Changing Consumers Behavior Around Happy Hour with Sharelle Klaus

September 21, 2020 | by Diana Fryc

Gooder Podcast with Sharelle Klaus

Listen on PodBean, Spotify, Apple Podcasts, YouTube, and Google Podcasts

In our current culture, alcoholic beverages have traditionally been the center of all celebrations. It’s how we wind down our day, relax and give ourselves a moment to rest. That is until now. Generation Z and Millennials are bucking those habits and finding better and healthier ways to relax. Part of it is self-awareness, the ability to recognize when alcohol is a crutch – rather than a treat, and some of it is “I’m not doing what my parents did”. They are normalizing alcohol-free celebrations, getting real about mental health, and creating an inclusive environment for everyone. It’s time for the sober revolution.

Sharelle Klaus and I walk through her journey of self-discovery, and the ins and outs of finding her and her brands true north. We discuss her passion to create inclusive celebrations for all people. And that sometimes, you just have to start all over.

In this episode we learn:

  • Sharelle’s aha moment that turned into DRY.
  • The story of teaming up with Sans Bar.
  • How Millennials and Generation Z are changing our relationship with alcohol consumption.
  • How to educate, socialize, and enroll behavior change for consumers.
  • How “bad news” can be the path to opportunity.
  • To trust your gut, even when you’re the only one in the room that believes it.

About Sharelle Klaus:

Sharelle Klaus is the Founder and CEO of DRY Soda Company  As the visionary behind DRY Soda Company, Sharelle has always had a passion for the culinary world and celebrating each part of a meal – including the beverage. After having four children, she didn’t want to let a lack of wine or cocktails stop her from being a part of the party. Klaus recognized an absence of refreshing, clean, non-alcoholic options in the market, and became determined to create the first line of botanical bubbly that was worthy of meal pairing. She believed savory and sweet flavors more commonly used in cuisine could offer exciting compliments to her favorite meals. In 2005, Klaus crafted the first batches of DRY in her home kitchen and officially launched DRY Soda Co. a few months later.

Klaus brings over two decades of entrepreneurial, financial and technology industry experience to her role as CEO at DRY, and oversees all marketing, strategic planning, and innovation for the brand. With guidance from some of the Pacific Northwest’s best chefs and a savvy corporate team, Klaus pioneered a new category of sparkling beverages, fearlessly leading DRY’s aggressive growth in a male-dominated industry. Prior to founding DRY, Klaus worked as a consultant for Infrastructure Management Group and Price Waterhouse. She also served as president of the Forum for Women Entrepreneurs, where she drove strategic development of programs, events, and fundraising for the organization’s 250+ Seattle-area members. Klaus has been featured by Huffpost, Forbes, Wall Street Journal, Imbibe, and others.  Klaus has also won several honors including, Seattle Business Magazine’s CEO of the year, Puget Sound Business Journal Women of Influence, and PSBJ 40 under 40.

With a keen appreciation for humor and wit, Klaus is an avid supporter of entrepreneurship and frequently speaks at professional conferences, workshops, and the University of Washington Business School, where she also participates as a judge for the Michael G. Foster’s School’s well-known business plan competitions. She is also a board member of the Aliados Foundation that builds resilient community business based on biodiversity in the Andes and the Amazon—and connect them to markets across the globe.  Klaus graduated from Seattle Pacific University with an undergraduate degree in political science and currently resides in Seattle, Wash.

LinkedIn – https://www.linkedin.com/in/sharelle-klaus-1804078/

Show Resources

DRY – Welcome to DRY Botanical Bubbly! The non-alcoholic sparkling soda perfect for celebrating any occasion. Enjoyed on the rocks or in your favorite zero-proof cocktail.

Sans Bar – We are a growing group of average people who recognize that life can be fun without alcohol.  We are sober, we are on the move, and we believe that real connection happens when people are sober.  We want to create a space that is free of alcohol and welcoming to all.  We believe that the best version of anyone’s life includes healthy socialization, helping others, and taking care of both mind and body.  Sans Bar is composed of people who want to change themselves and the world around them.  We believe positive change can happen in the smallest ways, and still yield a tremendous impact.

This Naked Mind: Control Alcohol, Find Freedom, Discover Happiness & Change Your Life (Book) – offers a new, positive solution. Here, Annie Grace clearly presents the psychological and neurological components of alcohol use based on the latest science, and reveals the cultural, social, and industry factors that support alcohol dependence in all of us.  Packed with surprising insight into the reasons we drink, this book will open your eyes to the startling role of alcohol in our culture, and how the stigma of alcoholism and recovery keeps people from getting the help they need. With Annie’s own extraordinary and candid personal story at its heart, this book is a must-read for anyone who drinks.

BevMo – a privately held corporation based in Concord, California, selling mainly alcoholic beverages.

Transcript

Diana Fryc: Hi, welcome to the Gooder Podcast. I’m your host Diana Fryc. As partner and CMO of Retail Voodoo and award winning branding agency, I have worked and met with some of the most amazing women in the naturals industry food beverage wellness, fitness even, as such I have decided to create the gutter podcast to interview these great people and subject matter experts and have them share their insights and expertise with all of us and help us make the world become gooder. So very fun guest for us today or for me today, somebody I worked with in the past Sharelle Klaus of Dry Soda Company. Sharelle is the visionary and founder and of course CEO of Dry Soda, she founded in 2005. Is that right?

Sharelle Klaus: Yes. You’ve got that right.

