Beer Marketer's Insights

Beer Marketer's Insights

It bears repeating: just about everyone wants to have their own beer brand. So here’s another quick group of high profile personalities and musicians teaming up with a craft brewer to create just that. First, famed skateboarder Tony Hawk linked up with SoCal’s Black Plague Brewing to produce Tony Hawps Birdhouse IPA, punning on Tony’s name alongside name of his skateboard co. The West Coast IPA debuted at Black Plague taproom over the weekend, NBC San Diego reported. Black Plague co-founded by Jordan Hoffart, also a pro skateboarder, and partners with a number of other boarders as brand ambassadors. Meanwhile, rock-focused Next Mosh publication (among others) pointed to pair of new band/brewer collabs this week. First, the band Live partnered with SoCal’s Alosta Brewing on Throwing Copper Ale, named after 25-yr-old album by the band. Then, Chicago’s Revolution Brewing announced helles-style lager in collaboration with hard rock band Chevelle.

Remember way back in 2014, when a proposal emerged to renovate part of old Olympia brewery in Tumwater, WA and turn it into a production and education hub for craft alc bevs? It’s been a while, but that project still moving forward and late last week, OR’s Ninkasi announced it’s joined on as a “key partner.” It’ll open its first WA-based tasting room at what’s now called The Craft District. The broader District development includes a marketplace, similar to popular food hall projects popping up all over the US, plus event space, restaurants, other small-scale food production and distillery/tasting room hub for Heritage Distilling Company, according to report by Washington Beer Blog.

Area will also house the brewing/distilling program for South Puget Sound Community College, housing a 10-bbl system for students. That educational tie-in, as well as “having a space to host Ninkasi fans in Washington,” an important piece of the puzzle for the brewery, CEO Nikos Ridge said in release. Indeed, “providing students with hands-on learning opportunities in brewing techniques and technologies, as well as the business and hospitality sides of the industry is something the entire team is delighted to be a part of,” Ninkasi Chief Commercial Officer Sarah Johnson said. Tasting room expected to open in about a yr, spokesperson told WBB.

Iron Hill Heads South, Will Open 18th Location in Atlanta, More Coming Iron Hill brewpub chain, based in Mid-Atlantic, wants to reach 20 locations by end of 2020. And it’s on track to open its 18th after signing lease for a location in Atlanta, GA, co announced this morn. It also recently announced location of its 17th spot, closer to its home base in Newtown, PA, opening next spring. But Atlanta outlet, in Buckhead nabe, marks Iron Hill’s expansion farther south. Co opened a Greenville, SC brewpub just last May. The 7,700 sq-ft location with seating for 250 diners and pub-sized brewing system will be located in Lenox Marketplace, a large shopping mall anchored by Target and Publix.

Big Hop Haus Expansion in Wisc, New 559 Tasting Room, Colo Seltzery & NJ Transition Plenty more expansion and opening clips popped in last week or two, worth noting. First, Verona, WI-based Hop Haus, opened in 2015, announced $4-mil plan to open 13K sq-ft facility in Fitchburg by next summer, Wisconsin State Journal reported. Plans include large tasting room and restaurant, natch, but also 15-bbl system, 5X size of co’s current operation. Initial capacity targeted at 2,500 bbls/yr, expandable to close to 10K bbls. It’s only brewing a few hundred bbls per yr in Verona, according to paper, but has been contracting at larger Octopi Brewing facility for packaged sales.

Meanwhile, in California, Clovis-based 559 Beer, which operates a brewpub in its hometown near Fresno, found a location outside of town on Shaver Lake, a popular summer resort location, to open its second restaurant, according to the Fresno Bee. In Colorado, closing of Grand Lake Brewing will lead to opening of the state’s first “seltzery,” Westword wrote this week. Owners Karen and Richard Wood closed down Grand Lake brewery near Rocky Mountain Natl Park earlier this yr, as well as co’s taproom outpost in Arvada, just outside Denver. But one of their sons, Hunter, took that taproom space to open ELVTD at 5280, serving variety of hard seltzers produced mostly on small 6-bbl in-house system. Location will serve some house beers too, but also taking a decidedly craft-like route to playing in fast-growing hard seltzer space. Finally, another closed brewery quickly reopened by new owners, this time out east. In Central NJ, northeast of Philadelphia, Common Sense Brewing closed in early June before quickly selling the license and location to Tindall Road Brewing, which just opened after upgrading some equipment, according to a Community News report.

