Beer Marketer's Insights - BMI Archives Entry

BMI Archives Entry

12/14/2016

Third Locations Coming for Both Hopworks Urban and Fish Brewing in PacNW

Pair of sizeable players in key PacNW markets announced opening or plans for third locations this week, tho just one includes brewing component. Hopworks Urban Brewery, one of top Portland, Oreg brewers, will open its third brewpub across the border in Vancouver, Wash tomorrow, just ahead of New Year's Eve, co announced. Space includes 8-bbl brewing system inside of 6000 sq-ft space with seating for 300 on east side of town. Further north in the state, Fish Brewing announced plans for a new restaurant/pub in Tacoma, Wash. That'll be the co's 3d retail location in the state, in addition to original Olympia brewpub and small tap room in Woodinville.

Newsletter Craft Brew News

Tagged under

12/14/2016

Third Schlafly Brewery On Hold Following Slower Recent Growth

Back in 2012, Schlafly had been growing at double-digit clip and announced plans to find location for a third brewing facility in hometown St Louis. But those plans now "on hold," St Louis Biz Journal reported today. In the interim, "the brewery found ways to increase production" at existing facilities. But the co's total shipments have held steady at about 60K bbls for last couple years and will top-out at about the same in 2016 too, the paper wrote.

Newsletter Craft Brew News

Tagged under

12/14/2016

Devils Backbone Hits 75K Bbls; Several New States & Expansion Projects Coming, Including Distillery

Another year-end recap for one of AB's acquisitions hit the wires recently. Devils Backbone "produced about 75,000 barrels" in 2016 and next year it expects "somewhere around 95,000 barrels," reported Lynchburg News & Advance after talking to founder Steve Crandall. So DBB grew about 21% in 2016 vs last yr. Revenue growth rate reportedly a bit behind, up 18-20%, according to paper. Keep in mind, before acquisition was announced in Apr, Steve and co told CBN it could reach 95K bbls in 2016 (see Mar 1 issue), so growth trajectory slowed quite a bit since. Deal didn't close until Sep, which perhaps stalled DBB's expansion plans. But now it's all systems go. AB's "funding our dream," as Steve put it, including cap expansions at outpost facility to 150K bbls ("deal basically included $25 million for us to build out the dream," he said), a $3 mil distillery, souring/barrel-aging capabilities, new mkts and new jobs (among other things). Gotta note, this will be AB's first fully-owned distillery that we know of.

As you'd prolly expect, Devils Backbone will enter several new mkts in 2017 including SC, GA, FL, KY, OH, NJ, NY and more of PA and TN, noted paper. In 2d half of 2015, DBB entered NC, WV and eastern TN, and co entered DE and part of PA this Jul. No question, Steve has natl aspirations for the brand, he told paper. Meanwhile, on top of expansions listed above, Devils Backbone hopes to break ground this upcoming spring on "a year-round camping and RV area with cottages," sez paper. And the Lexington facility construction project will add a 50K sq-ft packaging and shipping/receiving facility, upgraded equipment, additional barrel-aging system and tripling the size of current taproom (to ~150 person cap). Currently DBB has 180 employees, up from 130 a year ago, and "most of these hires were made before the acquisition," sez Steve.

Newsletter Craft Brew News

Tagged under

12/14/2016

Yuengling Heads to Indiana in 2017 With MC Distribs

Tho CBN doesn't include Yuengling in craft segment, it's certainly noteworthy anytime the co enters a new mkt. And word leaked late last week that Yuengling will head to the Hoosier state in 2017. MC's largest distrib Monarch will cover most of the state, with Indiana Bev getting the rest. (Note: this is an excerpt of an INSIGHTS Express article.) Recall, just 2 MC distribs in Ind compete against about 20 smaller AB distribs. If Yuengling were to get 3 share of state shipments for the yr, Indiana would provide Yuengling with an incremental 100,000 bbls next yr, undoubtedly coming mostly out of AB and MC's hides. After going with AB network in MS, Yuengling went with MillerCoors megadistribs in LA and IN, Crescent Crown in LA, Monarch and Indiana Bev in IN. In 1 LA mkt, Shreveport, AB distrib got Yuengling, but in IN, it's reportedly all MC. Nationally, Yuengling trending much better in scan data than it's doing across all channels. Yuengling up 5%, 732,000 cases to 15.4 mil cases in IRI multioutlet + convenience yr-to-date thru Nov 27. But recall, Yuengling does bigger % of its volume on premise than big 2 and it's hurting in that channel. Last we knew, Yuengling all-channel volume up slightly in Q3, but down 2% for 9 mos.

