afterthought, the bee also suggested that the contents of the bottle were irresistible, like nectar.
We knew instinctively that the packaging must creatively, truthfully, and precisely reflect the quality and experience of the contents. For Martin, it wasn't just about marketing; it was his life's philosophy. Years later, looking through some old papers, I came across a handwritten note from Martin that perfectly sums up the significance he gave to beauty in all things:
The divine energy put into a true work of art is captured and then radiates back into the environment. The more beauty we surround ourselves with, the more God's creative energy we are exposed to and can metabolize into our own being and synergistically grow with the beautiful and loving energy.
He then signed it with a phrase he used repeatedly: "Truth and beauty are lovers."
Martin knew that design is so much more than just a look. It also has the power to create a powerful emotion in the consumer. It's an approach that makes the difference between iconic consumer brands such as Coke, Chanel No. 5, even Campbell's Soup and just another product that gets lost in the crowd.
Once we were on a roll, there was no stopping us. We were both guilty of succumbing to designer's disease. At one point, after hours of tinkering, we sat back and looked at the little bottle, and Martin turned to me, sighed wistfully, and said, "Wouldn't it be wild if this became the top-selling tequila in the world?"
The only problem was that neither of us knew a thing about the liquor industry.
NOTHING VENTURED ...
The next night, we went to dinner at John Paul DeJoria's house in Beverly Hills. People know JP mainly as the owner of John Paul Mitchell Systems. He's the handsome, swarthy guy with the beard and ponytail featured in all the magazine ads, along with his exquisite wife, Eloise, a blonde Texan beauty. But what many people may not realize is that John Paul is a savvy investor with a hand in multiple business and philanthropic ventures. It's as if he has some sort of sixth sense about what will succeed, and almost everything he touches turns to platinum.
In John Paul's words, he was the "bank" in his partnership with Martin. This successful business marriage led to a friendship among the four of us, so we were often at one another's homes dining or partying. One of the few conditions JP asked of Martin was that whatever they did together should always be fun. He understood perfectly that a brand is only as good as the quality of the people involved. He shared our deeply held belief that what separates a good product from a great one are the intangible but powerful forces of the human spirit. For this and many other reasons, I adore John Paul and Eloise.
Martin brought the mocked-up bottle of tequila to dinner with us, with the fly removed of course, and poured John Paul a shot in a brandy snifter.
"Here it is, JP, the finest tequila in Mexico, and I believe with the help of tequila master Francisco Alcaraz, it can be made even better. I don't know what tequila the aristocrats drink now, but I do know what they'll be drinking in the near future."
"Wow. Martin, you're right; this is it!" exclaimed John Paul. "We're partners. Go back to Mexico, get Francisco involved, and buy a thousand cases. Worst case, if it doesn't sell, we'll have the world's best tequila for ourselves and our friends and family."
A DEAL THEY COULDN'T REFUSE
Soon afterward, Martin went back to the factory with Felipe and made the owners an offer. He would make a commitment to their entire production, providing all the bottling and packaging materials, but they couldn't sell to anyone else. We hadn't sold a dime's worth of tequila yet; his goal was to tie up the source. The family owners agreed to his terms. They must have thought Martin was a complete madman, but who would say no to a 100 percent guarantee of sales?
Back in Hermosa Beach, we continued designing. Martin and I bounced more ideas off each other in a creative frenzy, feeding off each other's imaginations as we took one concept and then raised the bar to the next level and the next. We were literally consumed with creating something that would do justice to this superb product. Like proud parents, we pampered and reveled in our newborn. Our efforts were truly joint and completely intertwined; enhancing our baby was our singular goal. There was no competing or even differentiating; we were just two impassioned beings, trusting their intent and creativity and surrendering to everything in the process. As much as we recognized each other's imprint on our progeny, we thrilled and marveled at what the magical mixture of our creative DNA had brought to life.
Little by little, our packaging evolved into the ultrapremium gift look you see on the shelves today. By then, with the help of Ron Wong, a stellar graphic designer and friend, we'd already designed the labels, with wording, ribbons, a booklet, tissue paper, and a box. Ron also created a usable mock-up of the bottle for us. Fortunately, Martin was able to use his sourcing expertise to find Cesar Hernandez, owner of the only remaining glassblowing factory in Mexico where they still used artisans to handblow each bottle. Perfecting our bottle design was a lengthy process of trial and error. The bottles were made from 100 percent recycled glass, not too dissimilar from the original hive-shaped bottle, with glass stoppers, like true decanters. Later, Martin added the punt at the bottom, as on wine bottles, and had the word Patrón embossed in the glass on the side.
Excerpted from THE PATRÃ"N WAY by ILANA EDELSTEIN. Copyright © 2013 by Ilana Edelstein. Excerpted by permission of The McGraw-Hill Companies, Inc..
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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Meet the Author
Ilana Edelstein met and fell in love with Martin Crowley in 1988, soon before Patrón Tequila was created. She is the founder of IE Financial Services, which provides a range of financial and retirement services to teachers. Edelstein is also the marketing consultant for EVOL, a new premium sugar-free, gluten-free distilled spirit company.
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