October Interview With John Lunn Reconsidered

Back in October, when Diageo announced the introduction of George Dickel Rye, I had occasion to talk briefly with John Lunn. He didn't have much to say that wasn't already in the press materials, but we had never met so I took the opportunity to chat him up when it was offered by the PR folks. We had a brief but pleasant conversation.

Earlier last year, I had learned that, in addition to being Master Distiller at the George Dickel Distillery in Tennessee, Lunn had been given responsibility for operations at the company's Stitzel-Weller Distillery in Kentucky. With the revelation this past Sunday that Diageo will resume distilling at Stitzel-Weller, revisiting that interview seemed like a good idea.

There were a few interesting tidbits. I learned that the property in Tennessee is 600 acres, so there's plenty of room for expansion, though nothing is currently planned. I probed for any inkling of future plans, but nothing leaked. "We're always looking at innovation, what we can do and what the people want," was all he would say.

We talked a little bit about Ralph Dupps, who oversaw the building of George Dickel in the late 1950s. Lunn got to meet Dupps before his death in 2008 at the age of 90. "His only advice was, 'Don’t change a damn thing,'" Lunn told me. That's when I learned that everything at Dickel is done the old fashioned way. There are no computers. "It's all sight and sound, touch and feel. Some of the employees here have 30 or more years of experience."

Although nothing was said about distilling resuming at Stitzel-Weller, we did discuss his responsibilities there. Operations there include maturation--which involves entering barrels, periodically checking them, and removing them when the whiskey is ready to sell--as well as blending. He declined to name which brands are matured or blended there, or where the whiskey aging there was distilled.

Visitors granted admission to The Bulleit Experience at Stitzel-Weller are not allowed to get close enough to the warehouses to look in the windows and see what the barrel heads say.

There is no bottling facility at either George Dickel or Stitzel-Weller. The whiskey goes from there to Plainfield, Illinois for bottling. Several requests to tour that facility have been denied.

Diageo has not publically confirmed anything about its plans for Stitzel-Weller.

So we don't know what Diageo plans to do at Sttzel-Weller, or if John Lunn will have anything to do with it, but it's easy to paint a pleasing picture of Mr. Lunn, after doing things 'the old fashioned way' at Dickel, doing the same thing with the mothballed equipment at Stitzel-Weller. Wouldn't that be something?

George Dickel Gives A Different Taste To LDI Rye

There’s an interesting link between the new George Dickel Rye and Templeton Rye. Though not available in most of the country, Templeton Rye has, in a short time, become a major brand in Iowa and Illinois, including the major market of Chicago.

When Templeton debuted in 2005, the company was extremely secretive about where it was made. They wanted people to believe it was made in Templeton, Iowa, since mythology about that small town’s Prohibition-era reputation as a leading illegal whiskey source was the heart and soul of the company’s marketing strategy. That was impossible, since the company got its license as a distilled spirits producer the same year it launched its product, which as a straight rye whiskey had to be at least two years old, and tasted more like five or six.

Obviously, Templeton was whiskey made by another distiller, but who? Most lists of the usual suspects (including mine) didn’t include the old Seagram’s distillery in Lawrenceburg, Indiana, which turned out to be the source. Little was known about that distillery, then owned by Pernod-Ricard, except that it made Seagram’s Gin, Seagram’s Vodka, and Seagram’s Seven Crown Blended Whiskey, but no straight whiskeys sold in the U.S.

Since then, many straight ryes have been introduced using whiskey made by the distillery best known as Lawrenceburg Distillers Indiana (LDI), which last year was sold to MGP Ingredients, Inc. of Atchison, Kansas. Templeton was the first to bring LDI’s unique 95% rye to market and George Dickel Rye may be the last, as least for now, since almost all of LDI’s current rye inventory is less than a year old. (Dickel has its supply locked up.)