Newsletter Craft Brew News

Tagged under

12/14/2016

More Tuff Beer Trends in Early Dec Include Steeper Sam Adams Decline, Slowing Ballast Point

More signs that Dec not so hot turned up in quick update from Morgan Stanley's Dara Mohsenian based on Nielsen all-outlet plus convenience data thru 12/17. First, total beer slipped into negative territory for 4 wks, $$ sales down just slightly, even tho it's still up over 2% for 12 wks. Trends of couple of largest craft brand families headed in wrong direction too. Sam Adams brands had been doing a bit better: -6.4% for 12 wks compared to -7.1% for 52 wks thru 12/17. But 4-wk decline actually slightly steeper than 52-wks, -7.4%. So now Boston Beer's oldest brand family just 40% of the co's brand mix in Nielsen data (tho Sam a much bigger part of Boston's on-premise biz still). Note very similar pattern for Blue Moon during same periods. Short- and long-term trends almost identical -2.8% and -2.7% for 4- and 52-wks, respectively, while 12-wk trend over a point better. At same time, Ballast Point still strong and up double-digits for all periods. But it's not maintaining massive 77% gain for 52 wks. For 12 wks, Ballast up about 43% in off-premise scans, +27% for 4 wks.

Newsletter Craft Brew News

Tagged under

12/15/2016

Pabst Partners With New Holland; Takes No Stake; Will Go Natl

Pabst announced 2d partnership in 2 weeks today with Michigan craft brewer New Holland (recall, first was with Mexican craft brewer Minerva). Importantly, no ownership changes hands. That is part of Pabst chairman Eugene Kashper's evolving vision on craft. "This is the first deal in craft beer where there are no options or shares changing hands," proclaimed Eugene to CBN. This "pure parternship" approach is "really unique," agreed New Holland founder/prexy Brett VanderKamp, adding that was a key attraction for him. Basically, Pabst will provide sales, mktg and distribution arm and participate in the upside as it builds out its high-end sales platform.

Mutual goal of partnership is to make New Holland beers available nationwide, but that will take some time, perhaps several yrs "There's a lot of room to run," Brett said. New Holland will be roughly level at about 35,000 bbls this yr, and is currently sold in parts of 35 states, founder/prexy Brett VanderKamp told CBN. In yr 1, New Holland will fill out the states where it already sells, and possibly add 3-4 states. In 3-4 yrs, it will be available in the lower 48. This is longterm partnership. Pabst and New Holland want to take their time and do this the right way in right accounts. New Holland currently has capacity to make 100,000 bbls. Roughly 80% of volume already aligned in distribution network. So partnership "not putting a high priority" on further distrib transitions tho they could happen down the road.

Flagship brand is 11% ABV barrel-aged stout Dragon's Milk, which is 40% of volume. Dragon's Milk is up 20% and only has 3% distribution, said Eugene. And at $15 per 4 pack, it's taking up avg price of Pabst portfolio and "moving in the right direction." Certainly, that's also aligned with what new Pabst ceo Simon Thorpe has long dubbed the "luxury" end of the mkt.

Total New Holland portfolio averaged $60 per case in IRI multi-outlet + convenience thru Aug 15. Dragon's Milk at $96 per case equiv and accounted for half of New Holland revs. So it's a growing brand at a very high price, not widely distributed. But Pabst has key account team of between 50-60 execs. That compares to just 1 at New Holland, or 1.1 as Brett said if you factor in 10% of his time. Should be able to make some headway.

About half New Holland's biz in home state Mich. So there's a bit of a local/regional play for Pabst here as well. Pabst's Stroh brand "seeing some resurgence," said Eugene. New Holland represents a "first step for us" in US craft and is a "great fit" that "makes us a better supplier. Brett "didn't want to sell out," added Eugene. "And we don't want to be buying craft brewers," he added, asserting that by staying totally independent New Holland retains its "passion, authentic story and entrepreneurial spirit."

