How Tito’s Vodka Poured On the Charm and Grew Bigger Than Texas

'Handmade' hooch now sells 3 million cases a year

Bertito Beveridge—"Tito" to everyone—likes to tell the story of how he first tried to get into the liquor business in 1993. The Texas-born geophysicist-turned-mortgage broker, who'd begun adding flavors to store-bought vodka as a hobby, tried to sell some of his concoctions at a local liquor store. The owner kicked him out. When Beveridge asked how he was supposed to distribute his flavored vodkas, the shopkeeper told him there was no future in that stuff.

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"He goes, 'If you can make a really smooth vodka that a girl can drink straight, then you might have something,'" Beveridge recalled in a recent radio interview. "Well, how do you do that?" Beveridge asked the man. He replied: "I don't know—you figure it out."

Beveridge did figure it out. Using credit cards to buy 13 "middle of nowhere" acres in Travis County, Beveridge designed a still based on old photos of moonshiners he found at the library and "just kind of started cooking," as he put it. He distilled corn (most vodkas use wheat) and used local aquifer water. The end result: Tito's Handmade Vodka. Take note of that adjective; we'll come back to it.

Courtesy Tito's Vodka

Today, with minimal marketing but many fans, Tito's has nudged aside giants like Ketel One and Grey Goose. "It's a brand you're beginning to see in bars all over the country—and I'm not talking neighborhood or sports bars, but upscale, expense-account places," said veteran spirits consultant Arthur Shapiro, author of the just-released book Inside the Bottle. "It's become a call brand: Someone will say, 'I'll have a Tito's martini.' Tito's has become a phenomenon, and that doesn't happen very often."

Courtesy Tito's Vodka

It certainly doesn't in the vodka category, one controlled by global conglomerates like Diageo and Pernod Ricard. So why is Tito's suddenly the toast of the town? The simple answer is that it's a premium vodka at a bargain-shelf price. But part of Tito's appeal is its back story. Tito's the brand has made shrewd and effective use of Tito the founder—how he went into debt with 19 credit cards, how he slept in his still shack with a pack of stray dogs, and how he made his vodka by hand. "Among the things that drives a brand is the back story, and Tito's has capitalized on that," Shapiro said. "Good guy makes it big after suffering. The entrepreneurial spirit. The Horatio Alger story. Don't we love that?"

The claim of "handmade" has gotten Tito's into a bind as the brand has grown. These days, a colony of industrial stills cranks out some 3 million cases a year, and in 2014 Tito's got slapped with two lawsuits alleging that the hooch can't possibly be made by hand anymore. But earlier this year, a judge threw both cases out, and Shapiro says that consumers are smarter than the claimants realized.

"Nobody expects it to be made by hand," he said. "Handmade is marketing speak for quality. And he's selling millions of 'handmade' bottles or whatever—we don't care. Tito's is a success story. It tastes good and it's cheap. Move on."

This story first appeared in the December 5, 2016 issue of Adweek magazine.
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@UpperEastRob Robert Klara is a senior editor, brands at Adweek, where he specializes in covering the evolution and impact of brands.