What the Maker’s Mark dilution debacle says about corporate strategy

So basically if Maker's was its own boss, this would not be happening. As is, Maker's is propping up terrible brands that Beam, Inc. is trying to push and in order to continue pushing those Maker's must be the sacrificial lamb.<p>Imagine if Maker's only had to worry about their own product. Now, a 6-7 year shortage would buy them 100 years of legendary status. "This bourbon is so good, for a while you couldn't even buy it!" They position themselves as an artisan product. What's a better story to tell as an artisan than huge growth and small batches?<p>As is, Beam, Inc. is like the cable networks: selling you HBO bundles with 200 channels of worthless crap, hindering HBO's ability to innovate in the process.

Sometimes you have to make an idea public to understand how truly stupid it is.<p>For anyone that doesn't understand why this is such a big deal, when you make bourbon drinks, especially a mint julep, you want ~100 proof liquor because you add so much ice that otherwise it becomes too watery. Makers Mark was basically stating that they didn't care about being taken seriously as a bourbon whiskey and their customers understandably had a cow, man.

That is some genius marketing move; although an extremely risky one. How much earned media did Maker's Mark get over this? How many people will be buying their bourbon rather than a competitors' because they "decided to do the right thing"?

&#62; a growing number of bars in D.C. using Bulleit bourbon, a bit cheaper and rougher on the finish than Maker’s<p>Bulleit is better, frankly. Maker's is overrated.

If you want to relate this to the web, imagine that you have more traffic than you expected, but can't bring up more capacity right away - if you do your own hosting, this is one of the only drawbacks.<p>So, you have the choice of throttling traffic, making things worse for everyone but at least everyone gets served, or you traffic shape and most people get full speed but a percentage don't get anything at all due to packet drops.<p>Looks like Beam decided to traffic shape!

I'm not a drinker, so maybe this is a stupid question, but why can't they dilute their stock with ethanol instead of (or in combination with) water, so the proof is unchanged? They'd be diluting the flavor, of course, but that would happen in any case. No?

In Australia, Maker's Mark lowered the proof a while ago. The bottle I have in my pantry is 40% (80 proof). Not to mention, bottles run ~$40 (1 AUD ~= 1 USD), so I suspect the branding/marketing considerations are different.

I believe they did this to make more money off the Chinese market. While whiskey drinkers in China mostly drink scotch, they recently have warmed up to bourbon. They mostly buy alcohol not for enjoyment of the drink itself, but to impress business clients. So they are buying lots of Maker's Mark for the famous brand name and distinctive bottle, and they couldn't care less that it's being diluted--they might actually enjoy it more that way.

I thought part of the original reasoning was that by dropping to a slightly lower proof they could also sell in locations where the current alcohol level was too high (states with tight liquor laws), but I'm not hearing any of that now.

Hmm, deliberate marketing ploy?