Diana Fryc: After recognizing an absence of refreshing, clean, non alcoholic options, beverages in the market, she just became determined to create the first line of botanical bubbly that was worth pairing with a meal. Sharelle brings over two decades of entrepreneurial and financial and technology industry experience to her role as CEO. And with the guidance of some of the Pacific Northwest best chefs that was my favorite part, and a savvy corporate team, she pioneered this new category of beverages, fearlessly driving her brand in a male dominated industry. Prior to founding Dry, Sharelle worked as a consultant for infrastructure management group at Price Waterhouse and Price Waterhouse. Do you serve, or you served as president for the form of women entrepreneurs?

Sharelle Klaus: I did serve. This was years ago.

Diana Fryc: This where she drove strategic development of programs, events and fundraising for the organization’s 250 plus y’all members. I also just as an aside from all of this greatness of Sharelle, I got to work with her here at Retail Voodoo personally, back when her brand Dry was going through a pretty significant change. And we’ve just been lucky enough to participate in the journey at that time and just remain in contact. It’s been fun. So Sharelle, hello, welcome.

Sharelle Klaus: Hello. Thank you. I’m so excited to be here. Fun to get to talk to you again. It’s been a while.

Diana Fryc: It’s been a while, you just made a personal move. You live just outside of Seattle now on the water. Is that right?

Sharelle Klaus: Yeah, I moved down to Barry and there’s this incredible like on the sound here. And it’s the perfect place to be during COVID. That’s for sure. And even during all this smoke of these fires because, well there’s some out here but it’s been pretty clear. There are lots of stand up paddle boarding and hanging out. So it’s like being on vacation every day.

Diana Fryc: Oh, that’s not a bad thing. That’s not a bad thing. I know.

Sharelle Klaus: I feel pretty blessed.

Diana Fryc: I wanted to start out, you of course, have been pretty visible in the industry, but for those people that don’t know Dry and kind of its genesis, maybe give us a high level overview. What is Dry and why did you create it?

Sharelle Klaus: Sure. So, like we had mentioned, I started the company 15 years ago. So 15 years ago, I had four kids under the age of seven. And for the kind of that 10 year period behind that, basically, I guess it was nine years, 10 altogether, between the pregnancies and nursing and just all the other sort of mother responsibilities I had, I didn’t drink and I felt very left out because I’m a total foodie. I’m an extrovert. I love going out to dinner parties and to restaurants and events. But when you’re not drinking alcohol, there’s very little options for you. There’s extremely limited options, at times it’s just water or it’s a water or a coke.

If you’re in a really fine dining establishment, you would like something to pair with your food or to feel part of the ritual, like somebody just plunks down a glass of matcha ice in it and a soda. It’s not the same as opening a nice bottle and pouring it into some beautiful barware. And I thought, this is crazy, I feel so excluded. I feel almost like a second class citizen to restaurants. And I’m like, there’s plenty of people who aren’t drinking for various reasons, and would like an elevated option. So I thought to myself absolutely want to create something a; that compare with food, so it has really beautiful culinary flavors. And then as you guys know, well, the packaging was really important to me. This package needed to be able to sit on a white tablecloth restaurant and just be part of that ritual. And so I really thought it was possible to bring a drink to market to change the way people think about drinking and change the way alcohol always has to be at the center of every celebration, like it doesn’t have to be. Now, you probably don’t want a coconut center of every celebration, but you might want some more elevated options.

[00:05:03]

And I wanted to change the way people thought about drinking. Not that I’m anti alcohol, just that when you’re not drinking, there should be options. So it was really about inclusion and connections and really options. And so that’s why I started it and I started it in my kitchen, creating these really great flavors. So that the first four flavors were lavender, lemongrass, rhubarb and kumquat these very fun culinary flavors, you can pair with different foods. So yeah, that’s how I got started with Dry.

Diana Fryc: When you first were coming out with this and I mentioned in your bio, kind of CSDs and beverages very male dominated. Were you getting some eye races or were you getting people that were like, “Hey, she’s onto something.” Like what was the initial feedback?

Sharelle Klaus: Before I launched it, everyone was like, “Do not go into beverage. Are you kidding me? That is like the worst business because it’s competitive, you’ll get eaten alive.” Even my own husband at the time was like, “Don’t do this. This does not seem like a good idea.” But it was like, for me that was such a clear vision. And then what’s really funny is once I started it, I cannot tell you the number of times people have said to me, “Ah, why didn’t I think of that? Of course, that’s a billion dollar idea. Why didn’t I think of it?” I’m like, “Yeah, it’s exactly that. It’s not that complicated.” Of course, people want options, and they want an elevated experience. So yeah, it was really funny how much pushback I got at the beginning, but then once I did it, so many people, strangers, everyone’s like, “Why didn’t I think of that?”

Diana Fryc: That’s so funny. But what’s interesting is you were getting pushback about entering the industry, but not on the idea. Am I catching that right?

Sharelle Klaus: Yeah, exactly. Everyone was super worried about the industry. Male dominated, distributors situation route to markets are really difficult. Coke, they’re not very tolerant to this kind of innovation, retailers will be difficult and all of those things turned out to be very, very true, but when you have a vision, and I did. I had a vision of where this thing could go that you just keep looking forward, there’s a lot of crying in between there when all of those things come true but you guys just keep moving forward.

Diana Fryc: I love that. I love that not only that you said it but that you owned it or maybe the other way around.

