Beer Marketer's Insights

Beer Marketer's Insights

A bit better qtr for Boston though it's not out of the woods yet. Boston Beer shipments increased 33K bbls, 1.4% in Q3, while STRs stayed down 6%. For 9 mos, STRs and shipments each down 6%. And that same 6% drop is continuing into q4 too thru week 42 (Oct 15). But in Q3, "excluding the Truly declines, the Company's depletion volumes for the remainder of the business in the third quarter increased 14%," Boston said. In Q3, Boston grew Twisted Tea, Sam Adams and Hard MTN Dew, but Truly, Angry Orchard and Dogfish Head declined.

Slowly but surely, direct-to-consumer beer sales are leaving the taproom. This wk, one of top craft players launched DtC shipments to trio of pretty small markets. New Belgium now utilizing Liviri packaging and shipment tech developed for wine cos to ship selection of specialty beers to consumers in Vermont, Washington DC and Nevada. It quietly started taking orders yesterday, specialty brand mgr Andrew Emerton shared via Twitter. Beyond tech allowing NBB to ship beer via reusable cooler boxes designed for wine shippers by makers of Otter Box, the brewer following lots of familiar protocols to way wine DtC biz evolved. Signature of 21+ adult required for accepting delivery thru FedEx. Unique Liviri boxes allow chilled packaging of 4 large format bottles, delivered within 1-2 biz days. FedEx will then pick up box for reuse. Portfolio of specialty brands NBB initially of

Plenty of shifts and tweaks to craft brewery ownership already done or in process late in 2019. Among latest changes, San Diego-based SouthNorte Beer now majority owned by one of its founding partners, John Gallegos (as first reported by Brewbound). Recall, SouthNorte founded a few yrs back as side project of Coronado Brewing head brewer Ryan Brooks. Coronado had minority stake in project also owned by John, Ryan and once Coronado CEO Brandon Richards, who recently moved on to run AleSmith. Upping his stake in the co, John now owns majority of SouthNorte. Coronado will still produce the co's beers but no longer owns a stake. Brandon remains purely in "an advisory role." In addition to greater ownership of co, John Gallegos will also take larger management roles for SouthNorte. "It's an exciting time to take up and reinvigorate the marketing, sales and creative mantle" at the brewing co, he said. Marketing a particular area of expertise for John as he also acts as CEO of United Collective, group of 5 communications/creative agencies with offices in Calif and NY.

As recreational cannabis sales set to come on line in IL on Jan 1, 2020, Chicago-based Revolution Brewing is looking to celebrate and embrace legalization, reported Eater Chicago. Revolution will launch "Legal Hero" hazy IPA as limited release in 16oz cans and draft at its taproom on Jan 1 - the brew itself has no cannabis properties, simply looking to call attention to and "celebrate" legalization, per co's website. Indeed, several brewers in recreational states and elsewhere have used weed references, both vague and direct, to market various new brand launches and/or events, getting in on the action in their own (legal) ways.

New Belgium employees' vote on sale to Lion Little World Beverages/Kirin Holdings is expected to finish today, Dec 17, according to report by KUNC radio. And at least one notable shareholder with voting rights remains torn by decision. "If it was purely a financial decision, it's an easy decision," former New Beligum brewmaster Peter Bouckaert shared. "But it's the emotional part - that's my hesitation." Turns out Peter, who left NBB a couple yrs ago to start a new small brewery in Ft Collins called Purpose Brewing and Cellars, has retained "a lot of shares," from his 21 yrs at the co. "I really want to chat with some other people about it…. I'm not going to sway it, but I have an influence." Peter's "key decision factor" is whether he believes Lion/Kirin can continue to make NBB "a great company to work for," he added. Yet as he's kept in touch with folks at NBB, Peter "kind of saw that something needed to happen" and "in the end I was really happy that it was actually Kirin and their Australian subsidiary who bought it," he stated. "My hope is that I can still go to New Belgium and feel like I'm in New Belgium as I was working there" and "I think there's a decent chance of it in this sale…. But you never know, of course."

