Water that spent 12,000 years trapped in glaciers is finding its way down the Labrador Current, turned into alcohol at a Newfoundland distillery, and poured into glasses at posh clubs where most of us couldn’t afford to drink.
A small U.K. company is introducing Iceberg Vodka to up-scale London drinking establishments and department stores, fighting to create a following for Newfoundland liquor in a market dominated by European labels, and it has plans to expand and go global within a year.
Goran Svilar, co-director of Signature Lifestyles, the company that owns the Iceberg brand in the U.K., says the vodka’s story helps it stand out in a crowded market. Iceberg Vodka is made by harvesting water from icebergs that drift south past Newfoundland and Labrador.
“When we first saw the video of how the product was made, we fell in love, because our passion is branding and developing something,” he says.
“It wasn’t a gimmick,” added Ali Samli, who runs Signature Lifestyles with Svilar. “It was a real story and it’s a very unique story. The unique selling point of the product was already there. To me that’s one of the biggest advantages you can have.”
But it isn’t easy selling Canadian vodka in a market where Russian and Scandinavian products get the most respect. Svilar and Samli faced sceptical customers and bar owners in the first six months of business because the vodka came from Canada, a country more known for whiskey and beer than clear spirits.
“If (customers) hadn’t heard of Iceberg, they’d usually ask ‘Canadian vodka, really?’” says Samli. “Canada is not perceived as a cool country, in some sense, but everyone knows Canada. Canada has a good reputation for good-quality products and natural ingredients.”
The big break came in December 2010 when Iceberg Vodka became the house vodka of Zuma, a well-known Japanese restaurant chain. Then it became the house brand of Nobu London, a prestigious restaurant that’s part of a larger franchise co-founded by Robert De Niro.
Svilar says that within a year customers will be able to buy Iceberg Vodka in any Nobu restaurant around the world, bringing Newfoundland spirits to up-scale locations such as Malibu, California and the Hamptons in New York.
Signature Lifestyles is also targeting the retail market, with plans to introduce Iceberg Vodka to Harrods and Selfridges department stores, two of the most expensive shops in London. The company has also made Iceberg available at online liquor stores where the bottles go for much higher prices than more mass-produced brands.
At vodkaemporium.co.uk, for example, Iceberg Vodka 700ml bottles sell for £25.69 (approximately $41), while Smirnoff Red Label 700ml goes for £13.23 (approximately $21). This also makes Iceberg Vodka a much more exclusive brand than back home in Newfoundland and Labrador, where a 750ml bottle sells for $25.78, the same price as an equally-sized bottle of Smirnoff Red Label.
The liquor costs a lot at bar counters as well. A 50ml shot of Iceberg Vodka at Nobu London will have you spending £9.50, or about $15.
Svilar says their strategy is to present Iceberg Vodka as an exclusive, high-value product to customers and bar owners, setting it above the more common brands. It’s a plan his company adopted in 2008 when it began selling high-end luxury items during the U.K.’s worst recession in over a decade.
“In a recession, either (companies) will fall apart, or they will invest and look for something new to attract clientele,” he says. “Because recession or no recession there are always people who have money. The people who have money are more cautious of what they spend money on, and when they’re spending, they’re more eager to spend more money but for a better product, to differentiate themselves from those with less money.”
To reinforce the vodka’s premium status, Iceberg Vodka will come in new transparent one litre and white three litre bottles starting later this year. Samli says the new bottles will help the product stand out from other vodkas on nightclub shelves.
“The (North American) packaging wasn’t impressive enough,” he says. “It wasn’t reflecting the quality of the product or the story of the product. Unfortunately in order to sell the product these days the packaging is probably 70 per cent of the whole perception. We had to work on the packaging so people could see it as a high-end, premium product.”
The U.K. continues to struggle economically and with a financial crisis rocking the European continent, it’s hard to see the country’s outlook improving in the near future. Svilar and Samli are confident by targeting high-income customers they make themselves resistant to economical trouble.
Svilar says Signature Lifestyles is now selling 1,500-2,000 bottles of Iceberg Vodka a month, and the goal now is to start selling 3,000 bottles a month by next spring. The company plans to do this by focusing more on the customer to drive demand and increase its volume of sales.
“We became available in quite a few high-end venues around London, and slowly we are developing other parts of (the) U.K., but in order to push our product in retail, we have to focus much more on public relations,” says Svilar. “In order for the final consumer to pick up the bottle from the shelf, and differentiate it from other products, he needs to know about it, which so far has only been done through the position in restaurants.”
Part of that public relations drive may include a press trip to Newfoundland and Labrador in 2013 that will show the world how the vodka is made, the same story that impressed Svilar and Samli enough for them to buy the U.K. brand rights two years ago. Svilar, who is from Croatia, and Samli, from Turkey, have never been to the province and say they’re excited to see the place where their vodka is made.
“It’s really important for me,” says Svilar, “When I see it on video, it looks incredible, so I’d love to see it myself. It’s definitely on the agenda. I think the world needs to see the story.”
Iceberg Vodka is distilled and bottled by Newfoundland and Labrador Liquor Corp. in St. John’s. An increase in sales overseas will bring more jobs to the province, and if the vodka becomes the hit of London, a boom in demand is a real possibility, according to Svilar, calling the city a trend setter when it comes to luxury items.
“London, I believe, is an amazing shop window of the world,” he says. “Even though there’s a recession, you’re targeting people with money ... but you give them vodka from the purest water available on Earth.”