Pabst building out high-end sales platform, which already includes partnerships with Vermont Hard Cider, Tsingtao, Small Town Brewery. But these 2 recent announcements significantly up its game in craft beer. New Holland will "benefit" as platform grows, said Brett, noting that platform "needs more partners who are the right fits, because that will strengthen the platform." (A different version of this article appeared earlier today in our INSIGHTS Express.)

Newsletter Craft Brew News

Tagged under

12/08/2016

Trend Diversity, Flavor Traps and Tragic Snobbery: Notes from Wine & Spirits

Interaction between beer, wine and spirits only seems to be increasing and some "common answers" to craft flavor trends may encourage that, even if "the trend for 2016 is not a trend, rather it's diversity," as BA economist Bart Watson wrote recently. In that post Bart notes that "sometimes the variations outweigh the themes." True, generalizing movement across full craft spectrum basically impossible these days, but among largest small brewers getting national attention, Bart points to oft-cited trends like "sessionable styles," "sours" and "fruit or other infused takes on existing styles," particularly fruited IPAs. While session beers work in beer's long-time wheelhouse, easy-drinking refreshment, observers regularly point to the acidity of sour beers as an attraction for wine drinkers. Could the infused fruit flavors coming on in IPA attract drinkers currently seeking these flavors in spirits? Consider these notes from beyond beer.

Diageo's Flavor Trap Diageo has become highly reliant on new flavored spirits, particularly within Smirnoff vodka line. An Exane analyst noted that Regal Apple Crown Royal (whiskey) release was 85% of Diageo's growth in the US in 2015, Wall Street Journal wrote. The co's CFO acknowledged that "flavors are going to cause you to have more ups and downs by its nature," adding that "the right flavors...can really resonate." But the Exane analyst expects the brand to "leave a big hole to fill for Diageo in the next six to 12 months." . . . Vodka is to Mainstream Beer as Whiskey is to Craft? Recent growth of both craft beer and particularly bourbon "reflect a similar change in consumer preference," Cowen and Co's Vivien Azer told just-drinks. Both craft and whiskey growth driven by younger drinkers, following "30-year trend to less flavorful" beer and spirits, Vivien said. Turning point in spirits was 2010, she noted, same year craft kicked volume growth into high gear. She expects mainstream share losses to go on for 10+ more years. . . . Big Vodkas Battle "Craft" To compete against whiskey and legion of new small distillers, Diageo will spend $50 mil on "Activation Army" to host tastings at bars nationwide, largely behind Smirnoff, Bloomberg reported. Competing vodka brand Absolut from Pernod Ricard changed its bottle for the first time to include the word "craft," working to bring drinkers attention to the brand's origin and quality.

Beer Encroaching Wine Searches for specific beers sextupled since June 2013 on wine-searcher.com, it shared in recent post titled "The Unstoppable Rise of Beer." It was on occasion of Goose Island Bourbon County Stout appearing on its Most Searched-for Wines list, the first beer to do so. The monthly searches for any beer on the site more than doubled last Nov to 100K+. . . . Wine Encroaching Beer Parts of Virginia and Rhode Island are seeing shipments of an Australian Pale Ale from [yellow tail] maker Casella Family Brands, according to Aussie source TheShout. A lager and wheat beer will roll out come March. . . . Tragic Wine Snobbery "We all have very different palates, cultural histories, childhood memories and favorite meals. We are not the same. There is no perfect wine. There is no right wine," wrote Ryan Opaz for HuffPost recently. Outlining his view of "the greatest tragedy in the wine industry today," he argues that snobbishly encouraging consumers to believe a wine could be "right" or "wrong" inhibits selling wine more generally. That doesn't mean an "intellectual type" shouldn't immerse herself in story or science and hone her palate. But that doesn't mean it "is better than another's," and "please do not assume that your new found knowledge is somehow absolute."