AZ's Barrio Brewing, the state's oldest craft brewer, is next in line to go ESOP (employee stock ownership plan) route. Barrio founders, Dennis and Tauna Arnold, will transfer 100% ownership to employees beginning Jan 2020, co announced. Co touts itself as the first craft brewer to transfer biz in its entirety to employees right off the bat (all others started by transferring a partial stake, at least initially) and the first craft brewer ESOP in AZ. "Nearly 30 years after our humble beginnings, the decision on our exit strategy was easy for both of us," said Dennis, who will transition to "brewmaster emeritus" and advisory role following the deal. Barrio has 70 employees altogether, and all employees who work at least 1K hours per yr will be "automatically enrolled" in the ESOP, per release. Under ESOP, "the employees will buy the brewery from the Arnolds over the next five years with proceeds from the brewery's profits," reported Tuscon.com separately.

Several yrs since selling to AB, Breckenridge continues to pick up steam. In fact, Breckenridge already eclipsed 100K bbls sold for the year last month and continues to grow double-digits, prexy Todd Usry and sales director George O'Neill told Craft Brew News. Recall, Breck shipped ~70K bbls in 2015 as cos announced sale to AB late that yr. It didn't grow much in first yr with AB. But sales accelerated each yr since; this yr Breckenridge volume is up a whopping 88% YTD thru Dec 1 in national IRI multi-outlet + convenience data, and among top-10 share gaining craft brand families nationally, co shared. "Brand health has never been [better]," and there's "still a ton of runway to keep going," said Todd and George.

It took 'til the eleventh hour, but lawmakers included an extension of 2017 fed excise tax breaks for beer, wine and spirits for 1 year thru 2020 in the package of a dozen tax bills agreed-to last night. House officially passed the extension this afternoon. But lobbyists won't have long to breathe sighs of relief or high five. Efforts to extend break beyond end of next yr, to make it permanent in fact, will ramp up in early 2020. Those lobbyists built broad Congressional support for an extension, as well as media support. Indeed, NY Times biz section front-paged some love this morn for craft distillers, published before deal announced. Many small distillers never paid more than $2.70 per proof gallon and faced 400% increase on Jan 1. Ditto many craft brewers who started up last 2 yrs; they faced a doubling of fed excise tax. Many of these small bizzes invested in new equipment, jobs, etc. "I've got 7,500 main-street members using that money to reinvest in their companies and their communities," Brewers Assn CEO Bob Pease told the Times. (This is an excerpt/updated version of an article from our sibling pub INSIGHTS Express.)

Craft beer's a long way from the darling growth category it once was in bev-alc - hardly even mentioned in Nielsen's "Beverage Alcohol 2020 predictions" released earlier today. More attention placed on spirits and "more alternative beverages" as well as broader low-calorie, low-ABV trends in off-premise channels. Lower ABV and lower calorie IPAs, as well as greater selection of non-alcoholic craft beers, got shout-out among other budding "better-for-you" trends. And craft beer "will continue to find success with styles found in more traditional beer segments," such as American/Mexican lagers, sez Nielsen (Editor's note: no mention of hazy IPAs and full-strength IPAs, both still among top bright spots in craft beer overall, at least currently.) On-prem, "hyper-local will continue to lead the way within beer." Yet for the most part, "growth in the beer industry will focus on nearly everything but beer."

With just one mo to go, craft $$ sales are up 3%, volume up 2% YTD thru Dec 1 in IRI multi-outlet + convenience data. Sales slowed a bit in Nov as total craft avg prices dipped $0.22/case to $38.33 for latest 4 wks. Pricing was softest in grocery channel, down $0.40/case to $37.58 for period, as craft $$ trend a full pt slower than volume, up 1% vs +2%. But overall, low-single-digit craft sales growth has been relatively consistent thruout the year in scans. And craft prices still up 0.8% in MULC and 0.5% in grocery channel. (Editor's note: craft segment had similar pricing drop in IRI vs Nielsen for latest 4 wks, yet IRI craft continues to trend a couple pts higher than Nielsen craft.)