After launching THC-infused brews in Dec 2018, CERIA Brewing will also launch non-alc, non-infused line of brews, starting with its Grainwave Belgian White, co announced. Recall, CERIA founded and run by ex-Blue Moon brewmaster Keith Villa and his wife Jodi Villa, based in Arvada, CO. Grainwave NA Belgian White Ale will be sold in 12oz cans (as opposed to 10oz aluminum bottles of THC version), tho co still determining what multi-pack size it will utilize and price point, director of media relations Jeff Blumenfeld told CBN. Yet CERIA already has its sights on potential massive expansion of its Grainwave NA Belgian White. “We saw an opportunity for a non-infused, non-alcoholic craft beer we could sell well beyond dispensaries, in fact anywhere NA beers are sold domestically or globally,” said Jodi.

Gotta note, CERIA is taking similar tack as Two Roots/Cannabiniers in NV and CA. Two Roots sells non-infused products and samples at its dispensary in Vegas and recently rebranded its acquired Helm Brewing location to become Two Roots Brewing, selling non-infused versions of its brews for additional brand exposure (see Jul 16 issue). And Cannabiniers has sizable ambitions, aiming to assemble portfolio comprised of $250 mil in cannabis biz and $500 mil total including broader production of conventional bevs (see Jun 19 issue).

Meanwhile, CERIA’s infused Grainwave Belgian White was available in 132 dispensaries thruout CO as recently as mid Jun, according to separate press release. And recall, co plans to expand to CA and NV later this yr, as well as several other legalized recreational states down the road. Tho gotta note, CERIA no longer among top-10 best-selling infused beverage brands in CO, according to Headset data for latest 30 days thru Jul 18. Top brands dominated by Stillwater dissolvable packs and Keef Cola bottles in CO.

The rise of juicy/hazy IPAs and pale ales clearly took the craft market by storm over the last couple of years and many have pointed out that they seem to be about as popular with female drinkers as with the stereotypical male hophead. Well, how about some numbers to put to that? Commenting on growing interest in juicy/hazy flavor profiles, Nielsen’s Caitlyn Battaglia “like[s] to call it ‘the gender bridge,’” she said during last wk’s Brewers Assn Power Hour. That’s because female craft beer drinkers are 8% more interested in juicy/hazy beers than the average craft beer drinker. Overall, interest in juicy/hazy is still growing. The group of craft drinkers who say they’re more interested in the flavor profile this yr than they were “a few years ago” is still almost 20 percentage pts higher than those who report less interest. That’s true of both weekly and more casual craft drinkers.

But the flavor profile with the broadest upside in craft is still “crisp,” or “balanced/clean beers” that are “not too malty/hoppy.” An overwhelming majority of craft drinkers report “more” interest in “crisp” craft beers now vs “a few years ago.” In fact, the percent of craft drinkers who are “more” interested in “crisp” is 37 pts higher than the percent who are “less” interested. Notably, weekly craft drinkers seem to be gravitating more toward “dark” these days, especially male craft drinkers and those aged 35-44. Overall, “tart” seems to be losing favor, but younger craft drinkers, age 21-34, are 8% more likely to be “more” interested in tart than the avg craft drinker.

“We’ve seen a slight down-tick in the average number of visits” to breweries in annual Nielsen survey of craft drinkers, the co’s Caitlyn Battaglia said during last wk’s Brewers Assn Power Hour. But that survey of 1,100 21+ adults who drink craft at least several times a year (see last issue for more) found fairly stable reasons why craft drinkers choose to visit brewery tasting rooms over bars and restaurants. Sampling still tops the list, named by almost half of all craft drinkers and 55% of female craft drinkers. Other top considerations to visit tasting rooms include the fact that they’re “family friendly” environments with fresh beer and beer that isn’t available elsewhere.

But it’s what happens after a brewery tasting room visit that may be more important. A growing group of craft drinkers say they purchase more of a brewery’s beer after visiting, including at traditional retailers on- and off-premise. Over 40% of craft drinkers say they buy “a little more” of a brewery’s products after a visit, up from closer to a third of craft drinkers just last yr. Additionally, 17% of craft drinkers and a quarter of weekly craft drinkers say they purchase “a lot more” of a brewery’s products after a visit. Both those figures up 1-2 percentage pts since last yr’s survey. Furthermore, over 60% of those weekly drinkers say they went to a “retail store” (64%) and “a restaurant/bar” (61%) for those purchases. That’s just a few points lower than the group of folks who made those purchases “at the brewery” (69%). Figures for all craft drinkers were 3-7 points lower for each of those channels.