Newsletter Craft Brew News

Tagged under

12/08/2016

Anchor Hires 20+ Yr Alc Bev Vet Matt Davenport as New Prexy, Extensive Wine, Spirits Experience

Lotsa changes, including expanding distribution, new beers and packaging, promised by new Anchor prexy Matt Davenport, "focused in the short term on shoring up key markets and key distributor relations," co announced yesterday. Matt comes with 20+ yrs of alc bev experience, mostly in wine and spirits and creates new role at Anchor Brewing (as Anchor also has distilling arm). He comes from exec veep of sales role at Gruppo Campari, following similar stint at Niebaum-Coppola Estate Winery. He plans to build on Anchor's history within craft movement "while seeking new ways to increase growth and maintain relevance," he said. Some of "exciting changes" he promises "in the next few years" include "new brews," to "expand sales in major metro cities across the country, south of the border and overseas," "freshen up Anchor's iconic look and feel," and "most importantly," "continue to honor Anchor's legacy and uphold that creative San Francisco spirit."

Newsletter Craft Brew News

Tagged under

12/08/2016

Survey Sez: Over 16% of Beer Drinkers in 10 Largest US Cities Report Craft Consumption

Steady rise of craft drinkers in major metro markets continued throughout 2014-2015, surveys by Scarborough Research show. Over 43% of 21+ adults in the 10 largest US cities reported any beer drinking in the last 30 days and over 16% of those folks said they had "any craft/microbrew" in that time. That's up over a point since surveys taken the year prior and up from just 9% in 2010. But the size of the group varies pretty widely from market to market. Over 20% of beer drinkers reported recent craft consumption in 4 markets last year, including almost 26% in San Francisco. That number's been pretty volatile last couple years, but it's back above level in 2012-2013 surveys. And over 20% of SF beer drinkers said they had a Sierra Nevada too, up 4 points. That's just slightly more than popularity of Bud Light and Blue Moon in the city. About 12% said they had an Anchor Steam recently, 10% reported recent Sam Adams consumption. (Note these survey results do not measure volume.)

In Boston, 23.5% of beer drinkers chose at least one craft beer in month before survey, up near 5 points. But that highlights one of oddities of this survey: most-named brand by Boston beer drinkers was again Sam Adams, reported by over a third of beer drinkers. In many of these markets, a single craft brand was reported by more drinkers than "any craft/microbrew," indicating at least some confusion still. Other big hometown brand, Harpoon, continues to perform better in these surveys. It was #4 most popular brand in Boston, up 6 ranks in 3 years, reported by 14.5% of beer drinkers. Sam Adams Light also appears on list at #10, but that's down 3 spots and reported by less than 10% of beer drinkers.

Almost 23% of beer drinkers had a craft brand recently in Chicago, up 3 pts. Sam Adams was reported by almost 14% of beer drinkers, down near 2 points, while over 12% of beer drinkers had a Goose Island there, up over 2 pts. Washington DC was only other market where more than 20% of beer drinkers told Scarborough they had a craft beer recently. Almost 22% said so, about a point higher than the 21% who said they had #2 brand Sam Adams recently and about identical to group of folks who had a Yuengling, #1 brand. Population of craft drinkers inched up a touch in New York to 14.4%, Houston to 13.6% and Dallas/Fort Worth to just over 10%. That's lowest number in all 10 markets, the last one to cross into double-digits. The percent of beer drinkers who remembered drinking any craft in last 30 days dipped a bit to 12% in Atlanta and LA and 13% in Philly. But local brands did better in some of those markets. Between 19-20% of beer drinkers in both Texas markets said they had a Shiner Bock recently, #3 brand in Houston, #4 in DFW. In Philly, almost 17% of beer drinkers had a Sam Adams. In Atlanta, about 11% of beer drinkers had a SweetWater and 10% had a Sam Adams.

