The Brown-Forman Way
Campbell Brown, the fifth-generation chairman of the board of Brown-Forman, is surveying his office in the otherwise modern Louisville headquarters of his family-controlled company, the maker of such storied Bourbon as Woodford Reserve, the official Bourbon of the 150th Kentucky Derby. This room is the opposite of modern, decorated with wood repurposed from a dining room where executives used to eat. The rug used to sit in his grandfather’s office. “And that’s my grandfather’s desk,” he says. “It’s the only office I think that kind of looks like you should be smoking a cigar.”
The nearby office of the president and CEO, Lawson Whiting, has a very different look. There’s a photo of the Rolling Stones’ Keith Richards, one of the many he has collected of celebrities drinking another of the company’s spirits brands, Jack Daniel’s Tennessee whiskey.
The contrast encapsulates the personality of Brown-Forman, a 154-year-old American institution that continues to thrive by melding the values of a family-run concern with agile business practices that have helped it adapt. Here, the steady hand of the Brown family—which Forbes magazine listed as worth more than $16 billion—guides a diverse group of nearly 6,000 employees that span the globe and keep the company evolving.
Brown is 53, and he grew up in Canada, then came to Louisville in 1985 as an intern in the mailroom and gingerly worked his way up through the company. “I used to be terrified to come up to [the executive offices],” he says. He would overcome that to work in the wine division and more recently to spearhead the resurgence of the company’s original brand, Old Forester, first distilled in 1870. In 2021, he became chairman, succeeding his brother George Garvin Brown IV on his retirement. However, Brown says there was nothing preordained about his rise. After all, some two dozen extended family share in the business.
Whiting, who is also 53, ed the company in 1997 with a background in finance, but went onto take stints in the operations and marketing side before becoming president in 2019. He served as director of global strategy for Jack Daniel’s, the sixth-largest distilled spirit brand in the United States, according to Impact Databank, which (like Cigar Aficionado) is published by M. Shanken Communications Inc. Even this stalwart brand has undergone significant change. Back in the 1990s, 95 percent of Jack Daniel’s business came from the United States, says Whiting, while today, some 55 percent of sales come from abroad. “That’s a pretty monumental shift,” he says. “And it impacts many, many things like where our employees are.” He estimates that only 1,500 of the company’s 6,000-person workforce now works in the United States.
Brown-Forman has continued to change even as it cleaves to its original business of Bourbon. Today, it owns brands in virtually every spirits category, from Herradura Tequila to Diplomatico rum, Slane Irish whiskey, Chambord liqueur, wine, Fords gin and a wide range of Scotch whiskies, including Glenglassaugh, ranked the No. 1 Whisky of the Year by Whisky Advocate, Cigar Aficionado’s sister publication. It also owns wine and Champagne brands. Although tradition plays a role here, and Brown-Forman has made Old Forester from the start, the company has undergone almost a complete turnover in the brands that it owns in the past quarter century. “The only three brands that are left from the year 2000 that we still have in our portfolio today are Jack Daniel’s, Old Forester and Woodford Reserve,” says Whiting.
While the Brown family has always steered the ship, change has been a constant for the distiller. George Garvin Brown founded the company with a partner, George Forman, in 1870. A pharmaceutical salesman, Brown’s thrust back in those days was to market Bourbon as a medicine. A slogan claimed, “Many, many times a day, eminent physicians say, Old Forester will life prolong and make old age hale and strong.”
But it wasn’t marketing Bourbon as medicine that would separate Brown’s whiskey from its competition. At the time, distilleries sold Bourbon by the cask. Taverns would buy a barrel and pour single glasses for on-site consumption or fill jugs for taking home. Unscrupulous dealers called rectifiers would doctor unaged spirits with all manner of flavor additives to make it seem aged. Consumers often had no idea what they were getting. Brown’s solution to protecting the reputation of his product was to become the first Bourbon maker to bottle his products with a seal and a label. He even signed them as a mark of authenticity.
“He was showing it off, what’s in a glass bottle,” says Brown. “You knew what you were getting well before the Bonded Act [an 1897 law that codified some whiskey standards]. On the death of his partner he would buy out his share of the business, keeping Forman’s name but creating an ongoing family-run concern. He brought on his son, Owsley Brown, who would take over upon George Garvin Brown’s death in 1917.
Almost immediately, Owsley Brown would face the banning of alcohol with the 18th Amendment in 1920. However, the early marketing of Old Forester as a pharmaceutical would prove prescient. Brown-Forman secured one of six licenses issued to sell the stocks they held for medicinal purposes as doctors were allowed to issue prescriptions to their patients. “There were a lot of sick people then,” Brown says with a chuckle.
By the end of the decade, stocks across the legal whiskey business were depleting and distilleries with licenses were allowed to resume production in 1929, four years before Prohibition ended. This gave Brown-Forman an advantage over makers who had been shut down for the duration. The allowance would also give Brown-Forman the distinction of being the only existing U.S. spirits company that made liquor before, during and after Prohibition.
With the repeal of Prohibition, Brown-Forman made its first public stock issues, but the family has retained a majority stake. It began a policy that the company calls a “purposeful relationship” between the leadership team and the controlling family shareholders. In a world where formidable family businesses have often met with ill fortune, the Brown-Forman model has kept the company in good stead.
Part of its success comes from nimbly meeting with change. During World War II, Brown-Forman exclusively turned to producing industrial alcohol, which was used to make gunpowder for the war effort. However, at the same time, enough Bourbon was laid down at the beginning of the war so that stocks of four years maturation were available at the end of the conflict.