Sharelle Klaus: Oh yeah. Oh 1,000%

Diana Fryc: So the sodas and beverages in general has just changed so much since 2005 since we are working together. When we were working together, we were working with you and it’s like let’s move this into the sparkling beverage category. And because sparkling beverages or sparkling water was not a thing La Croix was still out there, the stuff was out there, but as a category, it wasn’t really doing anything. So we did this using the sparkling beverage kind of positioning was a way to differentiate your brand, from traditional CSDs and Sodas, but then Dry started going down the soda path. Tell us about the journey of that and what was driving some of these decisions and where did it lead you?

Sharelle Klaus: So I would like to give you guys Retail Voodoo a lot of credit, you guys came in and had this incredible system that you put into place at Dry and how we would sort of get clear on who we were and you really helped us continue to be very clear on what we were. We were a differentiated product, we were elevating, we were different from a soda. I wanted to create a new category of soda. And we recognize that the word soda, that was such a heavy lift to try to actually change the way people think about soda. So that’s where we came up with the name sparkling. And then of course, we had the situation where, so that all happened, the packaging was great. We went down that path. And then just right after that sparkling water just started taking off, it became this very difficult situation where people were like, “Is it a soda or the sparkling water?” And it’s either, because Dry only has a quarter of the sugar of a regular soda, but it’s got some sugar and flavoring in it that’s differentiated from sparkling water. So we went through this phase where like, when sparkling water was going up, our velocity started to drop. And part of the challenge around that was that as you guys remember, when we went through this process, people were thinking of us as the healthier option. And even though that’s not what we intended to be, we intend to be an indulgence like, this experience, not just a healthy soda.

[00:10:00]

But because of that, we lost some of those customers to sparkling water. And so our velocity started to drop. And as a team, we kind of panicked, I’m going to be honest, and I panicked. And I was like, well, what’s happening? What’s happening? And it was like, everyone hates sugar. Everyone hates sugar. And Dry does have some sugar, even though it’s very little, it does have some sugar. So we’re like, okay, like, okay, I don’t want to do a sparkling water because everyone their brothers trying to do a sparkling water and the price points were, like it’s impossible to make money. So I said, “Well, then let’s do a zero sugar. Let’s do a zero sugar soda.” But I was so ambivalent about that because at the end of the day, I didn’t start Dry to start a soda company, I started to change the way people think about drinking. But now I’ve moved myself and our company down the soda path, and we created the zero sugar product. It was very good. It did really well. We had national disruption with Kroger and Target right out of the gate, which is fairly unheard of, and it was based off of  how well our product was doing, even though we were still growing, it just we weren’t growing at the rates that we were growing.

And it became this really difficult internal thing for me because I felt like I was moving away from what I had wanted to create. And no offense to soda, but now I’m just a soda company. And that’s not why I started it. And I really got frustrated, and there was challenges, but like, when I look at one of our head of sales, she was amazing, but she like she jumped ship because she was like, I don’t know what the problem is. I don’t know why we’re not like — and it was just too difficult. And so there was this time of turmoil, really, I think in the company, and I got very frustrated and there was something about zero sugar that just wasn’t working for me and I went to a meeting with Kroger and it was the renewal meeting for the next year and the buyers just said, “I have some bad news.” And due to some sort of internal politics, we’re going to discontinue the product. And it was like I stabbed to the guts because you’re like that is a millions of dollars of revenue. But I was also like, “Good, I want to be done with this product.” And this is my excuse to be able to get out of it.

That’s a painful way to do it. People do it that way, that flight home was like, I was just back and forth. And like I have to tell the team that we just lost many millions of dollars of revenue and that I have decided I really want to pull the plug on the whole thing. And how that’s going to go down because half was off to get this product out to market and it was beautiful. And the product was good. And it was doing well. But I think it is the lesson I learned there is you have to be focused on the vision and the mission of what you were doing. And so that’s my experience with Dry Zero Sugar and my experience being a soda company, which we don’t intend to be.

Diana Fryc: Yeah, when you were thinking back about that, like, all of these, so was the mistake — I kind of want to try to like capture this a little bit. There was a panic moment so what are some of the learnings that around these mistakes and then how are you — because I’m thinking that you might behave a little bit like me. I don’t know why. But like I would take all these things and I would go I’m going to make sure that never happens again and I’m going to just make sure that blah, blah, blah like, how are you personally making sure that you don’t overcompensate and not discard opportunities simply because you don’t want to go make that mistake again. Do you understand what I’m asking?

Sharelle Klaus: Yeah. So the way that I looked at this first off, I had a really great team at the time. And we did the post mortem on it, basically because it was painful for everyone and rightly so. And I’m really good at when I make a decision I move on. And I don’t like sort of think about the pain or whatever, I’m just kind of ready to move on. And I recognize one of the lessons I learned is a; you have to have time to let people mourn, something that they worked really hard at. So that was one lesson I learned. But really, the way that I looked at that was like, okay, what led me to those decisions? What was that and as a team, how did we come up to that answer? And part of that to be honest was me just saying let’s get an answer. I want an answer, we got to figure this out because it was this panic thing and I think so much times throughout my history and that natural channel, it is like you feel under this constant time pressure to make these very quick decisions.

[00:15:00]

And because, like, sets are coming up and if you don’t do well, if your velocities don’t start turning, you’re going to get discontinued. There’s just this constant pressure, and to be able to take just a beat and really think through and question assumptions. And I think had we done that and taken a little bit more time, we would have come to a different conclusion, but I think that it was like, you thought you saw what the answer was. And so you just kept going for that instead of looking at a bigger picture and just that one. Like, it was like, people don’t like sugar. But well, is that was that really it? No, that wasn’t really it. There was a lot of layers underneath that, like how do you describe what Dry is and yes, sparkling water came in and now we have to figure out how to differentiate ourselves against that not just panic. I feel badly because I feel like we sort of gave up hope on what Dry was and just went to this new thing, which I think is also just said, you got to be very careful about that.

