In nearly 50 years in Scotch, James Espey has seen it all, from the whisky loch to the rise of single malts. A veteran of some of the industry’s leading jobs, he helped launch the Classic Malts and Johnnie Walker Blue Label, and established the Keepers of the Quaich. Now in his 70s, his latest venture involves seeking out the rarest of spirits under the Last Drop banner. He spoke to Richard Woodard.
It’s no wonder that James Espey begins our conversation by professing his passionate belief that everything – you, me, the UK, the current Prime Minister – is a brand. This, after all, is a man with the likes of the Classic Malts, Johnnie Walker Blue Label, Chivas Regal 18-year-old, Baileys and Malibu on his CV.
In 50 years in business, including stints at International Distillers & Vintners (IDV), United Distillers (UD, both now part of Diageo) and Chivas Brothers, he’s seen the power of the right name on the right product at the right time.
Spend an hour or so in his company and – beyond finding it hard to get a word in – you’ll hear a fair bit of what can only be called marketing speak: ‘I’ve always believed in swimming upstream’ … ‘There are more Dr Nos than people who say yes, you can’ … ‘From acorns you grow mighty trees.’
But Espey’s love of jargon conceals a deeper understanding of spirits in general and Scotch whisky in particular, rooted in a refusal to allow short-term worries to overrun long-term vision. Beyond the brands, he also created the Keepers of Quaich, and was awarded the OBE for services to Scotch whisky in the 2013 Queen’s Birthday Honours.
Here’s Espey on the creation (by long-time colleague Tom Jago, with whom he co-founded The Last Drop) of Baileys in 1974: ‘Baileys failed in research, so Tom hid the research, because he believed in the brand … I just had a feeling about Baileys, became chairman of Baileys, went around the world talking about Baileys.’
Within a few years, Espey had persuaded the board of IDV parent Grand Met to spend £8m on a 3m-case Baileys factory in Dublin. ‘One year we even tried to persuade the Irish farmers to change their calving patterns because we were worried about having enough cream,’ he recalls with a wry smile.
And here he is on whisky inventory planning: ‘When I was chairman of Chivas, I remember laying down stock for the next 20 years – more than 20. I got a call from New York one day from a finance man saying: “James? Can you cut the distilling for a month or two because the quarterly earnings are down?” Well, my language was very colourful. I said to him: “Tough.” Because we were taking a long-term view.’
Proud moment: James Espey OBE, flanked by youngest daughter Jessica and wife Celia
To Espey, his time at IDV in the late 1970s and early 1980s was the most creative and innovative of his career. He was brought to London by then boss Anthony Tennant as marketing director, to oversee the federalisation of IDV’s painfully fragmented empire. ‘Six-month trial,’ Espey recalls. ‘Succeed and you’re on the board; fail and you get shipped back to South Africa. I said: “You’re on.”’
Born in Zambia, Espey was in his 30s by this time, his marketing nous sharpened by the reality of a long stint in sales with IDV outpost Gilbeys South Africa – where he made his mark on the chauffeur-driven sales force by matching them drink for drink (‘They promoted the old-fashioned way – drank like fish’) and challenging them to running races.
IDV – a collection of branded fiefdoms including J&B, Gilbeys, Croft and Smirnoff – was another matter entirely. Espey’s approach was forensic in the extreme: he wrote a doctorate on the history, operations, challenges and potential of the company which he has kept to this day.
It’s an approach that borders on the paradoxical – do your homework assiduously, be as thorough as you can be, but in the end rely on your gut instinct. And, as the success of Baileys, Malibu (created by Espey with the third member of the Last Drop triumvirate, Peter Fleck) and Piat d’Or showed, it worked.
Well, most of the time. Baileys bombed in research, but became one of the most successful drinks launches in history; the follow-up, John Dowland’s Greensleeves – ‘the English Baileys’ – researched brilliantly, but was a total failure – possibly, as Espey acknowledges now, because the liquid was chlorophyll-green.
‘Research is an aid to judgement, not a substitute for judgement,’ he says. ‘Research is like a drunk leaning against a lamp-post: is it there for illumination, or support, or both? You can use these tools, but where is the instinct?’