The recipe, which calls for 95% rye grain and 5% malt, was developed many years ago, when Seagram’s still reigned. It was created by Larry Ebersold, then master distiller there. At first they made a standard rye whiskey, just 51% rye, the rest corn and malt. They wanted more rye flavor so they experimented with a recipe that was 80% unmalted rye and 20% malted rye. Everyone loved the result except the accountants, because malted rye is expensive, so they changed the proportions to 95% unmalted and just 5% malted rye. Still too expensive, said the accountants, so they replaced the rye malt with standard barley malt, and that’s the recipe LDI makes today.

The whiskey was always intended to be an ingredient in blends, not a straight. The company liked it so well for that purpose they decided to make it at their plant in Gimli, Manitoba, for use in Crown Royal and other Canadian whiskeys. They failed because a crucial strain of bacteria, native to Indiana, couldn’t survive beyond one generation in the harsher Canadian climate.

Since Templeton, the LDI rye has appeared as straight rye whiskey from High West, Redemption, Filibuster, Smooth Ambler, James E. Pepper, and now Diageo's Bulleit and George Dickel.

Although Diageo doesn’t own LDI, they’re its biggest customer. For several years, Diageo has worked with LDI to develop rye whiskey products for Bulleit (released last year) and Dickel (coming soon) using the LDI rye. The Bulleit version is very similar to Templeton but the Dickel Rye is different.

According to Dickel Master Distiller John Lunn, the aged whiskey is transported from Indiana to the Diageo bottling facility in Plainfield, Illinois, near Chicago. There it meets up with charcoal sent from the Dickel distillery near Tullahoma, Tennessee. At Plainfield, it goes through the exact same charcoal mellowing process as George Dickel Tennessee Whisky does at the distillery. The only difference is that the Tennessee Whisky is filtered before aging and the rye is filtered after aging. It is done in the same way using the same charcoal, after chilling the whiskey to 40°F.

Compared to Bulleit Rye, the difference in flavor is dramatic. Critics of filtering claim it makes any whiskey less flavorful, but that’s not the case here. There is plenty of flavor, but it’s different. Bulleit Rye is fruity but the fruits it suggests are red grapes, plums, and dark berries. Dickel Rye has a strong citrus flavor, suggesting variously grapefruit or pineapple. It’s appropriately sweet with a little bitterness, like peanut brittle, licorice or sassafras. There’s some soot and also raspberry and apricot.

If Dickel Rye does well it will be good for LDI, since Lunn says there are no plans to distill rye at the Tullahoma plant. “We’re concentrating on making the best Tennessee Whisky we can,” he says. They’re not planning to expand the distillery or build more warehouses either, but they have 600 acres, so there’s plenty of room to grow. There are no other products or projects, such as limited edition releases, that Lunn wants to talk about, “but we’re always looking at innovation, what we can do and what the people want,” he says.

At 42, Lunn is one of the youngest master distillers for a major producer. He was trained by his predecessor, Dave Backus, and even got to meet Ralph Dupps, who built the current Dickel distillery in 1958. Dupps gave him one piece of advice, “Don’t change a damn thing.”

He hasn’t. Dickel is unique in operating almost exactly as it did 50 years ago, with no computerized control systems.

The business has been buzzing about rye whiskey for almost a decade, but in the last year or so several new ryes have been introduced as line extensions of major bourbon or Tennessee whiskey brands, including Jack Daniel’s, Knob Creek, Bulleit, and now George Dickel. This should prove whether or not the heavily-publicized rye whiskey revival really has legs or not.

NOTE 10/29:  Made a correction today based on information received from Diageo. When Lunn said they 'use the same charcoal," I incorrectly assumed they filtered it at the distillery. Instead they send the charcoal to Plainfield, Illinois, where Dickel is bottled. Sorry about that.

When You're The World's Biggest, What's Small?

In marketing terms, 'niche' is usually a nice way of saying 'little.' One way to grasp just how huge spirits industry leader Diageo really is by looking at what they consider 'niche' brands. This examination became more convenient last September when Diageo created Catalyst, a business unit focused on 28 spirits brands the company classifies as 'niche.' Together they bring in about $250 million a year.

Diago's stated goal is to double that by 2014. The unit experienced a setback when its first president, a 20-year Diageo veteran, abruptly left the company just four months into her new job.

