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Wednesday, July 25, 2012

The Future of Beer

Stephen Beaumont has an interesting post that got me thinking.  He sussed out an Advertising Age article describing the panic that has forced the cabal of macro brewers to huddle about saving their product:
According to Ad Age, new BI chairman, MillerCoors ceo Tom Long, hopes “to bring energy and ideas to the many programs and plans that tell the story about beer being the right choice for consumers and retailers alike.”
Uggh, what dismal corporatespeak.  The big breweries then go on to mis-analyze their own situation:
The scope of the new effort is unclear, but there seems to be a consensus that beer needs to emphasize its positioning as the beverage of "moderation," which Anheuser-Busch VP-Marketing Paul Chibe said "gives it a distinct advantage" over other booze options. 
Wine and liquor aren't the problem--big beer is.  When you look at the long history of brewing, the wholesale dominance by a single style is totally unprecedented. It’s even more bizarre that it happened during this amazing period of market freedom.  Offering customers one flavor was unsustainable ("welcome to Baskin-Robbins Single Flavor; can I get you some vanilla?"), but this isn't the problem the big companies have identified: no, to them, it's the encroachment of chardonnay and gin.

If they're smart, the bigs will instead think of making chocolate and maybe even strawberry.  Take the example of Blue Moon.  Keith Villa started brewing craft beer for Coors and now Blue Moon is the best selling ale in the US [edit: I'm speaking of Belgian White here, not the entire line]. That brand alone sells well over a million barrels a year. (Even by the standards of the bigs, nothing to sniff at.) Villa didn’t backward-engineer it, though; he brewed a standard witbier and found a market halfway between Bud and craft beer drinkers (discovering, indeed, a market made of people who never drank either one of those). It helped to have the muscle of Coors to put it on supermarket shelves around the country, but it sold because it was a different, interesting, and pretty tasty product.

But the big companies keep trying to peddle the same old crap in new packages and wonder why people are reaching for something else.

6 comments:

Jack R. said...

re: "Blue Moon is the best selling ale in the US. That brand alone sells well over a million barrels a year."

Boston Beer Co. sold 2,096k barrels in 2011; part of that would have been lager [Symphony IRI reports Boston Lager accounts for only 24%]. It is difficult for me to accept that Blue Moon brand is the best selling ales in the US.

Jeff Alworth said...

I haven't seen all the numbers for all the breweries in the US, but Blue Moon (White, if I wasn't clear in the post) has to be far and away the US's best-selling ale brand--with one possible exception. It accounts for 1.4 million barrels of production, which alone makes that brand larger than every craft brewery except Boston Beer. Boston Beer's best-selling brand is Boston Lager--obviously not an ale--which means Blue Moon probably outsells the entire rest of Boston Beer's production.

The exception is Bud's American Ale, and I've never seen any numbers for it. My guess is that it's selling less than Blue Moon based solely on the latter's ubiquity (I almost never see American Ale). But we'll leave an asterisk there for posterity.

Kari Chisholm said...

Well, it's not as if the big breweries are just offering one singular flavor -- it's that the variations they offer aren't flavor-based, or if they are, the flavor differences are almost impossible to discern.

I mean - Bud, Bud Light, Bud Platinum, Bud Select, Bud Select 55, Bud Ice, Bud Ice Light, Bud Dry, Bud Silver... Seriously?

Great post, Jeff.

Brewers Union Local 180 said...

The Future of Beer is that it's going down my neck.

Pete Dunlop said...

You are exactly right. The bigs continue to think in terms of developing new marketing campaigns to sell a bland, dreadful product. They seem unwilling (or unable) to comprehend that this strategy is failing. I've often wondered what would happen if they actually decided to make good beer. They could do it...they simply choose not to.

Jack R. said...

I am now better informed.

Blue Moon and its parent, Tenth and Blake Beer Company, are big and are apparently serious about offering 'good beer'. [2011 Tenth and Blake was up 15% in 2011 to three million barrels.]

This seems a good things. I notice 08 varients of Blue Moon. Eight assessible, gateway beers to introduce BMC drinkers to diverse and flavorful beer.

===
The Future of Big Beer?
I hear the Future of Big Beer is . . . China and India; combined population > 8X the USA.

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