Johnnie Walker Oldest – later renamed Blue Label – was another Jago creation, a judicious marriage of 15-year-old whisky with what Espey has termed ‘homeopathic’ amounts of 60-year-old liquid (the original label featured the now illegal ‘Aged 15 to 60 Years’ descriptor). The result was a huge boost to the Walker franchise – and to luxury blended Scotch in general.
And the Classic Malts? ‘We did the Classic Malts because we felt there was a future for malts,’ Espey recalls. ‘Glenfiddich had done a brilliant job and we hadn’t – United Distillers hadn’t. The only brand we were selling was Cardhu, which we made the home of Johnnie Walker.
‘I think we had 32 distilleries at the time. We looked at all 32 and said: “What’s a balanced portfolio of interesting distilleries?” We wanted a Lowland, so we picked Glenkinchie; we wanted an Islay, so we chose Lagavulin; we got Talisker for Skye; Dalwhinnie as the highest distillery in Scotland.
‘So we balanced the six and then we packaged it uniquely for the on-trade. It was a fun thing to do at the time because the Distillers Company used to run down single malts. And the one that ran out fastest was Lagavulin, and we’d made that a 16-year-old!’
Your health: Espey with then Prime Minister John Major during a visit in May 1996
The genius of the Classic Malts – and it sounds obvious in 2016 – is the rooting of product in place, the simple, regional breakdown of people’s increasing interest in the world of single malts. The way you sell that kind of concept is what Espey calls the ‘soft rain’ of Scotch whisky marketing.
‘When you bring people in from overseas [to Scotland], you’re working on their mindsets,’ he says. ‘You make them get a feeling for Scotch. It’s not about an advert, it’s about this magical industry with its rich heritage and this history.
‘It’s not about kilts and drums, but it’s about the Highlands, the water, the peat, the stories, and I call it softness – it’s very gentle marketing. A lot of what you’ve got to do is to win the hearts and minds.’
When Espey left UD for its Seagram-owned rival, Chivas Regal & Glenlivet Group, in 1992, one of his first acts was to persuade the owning Bronfman family to spend US$10m on revamping the company’s distilleries for tourism, upgrading The Glenlivet and restoring the historic gardens at Glen Grant.
But the ‘soft rain’ theory is perhaps best encapsulated by Espey’s creation of the Keepers of the Quaich in 1988. ‘I wanted something to honour people who had made a contribution to Scotch whisky,’ he explains. ‘It’s the ultimate “soft rain” – a Scotch whisky knighthood.
‘You only induct 80 people a year roughly, twice a year at Blair Castle. And you have to have been in the industry for a minimum of five years. I remember when I was chairman, there were multi-millionaires shaking when I said: “Will you uphold the aims and honour of the Keepers of the Quaich?”’
One of Espey’s other creations was to signal the end of his career at Chivas. He and Jago were convinced that Chivas Regal 18-year-old would be a huge success, but hit internal opposition in the form of their boss. ‘Edgar Bronfman Sr said: “You won’t launch Chivas 18. My father [Sam] launched Chivas 12 and there’ll never be an 18 – you’re wrong.” He didn’t think we could do it, and people were used to saying: “Yes, sir; no, sir.” He was arrogant.’
Against Bronfman’s wishes, Chivas 18 was launched; shortly afterwards, on his wedding anniversary, Espey found himself out of a job. He vowed never to work for a corporation again, taking on a series of non-executive appointments instead – AG Barr, Fuller, Smith & Turner, Church Shoes – and, among other things, helping smooth the sale of Whyte & Mackay to Indian mogul Vijay Mallya.
Creative tension: Espey (left) clashed with Seagram’s Edgar Bronfman Sr (centre) while at Chivas
The Espey vision of human life as brand cycle goes something like this: up to 30: shaping your brand; 30-50: building and enhancing your brand; 50-65: capitalising on your brand; 65-plus: self-reinvention. In Espey’s case, the self-reinvention is The Last Drop Distillers, in which endeavour he is joined by his old muckers, Jago and Fleck.