The Catalyst portfolio includes line extensions such as Tanqueray Sterling Vodka, acquisitions such as Stirrings Liqueurs, new products such as Moon Mountain Vodka, and small but venerable brands such as Pimms and Myers’s Rum.

Whiskey enthusiasts will be interested to know that the Catalyst group contains several esteemed single malts: Lagavulin, Glenkinchie, Cragganmore, Dalwhinnie, Caol Ila, Clynelish, Oban, and Talisker. George Dickel Tennessee Whiskey is 'niche,' as are pseudo-whiskeys Jeremiah Weed and Yukon Jack.

The word 'catalyst' has become fashionable in company names without much regard for its dictionary definition, which is something that causes change without being changed. The word 'niche' also seems misused, since it usually means a product or service that appeals to a very narrow and specific audience. One thing true niche brands do not do, almost by definition, is double in size.

If you examine it, Catalyst starts to look like a free-standing luxury brands portfolio, especially if it shed Weed, Jack, and Moon. The single malts are an exceptional collection, and George Dickel is a brand full of potential that Diageo has never quite realized.

No one has said anything about a spin-off, but wouldn't that be nice?

Dickel No. 8 Distribution Revealed.

Few posts on this blog have attracted as much interest and comment as this one from December, 2007.

It was all about the disappearance of George Dickel No. 8 (the black label) from stores across the country, but especially in the South. Diageo, the brand's owner, admitted there was a shortage due to a four-year shutdown at the distillery.

Supplies were supposed to resume in 2008 and did in a few markets, but many fans of the product are still looking for it in vain.

No. 8 has long been the brand's best seller. The more expensive No. 12 and Barrel Select have not been affected by the shortage. Since the shortage began, Dickel has introduced a new product, called George Dickel Cascade Hollow Recipe, that is a three-year old whiskey. It originally had a black label suspiciously like No. 8, which was changed to red when No. 8 began to reappear.

I will keep you in suspense no longer. The official word is that they only have enough whiskey to fully support No. 8 in its eight core markets, which are Alabama, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Virginia and West Virginia. This is the official answer Dickel is sending out in response to consumer inquiries.

When will No. 8 distribution widen? No one knows. Not having enough product to meet demand is a high class problem for any manufacturer. That whiskey has to age for several years makes production planning a nightmare. Presumably, Dickel has more whiskey in the pipeline each year, but if demand continues to outstrip supply it could be a long time before George Dickel No. 8 Brand Tennessee Whiskey reappears at a store near you.

The New Bourbon Country Reader Is Here!

The new issue of The Bourbon Country Reader will drop in the next couple of days.

In this issue we complete our three part examination of George Dickel. Staying in Tennessee, we also have an update about that guy charged with illegal possession of $1 million worth of Jack Daniel's whiskey. Then we do our first review of a micro-distillery whiskey. The verdict may surprise you.

In fact, our goal is to surprise you with every issue of The Bourbon Country Reader. Sometimes it's a surprise to everybody that we even get the darn thing out.

The Bourbon Country Reader is the exclusive source for everything you need to know about American Whiskey. It is the only publication devoted exclusively to American whiskey. Always idiosyncratic, we accept no advertising, have no distillery affiliation and serve enthusiasts of American Whiskey like no other publication.

A six-issue subscription is just $20.00. Click here for a free sample issue (PDF format). Click here to subscribe. Click here for more information.

Additional charges for delivery outside the U.S. will be added on the order form.

The Lost Dickel Partner.

My recent interest in George Dickel history led me to an article in the Fall 1998 issue of the Tennessee Historical Quarterly. It is entitled "George Dickel Tennessee Sour Mash Whisky: The Story Behind the Label," by Kay Baker Gaston.

She offers the same overall outline for the history that has long been known and agreed upon by just about everybody except Diageo. What's fun is some of the other stuff she uncovered, especially about Dickel and Shwab, the early years.