So I’m not sorry I went through that I think it was an incredible experience for me as a CEO to learn about that process of when you come up to these challenges, how do you question them? And how do you try to look at a bigger picture? And not just think I know what the answer is. So let’s go for that one answer because it could be others. I think that’s the most important lesson.

Diana Fryc: I think it’s tough especially when you’re CEO and you have such a dynamic personality like yours, you are a really bold personality and you surround yourself with bold personalities, and I think it’s really easy to kind of go, “Here’s the big idea. Okay.” It feels maybe in the moment it might not feel like immediate response to panic. Maybe super oversimplifying here, but it might be more of a like, well, this seems like the natural next step, like, go, like, we’re solid, and we’re bold and we know exactly what we’re doing. Do you feel like it was more panic? Like, oh, my goodness, or was it just a little bit like, here’s the problem, here’s the solution go or maybe a combination of both?

Sharelle Klaus: Like I said, I think there’s a lot of pressure to have an answer. And I think one of the other just super key lessons that I learned, and that’s actually this is probably the most important one is that, honestly, up until that point, I always thought as a CEO, I had to have the answers. Like, if I don’t have the answers, why would I ask my team to have the answers? That is so opposite of how this thing is? What you need to be doing is having a team that can come to you, and you can listen to it? And instead, I was always just like, Oh, I think this is the problem. Let’s fix that.” And that’s a huge problem. And so now, I definitely don’t do that. I’m like, “All right, here’s what the challenges are, I want all of your perspectives on what do we think the challenges? Let’s look at data from over here. Let’s look at this.” Because a lot of times when our founders too, we’re like, “Oh, well, my gut says this and my gut says that.”

And that’s great. You definitely need to listen to your gut, but you need 15 years into it, you need guts plus data plus a lot of other stuff. So I do think a; I want answers quickly. I’m very impatient about getting answers and b; is that I just want to move forward. I want to feel like we’re moving forward. But interestingly, we made some mistakes along the line with that, with pricing and the margins didn’t end up being as good as we thought. And, I mean, there was a lot of challenges, but it was because I was trying to push us quickly, quickly, quickly to solve this problem because it was a true panic moment. And I feel like so much of the time with Dry, there was this panic moment, and when I decided to stop panicking, and to step back, I went and got financing for three years instead of like one year at a time, like different things like that, where you can make these more intelligent, thoughtful, measured responses to things instead of being under this time pressure all the time.

Diana Fryc: Interesting. Well, so now you and Dry are kind of going through another transformational change.

Sharelle Klaus: Well, yeah, so as we came out of Dry Zero Sugar, actually, so this is all look kind of related. I was really struggling after that. And I have this friend who I met at a woman’s Leadership Conference 10 years ago and she honestly is the smartest person I have ever met matter of fact, when I first met her, when I first started Dry, I remember thinking, if I was ever going to let someone run my company, it would be her. Trust me, I was so tightly wound there was no one going to run my company but me and I remember going — she lives in Minneapolis and I had had a target meeting and I was sitting at her dining room table and  I just like, I don’t know what to do about it.

[00:20:05]

I’m personally exhausted from all this, this company’s not where I thought it would be. I don’t feel like I’m leading my team in the right direction. Like, I don’t know where this brand is going like it was this whole thing, and I was just kind of like laying it all on her. And I said, “I really need your help.” And up to that point, she was to the General Millers like happy. And finally she said, “Well, why don’t I come in as a consultant. We’ll see how it works.” And she helped me. She said, “Sharelle, we got to get back to why did you start this company? What made you happy about this?” And I’m like, “My mission was to make people feel included. That they had an option. That’s what I care about. Like, everyone should have this option and so included.” When people feel excluded, I’ve hated that since I was a little kid. And she’s like, “Then let’s get back to that.” And she came in. She’s our chief revenue officer. And she helped us get back to that mission, the mission of helping people who are, whether they’re drinking or not drinking, there’s this and interestingly sort of at the same time, which I just love the way the world works sometimes, maybe not so much in 2020. But in general, I like the way the world works.

There’s been a massive cultural shift in the last couple of years, people are really questioning their relationship with alcohol. The millennials refer to themselves as a sober generation. Alcohol sales are down, beer is down considerably, because people are recognizing, they’re doing meditating and they’re doing yoga and they’re working out but then they’re coming home and drinking a bottle of wine. Something’s doesn’t fit here. And you’re starting to see people question their relationship with alcohol, they’re drinking less or they’re like, we call that sober, curious sort of spectrum. People like, I’ll do a Dry January. Or sober October, two people who are in recovery. And so we’re seeing the shift. And I’m like, “Oh my God, here comes this way, this is what we’ve been talking about.”

And so at the same time that we were able to come back to our mission, I look behind me and I’m like, “Oh, my gosh, look at this shift that’s happening.” And so that happened and then last summer as part of all this, that he said, I think it’s important for you to get out on the road and go meet with people and figure out what Dry means to them. So I have an Airstream. And it’s a little 16 foot Airstream named Kevin, and Kevin and I hit the road and I went down to the Gulf of Mexico and then back up like to the Grand Canyon and I had the chance to meet with all these different people. And I had this one incredibly powerful experience in Austin, where I went to Sam’s bar which is one of the first sober bars in the country. And when that idea first came out, Dry supported it and we give them product and I had not had a chance to meet the founder of it. But he been to the offices and was very involved with Dry. I just personally hadn’t had a chance to meet him. And we had an event that night and I was so taken aback about how much I had meant to him personally and his journey. And to the people that were all in the room.

