Jimmy Buffett’s ‘Margaritaville’ Is a State of Mind, and an Empire
His newest showstopper, a 17-story hotel near Miami, has three pools, a full-service spa and eight restaurants, including a seriously upscale steakhouse. That electric blue sculpture in the lobby? You’d swear it was by Jeff Koons.
Over near Orlando, work has started on his $800 million family resort, which will include a 12-acre water park and 1,200 homes priced at up to $1 million apiece. His company, which had $1.5 billion in sales last year, is introducing a line of jewelry. He has one of America’s fastest-growing craft beers. A team — led by a former Google executive — is working to transform his digital media business.
The man is Jimmy Buffett. And it’s time to toss whatever you thought you knew about his lazy, hazy Margaritaville out the window.
Forget the ville. This is a Margarita World. “People are always shocked when they find out how big we’ve gotten,” Mr. Buffett said recently over lunch, grinning and splashing Tabasco on a modified Cobb salad. “We just kept quietly doing our thing. Not saying much. And now — bam! — here we are.”
Margaritaville, with its themed restaurants (erupting volcanoes, boat-shaped booths), started as a tropical cousin to T.G.I. Friday’s. Through trial and error, Mr. Buffett and a partner, John Cohlan, have since expanded Margaritaville Holdings to include four booming divisions: lodging, alcohol, licensing and media. Now, as they pursue growth for the first time overseas, where Mr. Buffett has a much softer fan base, they are trying to recast Margaritaville as a broad, aspirational brand — the Ralph Lauren of leisurely escape, if you will.
“The stroke of genius was making Margaritaville a feeling, not a place,” said Mindy Grossman, the chief executive of the home-shopping behemoths HSN and Frontgate, where 400-plus Margaritaville items include a $799 hammock and $159 penny loafers. “If you don’t take the name so literally, growth could be endless.”
“O.K., not endless,” Ms. Grossman said. “I wouldn’t suggest doing fake fur coats. But almost.”
Mr. Buffett, patron saint of the untroubled, has long been known for his business acumen. In some ways, with his approach to concert merchandise and tour sponsorship in the 1980s, he created the model of musician-as-entrepreneur that managers for artists like Madonna and Dave Matthews have pursued more recently. Other singers have parlayed their personas into business empires — Dolly Parton, for instance, with her Dollywood theme park, Dixie Stampede dinner theaters, Dolly slot machines and “Coat of Many Colors” merchandise — but none are as singularly sprawling as Mr. Buffett’s Margaritaville.
“He understands his brand, which has a substantial reach,” Warren E. Buffett, a friend (but not a relative), said by phone. “One of the secrets to his success is that he never really loses any fans.”
Still, a thriving brand needs to steadily recruit new devotees, and that may be Margaritaville’s biggest challenge. While Mr. Buffett’s fan base includes young people — drunkenly singing along to “Margaritaville” in a college bar is practically an American rite of passage — his core followers are baby boomers. How does Margaritaville make itself more relevant to people in their 30s? What fuels sales of those licensed products once Mr. Buffett, 69, has warbled his last warble?
It’s a subject that Mr. Cohlan, who is Margaritaville’s chief executive, was not especially keen to discuss. Asked about how the company thinks about a future without its public face, Mr. Cohlan said, “Jimmy Buffett is an American treasure,” and changed the subject.
A more robust media presence beyond Mr. Buffett seems to be one answer. Last year, Mr. Cohlan expanded the company’s digital media efforts, which already included a SiriusXM satellite radio channel. He hired Laura Lee from the Google ranks, where she was a senior executive at YouTube, and charged her with building a digital content studio, improving Margaritaville’s social media presence and introducing mobile games. (One casual game coming in July will have users searching for their lost shaker of salt.)
The goal is a fully formed ecosystem. Last year, an estimated 15 million people ate at one of Mr. Buffett’s 67 restaurants or stayed at one of his seven hotels and time-share resorts. The company also wants the masses to buy Margaritaville food at their local grocery store (items like iced tea, frozen shrimp and tortilla chips are already on shelves), watch Margaritaville-produced videos on their phones (“The Best Beach Bars of the Caribbean” is one idea in development) and maybe even sleep on Margaritaville bedsheets (in various designs, including “Strawberry Daiquiri” coral, starting at $19.98).
Ms. Lee’s efforts could also lead to more traditional TV programming. A model is Vice Media, which began as a hard-partying video company and went on to sprout an HBO series and Viceland, a Disney-backed cable channel. Not by coincidence, Margaritaville in 2014 sold a minority stake to the Raine Group, a merchant bank known for its investment in Vice and ties to the William Morris Endeavor talent agency. “The international opportunity for the Margaritaville ecosystem is really exciting,” said Joe Ravitch, Raine’s co-founder.
Mr. Buffett and Mr. Cohlan are co-owners of the rest of Margaritaville.
In success, could Margaritaville be a candidate for a public offering? “The brand isn’t yet for everybody,” said the political polling expert Douglas E. Schoen, who has conducted extensive consumer research for Margaritaville. “It’s not for me, and it’s not for most journalists. But it’s much, much bigger than I initially thought.”
Mr. Schoen added, “It has the potential to be a major global brand.”
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