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Friday read: Tequila overload and the celeb-driven bottleneck

Published:  27 October, 2023

Just as 818, the new tequila brand from Kardashian scion, Kendall Jenner, lands in the UK, Michael Goldstein, drinks entrepreneur behind Prosecco Ventures asks, ‘Can tequila’s fiery spirits brands continue their ascent, or will they fade into obscurity?’

‘You know what you need? A celebrity for your drinks brand!’ As a veteran marketer and drinks entrepreneur building independent brands, I hear this cliché often. Yet, the surge of celebrity tequilas is unmissable.

George Clooney and his partners launched Casamigos in 2013. Four years later, Diageo bought it for $1 billion and sparked a celebrity tequila rush that attracted stars and investors with the sales pitch, ‘If Clooney can do it, so can we’.

The question is, as celebrity tequila brands multiply, can consumers support them all? It’s a competitive star-studded market resembling a high-stakes game of one-upmanship to shift sippers between brands.

The tequila roster

To kick things off, here are 13 celebrity tequila brands from the USA, now available in the UK.

DeLeón (2009): Backed by Diageo in collaboration with Sean Combs. Now at the forefront of a spicy lawsuit.

Casa Noble (2011): Backed by industry giant Constellation Brands, Carlos Santana became a part-owner. Santana’s Mexican heritage stands out against competitors with superficial tequila connections.

Casamigos (2013): The now legendary Clooney venture.

Cincoro (2019): Backed by NBA court royalty Michael Jordan and co.

Jaja (2019): The Chainsmokers music duo partnered with leading tequila producer Casa Cuervo.

Villa One (2018): Drinks titan Stoli collaborated with Nick Jonas and John Varvatos.

Próspero (2019): Rita Ora teamed with spirits marketing firm Conecuh Brands, targeting vibrant women and tequila enthusiasts. But does tequila resonate with Ora’s fans?

Tesla Tequila (2020): Elon Musk transformed an April Fools’ joke into an actual product.

Lobos 1707 (2020): Launched by basketball superstar LeBron James.

Teremana (2020): ‘The Rock’ partnered with Mast-Jägermeister to secure his tequila legacy.

818 (2021): Kendall Jenner received initial praise, but mixed reviews. While Jenner’s fashionable marketing is potent, the affinity of her young female audience with tequila culture is questionable.

Calirosa (2021): Maroon 5’s Adam Levine and wife, former Victoria’s Secret Angel Behati Prinsloo, made a 50% capital investment in their drink business, distinguishing their commitment in a crowded celebrity drinks scene.

Gran Coramino (2022): A collaboration involving comedian Kevin Hart and Jose Cuervo’s CEO, Juan Domingo Beckmann, Global Brand Equities, and Proximo Spirits.

It’s not just about the money; it’s about making a mark

Celebrities always benefit from drink promotions and even in failure, their profile rises. For companies, it’s riskier: they gain shelf dominance but risk losses if the star doesn’t spike sales.

In the bustling tequila scene, many celebrities appear to ride waves rather than create them. While many celebrity tequila brands proclaim independence, behind-the-scenes dealings paint a different picture, with many co-developed and backed by drinks giants. Consequently, these celebrities typically receive royalties or payment guarantees akin to standard endorsement deals.

This distinction matters. Without genuine ownership and skin in the game, celebrities may not realise the massive pay-outs and elite entrepreneurial status that attracted them to these beverage ventures in the first place. After all, if a conglomerate already holds a significant stake or outright ownership, what incentive does it have to sell or buy out the brand?

Why haven't we witnessed a surge in celebrity-endorsed gins, vodkas, or even my beloved Prosecco? Maybe they lack that special ingredient – the George Clooney factor. Tequila distinguishes itself with straightforward production, easy market entry and unparalleled flavour.

While ‘authenticity’ and ‘innovation’ are buzzwords in the drinks business, few brands embody these traits. Celebrity tequilas may grab attention with star power, but repetitive tales and familiar bottles erode authenticity. The monotony of labels underscores that even uniformity attracts attention and soaring investment.

Money talk

Although tequila’s market size is just a quarter of vodka’s, its surge in popularity is undeniable. With a rise in demand causing a hike in agave prices, the forecast remains sunny: a 9% Compound Annual Growth Rate (CAGR) through 2026 and a global value surge of 67%, further propelled by a UK boom (IWSR).

Recent trends highlight a growing tequila intrigue among British consumers. Pernod Ricard (Avion), Diageo (Casamigos, Don Julio), and Bacardi (Patrón) dominate the tequila market in the UK with their vast resources.

The bottleneck ahead

The tequila market is rapidly approaching a bottleneck. An influx of celebrity-branded tequila risks oversaturating the market, making it harder for brands to stand out. Meanwhile, rising agave prices threaten to increase production costs, which could dampen consumer enthusiasm.

In a saturated market, where superficial ties to tequila are increasingly evident, brands must innovate to assert authenticity and maintain relevance.

While it’s uncertain what this innovation might look like, one doesn’t need to be a marketing expert to understand that mere celebrity endorsement isn’t a guarantee of success.

True brand loyalty isn’t about the quick sprint – it’s the enduring marathon, and only those who invest in forging genuine connections go the distance.