First, she found evidence that Dickel was a bastard (literally). His father's family acknowledged him but in a backhanded way, by having his bastard uncle stand as his godfather.

Dickel probably was a smuggler during the Union occupation of Nashville, as was Shwab and a 3rd partner, never mentioned in Dickel histories, probably because this partner was actually convicted. There was some evidence against Shwab, but not enough, and nothing against Dickel directly. Gaston concludes that the capital which got them all set up in the liquor business after the occupation came from their smuggling activities during it.

The other Dickel partner, the forgotten one, was Meier Salzkotter.

Salzkotter was in business, both licit and illicit, with Shwab's father and was married to Shwab's older sister, Cecelia. He worked for Dickel before Shwab did and was a partner in the Dickel enterprise until his death in 1891. All three men--Salzkotter, Dickel and Abram Schwab--did various kinds of business together in Knoxville and Nashville. Victor, Abram's son, dropped the "c" from his surname and joined a Christian church, but otherwise followed in his father's footsteps.

The author found evidence that Shwab also changed his given name many times in many small ways in his youth, apparently to confuse the authorities.

None of this was necessarily disreputable, at least within their community, as they were all good Rebs doing what they could to get around the Yankee occupation (1862-65).

Salzkotter got the worst of it. He was caught using false-bottomed wagons to smuggle prohibited goods past the Union blockade and spent time in a military prison for his offense. While he was away his wife, Victor's sister, decamped for Louisville and became a prostitute there.

Gaston also talks about another key part of the Dickel-Shwab-Salzkotter business, the Climax Saloon, which was in Nashville's prime entertainment district, close to the famous Maxwell House Hotel. The entertainment at Climax included liquor, gambling, and prostitution.

She also has details I didn't know about MacLin Davis, the distiller at Cascade (and part owner) who appears to be the man most responsible for the success of the whiskey itself. He and Shwab apparently had a close relationship, to the point that one of Shwab's daughters married one of Davis's sons.

All of which is more interesting than anything Diageo will tell you.

Gaston's sources are deed books, wills, newspaper stories, census records, city directories, and other sources published during the time the events occurred. No "oral history."

George Dickel, the Boot.

I sure have been writing about George Dickel a lot lately. If you want to see all of them, that's what the labels at the bottom of each post are for. Click on the "George Dickel" label and you'll see every post in which George Dickel is mentioned.

Today I rise to add a small point. In Friday's post, I mentioned that the earliest record of George Dickel being in business in Nashville is from 1853. What I failed to mention is that he was not in the liquor business. He was a manufacturer of boots and shoes.

Austin Nichols, the parent company of Wild Turkey before it was acquired by Pernod Ricard, was a grocery wholesaler who started to sell wine and liquor, found it to be a very good business, and eventually dropped the groceries. That makes sense, I can see that happening, but how do you go from making boots and shoes to selling liquor?

Was that always his dream?

I can hear it now: "Humble shoemaker George Dickel had big dreams. He wanted to sell alcohol, because alcohol makes people happy and makes their pain go away, if only for a little while."

Or maybe he thought the whole Germans and boots thing was just a little too on the nose.

Dickel Checks In.

I just got off the phone with Gene Song, Brand Manager for George Dickel at Diageo. He was very nice, but I can't say he told me anything to make me regret or take back what I wrote yesterday. 

There are a few things to report on the availability story. The shortage of Dickel No. 8 really has not abated, but the younger Cascade Hollow Recipe is selling well. They haven't decided whether or not the Cascade recipe will remain after they have sufficiently resupplied No. 8, but they certainly seem to be leaning in that direction. As for the shortages of Dickel No. 12 that people have reported, here and elsewhere, Song isn't willing to say there is an official shortage, but supplies are tight. 

Basically, Dickel has been enjoying its share of the bourbon boom. The interesting part is that it is not being driven by export, as Dickel is sold only in the USA. 

