Ep. 1809 Charlie Friedmann | Masterclass US Wine Market With Juliana Colangelo

The Italian wine podcast is the community driven platform for Italian wine Geeks around the world. Support the show by donating at Italian wine podcast dot com. Donate five or more Euros, and we'll send you a copy of our latest book. My Italian GreatGeek journal. Absolutely free. To get your free copy of my Italian GreatGeek journal, click support us at italian wine podcast dot com, or wherever you get your pots. Welcome to Mastercross US Market with me, Juliana Colangelo. This show has been designed to demystify the US market for Italian wineries through interviews of experts in sales and distribution, social media, communications, and so much more. We will quiz each of our esteemed guests in the end of each episode to solidify the lessons that we've learned. To sharpen your pencils, get out your notebooks, and join us each week to learn more about the US market. Hello. Welcome to Masterclass US Y market. Today, I'm thrilled to welcome Charlie Friedman to the Italian Wine pest. Charlie is the founder of proxies, a non alcoholic wine alternative. By blessing wine grapes, fruits, teas, spices, and complex ferments, proxies, the way beyond the grape to capture everything that makes wine a great pairing with food. Acidity, body, and tannin, but without the alcohol. Welcome to the show, Charlie. It's really great to have you here. Really excited to be here. You know, we try to do something a little different in non alkaline. And for us, it's always about getting the approval and and feedback from the industry. So it's really setting to be on on with you. Absolutely. Yeah. And we're really excited, Charlie, to dive into all things, non alf today on the heels of dry January. He's talking about the growth of the category and you as a founder of proxies, one of the bigger non alf brands here in the US market, just learning more about the space. But, before we dive in, Charlie, tell us a little bit more about your about your background, and how you came to start proxy? Okay. I mean, I don't wanna waste, the whole thing on my background, but The short version. I've had a a varied career. I grew up in the food industry. My family had a a frozen chicken business. We claimed to have invented the dinosaur shaped chicken nugget. Oh, wow. That's a big Some some debate of, like, who who made it first. But anyway, so I was always, like, in this world of PPG products and and food and retail. But ultimately, I I went to law school. I worked as a a lawyer and a a big law firm in New York for a few years really didn't like that went briefly into restaurant consulting, which should not be a thing, but it was. And so I did that for a little bit in New York, helped open a few different concepts but really everything from trying to create the strategy to helping to build a wine list and a cocktail list and washing dishes on opening night, cleaning the toilet, you know, right before opening. So really, across the board there. And then You know, I I grew up in Canada and I moved back to Canada after that to Montreal and then to Toronto where I am now. And I've really been working, you know, trying to get back into food since then, worked on a couple of different failed startups for the most part, did another startup that was, a direct to consumer athletic wear brand. And after that finished, I took a food writing class on a whim and ultimately spent a couple years writing for the globe and mail, Canada's national paper, food and wine, bon appetit, and and, you know, all the all the usual suspects about food, wine travel, and really that led to a job at a company called Assid League, where I I joined as one of the first employees to run the marketing and to write copy and do the labels and all kinds of things. And while we were at As League, we had this this idea. We had a friend who it was the middle of COVID, and he was back in Canada. He he had been working in New Zealand and Australia and in France as a winemaker. And he he had to come back home. And we said, well, you know, we see what's going on in in beer and in wine, in non alc. And we said, like, but or sorry, in beer and in spirits, but in wine, like, there's nothing that we as wine lovers wanted to drink ever. Like, the the DLK wines were just it's always a less end product and and like friends of mine who had restaurants, you know, didn't didn't wanna serve them and we're always looking for something. So we said, like, can we make something better? It was just a figment of an idea. This might be answering ten questions forward, but, you know, we we said, like, can we make something better that serves the wine occasion? Can we take a different approach and and make something that really does pair with food that that has texture and complexity and entertainment structure. And he tried to do that. Devin, one of my co founders of proxies, and he came back with something in a wine bottle, and we swirled it in wine glasses, and we did the whole pretentious thing. And and we said, Like, you know, we're onto something and and we sort of just built from there. That's really exciting. And and what year was all that happening, Charlie? That was, in this towards the end of twenty twenty. So we launched the first proxies, in January twenty twenty one, we, like, rushed to just hit try January that year. I feel like we were, like, we didn't even know what we were doing, and then we realized, oh, like, it's a try January. That's a thing. So let's get this out the door. That'll speed up the timeline. Yeah. And, you know, originally, we wanted to build slowly, like I said, at the beginning, through restaurants, I had friends in the industry who are, like, there's nothing we wanna