With Owsley Brown’s retirement in 1951, leadership ed to W.L. Lyons Brown as chairman and George Garvin Brown III as chairman and president. The decade was heady times for the company, during which it had Early Times, then the world’s best-selling Bourbon. Brown-Forman also began to diversify, increasing its portfolio nearly tenfold, with wines, liqueurs and imported spirits in 1956. The sweetest acquisition of the year was Jack Daniel’s, the now world-famous Tennessee sour mash.
The 1960s brought what Brown-Forman refers to as “the dark age of dark spirit.” Lighter spirits and wine were overtaking Bourbon and the like, and the response was to invest in the categories that were gaining on them. By 1983, the company had further diversified with such non-potable products as Lenox China, Hartman luggage and giftwares. They have since been sold and today, the company concentrates on beverage alcohol.
Despite the gloomy assessment of the American whiskey category, the Browns never forgot the spirit on which it was founded. Jack Daniel’s showed its allegiance by adding the super- Gentleman Jack in 1988 and later a single-barrel whiskey. However, those may seem like baby steps compared with a move Brown-Forman made in 1996, when it introduced Woodford Reserve Bourbon. The newly minted chairman, Owsley Brown II, spearheaded a project to refurbish a 19th century distillery located 60 miles east of Louisville. There, it embarked on a project that would create a huge tourist attraction and the first new major Bourbon in decades. The spirit, made in small batches in pot stills, was quite the anomaly.
In this era of craft distilling, when new Bourbons are regularly released, the move hardly seems astounding. But at the time, it was groundbreaking. “No one was investing in the Bourbon business in 1996,” Whiting says. “There just weren’t any new brands, the category had been in a long-term decline. And Owsley Brown gets all the credit in the world for saying, ‘You know what, we’re going to build something at an ultra- price-point.’ ”
Woodford Reserve has become a monster hit for the company, one that is prized by collectors and Bourbon lovers. It is one of the fastest-growing spirits brands in the United States, averaging more than 17 percent growth over the last three years, according to Impact. Innovation and offerings are two of the seminal elements of the success.
“Woodford is the clearest and cleanest example,” says Whiting. “You’ve got the core brand, but you’ve got something called Double Oaked. That was really the first double barrel brand to make it big. It’s a phenomenal, home run success.” To punctuate his point, he adds: “How many brands in the world have consumers that are willing to sleep outside for days on end to get a new edition or a new special whiskey?”
In hindsight, in a world crazy for Bourbon, the move seems logical, but at the onset, some questioned the move into a new Bourbon brand, despite Owsley Brown’s lofty position.
“It took some time, believe it or not, because some people within the company said, ‘not a good idea to waste the money. Bourbon is dying. Why would we want to do that?’ ” says renowned whisky maker Chris Morris, now in his 48th year at the company, and distiller emeritus of the Woodford Reserve brand. He’s created many of the expressions of the Woodford Reserve brand and the revived Old Forester.
The company plowed ahead using its vast resources. “No one was in charge of the development,” says Morris. “Everybody had their piece. We had the packaging people working on deg the bottle and the marketing and brand team were coming up with the names. We in production were working on a whiskey. It was a big community effort.”
What began as essentially a microdistillery with only one warehouse that could hold a mere 5,000 barrels would eventually require new aging space. Now, the brand stores 300,000 barrels. Woodford also now produces a fleet of whiskeys that includes its Double Oaked version, as well as a revolving door of special editions and innovations that have included rye, wheat and malt whiskeys. Special releases have fans lining up at the distillery for purchase.
Woodford was also on the ground floor of the Bourbon tourism boom, which draws some two million to the state each year. Morris re that in the early days he might greet as few as two visitors in a day. Now, with a selection of a half dozen tours and tastings, Woodford attracts some 170,000 guests a year.
Elizabeth McCall, Morris’ recent successor as Woodford master distiller, ed Brown-Forman in the sensory division having obtained a master’s degree in psychology. The logic isn’t so odd, she explains. “If you think of sensory, it’s all about human response. And psychology is all human response and then I had [training in] statistical analysis and the methodology of experimentation.” Through a series of coincidences, she now oversees one of the biggest success stories in the industry.
Even while enjoying success with a (relatively) new brand, Brown-Forman has reached back into its heritage to revive its original product, Old Forester. The flagship had fallen onto hard days. Back in the 1970s, it had peak sales of a million cases a year, but it began to tail off while Jack Daniel’s surged ahead, at one point falling to a mere 90,000 cases. Jack Daniel’s now sells some 6.5 million cases a year, according to Impact.
According to Brown, who was charged in 2017 with bringing the brand back before he became chairman, it was Paul Varga, president and CEO from 2005 until 2019, who articulated the Old Forester story best. “It was almost as though it were a tragedy that we haven’t connected the authentic Old Forester story back to the family that was still involved in, and has always been involved in, this industry.” Brown became the member of the family who would tell the family story. The Old Forester brand already had an ultra-small-batch release called Birthday Bourbon, which is the product of one day’s barreling each year. The company spent $50 million to build a showcase distillery and visitors center on Whiskey Row in Louisville to add more allure and visibility to Old Forester. Brown-Forman gave the brand—which is made in Shively, Kentucky, at a facility that cannot be toured—a presence in Louisville for the first time since the beginning of Prohibition. With the new location came the Old Forester Whiskey Row Series, which now includes five releases, including the brand new 1924 10-year-old, a rare age-statement Bourbon for Brown-Forman.
The moves have paid off. Brown-Forman company recently announced that Old Forester has hit the half-million case mark.
That situation reflects not only the American whiskey boom of the new century, but also Brown-Forman’s willingness to stay true to its roots even while constantly innovating. But Campbell Brown hesitates to describe the resurgence in those . “It’s hard to think of it as a boom when you’ve got all these really good foundational truths of the category that are just opening up more and more opportunities for consumers. We’re the last kind of American business that you can be a part of and the biggest investor in that category as well.”
