Russian Standard has acquired the domain vodka.com for $3 million from an undisclosed seller. According to news reports, the reason for the acquisition is to make it easier entering the American market.
The domain now points to Russian Standard’s website, which is in English if you enter it that way. Now, having a good domain name sure is important, and I can’t really get that “wow” feeling over a puny amount such as $3 million. I mean come on, this is the liquor business, they make solid dough and having the number 1 premium name for your niche is worth a lot. Why didn’t Swedish vodka maker Absolut buy it? The answer is simple: They don’t need too, because they have an established brand in Absolut and don’t want to take any focus from it.
But vodka for $3 million? Not for me, I prefer single malt whisky.
Originally posted on December 17, 2006 @ 6:54 am
I’m still in shock. Yes their are definitive reasons to own a powerful domain keyword based in your niche and this just goes to show you people will pay a premium.
Bacardi never feared throwing money out of the door. Remember what they paid for Grey Goose or Bombay Sapphire? Those were sky high amounts. And that only for a quality niche product, not a main stream product.
Vodka is a billion market and it is very hard to walk into the business with the major corpos owning the more popular brands. Just have a look at how hard Campari fights the world to give Sky a world wide reputation. Great marketing strategies, modern campaigns and a quality (main stream taste) product. Highly respected among cocktail mixers. But still they fight Smirnoff and Absolut.
But even with an established brand behind you it is really hard in that market : Absolut still hasn’t managed to position Level Vodka among the high quality vodkas (and personally I don’t like the taste either)
But what could be the power of the domain for an ecommerce?
Well having a great domain and a solid product could open up the door for lots and lots of us sales. Personally I think Russian Standard should go for the high end buyer in order to recoup their investment. But I also think Nintendo should have sold the Wii for 350 too.
So what do I know..
Lol David.
Here in the UK we pay $350 for the Wii (189GBP). Thanks taxes.
Having been several years in the cocktail business and dealt with many representants of Smirnoff (Diageo), Bacardi, Campari and Absolut (Maxxium) in Germany I see a classical Bacardi move in this.
Isn’t Bacardi the only major company who still doesn’t have a well established main stream vodka? Don’t mention Finlandia, that’s only water. I wouldn’t be surprised if they were behind this, but then again I am almost 2 years out of the business and haven’t followed it anymore.
And now I want to drink a G&T.
Shoot, pass me a gin and tonic. Woot.
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