So, on to the history. Song said the web site hasn't been updated since it was launched, so those statements aren't based on any recent discoveries. He attributes them to "oral history" put together by Ralph Dupps, who built and ran the current distillery for its then-owner, Schenley, starting in the late 1950s. Dupps passed away last December, at the age of 90. As I said yesterday, my telling of the Dickel story is based on a timeline put together by Nick Morgan about 15 years ago. At that time, he was the company archivist. Now he's in charge of marketing their Classic Malts portfolio. Song said they've asked him to comment on my questions, but he hasn't responded yet. 

The "oral history" explanation is frequently offered by the companies. Doesn't it seem odd that there isn't more documentation for some of this stuff? We're not talking about events that occurred 2,000 years ago. We're talking about Tennessee in the post-Civil War period, so 140 years ago and less. They had typewriters then, manila folders, filing cabinets. They kept a lot of business records. Why do all of these histories (the stories they want to tell, that is) have to be based on "oral history"? 

But I can't hang that one on Dickel or Diageo alone. That's everybody: Beam, Daniel's, etc. When the Dickel company (mostly the Shwabs, George was dead by then) moved to Louisville after Tennessee went dry, they brought their records with them. All of that stuff is in boxes at the old Stitzel-Weller Distillery in Shiveley. I know there is a lot there documenting the Dickel company's relationship with the A. Ph. Stitzel Distillery, which made Cascade Tennessee Whiskey until National Prohibition put everybody out of business in 1920. 

Song did provide one interesting piece of documentation, the brand's trademark filing with the United States Patent and Trademark Office. The trademark was filed in 1895, but it cites 1870 as the date of first use, and the trademark is for "Cascade" Distillery Handmade Sour Mash Tennessee Whiskey Geo. A. Dickel & Co. Does that mean, contrary to other indications, that Dickel was marketing Cascade brand whiskey, made at Tullahoma, as early as 1870? Not necessarily, but it certainly suggests that someone was using the Cascade name that early, though I think it most likely was John F. Brown and F. E. Cunningham, the distillery's founders. 

On the other hand, most accounts put the founding of Cascade at 1877 or 1878 and, in fact, there is some good documentation that Brown and Cunningham bought the land that year, although that doesn't mean they weren't operating as Cascade somewhere else. There's no question Dickel himself was in business by 1870. That's the first year Dickel & Co. shows up in the tax records. Morgan puts the founding of Dickel's business as early as 1853, so the person who put down 1870 as the date of first use wasn't referring to the Dickel part of the mark. 

The 1870 clearly refers to the Cascade part of the mark. So the 1870 date on the trademark filing is pretty good evidence for a first use of Cascade, by somebody, in 1870. But not necessarily by George Dickel. In fact, probably not by George Dickel, contrary to what the web site claims. The 1895 filing unquestionably proves that Dickel and Cascade were one and the same by that point, but we pretty much already knew that. Company A buys Company B. Company A was founded in 1920. Company B was founded in 1820. Even though Company A is the entity that remains, having assimilated Company B, it can claim an 1820 origin if it wants to. In buying Company B, it buys Company B's history too. 

In 1888, 70-year-old George Dickel takes a fall off his horse and withdraws from active participation in the business. His partner, Victor Shwab, is in charge. In short order he buys controlling interest in the Cascade Distillery and the Dickel Company becomes exclusive distributor for Cascade whiskey. Seven years later, when Dickel submits the trademark application, it invokes the assimilated company's history as its own. There is nothing wrong with that, but you should use the assimilated company's actual history, not a made-up history that projects Company A's principal into Company B's narrative almost 20 years before it actually took place. 

The most likely history is still the timeline Nick Morgan put together in the early 90s, as it cites to actual documents, not oral history. It's unlikely that George and Augusta Dickel ever visited Tullahoma. If putting George Dickel in Tullahoma at any point is the goal, that's a problem. His business was in Nashville, not Coffee County. When I have these conversations with brand managers, they always tell me how much they care about the industry's history. Well, talk is cheap. Where is the company that will step up, fund some real research, publish the results, and let the chips fall where they may? It won't make the whiskey taste any different either way. 