serve. So we wanted to make a drink that restaurants would be proud to serve that that they would be interested in. But again, it was peak COVID January twenty twenty one. So, restaurants were not open. Maybe restaurants weren't your biggest market at that point. We we launched as an online wine club or not wine club and we said we're gonna make three new proxies every month. Three new products. Hey. Wow. And then for the wine industry, that's, you know, wild. Right? Because it takes approximately seventeen thousand months just to get a new product into the market. Pretty much. Honestly, yeah, we didn't have to wait for grapes to grow, but it was it was insane also. But we said that. And, you know, nobody in the world had really made anything like it before at all. And we're like, oh, we'll just make three a month. No problem. And so we did that. And and that really struck a chord with a lot of people that it was a different approach to non outline because we weren't just taking you know, bulk wine and stripping the alcohol out. We were taking varietal wine grape juices, but then layering on other fruits, layering on, you know, whole spices, natural botanicals. And and maybe most importantly, really high quality teas. You know, wine is a super special beverage, and nothing really compares. But if anything is to compare, it's probably tea in terms of just the structure of of the beverage and the tenon that you get and how it can sort of, like, have that texture and and full flavor in aromatics. What's that bitterness to, you know, that that kind of that quality if we think about the the different tastes, you know, sweet, sour, bitter, right, and tea and and grape and wine, all of that has that bitter from the tenant. Totally. We use, like, tea that you could, like, never buy unless you're, like, a super t nerd. Like, like, we use super high quality tea because it is so important. And so that's, like, the base of it. We treat each ingredient in the best way possible it's always blending to taste. It's a very unconventional method to make a a ultimately a commercial product. Like, it's very labor intensive. It's very high ingredient costs. It's it's a lot of effort. But to us, like, we have to do something completely different. Right. Because there was a gap in the market, as you said, for a product that your friends in the restaurant industry, and I'm assuming a lot of your peers felt proud to serve and and wanted to actually right? That's the hope. Right? Yeah. Exactly. Well, it seems like you've been successful. We're gonna talk a little bit more about the evolution of proxies, but I just wanna lay out kind of what our three key takeaways are for this episode and what we're excited. We've already learned a lot, but what we're excited to learn from you, Charlie, is, you know, how is this no alcohol category ex evolved over the years, especially since proxy launched, so we can focus on the last three years in the US market what are the opportunities in this category that you see moving forward? And, you know, what kind of the future of the space as well, is it a fad? Is it here to say? Well, what is what does it look like moving forward? So Talk to us, you know, first about the last three years and the evolution of proxies and by proxy, how to do it, by proxy, the evolution of the no alcohol space for wine specifically. I'm sort of the skeptical person that if you had told me three and a half years ago, like this would be your life, I would have told you you're insane. You know, I was like the one who wouldn't wanna drink these types of products you know, it's been a a personal development journey along with along with the market and along with the brand. Right. When we first launched, there was, like I said, a lot of excitement at at there being something different. That said, there was a lot of still skepticism and a lot of a lot of people have tasted a lot of bad de alkalized wine in their life. Actually, they probably haven't tasted a lot of it, but they've tasted the same couple, cheap grocery store things that someone bought when someone was pregnant or whatever it might be. And those products are always like a necessity. It's like, oh, I had to have something, you know, so I bought this thing and maybe it has bubbles and it made it slightly less bad. Right. So we we had to overcome a lot there. At the same time, you know, there was this built in interest of, like, can someone make something different? Oh, this this feels different. Like, maybe maybe it's interesting. We've seen a lot of excitement at the start, but then a lot of challenges too. And a lot of, you know, if we're looking at selling to you know, on premise buyers or or trade retail, for example, you know, a lot of buyers didn't think they needed something. Some get it right away, and some were, you know, more reluctant. Some some saw a need, but didn't really trust the non out customer to drink something sophisticated. You know, they thought, oh, we can just get away with something basic, and it doesn't matter what it tastes like. Well, probably because they didn't have a lot of choices before too. Right? Yeah. I I mean, I don't put grudge them. You know, it's it's also everyone was going through a hard time and it's like you have a limited budget. You're gonna buy the stuff that you know moves. Right? So to take on a new product is is the leap of faith. I'm eternally grateful to those partners that did take that leap with us. And saw that that consumers are demanding, you know, more exciting products and that they are willing to pay the same for non alc as they would pay for for an alcoholic drink, and especially in the wine space are desperate for something new. And and the thing is, like, we made