Nielsen’s survey found that these folks made an average of 2.4 visits to breweries 1-2 hrs from home in the last yr. They also made 1.7 visits to breweries while traveling. Weekly craft drinkers (45% of the total group) made 3.4 visits to closer-in breweries in the last yr and 2.4 visits while traveling. While these numbers may be slightly lower than in the past, the decrease is driven by a moderation of visits as fewer drinkers are reporting 5+ visits in the last 12 mos. In 2016-17, about 20% of craft drinkers told Nielsen they visited 5+ breweries in the last 12 mos. That shrunk over the last 2 surveys to closer to 15% in 2019. A smaller, but steadier group of folks made 3 or 4 visits and another about 15% of craft drinkers made 2 visits to breweries in the last yr. Importantly, the percent of craft drinkers who didn’t visit any breweries in the last yr shrunk to around 35%. And the group of drinkers visiting one brewery in the last yr increased every yr since 2016 from 15% to over 20%.

AB’s Golden Road is off to another strong start in 2019 with $$ up 80% and volume up 102% YTD thru Jun 16 in IRI multi-outlet + convenience data. Indeed, Golden Road has consistently posted some of the fastest-paced growth trends over the last several yrs among AB’s craft cos, as well as the entire craft industry in scans since it was acquired in Sep 2015. Starting off of smaller base, Golden Road $$ grew 94% in 2016 IRI data followed by up 242% in 2017 and up 56.5% in 2018. It’s getting sizable boost this yr from new Spiked Agua Fresca brand family, which launched nationally as more of an FMB play. Yet even without new Spiked Agua Frescas, Golden Road still up 59% by $$, 79% by volume. Essentially “anything” with fruit is fueling growth, founder Meg Gill told CBN (only half joking). Especially its Cart series. Mango Cart still flyin’ in scans YTD and +485% for 4 wks. New Fruit Cart Mixer variety pk is among top new craft brands in scans this yr with incremental $959K in sales YTD thru Jun 16. Pineapple Cart and Spicy Mango Cart gained nearly all incremental $290K in sales collectively. And Melon Cart flattish for 4 wks, but still up 97% YTD.

Then too, Spiked Agua Fresca variety pk sold an incremental $1.2 mil YTD, becoming Golden Road’s #4 brand YTD and closing in on #2 spot. It passed #3 Mango Cart for 4 wks, only behind Wolf Pup session IPA and Seasonal for period (Wolf Pup declined mid-singles for latest period, tho still up 11% YTD). Recall, Spiked Agua Frescas rolled out nationally this yr, tho it’s “spotty national,” Meg acknowledged, gaining traction in SoCal mkts most of all, as well as in mkts where “there’s chain acceptance.” It will go “truly national” by next year with “more marketing support” and higher “head count” supporting the brand. And AB’s Estrella Mango Michelada, made in partnership with Golden Road, already became “big brand” for co (tho counted under Estrella brand family in scans), also with SoCal focus. Ultimately, “we feel there’s a lot of upside still” in both Mango Cart series and Spiked Agua Frescas, Meg said. Plus, slew of other new brands are adding to Golden Road growth in scans this yr as well, including LA Blonde Ale (in partnership with Dodgers), Haze the Day IPA, Medianoche IPA and Guava Dia Blonde Ale among others. Seasonal (+119%), Hazy LA IPA (+519%) and Balboa Blonde (+322%) all still posting big growth YTD even as trends slowed considerably in latest periods.

Golden Road USA Swimming Partnership Golden Road inked multi-year partnership with USA swim team to become official sponsor, marking team’s first-ever alcohol sponsorship, co announced last week. Golden Road will hold rights to official marks, branding, marketing and promotional opportunities thruout multiple key USA swim events and championships including beer garden at Olympic Team Trials events in Omaha, NE among others. Co will also implement unique athletic grant program that provides “financial support” and beer industry “exposure” and “training” for one male and one female swimmer each season. USA Swimming is looking to bring more of “spectator environment and culture into the sport,” said Meg. Crowds in Omaha reach over 200K visitors, and Golden Road can “activate the city of Omaha” thruout the event as well. Meg was swim team captain at Yale and co-founded Golden Road Aquatics swim team/fitness organization in SoCal back in 2015.

