Beer Marketer's Insights - Focus: SKU Cuts, Footprint Shrinking "Not a Sign of Weakness," Needed for Long Game, Leaders Say

"Focus" was the "word of this conference," Brian "BK" Krueger of Bump Williams Consulting remarked during panel discussion at Brewbound Live yesterday. He, Deschutes CEO Peter Skrbek and Whole Foods beer buyer Mary Guiver reflected on the theme of focus, resisting the urge "to do everything" and "chase everything," as BK said, reviewing BWC's analysis of that theme in craft from earlier this yr. Whole Foods "had to weather the storm of being a craft-centric retailer," Mary said, and "it sucked." Craft is still "definitely a mixed bag," she remarked, but it's looking more and more like the "wind's finally&hellip;at our back." She remains "really bullish" about the segment and sees a turnaround "showing up in the numbers now," at least for her stores. But it's "not every brand," she cautioned. "The brands that are showing growth," including some double-digit gains, are "ones that are focused." Deschutes Slashed SKUs by Almost Half; "Not a Sign of Weakness" Headed into 2025, "we don't have a single new product coming out next year," Peter explained about Deschutes' plan. In last few yrs, co went from 572 SKUs to 308, he shared, just one aspect of co's efforts to be more "disciplined." Doing that kind of "declutter" work "takes time," is a "very long planning exercise," and brewers are "going to take a hit," he acknowledged. It's also "hard to say that when we're in a moment of categorical weakness," but you're "going to have to get your lumps" in order to move on. Plus, "a wise retail partner is not going to punish you" for making that call, he said. Mary agreed: "it's not a sign of weakness" to say "we're pulling out of these states" or "discontinuing a whole product line." Instead, it's the "opposite" and her team is "thankful" to see brewers making "strategic moves to shore up your business."Prioritizing Non-Alc & Fresh Squeezed, Building "Awareness Economies of Scale" Deschutes also has just "two priorities," Peter said: co's non-alc line and Fresh Squeezed IPA. Co chose to build NA brands based on its existing core beers in order to "focus on brand," he explained. "Our unaided awareness" is "very, very low," he said, so "to start from scratch was not an option." Launching Fresh Squeezed and Black Butte NA allows the co "to draft off the existing equities" in those brands. Co sees some "positive reciprocality," with folks finding the original Fresh Squeezed after entering thru the NA version. That's also why many of co's current national brands, like the Patagonia kernza lager and the new Kirkland co-brands for Costco, are "not pure-play Deschutes brands." It's about "achieving awareness economies of scale," Peter said.Pick and Stick to Top 3; Gotta Be Focused on Products, Channel, Footprint In meeting with brewers, Mary asks "what's your top three?" And focus doesn't just apply to brand, SKU or product mix. "Your products, your channel and your footprint all matter," she said. "It has to be all three." What's right for one channel doesn't always work for another, she reminded. In recent yrs, "we had to contend with the world of singles" and "for the love of God, we didn't ask for tall cans." Single-serve 19.2s are "not the solution for us as a grocery store," she said. The craft segment is also still in a "hangover" mindset that "success meant more points of distribution." But that's "simply not the case anymore," Mary commented. "Casting a wide net does not equal success," and the "inch wide, mile deep concept works."Fighting Against Dairy and Getting Away from Playing "Hopscotch on a Freaking Treadmill" "Retail space is shrinking slightly" for beer, BK commented, but it's not only "fighting a beer battle here." The category is "fighting energy drinks&hellip;soft drinks, flavored water," and "a lot of time there is a better story for some of those other categories," he said. Mary sees that especially with non-alc. "We're constantly fighting for life," she said, with some of the biggest recent challenges from dairy. "People be drinking milk lately," she quipped, so "they want to turn beer space into milk space." She also cautioned against the "danger zone" of innovating just to cycle last yr's numbers. "The spinning of desperation" is like playing "hopscotch on a freaking treadmill," when you're "trying to find the next thing to stay alive." She wants brewers to be able to innovate, but "you have to have a foundation. Then you can play."

Focus: SKU Cuts, Footprint Shrinking "Not a Sign of Weakness," Needed for Long Game, Leaders Say

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