three new ones every month for for a while, and then we switched to six every quarter for a bit. But either way, like, we've made nearly a hundred different blends now. And to be frank, like, we've gotten a lot better too. Which which is a blessing, that, you know, sometimes it's good that not as many people tasted your early stuff. Right. I imagine all those different products too, like, a little bit of trial and error or just market testing to see which blends and which formulas this is best. Yeah. I think that's our advantage Mhmm. That we have this direct feedback loop where we know we have a better sense at least than than any other company, I think, of what people are really looking for in this space. Right. And and how to deliver that. And so, yeah, sometimes we put out stuff that that was crazy, like, like an oxidized, you know, madeira style thing. And we didn't think people would love it, but it was it was a learning experience, right? It, like, how far can we push the boundaries? This thing. But but what we've seen is in raw numbers, like, you know, we grow, a hundred and fifty percent year over year. Right. But we see that anecdotal interest is you know, is just compounding. And Wow. You know, you get I get emails from really big grocery stores now and and big trade retailers. You get restaurants all over North America reaching out like, hey, I saw something about you, like, How can I get this on my menu? At first, it was hard to get distribution partners super interested, and now they're like, wait, this is something this is a huge value add for my my portfolio. Like, we have states where know, we have a few distributors fighting over carrying proxies. So it's really exciting to see. A good problem to have. Yeah. And, even where we are now is is really at the beginning of an inflection point because you're starting to see the really big retailers understand that they need to play in this space, but also understand how to play in this space because throwing stuff on a bottom shelf in a corner, you know, that's not doing anyone any good. But, you know, like, when gluten free products first existed, they were just shoved in next to the bread, and nobody knew what they were and didn't buy them. Right. As soon as they were, you know, merchandise properly, you know, that's become a huge thing to the point that now people think it's a fake allergy, but, like, you know, as soon as people see in stores that there is a a non alc isle or display, you know, they're drawn to that and they're purchasing. And and it's not really taking away from alcohol sales, it's really additive. It's something that, you know, is bringing in a a consumer that is spending a lot that, you know, retailers see their basket size improve. It's it's really beneficial to to everyone, but we need to do it. We need to do it right. So And it's having a different location. Yeah. Exactly. I mean, it's there was a stat, I think, from Nielsen, that said something like ninety four percent of people buying non alcoholic. Alternatives are also buying alcohol. So it's not that, you know, you like you said, it's not taking away necessarily from someone who's buying alcohol. It's just they're buying for a different occasion or for a different use case or, you know, to maybe, to be more moderate about consumption. So I agree with you that there's there's room for everyone. Italian wine podcast, part of the Mamma jumbo shrimp family. You know, it sounds like, you know, you feel that the retailers are are now starting to catch on with the category and and really how to properly merchandise this merchandise the category. So on that topic, talk just a little bit about the marketing of proxies and the direction you went in and and what's been most successful when it's come to really growing your brain. What we're talking about is is the case where, you know, the the stat you just mentioned, like, we've always marketed to people who are cutting back Obviously, there's a core audience who don't drink at all. But for us, we like to talk about the weeknight wine, you know, like, I still drink wine. Pretty much everyone on our team loves wine. Wine is great. That's why we do this. Like, but I can't drink wine every night. And I also don't wanna drink LaCroy every night. You know, like, with dinner, like, I want something that feels like an escape from the work day. I want something that actually makes my meal more interesting. You want something that you can have with friends or family and and talk about. And so that's the the market we've gone after, we've really tried to focus in on what is the core occasion for wine. And to us, that is food pairing. The only wines that have other occasions, like champagne has a celebratory occasion use case, rose has, you know, a summer occasion as well. But generally, when you think about wine, it's about pairing with food. So that's what we really thought about from the start. And like I said, why we wanted to work through sort of the chefs and the Psalms and the industry three credibility and rebuild, you know, a distinct category. And so the way we did that, at first, to be honest, our goal was just be in good restaurants, get feedback, see if people we respect will carry this. It was in the news at the time early on that Sean Brock. Famous Jeff obviously had gone sober. And we said, like, okay, wouldn't it be cool if we could just get his feedback? Like, get Sean Brock to try this. And we were trying to reach him. And by the time we did, which wasn't far into our journey just like a few months in. He said, hey, I'm a subscriber. You didn't notice? Oh, wow. I should pay more attention. And we got on a call and he, like, flashed all our marketing materials at me. I was like, I even I