CANarchy kept up strong growth pace in 2019 with total volume up 12% vs prior year, new CEO Tony Short shared with CBN along with additional 1st half data points in latest release. Recall, CANarchy collectively shipped 421K bbls in 2018. So if trends keep up, CANarchy would gain 50K bbls to 471K bbls this year. And CANarchy growing more than 2X that rate in scans this year. Its $$ up nearly 28%, volume up 30%, YTD thru Jun 16 in IRI multi-outlet + convenience data (see Jul 2 issue). Foray into hard seltzers with Wild Basin, Grandeur Peak and Clear Coast is providing a boost, reaching nearly 13,000 points of distribution (including 2100 on-premise locations) and gaining an avg of 130 new PODs per day. Yet CANarchy craft beer portfolio $$ still up 25% YTD as well, so new hard seltzer brands only providing a 3-pt boost to overall trend in scans.

Each Brand Family Growing in Scans; Innovations AND Flagships Up Each CANarchy brand family is growing YTD in scans, including Cigar City $$ up 48%, Oskar Blues up 18%, Deep Ellum up 7%, Wasatch up 6.5%, Squatters up 16%, Perrin up 4% and Three Weavers up 122%. Growth is coming from healthy mix of new innovations and solid flagship growth across the board. New innovations (including hard seltzers) helped Oskar Blues (+43%), Squatters (+33%) and Three Weavers (+150%) notably accelerate in latest 4 wks, tho Perrin has begun to slip (-7%) and Cigar City growth nearly cut in half (+28%) for period. Oskar Blues CANundrum mix pk is up 80% YTD after switching to 15pk format. Squatters Juicy IPA and Oskar Blues Can-O-Bliss IPA series among top new brands in UT and CO scans, respectively. And hard seltzers’ velocity continues to grow even amid fast-paced distribution gains, with rate of sale up 30% over launch numbers in Mar, per release. “There is significant room for growth in this segment, as the current footprint only represents 20-30% of the distribution of CANarchy flagship brands,” per co. But at same time, each of its flagship brands are growing this yr including: Cigar City Jai Alai $$ up 52%, Oskar Blues Dale’s Pale +4%, Perrin Black Ale +17%, Wasatch Apricot Hefeweizen +29%, Squatters Hop Rising double IPA +3%, Deep Ellum Dallas Blonde +7% and Three Weavers Expatriate IPA up 111%.

Trendy New Brands Comin’: Oskar “One-y” Hazy IPA with 100 Cals; Cigar City Margarita Gose & More A couple notable new brands from Oskar Blues and Cigar City will launch in time for fall chain resets, release highlighted. Oskar Blues “One-y” is a 100-calorie hazy IPA and Cigar City Margarita Gose will be “large-scale distribution” launch across its now sizable footprint. Also, co will launch CANarchy IPA Mixed Pack this fall featuring 4 IPAs from across the portfolio. Separately, Oskar Blues just announced nationwide release of Rosé for Daze ale, seemingly the rebranded version of previous Guns and Rosé. And “there is more rebranding to come, including a reimagining of Three Weavers, Oskar Blues and Wasatch brands,” co hinted.

Cigar City Added 13 of 16 New States Thru First Half; Other Expansions Recap Then too, several brand families are expanding distribution and adding new locations in 2019. Cigar City already launched 13 new states this yr, with plans to add 16 states in 2019, bringing it to 42 total (see Mar 21 issue). Deep Ellum and Three Weavers only just getting started with their territory expansion, as Deep Ellum added OK as its first out-of-state mkt earlier this yr and Three Weavers added northern CA distribution. Plus, Deep Ellum officially opened Funkytown Fermatorium in Fort Worth and CANarchy-branded Collaboratory opened in Asheville.

All in, “CANarchy is positioned for continued growth in the latter half of the year and into 2020,” sez co. CANarchy on pace to be among top craft growth cos overall in 2019 while gaining ground in tracked chains most of all.

After a tuffer Jun, craft is showing signs of improvement in Jul Nielsen data, particularly just in the last tracked week. Indeed, Nielsen-defined craft $$ eked out 0.3% gain for latest 4 wks thru Jul 13 compared to down 1.4% for 4 wks thru Jul 6 and -1% for 4 wks thru Jun 29. Nielsen craft $$ still up 0.6% yr-to-date thru Jul 13, tho volume is down 0.6%.