‘Tom and I registered a company called The Last Drop Distillers Ltd and the slogan Before There is No More because we believe passionately that there are little nuggets of whisky hiding all over Scotland,’ Espey explains. ‘But what happened in the old days was that companies would just blend them in and they would disappear.’
But how to unearth these liquid gems? Espey raided his contacts book, recalling in particular a young accountant from his UD days with whom he had ‘got on like a house on fire’ – Mike Keiller, then boss of Morrison Bowmore.
‘Mike liked the idea and I couldn’t have done it on my own,’ Espey acknowledges. ‘And in his cellars I found sleeping a 1960 whisky, and it was a blend, 82 whiskies – a freak of a blend – and, when we tasted it, we were gobsmacked.’
The Last Drop has released a series of ancient blends since then, plus a memorable 1967 Glen Garioch bottling, all in severely limited numbers and all with frankly eye-watering price tags (the latest, a 50-year-old Double Matured blend, is £3,000 a bottle).
It hasn’t all been plain sailing: it’s not easy to find distribution partners when you’re only selling minuscule amounts of extremely high-value liquid; and, now that Morrison Bowmore is subsumed into the merged Beam Suntory (Keiller is now on the board at The Last Drop), there’s the tricky task of finding the liquid for future bottlings.
Family business: James Espey with daughter Beanie, who has joined The Last Drop
‘We want to be agile,’ says Espey. ‘We’re not brokers; we’re not wheeling and dealing in someone else’s brands. We made an absolute virtue of Glen Garioch – we’re proud of it. So Glen Garioch gets all this wonderful PR; every time they write about The Last Drop, they’re getting the benefits.
‘So we’re doing a job for them, and you could argue that, if there were one or two interesting distilleries out there, we could do a marketing job for them, provided they’ve got one or two old parcels. We can help.’
The alternative, of course, would be to sell all or part of the business to an established player. ‘I always saw it as being maybe, one day, a halo brand in somebody’s stable,’ Espey admits. ‘It’s got to be somebody with vision – I’m not here trying to sell the company, but we might talk to someone and they might take a position with us.’
Given the somewhat advanced years of The Last Drop’s founding trio – the company brochure talks of ‘120 years of experience in the bottle’ – that conversation might happen quite soon. But then again, there’s a bit of succession planning going on as well: Espey’s and Jago’s daughters, Beanie and Rebecca, have joined the company in recent times.
Not that Espey – a bundle of ceaseless energy nearly a decade into his ‘retirement’ – is about to pack it all in just yet. ‘It’s a fun industry,’ he says. ‘I’m still in it at 73 because I love it. I’m as passionate about it as the day when I started, and this is my 47th year.’ And that has to rank as decent longevity for any brand.
JAMES ESPEY ON…
Moving to England: ‘I arrived on 18 May 1977 and stayed in the Chesterfield Hotel for six weeks. Then I bought a house in Putney – I had exactly £3,000 in my life and I put that down as a deposit.’
A love of grain whisky: ‘I’m a big fan of grain and I think you will hear more about grain from us. And I think the industry should be making more of a virtue of old grain.’
The 1980s whisky loch: ‘Let me tell you what happened precisely: there was a panic. Suddenly there’s too much whisky, so at the bottom end people were dumping whisky and supermarkets were buying it at £5 a case. If you’re buying three-year-old whisky at £5 a case, who’s making money there? So what happened? People turned off the taps.’
The pressures of the modern whisky industry: ‘I think the bonus culture is a little too short-term. We took a long-term view of everything; if we’d taken a short-term view, we wouldn’t have launched half the brands we did. I do worry and feel for the top executives of these companies – they’re under enormous pressures every day.’
Old-school whisky arrogance: ‘I think 40 years ago the Distillers Company was very arrogant, saying you only drink Scotch with soda water, or on the rocks, or with ordinary water. If you want to drink it with kangaroo juice, I’m happy with that. I drank Scotch with Diet Coke last night with my mother-in-law, and what’s wrong with that?’
The rise of ‘craft’: ‘We’re now seeing all these craft things arising left, right and centre, because the consumer’s tired of big, battalion brands that don’t seem to care about them. I think you’ve got to show through your brand that you care about the consumer.’