don't have that many. Like, we and, you know That's amazing. Boxes with tasting notes. And he's like, I drink these with my family. Like, I'm super excited. Can we can we do something together? And I was like, yes, yes, please. And so that became our first collaboration, and it was truly just that organic. Like, it was a natural thing. It was a true collaboration. We went down to Nashville. We worked in his kitchen on on what it would taste like. There was no, like, financial component. It it's not one of these, like, hey, take some shares and pretend you're part of the company. It was totally just like, I'm super excited about what you're doing. Can we do this together? And we did. And that really set us on a path where we're like, like, what's the next one? You know, we got that itch, and we ended up collaborating with with Andre Mac, which was amazing and and Dominic Kren, Oh, he's great. And then, yeah, Michelin Starsteps in Chicago, Beverly Kim and Johnny Clark, and Division wine making, and, Miguel De Leon, amazing Psalm in New York. And so that has sort of become part of our calling card. Right? Like, it's it's not about the collabs. It's about the credibility that brings and that it's really something that nobody else can match, because it's something that's been real. Like, it's it's just about the quality and the credibility Right. That that that brings. And if proxies are served at a linear or the French laundry, well, they must have something going for them. Right? Absolutely. Absolutely. And it sounds like the partnerships and relationships you built are are real. They're not Which is amazing. Consumers are starting to get really wise too that they're paid and they're not real. Like, you went or the real relationship. It's not a celebrity alcohol brand or anything like that. Some of these people are, like, on Netflix and things. But but, you know, they just wanted to do this because it was something exciting. And so we find that our marketing is most success full when we focus on what's different about proxies. And so it is the the chef and some credibility, but it's also how they're made, how we build a beverage from the ground up, and that it's not just the alkalized wine, because a lot of people have had you know, a poor experience with that. So, you know, we we do a lot of online advertising and we've learned what sort of messaging works and and what resonates with the right type of consumer that that will really, you know, like our product and keep coming back. And it is it is built around that. And it's a really important part, you know, even if it didn't work in that, it's like, to me, that's what we always set out to do and ultimately, like, to build a sustainable company in this space, it it has to be quality above everything. And people are, you know, coming to non alc as as as we said as retailers start to merchandise it better and and carry more products, but they're willing to try it once maybe twice. If if you give them a product that's subpar, like, you know, they go back to their preconceived notions of, well, never mind that, like ultra string water, you know. Or La Corey. I mean, speaking of quality, Charlie, talk. This is all about pricing strategy when it comes to proxies because, you know, we think about nonalcoholic versus alcoholic and price. You know, I have friends and I hear them say, like, why is a non alcoholic alternative the same price? And how did you navigate that part of the the launch and and the marketing? Yeah. I mean, ultimately, first of all, the product costs a lot to make. Like I said earlier, you know, there is a lot of effort that goes into it. We're using expensive ingredients. We're using varietal wine grapes. We're using vergio that we source locally. You know, we're using amazing teas. We're building a lot of our own aromatics, almost like almost like cocktail bitters, but we're we're making a lot of those ourselves, with the best quality spices and and botanicals. So it's expensive. And ultimately, the the price should reflect quality as well and sort of tells the consumer that this is something different. So there is there is a an element of brand and marketing in that as well, you know, You you know this from, you know, wine as well. Right? Like, so it doesn't cost that much more to make a bottle of hundred fifty dollar wine versus a twenty dollar wine. It's just, you know, the the signal of quality and the goodwill that's been built up and so on. It's a bit of both, but we find that the end consumer is pretty willing to pay here. It is more the industry, you know, gatekeepers that are sometimes afraid of the price. But, you know, we we try to work with our partners, you know, like, in on premise accounts to get to a buy the glass price and really encourage sampling and and prove that that people are gonna like it and that's smooth. So like you said earlier in the conversation when it comes to, you know, the retailers and accounts you're working on, it's also teaching them how to market the product, right, and how to correctly whether it's on a shelf or list, position it so that it does move. That seems like a really important part of the offering for proxies, but I would say for the non alcoholic space in general. Yeah. Education is huge. So Yeah. For sure. And, you know, just speaking of the space a little more broadly since, you know, you've been in it now for for over three years and and seen a lot of, you know, success and growth with the proxies brand. What do you see as the future for the category? I mean, I'm biased, but, I I do think it's gonna continue to grow. I think it's it's really short sighted if anyone thinks this is a fad because you know, to the point you said it's, like, in the mid nineties