Quirky One-Product Companies
How cocktail sugar and unicycles make for lucrative businesses
John Drummond and Edmundo Macias have never met, but they have a lot in common. They live across the country from each other and have different professional backgrounds, but they both quit their comfortable corporate jobs at 40 to start quirky, one-product businesses.
Drummond, who lives near Atlanta, sells unicycles over the Internet at Unicycle.com. Macias' Los Angeles-based company, Planet Sugar, sells Cocktail Candy, colorful, flavored sugars used to decorate the rim of a cocktail glass. Both entrepreneurs are having fun and making money, with no regrets. "I worked for Anheuser-Busch for 16 years," said Macias. "When I quit my job last September, my co-workers all thought I was nuts."
While Drummond's job at IBM had nothing to do with recreational cycling, Macias' experience as a brand manager prepared him for developing and launching a unique product. He knew the beer industry and was comfortable promoting adult beverages. He said the idea for Cocktail Candy hit him during a visit to a San Antonio company that was developing a lime-flavored salt to enhance the flavor of Tequiza, a new beer spiked with tequila that Macias was promoting for Anheuser-Busch. "I asked if they were making flavored sugars, and they weren't," he recalled. "I asked them to make samples for all the flavors I wanted. They kept making and sending samples until it was right."
Macias, who quit his job in September, cashed in stocks and savings to invest about $80,000 in launching Cocktail Candy. He sells four ounces of the flavored sugars in flat, round tins that retail for $13 each. Each tin comes with a thin sponge to dampen the rim of the glass, and the lids feature a quirky, 1950s-style bar scene based on each flavor.
Macias said he found the perfect illustrator for the tins' labels when he was flipping through an art book featuring the work of Josh Agle, a Southern California artist known as "Shag." Macias said Agle was reluctant to design the labels, but Macias sold him on the product. "I did the labels because I thought it was both a unique product, one that would interest me even if I hadn't worked with the company, and because it fit so nicely into the little world I'm trying to depict with my art," said Shag. "Almost all my paintings are set in lounges, bachelor pads or jet-set destinations, and they feature a lot of drinking and late-night entertaining.
Shag said the product appealed to him because "most alcohols and mixers have been experimented with endlessly, but this adds another element-almost any existing cocktail can be altered and enhanced with the flavored sugars."
Shag and Macias are now discussing ways to license his designs for Cocktail Candy-related merchandise. "I have licensed much of my art for use on merchandise-everything from handbags and T-shirts to custom Tiki Mugs," said Shag. "Most of the merchandise is released in signed/limited-edition form and sold through galleries and museum gift shops." Shag's favorite flavor? "My favorite Cocktail Candy flavor is apple--I think it does wonders to apple martinis."
Macias said his cocktail sugars fit right in with the trend toward flavored martinis and trendy, flavored alcoholic drinks. "The flavors I have go well with flavored martinis," said Macias. "You can use the peach-flavored sugar for Bellinis (champagne and peach juice), raspberry goes well with a Cosmopolitan, and the apple is perfect for a Sour Apple martini."
Leaving a big company means Macias now wears every hat: He works out of his home with one part-time office assistant. He relies on his manufacturer to ship orders directly from San Antonio. After two months, he has already found a few independent distributors to sell Cocktail Candy. His goal is to find a few commercial food and liquor distributors to sell his novelty sugars to bars, nightclubs and restaurants. He's also pitching the product to upscale retailers like Williams-Sonoma and Crate & Barrel and working with a woman who develops recipes for smoothies.
Macias, 41, also has waged a one-man grassroots marketing campaign. Here's his strategy: He goes into a trendy bar, orders a Lemon Drop and asks the bartender to put some of his lemon-flavored sugar on the rim of the glass. Soon, patrons and waiters are gathered around him and his cocktail, asking questions about the bright yellow sugar. Of course, he leaves the tin behind with a brochure for Cocktail Candy. "It's such a fun product," he said. "It's like Pixie Stix for big kids."
Likewise, more than 4,000 big and small kids bought unicycles last year from Unicycle.com, a Marietta, Georgia-based business that was inspired by a midlife crisis. "I hit 40 and realized I had gained a pound a year since high school," said founder John Drummond. "I felt like cycling was a good way to lose weight since I was not good about sticking to a diet."
Because he had delivered newspapers on his unicycle as a kid, it didn't take long for Drummond to get back in the saddle. Once he was riding again, he began visiting online chat rooms for unicyclists to get a feel for where the market was headed. "I started a business but hadn't intended to," said Drummond, who started selling unicycles out of his garage in 1998. He invested $700 in the business and relied on a small-business program offered by IBM to help him create a simple Web site. "I was scared to be out on my own because I'd been [at IBM] so long," said Drummond who worked for the computer giant for 23 years. But he was encouraged when sales grew from $1,000 in April 1999 to $9,000 the following month. Last year, sales were $455,000; Drummond predicts sales will reach $600,000 in 2001.
With help from his wife, Amy, Drummond is now supporting his family and employees. The business has also brought him and his three sons closer together: His son Casey, 12, is a champion unicyclist, and Drummond has collected two gold medals in the "old-timers" class.
His advice for learning how to ride a unicycle? "Hold on to a railing so you don't fall down."
Here are some marketing tips for anyone promoting a single product from Nancy Michaels, president of Concord, Massachusetts-based Impression Impact and co-author of Off-the-Wall Marketing Ideas: "When you only sell one product, it's wise to hope and pray that your product will always be in demand, or you'll continue to improve and reinvent it for a changing marketplace," said Michaels.
Michaels said one-product companies actually have an easier time targeting a niche market. "It's more cost-effective to target a niche market than a broad market," she said. "You should participate in industry trade shows and use direct mail to promote your product to a specific market." Publicity remains the most cost-effective method, said Michaels, but if you can't afford a publicist be prepared to invest a tremendous amount of time.
Michaels suggests making list of publications and radio and TV shows that would appeal to your target audience. Figure out how your product ties in to a current trend.
Jane Applegate is a syndicated columnist and the author of 201 Great Ideas for Your Small Business. For a free copy of her "Business Owner's Check Up," send your name and address to Check Up, P.O. Box 768, Pelham NY 10803 or e-mail it to firstname.lastname@example.org. Sarah Prior contributed to this report.