It was such an epiphany for me, I was like, “Oh, what we’re doing is making a difference. These people really feel like they’re being seen. They’re being heard.” We’re answering this real challenge they have which is I’m important to just because I don’t want to have alcohol when I celebrate, or when I go out to dinner doesn’t mean that I don’t deserve something special. And to have people just talk to me like that was such an incredible and I came back to Kevin that night and I wrote an email to the team and I just said what we’re doing is so important, and it is so crystal clear why we’re here. And this is what we’re going to be all about is how do we answer to this consumer if that’s products, if it’s lifestyle stuff, and then this last year, it’s been incredible. We ended up investing in sandbar and we’re partnered with him now. And we put on a 15 city national tour that got cut short in March, I think we were on city number four, or five even, but now we do these virtual events on spire where you are, we put together kits for people where you can get these like zero proof cocktail kids, where we have all these really incredible things in the works around supporting this concept of having elevated options.

This vision I have in my head of you can go into a bar, you ask the bartender for a cocktail, and they say with alcohol or without like, that’s my vision, and I want to make sure that everyone has that opportunity. So that was an incredible moment in the year sense has been incredible.

[00:25:00]

And we’ve done a lot to the brand since.

Diana Fryc: It’s common with founder owner brands that the brand and them are so intertwined. So you’re making this personal investment it’s kind of a cultural investment right? Like you’re kind of identifying there’s a few other brands that are like lip or slip — I can’t remember, there’s a couple of other brands out there that are not a product that’s competitive to yours, but also kind of addressing the same audience. You see these people and you hear these people, what is the industry saying as you’re talking about this a little bit more? I’m curious, as you’re having conversations with retailers now and you’re starting this kind of pushing towards this type of positioning, what are you hearing from retailers and other industry professionals? You’re getting a thumbs up from consumers it sounds like.

Sharelle Klaus: For sure. And what we’ve done is we decided to invest a lot of resources into consumer surveys and data. So we want to be able to show retailers, because we have a vision of what a grocery set should look like, and that there should be more non alcoholic celebration beverages. And one of the things I’m really proud of is we’re reaching out to all of these different products. So we do not see these products as competitors. I mean, there’s an incredible group of products coming out, and we’re trying to work with them, we’re bringing them into the sandbar. We’re like, “How do you want to partner? Do you want to partner over here?” And because I think it’s an incredible part of what can happen in this industry and where I think changes can happen at grocery. And the response has been amazing. And BevMo, I have got to hand it to BevMo. BevMo is absolutely behind this non alcoholic set and they brought in the non alcoholic spirits and see lips and the different kind of brands like that. And they’re fully behind it and I love that leadership that BevMo is taking in this and we’re seeing it everywhere. I’m not saying that grocery stores are going to change some of their sets tomorrow because we know how that works but the buyers are absolutely getting it because you can show them this incredible data and they get it. They see how the numbers are going. And even the industry, even alcohol companies are starting to reach out to Dry and like, “Hey, what are you doing? Let’s talk.” Because I think they’re seeing that because we’re not anti alcohol. As a matter of fact, we’re doing a wine partnership this holiday where it’s like buy a bottle because we have our 750 bottle celebration, buy a bottle of wine and buy a bottle of Dry, you should take both to any party you go to. Absolutely have to have a non alcoholic too, you can’t just bring alcohol.

So I think that it’s just it’s all coming together in a really beautiful way and I’m really appreciative. We work with like Kroger and hgb. And here in the northwest we have met markets and these buyers we work with, I really appreciate our buyers, they get it, they’re thinking ahead, they’re thinking about their customers. And that’s their number one question all the time and I love that is like, is this something our customers need and want? And we can show them, yes it is. And then here’s where some of the challenges of our of how you get to them but like, here’s how they host, here’s how they think about dinner party, all of this different things. We’ve given them the whole gamut and how it can actually help them not just within our sets, but others. So it’s been a really cool journey. Really cool journey.

Diana Fryc: Well, what’s brilliant about what you’re doing is that you’re not just bringing anecdotal data like this is what the target market looks like, but you’re actually coming to the retailers and you’re saying this is really how this audience or this consumer wants to be spoken to. You’re providing them education, you’re not just providing them a product, how great, because retailers are looking for as much education as possible too, and that I think it’s wonderful that you’re able to do that.

Sharelle Klaus: Yeah, and the showing them the way they shop and for when they shop, for instance. I mean, we kind of take the whole thing. And they’ve been super appreciative and very responsive and asking for more Whole Foods is the same way a fresh market. They were like, “Oh, wow, this is really cool. Let’s keep talking.”

Diana Fryc: I have a tricky question then because, we’re talking about Dry Soda, we’re talking about alcohol as well and I’ve had people that have needed to be sober for their health in my life and I know their relationship with alcohol is very strained even when they’re not drinking, when they’re around other people that are drinking, it makes them uncomfortable sometimes depends on where they are in their journey.