Part of the reason for improvement is due to top-4 craft brand families’ improving trends, including each of the top-3 indie craft cos. Sierra Nevada improved to $$ up 4%, New Belgium $$ up 8.4% and Sam Adams cut its decline rate nearly in half to $$ down 7% for latest 4 wks thru Jul 13 in Nielsen All Outlet data. Yr-to-date, Sierra $$ down 1%, NBB up 8.1% and Sam Adams down 13%. Also, Blue Moon brand family $$ grew 0.6% for 4 wks vs down 3.2% YTD. Flagship Blue Moon Belgian White is driving growth, perhaps fueled by latest media boost lining up with 50th anniversary moon landing campaign: $$ up 3.7% for 4 wks vs down 0.2% YTD. Yet Leinenkugel shandies (-15.6%) and AB’s Shock Top (-29%) continue to decline at steep double-digit rates in latest 4 wks. So craft segment still looks a fair amount healthier without Blue Moon, Leinie and Shock Top. Without those brands, craft $$ up 2.2% for 4 wks and +2.6% YTD in Nielsen All Outlet data.

Reserve your seat for the 2019 Beer INSIGHTS Seminar, our 26th annual fall meeting. Opening reception begins on the evening of Sunday, Nov 17 and our top-notch program will run all day Monday, Nov 18 at New York City’s Convene, a state-of-the-art meeting and event venue.

Right on cue as Boston reports its Q2, Boston Beer chairman Jim Koch and Dogfish Head founder Sam Calagione will jointly share the stage to talk about the progress of their merger and much more. Plenty of other high-level US beer execs and growth leaders have signed on to discuss current hot topics and challenges in the US beer biz too, including: Marcel Marcondes, US Chief Mktg Officer for AB; Constellation Brands’ Chief Mktg Officer Jim Sabia; Mike’s Hard Lemonade chairman Anthony von Mandl and prexy Phil Rosse. More speakers will be added.

This year’s seminar promises to once again feature cutting-edge content and plenty of time to network with industry leaders and peers. Convene is conveniently located on W 46th St, near Rockefeller Center and Times Square. We have a room block set aside at The Kimpton Muse Hotel across the street at a special conference rate. Click here to register.

After BrewDog hired ex-Red Bull vet, Andy Shaw, as “newly-created role of [global] CEO of Beer” in Feb 2019, Andy abruptly left the co just 5 mos later, The Grocer reported. Andy previously worked at Red Bull for 14 yrs, including most recently as managing director of UK before joining BrewDog, per LinkedIn. In his “CEO of Beer” role, Andy was “responsible for the global sales and marketing of BrewDog’s beer,” noted The Drinks Business when he was initially hired. Position was created “in order to provide additional senior strategic leadership as BrewDog enters a period of accelerated growth domestically and internationally,” co stated then.

Co-founder and CEO of BrewDog, James Watt confirmed Andy’s departure with The Grocer, tho Shaw himself didn’t comment. And co now promoted former retail CEO David McDowall “to new role as group COO.” And recall, BrewDog also hired new CEO Allison Green for US biz unit earlier this yr as prior CEO Tanisha Robinson was promoted to global role as Chief Disruption Officer (see Mar 26 issue); hired former Diageo vet David Gates as managing director of its LoneWolf distillery. Indeed, BrewDog is a sprawling global enterprise with breweries in UK, Columbus, OH, Australia, Germany, along with 47 bars in the UK, 21 bars in Europe, 4 bars in US and 3 in the “rest of the world,” and a hotel, distillery and cidery, according to its latest Punk Prospectus. It continues to grow at an aggressive pace, only planning more hotels (London), breweries (China), bars (across Europe and US in particular) and new products.

In 2018, BrewDog revenue grew 54% to £171.1 mil ($213.55 mil at current exchange rate), including nearly £50 mil generated from its global-spanning bar biz. Co added a whopping 470 new employees to 1,247 total and reached 97K shareholders in the calendar yr (already pushing 1,500 employees and 117K investors in 2019). Yet co incurred net loss of £1.5 mil in 2018 thanks to hefty “administrative expenses” and “finance costs,” according to Prospectus balance sheet. Indeed, BrewDog continues to overinvest in growth, which in turn is fueling co’s strong topline and expansion. Plus, BrewDog is in midst of yet another successful crowdfunding campaign via Equity for Punks platform, currently at 81% of £7 mil goal with 254 days remaining. Meanwhile, BrewDog USA still a small piece of the puzzle overall, but it’s building off a strong year of growth in 2018, and more than doubling its volume YTD thru May (see Jun 19 issue).