Finally, if you're still reading this, welcome to my world. I don't know why I concern myself with this stuff, but I do, and if you're curious enough to read it, well, then you're probably not much better. It can be fun, it can be frustrating, but most of all it's mighty thirsty work.

We'll Get Back To You, Not.

A month ago, I wrote here about likely bullshit in the marketing of George Dickel Tennessee Whiskey. Though perhaps my process is backwards, the next day, better late than never, I sent my questions to the Manager of Public Relations at Diageo, Dickel's parent company. Two days after that, I received a call from one of the minions in Diageo's PR Department, wanting to know why I was asking so many questions. We had a pleasant conversation and she said she would get back to me.

Since then, squat.

Today, I sent an email to the original contact, laying out the chronology above. However, since it has been a month since my original inquiry, I now feel confident in saying that the new story Diageo is telling about Dickel, about how George and his young bride, Augusta, visited Tullahoma in 1867, where he dreamt about "creating the finest, smoothest sippin’ whisky," and then started a business there in 1870, is pure fiction.

Why does is matter?

The Keebler Elves were created in 1968 by the Chicago-based advertising agency, Leo Burnett Co. One of Burnett's trademarks was the use of mascots, fictional and, usually, illustrated characters who personified the brand's advertising proposition. The difference between Ernie Keebler and George Dickel is that George Dickel was a real person. So was Agusta Banzer Dickel, who had a younger sister, named Emma, who married George Dickel's business partner, Victor Shwab. All real people.

Not only were all of those people real, with real histories, but the things they did matter. The history of commercial enterprises may not be as significant as the history of governments, but they are part of the overall story of how we developed as a nation and people. The history of America's alcoholic beverage industries may be more important than most because they contributed so much to the nation's development in terms of taxes, and alcohol is the only industry that has prompted two constitutional amendments.

Part of what stimulated me to start taking a hard look at Dickel was the Associated Press report in December about a shortage at retail of George Dickel No. 8. Diageo spokespeople at that time cited the distillery shutdown between 1999 and 2003 as the cause of the shortage, and further stated that the shutdown was a result of overproduction in the early 1990s.

What caused that overproduction was an ambitious but ultimately unsuccessful attempt to make George Dickel a one-million case brand. One-million cases is the traditional threshold in the distilled spirits business for a major brand. One of the things they did at that time was try to put together a real history of Dickel. The person who spearheaded that effort was Dr. Nicholas Morgan, who was archivist at that time for Dickel's parent company in Great Britain. He had some research done and put together a timeline of key event's in Dickel's history. I have a copy of that timeline and it is through comparing that to what the company is saying now that the pattern of historical falsification (aka, bullshit) is revealed.

Nick Morgan is still at Diageo and is a big marketing honcho for their single malt scotch portfolio.

The practice of playing fast and loose with history is not unique to Diageo. Far from it. Virtually every company that sells American whiskey is guilty of at least some fudging with history. To some extent, it depends on how it is handled. Many of the things Brown-Forman says about Jack Daniel's are unproven and probably unprovable, but they call them "Legends and Lore." Jim Beam has no real evidence that, as they say, Jacob Beam sold his first barrel of whiskey in Kentucky in 1795, but the family has been saying that for a very long time so it's probably at least as good as some of the Daniel's claims. On the other hand, more recent fudging such as writing out of their history the contributions of Jim Beam's brother, Park, and his descendants, is of more recent vintage and, in my opinion, deplorable.

In one sense, at least, I can't complain too much about any of this because it gives me something to do. If you want the real history of the American whiskey industry, you pretty much have to come to people like me, because you're sure not going to get it from the companies.

Diageo Checks In.

I heard from someone at Diageo today, wanting to know why I'm asking so many questions.

She didn't say it exactly like that. It was more like, "I just wanted to get some more information about what you're going to be writing about and why exactly you need all these details about Dickel, is this for a story or an upcoming book?"

We had a nice chat, but no answers yet. Stay tuned.

Better Late Than Never (We'll See).

