Get Barefoot and Have a Great Time! Uncorking the Success of Barefoot Wines
Hardship + Hustle + Heart = The Best Selling Wine Brand in America.
That’s the magic recipe Michael Houlihan and Bonnie Harvey discovered in 1986 in Sonoma County, California. The founders of Barefoot Winery came to the School of Hotel Administration to talk about their entrepreneurial story detailed in their new book The Barefoot Spirit. The team asserted that one does not always have to be an expert before pursuing ventures in an industry; rather this expertise can be learned along the way. Here’s what I took away from listening to their story…
1. Follow Opportunities Passionately
Their story began when a grape grower, and client of Harvey’s, was due $300,000 from a large winery and had yet to receive payment. The winery was in the middle of bankruptcy and had no way to pay for the product. However, the firm did have infrastructure and materials, which could be traded for the debt… Bonnie & Michael jumped on the opportunity, absorbed the debt and went into the winemaking business. After 6 months, registration, and brand brainstorming Barefoot Wines came into existence.
2. Listen and Recognize Niche Markets
During the early days of Barefoot, Michael Houlihan met with Don Brown, a big name in the wine industry, about strategic implementation. Brown was a no-nonsense businessman with little time, but when Houlihan started his pitch by asking how do you want to move forward, Brown was caught off guard. “I remember he was so surprised,” Houlihan recounts “that I didn’t tell him how I would give him my product rather I asked and listened to what he needed.” Brown was able to let Houlihan in on the rise of a niche wine market, Women grocery shoppers looking for “Tuesday night” wine – an entirely underserved clientele. This was the sweet spot.
3. Give Ownership To Your Staff
Nobody likes being micromanaged. As the company grew in size a larger sale team was needed for each new state’s market. The management team decided to let salespeople dictate the strategic launch for their respective market. “We let them pick nonprofit partnerships to work with our brand, let them pick the events to sponsor, and really trust them on what the community would support.”
4. Outsourcing and Contracting Are Your Best Friends
“We were a sales company really, and wine just happens to be our product.” Says Harvey “we had no facilities, yet there were plenty of vineyards and production houses…they just weren’t ours.” Turns out, this was one of the smartest moves to be made. Barefoot bought grape juice and bulk wine from an array of growers, traded goods & services for production, and used strategic partnerships to keep a focus on their core competency: sales & distribution. “We leveraged contracts to ensure consistent high quality. We only accepted a certain quality of grapes and bulk wine for payment. We never considered producing the juice ourselves. Because we were non-vintage, If we had a bad season, we did not still need to put it out on the market when we knew it’s wasn’t the best it could be. This way we ensured consistent taste, flavor and quality from year to year.”
5. Creative Destruction: We Don’t Have To Be Sommeliers To Enjoy Wine
“No vintage, no French and no castles.” Those were the instructions from Brown on how to shake up the industry. “We made a logo that was simple and could be seen from 4 ft. away. We dropped a lot of the lingo that could come off as pretentious, and well, we made wine fun!” Harvey and Houlihan recount. “We used innovative techniques to help us make a name for ourselves. Our best move was partnering with local nonprofits at events and promotions – the community got to know us on more authentic terms.” When it came to marketing, the team asserted the importance of asking everyone their firm’s opinion. Bottles were being thrown on the bottom shelf, below the eyes of shoppers. And it was the back-office staff that found the solution: make fun grape stained foot decals to walk shoppers to the Barefoot shelf in the store.
Ultimately the brand was acquired by wine giant E.J. Gallo in 2005 – a testament to the success of Houlihan and Harvey. “We caught the eye of the big guys, to a level where we demonstrated a significant and growing market share.” That’s pretty good given the two founders had no prior experience in the world of vitis vinifera and grand cru. The team was asked to remain on as consultants for a year and the brand even went on to win ‘Fastest growing wine amongst the TOP 5 Popular Brands,’ and ‘MarketWatch Magazine’s Wine Brand of the Year.’
This just goes to show you that inhibitions should be checked at the door, one could always shake up an industry, capitalize on opportunities and have fun along the way. To which I say, cheers!
…now where’s that bottle opener…
Check out E@D’s exclusive interview with Barefoot Wines founder Michael Houlihan!
E@D also spoke with Marisa Sergi ’15, who is currently founding her own startup ‘Red Head Wines’ and asked what were her key takeaways from the presentation…
- Connecting your brand with your consumers is vital for success. Barefoot did a great job targeting their audience by utilizing charities that correlated with their brand, especially the beach and surf related charities. Being a large brand, it is nice to know that they strategized to try to keep as close of a watch on their product as possible; this can be challenge for brands that are nation-wide. This was done through efficient management techniques with national salespeople
- I was very surprised that they entered the market by only focusing on sales, not as enologists. I was impressed to hear that the Barefoot founders did not have any experience with wine but learned and became so successful. Their marketing strategy and approach was brilliant and I learned a lot from their focus on sales.
- I was shocked and was intrigued that they both took risk to help a wine production affiliate get out of debt. That takes courage and their risk turned into a success story. Barefoot sets a great example for those who want to take risks to become successful.