[00:30:19]

And then there’s also people like my neighbor who has said during this pandemic and everything that’s going on I had to take alcohol out of my life because it was adding, it was not taken away. And I think it as a culture, we see alcohol as a way to wind down to get comfortable and I don’t know that Dry can necessarily help with this, but maybe you are. Are there things that you are providing to people, the sober curious people and just kind of going, “Okay, well, here’s a non alcoholic beverage but your lifestyle might be looking like this and these are some ways to wind down rather than using a crutch like alcohol in order to get you there.” Especially when we’re in COVID and your office is in one room and the rest of your house is another room and you’re using wine, maybe as a separator between your days like, how are you guys addressing that? Or are you?

Sharelle Klaus: We definitely are. So for me, when I experienced not being able to drink one of the things I missed was the ritual. Ritual of pouring a drink and using beautiful barware. And so we have created a lot of zero proof cocktail recipes and we have some other fun stuff in the works on that. And so we’re providing that to people and we’re really trying to get people to think I mean, yeah, separate your day. So then let’s create, like you can have your you can have your bottle of Dry during the middle of the day with your lunch or whoever that is, but then let’s like take this and turn this into a zero proof cocktail. Like take that opportunity to mix yourself a drink, put a beautiful garnish with it, put it in a beautiful barware.

When I first started Dry, we only drank it out of champagne flutes and it was like four o’clock in the afternoon I put it in, I still do that. And because it’s this like, there’s these I think ritual brings around that sort of that endorphin feel and not, or even sharing a bottle like we have the 750 bottles buy that bring that to your friends open that instead of a bottle of wine because what we’re finding, obviously is alcohol is more of a fuel for anxiety. And I think that’s one of the reasons people are recognizing, especially in COVID, oh wait a minute, this isn’t actually helping, like I don’t sleep better at night, some of these other things. And then we have a bunch of stuff coming up and sober October but we’re really looking at health and wellness as a whole. And mental health is one of those great things and I think this is one of the reasons why people also are starting to question their relationship with alcohol is because you’ve got it. God bless the millennials and Gen Z’s, they talk about mental health a lot.

My generation Gen X, we did not talk about mental health. And now it is an absolute topic of conversations and how is your mental health especially during 2020. I mean, everyone’s asking that question. And so I think trying to provide as much stuff as we can and we see ourselves as trying to be that conduit. So like, our sense of our where you our events are, we have different components. There’s always like we did an art therapist in one of our events, where it’s like art therapy on how to use sort of get yourself more relaxed. And so there are different things that we try to provide to help you with that. But part of it is like taking that moment for yourself because you can pour this into a beautiful glass and enjoy that the same way you would wine. And it’s sort of can delineate that or you can do the zero proof cocktail and that because we think that part’s important. We’re all struggling right now. And so how do we help and we do take responsibility. We think that’s important to do. So we’re doing a lot around health and wellness, both mental health and physical health over the next few months.

Dian Fryc: That’s great. When we had our little prep call a few weeks ago, and we just started talking about this topic, actually since I’ve removed alcohol, I’m going to go Dry for 90 days.

Sharelle Klaus: Oh, the 90 days is amazing.

Diana Fryc: I know. I’ll be honest, before I had kids, I was a very big drinker. I mean, I was no lush but I drank every day and would drink spirits. That was my choice. And then after kids I stopped drinking so I don’t drink nearly as much as I used to maybe one or two glasses a week at the most, but I just thought, I’m going to get rid of that.

[00:35:00]

But then I also got rid of caffeine at the same time because caffeine and alcohol are not my friend right now, so I am seeing what seeing what happens.

Sharelle Klaus: It’s amazing. You’ll like it and I’m actually going to be doing it again myself. I’m going to start with sober October, which is what I did last year ago. I don’t drink very much anymore myself either, but I still do occasionally. But I love that 90 days that just completely taking it out. Like no matter what. And it’s pretty powerful. And it changed the way I think about alcohol, that’s for sure. You don’t need it. Like you don’t have that, like for me, it was like, I don’t love having to have something admitted. I do have to have my coffee in the morning but I didn’t want to have to have a glass of wine then I get tired and then I can’t do as much stuff. If I drink wine, then I’m probably not going to go stand up paddle boarding at sunset, which I love doing. So it’s just replacing things and making different choices. Try it out and you don’t ever have to give it up forever. But just to try.

Diana Fryc: Yes. Well, and I think I’m doing it for myself. If I set a goal in place, I’m pretty good at keeping to it. But really, what I’m wanting to do is kind of telepath to my friend, because now we’ve had backyard social hours. And backyard social hours, there’s usually several bottles of wine on the table. And that’s it. And so when I showed up to one and I was like, “Well, I’m not drinking alcohol.” There’s an opportunity for me to have a conversation about how I was seeing it. And now I’m able to share the story and you could see these people kind of going, “Yeah, I’m not doing it to make people feel bad, but just kind of to have in their head.” “Oh yeah, I have to have.” Why does every time I hang out with my friends, I need to have a couple of glasses of wine? So it’s been kind of fun and curious for me. And I appreciate that we talked about that last time.

Sharelle Klaus: I would also say it’s a great time to be bringing the 750 bottles of Dry or a four pack, but people trying like just saying, “Hey, maybe have one glass and then try Dry.” Or like it’s just a great way, you don’t feel like because the other problem is if you’re in a social, like, I had a dinner. I had two dinner parties outside of my big deck here the last this last week. And it’s like, one of the nights went very, very late. But you’re sitting there and so you keep filling up the wineglass and you’re there, so you need these, like what we call session extenders. Dry is a good fit there.

