Sake by subscription: late millennial founds online sake shop

Genki Ito

Many American attempts at bringing sake to people are lame: some entrepreneur selling overpriced second-rate sake in a fancy bottle.

In contrast, Tippsy is the best online U.S. sake store I've seen since True Sake. Tippsy, which launched last November, is an easy-to-use site and has a legit selection of good sakes at reasonable prices.

It also has a subscription service that seems like a great way to bring new drinkers to sake. For $59 a month, shipping included, you get a box of three 300 ml bottles. You can reorder larger bottles of whichever ones you like.

I was impressed enough with Tippsy's selection to call its founder, Genki Ito. Here's an edited version of our conversation.

The Gray Report: What made you decide to start a website selling sake?

Ito: I think I can reach the existing demand for sake drinkers. There aren't many Japanese supermarkets that sell sake in the US unless you're living in a big city like Los Angeles. Some people go to nice restaurants and try sake and they become interested in buying good sake, but they don't have any clue of where to buy sake.

It's still small demand, but eventually I'm trying to convert millennial drinkers to sake drinkers. That's what this sake club is all about, giving opportunity for new drinkers to try different flavors. Sake comes in different flavor profiles just like wine.

Gray: You're a millennial yourself. Is that what inspired you to do the subscription?

Ito: I'm 35, a late millennial. I came to the US 10 years ago for a job at Nishimoto Trading. It's a Japanese importer, the largest in the US. I started my career in Hawaii, moved to Los Angeles, moved to New York, came back to Los Angeles. I finished my MBA at USC. I've been in this business and seen the growing demand for sake. There's nobody marketing sake very well.

Gray: What is Tippsy doing to market sake that hasn't been done in the past?


 

A typical Tippsy sake box. Fruit and glassware are not included

Ito: There's no good direct communication with consumers. Sake has been marketed largely by importers. Sake has been around here for decades. Sushi became popular 30-40 years ago and sake came along with it. The big producers came to California and began producing sake here with California rice. They marketed their products as a mysterious foreign drink. They marketed hot sake. People started drinking sake bombs.

What I see in the market is people think they are familiar with sake but they don't really know the beauty of premium sake: craft sake from small breweries in Japan.

With the three-tier system in the US, importers have to sell to wholesalers. Wholesalers have to sell to retailers. Because of these layers, the message from the brewers in Japan is diluted. These breweries are hundreds of years old. What ends up happening is these breweries come to the US once a year for tasting events where they meet retailers. But they never talk to consumers.

In most cities, people get narrow selections. And sometimes sake has been sitting on the shelf for one year. Some ginjo sakes need to be refrigerated. The (retail) buyers in smaller cities, they don't have the right knowledge. They just put the stuff on the shelf and it sits there for a long time. People who buy those sakes, their first experience, those sakes are stale already. I think the supply chain is really a problem for sake here.

Gray: How do you choose the sakes for the subscription box?

Ito: We're trying to choose sake with different taste profiles. We usually select a daiginjo grade with a high polishing ratio, and a junmai with less polishing, and some unusual product like sparkling or nigori. I didn't intend to make a lot of profit selling sake boxes. My intention is to grow the market for sake. It's 1% of wine right now. I want to grow the market and I want to be the market leader for sake online.

Gray: What part of Japan are you from?

Ito: Nagoya.

Gray: That's not a sake region. How did you get into sake?

Ito: I didn't drink much sake when I was in Japan. The job I had with Nishimoto Trading got me into sake. I had no idea sake came in this variety, these different tastes. I was probably like most consumers here. Once I had some good ginjo sake, I thought, this is really fresh and aromatic. I could really enjoy it.

Gray: What's your favorite style of sake?

Ito: I would say ginjo, higher rice polishing, with a lot of aromas.
The first brand that got me into sake was Kudoki Jozu. The label is from the Edo period (1603-1868). "Kudoki Jozu" means somebody who's good at talking to women. Womanizer. It has good aromas because of its higher rice polishing. It has aromas that are almost like banana or melon (Editor's note: that's actually the yeast -- but yes, it is delightful). I was surprised that sake can be this clean and beautiful.
I recommend Dassai too. It has similar aromas. Dassai was the first brand that told people to drink sake in wine glasses, to enjoy the aromas.

Gray: Nigori sake is minor in Japan but it's huge, relatively, in the US. How important is it for Tippsy?

Ito: I think nigori got really popular because it's unique, it's easy to drink and it's very sweet. The Sayuri brand from Hakutsuru with the pink bottle got popular. You can see the brand everywhere you go in the US. I understand people who are new to sake enjoy Sayuri because of its simple taste. But nigori can come in different taste profiles as well. There are many different types of nigori that I want people to discover, not just really sweet. There are some dry nigori and some are really rich. They taste like you're eating rice.

Gray: What are your biggest markets?

Ito: California and New York are the largest. Texas is a big state too. I see Japanese people not living in big cities, working at universities. I see a lot of .edu addresses ordering sake. And I see some people ordering rare sake that they don't find in these stores. But overall I see more orders from non-Japanese.

You can check out Tippsy here. 

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It's worth saying because so many Instagrammers are for sale: I didn't get paid to write this.