percentage of of consumers of non alcohol do still drink alcohol. So it's about people moderating their drinking and cutting back and Right. To be frank, like, finding other, you know, substances as they become legal as well. It's just gonna grow and really it's gonna grow as awareness of the category grows, you know, as it's put in front of people and they see that there are good options and they try them and and they're able to get them in their local restaurant where they trust the person serving them and then in their local store, you know, we have a great online business, but ultimately, I don't wanna be forcing people to buy four or six bottles online forever. Like, want you to be able to get this in your local store. I want you to be able to taste it at your local restaurant. And that's really what's what's happening, I think, in the next year or two is that proliferation into more and more spaces and just more awareness of of the products that are out there and hopefully the the high quality products. Right. More acceptability. You know, it's a rising tide type of thing. This sounds cliche, but it's true. More and more people realize, hey, like, there is something other than these bubbly waters. There is something different than kombucha, you know. How can I replace wine? How can I make my day and my week feel better without having to to have alcohol? And sometimes we can be a better pairing than alcohol, sometimes worse. Sometimes you have it alongside wine. You know, like, we we encourage all these things because it's really about finding the opportunities to have a non health alternative that work for you. And, really, that's different for everyone. But, but it's rare that anyone wouldn't see any use case in their life for a non health product. Right? Totally. So many different, you know, opportunities for it. Well, Charlie, thank you for for joining us today. As we wrap up, we do wanna do our rapid fire quiz. We do at the end of every episode just to give our listeners a few final pieces of advice about the US market, in this case, and non alcoholic space in the US market. So if you can do your best to answer these questions in, one or two sentences, I was gonna say that you've seen that that might be difficult. Try your best. Try your best. Question number one, I know your company is from Canada, but we're gonna focus on the US still. And I know you've lived here. So it works. Number one, what is your number one tip for mastering the US Y market? For us, it's it's patience. It's about finding the right products, putting them in the right place at the right time. So making sure that if we go into a retailer, that retailer is, you know, is ready to do this in this category and and is gonna be a good partner and listen to us as well and share data back and forth about what works. So it's it's about being patient for us. Great advice. Number two, what's something you might have told your younger professional self about selling non alcoholic wine in the US. I I I never would have told my younger self that. Kind of like wine, every state and every region is different, both in terms of laws and regulations and and frankly consumer tastes and readiness. You would think New York would be an amazing state for non health products, but the laws don't allow alcohol sellers, retailers to sell non health products. So it's really difficult to to figure out a distribution pathway there. It's really difficult to get products in front of people. Each next state we go to, there's another particularity, even in non alc like, we're immune to some laws, but it's it's a complicated pathway in working through the three tier system and sometimes outside the three tier system as it's challenges. For sure. Absolutely. Yeah. I experienced that in New York recently about the non out not being sold in alcohol stores. So definitely a unique challenge. Like you said, in every state has its own. It's all unique challenges. Finally, number three, we all travel a lot in this industry. It sounds like you're traveling a lot throughout the country meeting with partners. What's your favorite travel hack? I'm not good at this. I don't I I'm I'm I'm I'm going on a trip tomorrow, and I'm not really really packed yet. For me, it's funny. At one point, I was I was looking for good solutions for how we could ship our bottles, direct to consumer. We were having some breakage issues. And I ordered from a bunch of different places, and one seller had these odd plastic, like, bottle sleeves that honestly were not the best option, but in the end, I kept them all and I take them with me, empty and travel and bring bring bottles of wine or sometimes non alc products back. Okay. So it's just, being prepared to fairy stuff. And when I don't, you know, there's always socks and sweatshirts. But yeah. Very cool. Versus paintable view. Using laundry to pack wine. I've done it many times. Well, Charlie, thank you again so much for joining us in the Italian wine podcast. How can our listeners connect with you? Yeah. We're at drink proxies dot com, and drink proxies on Instagram, pretty much drink proxies everywhere. It seems like every beverage brand now has a Rink before their name because it's just easier. But, yeah, that's how you can find us and sign up for our emails if you want and keep track of what we're up to. But hopefully, we'll be, you know, in more and more restaurants and stores near you wherever you may be, in the future. Fantastic. Alright. Thanks again, Charlie. Thank you. Thank you for joining me today. Stay tuned each week for new episodes of Master Class US wine market with me, Juliana Colangelo. And remember if you enjoyed today's show, hit the like and follow buttons wherever you get your podcasts.