I have better contacts at some of the American whiskey producers than I do at others. I don't know anybody at Diageo. I know Tom Bulleit (Bulleit Bourbon) and I met the Diageo brand guy responsible for North American whiskey (big gun is Crown Royal) once about three years ago. That's it. But I do have a name of somebody in PR who did return an email from me once, so I tried her on the Dickel questions. 

Here's what I asked: 

"What is the status of Dickel No. 8, re the shortage reported by AP in December? Will Cascade Hollow continue to be distributed after No. 8 returns? Are there shortages at retail of Dickel No. 12 and Barrel Select too, as has been reported to me?

"Also, I noticed on the Dickel web site what appears to be some new historical information. I would like to know the basis for the claim that George and Augusta Dickel visited Tullahoma in 1867 and that George Dickel established a business there in 1870. 

"Most accounts with which I am familiar have Cascade Distillery established in 1877/8 and independent of Dickel until 1888. Those particular dates come from Dr. Nicholas Morgan, who was archivist for United Distillers pre Diageo. That information is more than 10-years-old, so maybe something new has been discovered." 

That guy from Utah got mad at me for not talking to him before I wrote what I did about his product. Maybe Diageo will feel the same way. I'm sympathetic in principle, but since I'm writing, in both cases, about stuff they've either published directly or caused to be published through the magic of PR, I feel like they already had their say. I have not, by the way, heard anything more from either the High West guy or the Templeton guy.

George Dickel, Say What?

Lest no one think my gripes about bullshit in the marketing of spirits products are limited to micro-distilleries, here's a shot at Diageo, the world's biggest booze company.

I was working on some follow up to my December post about the George Dickel No. 8 shortage for my newsletter, The Bourbon Country Reader, which got me looking at several sources, including the history section of the Dickel web site.

Diageo seems to be engaging in some revisionist history on Dickel's behalf. They now have George and his wife, Augusta, visiting Tullahoma in 1867, where he dreams about "creating the finest, smoothest sippin’ whisky," and then "In 1870, Dickel’s dream came true, and a company which bore his name was opened at Cascade Hollow, Tennessee."

Both, based on everything else I can find out about Dickel's history, appear to be complete fabrications.

One purpose seems to be to obliterate both the independent history of the Cascade Distillery (which was, by all accounts, established in 1877 and never actually owned by Dickel) and diminish the role of the Shwab family (which the Dickel web site misspells as Schwab, like the stock broker), much like Four Roses has built up John Paul Jones at the expense of Rufus Rose.

What Is Really Going On With George Dickel No. 8?

Whiskey is weird.

How many other products can you name that take four or more years to manufacture? We always talk about this, how the whiskey aging cycle challenges distillery production planners. The story of George Dickel No. 8 Brand Tennessee Whisky demonstrates what can go wrong.

In the early 1990s, United Distillers was a company with big plans. The spirits division of Guinness & Co., it had been built by acquisitions over the previous decade. It was an international company with major brands in the scotch whiskey and American whiskey categories, as well as gin, rum, and others.

Among its assets was George Dickel Tennessee Whiskey.

One of the company’s big plans was to take selected American whiskey brands and give them a big marketing push in Europe and Asia, where American whiskey was starting to grow as a category, unlike the U.S. market, where it was doing nothing. One of the brands selected was George Dickel.

As a Tennessee whiskey, Dickel is a unique product. Unlike United’s many bourbons (at the time), the George Dickel recipe is shared by no other brands. Because of the whiskey aging cycle, any long-term sales growth strategy has to be accompanied by steady production growth, so that when the marketing plan succeeds, you have enough product to sell. United started to make more Dickel, a lot more.

The effort to sell more Dickel overseas wasn’t a failure exactly, but it didn’t meet expectations either. Part of the problem was that the newly huge company was unwieldy and often lacked focus. Dickel was too far back in the portfolio to get the attention it needed. Because the whiskey made at Dickel could only really be used for the Dickel brand, the stocks built up, and because nobody was paying close enough attention, they just kept producing.