Newsletter Craft Brew News

Tagged under

12/08/2016

Firestone Walker Announces 8 New States + Exports, On Its Way to 340K Bbls This Yr

As Firestone Walker plans to grow biz about 28% to 340K bbls in 2016, it will expand into 8 new states - KS, MT, ME, VT, CT, NM, IA, NE - by May this year, along with new territory in Canada and Sweden, co announced. Now that it has "additional flexibility" capacity-wise, Firestone mainly "just filling out some places where we think we can get some footprint cleaned up," sales & mktg veep Dave Macon told CBN. Expansion into Midwest is viewed as "one of our biggest areas of opportunities, especially considering our partnership [with DuvelUSA]." Indeed, Firestone currently only in MO and Chicago area, IL in Midwest region. So Firestone will enter KS in Mar with Central States Beverage and Crown Distributors ("more regions to follow"), as well as IA and NE in May. "Potential is there" for Firestone to brew Midwest production at Boulevard facility and "I know they've been discussing…but that's definitely down the road," said Dave. Recall, Firestone will brew select Boulevard beers at its Paso Robles facility this yr for west coast distribution (see Feb 2 issue). It recently added 8 new tanks that "bought us the additional room from where we were last year" and expects to break ground on Paso Robles facility expansion in May, taking anywhere from 18-24 mos to complete.

Out west, Firestone will enter MT in Mar with Cardinal Dist, Mountain Country Dist, Eagle Dist, Briggs Dist, Summit Dist and one more in Kalispell/northwest MT area to be determined, as well as NM in Apr. Both MT and NM are "very important" to PacNW and SW grocery chain networks, and "it starts filling out the west for us," Dave noted. Firestone also filling in its 3 remaining northeast states starting with Sheehan Family Co's Craft Beer Guild in ME and VT, still deciding on CT distrib. Firestone is with Sheehan Family in most northeast states with exception of Philly area, PA and NJ, Dave acknowledged. Lastly, Firestone will also expand its export biz to Sweden with Spendrups Byrggeri later this mo and Canada (Alberta, Saskatchewan, Manitoba) with Horizon Beers. While it's already "dabbling in the UK" and Germany, this is co's "first real attempt to get our handle on" export biz and there's "an awful lot of opportunity," said Dave. "If you don't have export as part of your strategy right now, you're already behind," tho "shouldn't be first and foremost." Going forward, Duvel "certainly going to play a role in certain geographies" too (Horizon Beers is also Duvel's Canadian importer, for instance).

805 up 71% in Jan, On Pace for 150K Bbls This Yr; New Products/Packaging for Easy Jack, Merlin Nitro, DBA, Rotating Hoppy Series Firestone 805 Blonde Ale still zoomin' in Jan amid slower overall mo for the industry, Dave noted; up 71% with an extra boost from draft-only rollouts into AZ, NV and TX. It's definitely a "big part of our growth in CA" and in new states "so far the draft rollout has exceeded expectations," he said, adding "velocity is fantastic." Typically Firestone does draft-only rollout "for the first 60-90 days" before package rollout begins, since "we try to time that with chain resets." Net-net, 805 is currently around 45% of Firestone's total biz and "once package comes on line it will probably grow." Indeed, 805 up 161% in Jan scans (see above), still all in Calif and is more like 67% of total volume and 62% of total $$ in national IRI MULC to start this yr. So all things considered, 805 will likely be over 150K bbls this year on its own, with vast majority in CA.

Then too, Firestone launching several new products and packages this yr. Recall, Easy Jack IPA will be available in 12pk bottles and cans starting this March. Last yr was Easy Jack's first as a year-round offering, and it easily quadrupled to 200K ce's, roughly 5% of Firestone's total biz. And this yr co expects Easy Jack to grow "double-digits." Notably, "one of the cool things we did" with Easy Jack was to leave out "session" on the packaging, he added. "The word 'easy' sort of said it all." Firestone also added nitro version of its Merlin Oatmeal Stout year round on draft as well as a version of DBA nitro later in the yr. Firestone partnered with local cookie company, Brown Butter cookie co, to pair with Merlin nitro for on-premise promotion dubbed "cookies and milk": they "pair amazingly well." And since Firestone is celebrating its 20th anniversary this year, it will give extra "attention to the beer that got us here," Firestone DBA. First keg of DBA nitro will tap at their 20th anniversary celebration at the brewery and Firestone will do various "on premise promotions" of nitro version and unfiltered DBA in select mkts. And Firestone created new rotating hoppy series called "Luponic Distortion" that looks to "make music out of different hops." Available in 6pk cans and on draft, it'll change brews nearly quarterly, tho they're "not tied to any season" and "hop combinations will change" to get "very different beer" for "each rotation."

Newsletter Craft Brew News

Tagged under

Page 545 of 1041