Diana Fryc: Don’t let me forget, before we end there is a place up on Lummi Island that makes the most amazing non alcoholic beverages that will explode your brain and I’m going to send you the link to them. It’s actually a hotel that has a restaurant and they source all their ingredients from the island. You might know them.

Sharelle Klaus: Yeah, I’ve heard of them. Yes, it is. I can’t think of the name but I didn’t know they were making beverages too. So that’s super cool.

Diana Fryc: Oh, yes. I will send that link to you. Don’t let me forget. So what is your wind down now? What is it that you do? You talked about paddle boarding and being by the water but what is it now that you are doing to kind of keep yourself peaceful and focused?

Sharelle Klaus: So for me, it’s around metrics. I’ve a CEO group of friends that we really hold each other accountable. So they were the ones that I was having dinner with the other night outside and I was like the thing I’m excited about that I would love them to celebrate with me is that I’m 51 now and I think age has something to do with that I think living out here is a little bit to do with it but also that I only have one teenage kids. I have four kids and I only have one teenager left here and so it’s like, very, very different. All of a sudden I have time and space for me. And I am taking that, so on Monday when we had the day off or Saturday, I decided I want to learn about Shinchan cooking. So I ordered a book on Shinchan cooking and then Sunday or Monday I went to buy them, I bought all my stuff. And I came home and I cooked Shinchan food all day and there was really no one else there to eat. I guess I had a friend came over and I gave him some of it but like I did that for myself. And so for me I’m all about flavors and cooking but it was like I’ve never just taken entire day and it was actually and a half because I got the book and I spent half the day sitting on the deck reading it and then the next day cooking it.

[00:40:023]

I’m like, “Who does that? Who takes a day and a half just to do something for themselves?” Well, I do now, but I didn’t use to. I used to be so tightly wound that on the weekends, if I didn’t have like a ton to do, which I usually always did, I would get nauseous because like, if I couldn’t just sit on a couch and relax, like I had to be training for a marathon, which I never ended up running, or I would be at 16 different baseball games or whatever, like I always had to be doing achieving. Achieving, I think that’s the word. Achieving like, “Okay, I’m making the kids smarter, I’m making the kids more athletic, I’m making myself more athletic, I’m whatever.” And now it’s just around space for myself. And then I’ve also taken some time to fix up my own personal space and not having to spend a ton of money but just like sourcing things from antique stores and different things. Like for instance this cool lamp I got back here the cork lamp like just but to start to make my space nice too.

For myself too, and then I just sit in it. And I just like, for instance I sat in my living room last night and just sat there with a cup of tea and did nothing else, but just sit there. And I do that and I go out and look at the stars now. Things like that, I’m just taking time. I think that’s it. I think COVID has certainly put a pause button on life a little bit and allowed us to do that and I am fully grasping that and I love it. Well, the there’s one other thing I do that is my very favorite thing to do is I have a two and a half year old granddaughter. She is the greatest thing ever and I will just sit with her and just whatever she wants to do, we’ll just do; we’ll cook together, we’ll just hang out, just sitting with her and not feeling like I have to jump up and do anything else. Like we want to sit and sort. We’ll sit and sort like buttons for an hour and that is so peaceful and incredible and anyway, taking time I guess that’s my most important thing.

Diana Fryc: A granddaughter; I can’t believe that!

Sharelle Klaus: Yeah her name is Jia Sharelle, though she’s got my name too.

Diana Fryc: Oh, how wonderful, that’s so great. Oh, congratulations on that. I sort of have grandkids and in a previous life I was in a relationship with somebody for years who had kids that were older, they’re in their 30s now and so they’re kind of; they’re not my step kids anymore but I kind of have a little… Yeah and I have four from those guys but I don’t get to really see them other than visually like on social media and stuff like that. But there’s a place there, man. It’s so different from your kids.

Sharelle Klaus: Yeah and it’s just so peaceful and lovely and yeah she’s a lot of fun.

Diana Fryc: That’s so wonderful! We’ve talked a lot about the business, is there anything that you are like, oh, I really want to make sure that people that I get to share this particular point about kind of this journey around where drive is going, and not necessarily it doesn’t necessarily have to be about drive, but just kind of things that you’re finding about this new audience that you think that people would like to hear?

Sharelle Klaus: I think as a country, I think inclusion is really important and that concept of community and connection and that’s what we care about the celebration, this connection, and including everyone and I think we all know that this country’s become incredibly divisive, and I think all of those different ways that we can come together and unite and make everyone feel included and everyone has a place at the party is the way I think of this, and that’s kind of the way that I want to live my life holistically is through that. I think when we as CEOs live our values fully through our company, everything starts to come together and align. And I kind of can’t get over how powerful that is, and how as I’ve done that, how things have come together and the people that I have got to meet. I did as I said, I went into this tour, and I met with different sober influencers and sober groups and just all these different kinds of people and they’ve all come to this point in their life around alcohol for very different reasons. And it’s not because they all necessarily have the disease of alcoholism. It’s just these really different stories and it’s so powerful and I feel like they’re in this incredibly generous group of people who are willing to share.