In 1997, Guinness merged with Grand Metropolitan to form Diageo. To accomplish the combination, the company assumed a lot of debt. It soon had to start selling assets to generate cash and also cut costs wherever it could. It decided what its core business would be and, by 1999, it had decided that American whiskey was not part of that picture. Early that year, it sold off all of its American whiskey assets except two brands, I. W. Harper and George Dickel. It also stopped production at the Dickel distillery.

In addition to the excess whiskey inventory, Dickel had some environmental issues in Tennessee, having to do with wastewater disposal. They weren’t a huge deal but would require a significant investment to fix. Because of that, the company couldn’t casually crank up the distillery for a few weeks each season, just to keep some current production in the pipeline. They had to stay completely dark and take their chances.

When they stopped Dickel production, they pretty much stopped marketing it too. That will tell you what the underlying strength of a brand is. Maybe that was their plan, maybe there was no plan beyond stopping the bleeding and making the brand profitable again. With the distillery closed and the marketing budget at zero, it wasn’t too hard to make the brand profitable in the short term.

At that time, now almost nine years ago, product availability seemed like the least of their problems.

In 2002, Diageo began to pay some attention to Dickel again. The brand got a marketing budget and started to make some noise. Either the marketing worked, or it was just time, you never know exactly, but Dickel sales suddenly picked up here, there, and everywhere. They got their environmental problems fixed and resumed production in fall of 2003.

The new marketing program featured the premium Dickel expression, known as No. 12, but the less expensive No. 8 continued to be the main seller. In about the middle of 2007, Dickel No. 8 drinkers began to notice bare shelves. In some cases there was a note on the shelf explaining that No. 8 was in short supply because of the 1999-2003 distillery shutdown. Ads in a few markets explained that the shortage was being caused by the shutdown, combined with “an incredible surge in demand for George Dickel No. 8."

No company gets itself into a situation like that on purpose, but when you find yourself with that kind of problem you try to make the best of it. One tactic has been to generate publicity about the shortage itself. Nothing makes people want something like telling them they can’t have it. Another has been to release a temporary stop-gap, a new product called Cascade Hollow Recipe, aged three years. The strange thing is, the Cascade Hollow label looks almost exactly like the No. 8 label and it is being sold for the same price. It’s obvious that many shoppers, grabbing for the familiar black label, will never notice it’s a different product, a fact no doubt anticipated by the brand’s management.

Since the company could easily have made the Cascade Hollow packaging look completely different, why make it virtually indistinguishable from the No. 8? The strategy, it appears, is to have it both ways. They’re being upfront with the people who are paying attention while hoping to slip one past the people who aren’t.

Here are some simple facts the people at Diageo aren’t talking about.

No Dickel product except the new Cascade Hollow carries an age statement. It has one because it is required to, by law, because it is less than four years old. Unofficial statements by distillery personnel have pegged the top-of-the-line Dickel Barrel Select product as containing whiskey 8 to 12 years old, the No. 12 as 8 to 10 years old, and the No. 8 as 4 to 6, but those ages are all unofficial. They are trying to match a taste profile, of course, and if the whiskey starts to taste a little younger they hope no one will notice. Having no age statement gives them a lot of flexibility. With no age statement, all you know for sure is that the whiskey is at least four years old.

Regardless of what age it actually is, the oldest and most mature whiskey they have is going into the more profitable No. 12 and Barrel Select expressions. Those are reporting no shortages.

On Monday, the Associated Press (AP) ran a story in which a Diageo vice-president acknowledged the “temporary” shortage and promised that No. 8 will return early in 2008.

What seems underway, then, is an effort to turn a problem into an opportunity, always a good idea. By next year, Dickel hopes to be in greater demand than ever thanks to publicity generated by the shortage. The AP story alone was picked up by thousands of print and electronic outlets. When No. 8 returns, the company will have a new entry-level product on the shelves and its best-seller, the No. 8 Brand, will reappear, maybe at a higher and more profitable price. Then maybe they will start to change the two labels to give the two products more separation. They’ll transition price-sensitive shoppers to the Cascade Hollow product and get a little more scratch from No. 8 loyalists.

Let’s hope for their sake that all this works out better than their last master plan.