[00:45:00]

What they’ve learned and to be open about however they are on that spectrum and just being around them has made me feel good and they’re so generous with wanting to share and their excitement around things. They’re the reasons that like, I gave up alcohol for 90 days, I met one of them and she’s like, surely you should read this book, you should really think about this. And then I did it with Annie Grace’s book, The Naked mind and I was like, oh, well, that is really fascinating. I just appreciate this generosity of sharing information and being supportive of each other. As it is still difficult when you tell friends, I’m not drinking, it was like, why rehab lately? There’s always this negative thing and I’m like, this is ridiculous. We need to get to a place where no one says to you, well, why don’t you smoke? We all get to make our choices on what we put in our bodies and it shouldn’t be a thing. And so anyway, that’s what I appreciate about this and I think again Dry is not anti-alcohol by any stretch may effect a lot of people use Dry as a mixer it’s around inclusion and making sure that everyone our mission is social drinking for everyone. That’s our mission that we say all the things social drinking for everyone and everyone should have an option, whatever they choose to drink. So do you want to put alcohol in Dry put alcohol in dry, if you want to create a really cool zero pro cocktail, then do that but like, everyone gets it, everyone gets to choose. I hope that makes you happy.

Diana Fryc: I love that. Thank you. Thank you for answering all these questions. I just have a couple of more that start to kind of get away from the topic a little bit. Well, it’s kind of topic but this is kind of my last favorite questions are these. This is what I call my cocktail hour treat. Is there some sort of interesting fact about whether it’s driving soda or alcohol that you’ve run across our beverages in general, that is kind of interesting that I could take to my next virtual happy hour and say, “Hey, did you hear? Did you know?” Do you have some kind of fun, interesting tidbit?

Sharelle Klaus: I think it’s interesting. So one of the things that Dry is doing is we are actually writing a book under a pro cocktails and what I have learned through that process is how we taste and perceive flavors. So we really only taste five different things sour, bitter, sweet, salty, and then umami is considered continuous kind of maybe the fifth. But we perceive flavors; we can perceive any flavor. So if you catch a cold or you catch COVID, and you can’t smell then you don’t taste as much. But it’s the perception comes not just from the aroma, but also the visual, the color. Like, there are all these things that come together for that perception of flavor and that really blew my mind. And then there are just some other pieces to around how you marry flavors or how you compliment flavors or how you contrast flavors, so that you’ll have to read the book for that; anyway that’s all my stuff.

Because I think for me, I am so fascinated with how flavors worked and that’s why I wanted to create Dry because I loved pairing wine and food. I thought I’m not a complete wine aficionado, but I loved how if I put wine and food together how you could get these incredible pair like it would make them both better and that’s what I wanted with Dry and that we’ve done that and was really one of the really cool things I did early on with Lauren Adler. Her name’s Lauren Adler and she had this incredible chocolate shop up on Queen Anne. She is one of the smartest people I’ve ever met around chocolate and she sourced all these different chocolates and she said, “I think we should try a Dry and chocolate pairing.” And we did this incredible experience where at times, you would be able to taste the flavor of the beverage better. Other times you taste the flavor of the chocolate and I find that all super fascinating how that can work.

Diana Fryc: Oh, that’s cool. It’s almost like blending colors. Like if you have yellow and blue, and then they’re yellow and blue, when you put them together it’s green and sometimes it’s more blue and sometimes it’s more yellow, but it’s still different.

Sharelle Klaus: If you put yellow and green slime together, it turns gray. I learned that yesterday when I was playing with Jia. I was like whoa, I could tell her it’s going to turn green Jia and I’m like, oh, it’s from this green to gray.

Diana Fryc: I suppose that could be in food too. I’m sure that can happen with flavors too. And then tell me now; my very last question is;

[00:50:00]

So what’s your favorite? I’m going to call it your mock tail. Or what’s your go to mock tail? They could be the same it could be different.

Sharelle Klaus: So I really like spicy food. So we have one where we use a mango habanero syrup and you can make it yourself or there’s a great company called Portland syrups company that we use with the pineapple Dry and then I like to grill pineapple and then put that pineapple in the drink and then do the chili sugar rim. That’s my favorite.

Diana Fryc: You’re growing pineapple here?

Sharelle Klaus: No, no grill.

Diana Fryc: Oh, grill.

Sharelle Klaus: I have quite a garden out here.

Diana Fryc: I’m going to your house. What are you doing this afternoon? That’s awesome.

Sharelle Klaus: I grill it.

Diana Fryc: Yeah, and is that in the book?

Sharelle Klaus: Yeah, that’s one of them. We’ve done with some amazing ones, but it’s really cool because they’re all done but those sour spicy, salty. There’s some better ones that I really liked a really easy one is a vanilla bean soda with grapefruit juice and a little grape fruit garnish and it’s incredible. It’s so refreshing and it kind of just a touch a bitter and the sweet from the vanilla. It’s really good and really easy and we kind of put any kind of glass you want.

Diana Fryc: Yeah, and always something beautiful in your hand.

Sharelle Klaus: Exactly. Yeah. You do the pink grapefruit juice and then it’s like this beautiful color and yeah, that’s a good one.

Diana Fryc: Well, I know that that’s our time for today Sharelle. I have really enjoyed talking with you again today, particularly around this topic. I think the beverage industry is ready for another big change. First that was sugar and now I think alcohol is really you’re on the front of something else.

Sharelle Klaus: Yeah, been thinking about it for 15 years. Let’s hope we can finally get there and spend time.

Diana Fryc: It’s always the normal overnight success.

Sharelle Klaus: Exactly.

Diana Fryc: It looks like it came out of nowhere you’ve been working on forever. Oh my goodness. Well, thank you so much for being with me today. I hope you had fun and I look forward to it again.

Sharelle Klaus: I had a great time. Okay, thanks a lot, Diana.

Diana Fryc: Okay.

Sharelle Klaus: Bye.

Diana Fryc: Bye.