Craft Brew News
Beer Marketer's INSIGHTS brings you a new e-letter to cover the hottest segment in the beer biz, craft, in-depth, as it deserves:
CRAFT BREW NEWS
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Craft Brew News is an e-letter published at least once a week, 60+ times a year, including flashes whenever need-to-know info breaks. CBN will also include occasional forays into the exciting world of specialty imports as well as big brewer efforts to compete in the craft arena. This publication synthesizes what you need to know about craft, helping you avoid information overload, while giving you data and insights you need to maximize your business opportunities.
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Craft beer is a “different category than it was two or three years ago,” Boston Beer founder/chairman Jim Koch acknowledged on co’s Q2 earnings call yesterday afternoon, soon after reporting huge 17% shipments and depletions gain for the qtr (see yesterday’s issue). Craft is “more mature, more stable,” yet still sees “a thousand new entrants a year. So it’s a category where it’s really difficult to grow if you’re fully distributed and your brand’s been around a long time.” Like Sam Adams. So Boston execs not exactly surprised that Sam Adams continues to underperform in craft. Asked about the brand’s softness – total Sam franchise $$ down 13.3% yr-to-date thru Jul 13 in Nielsen all outlet data – Jim said its current status actually falls “pretty much in the ballpark of expectations.” However, it’s “gaining share in seasonals,” he said. As we noted yesterday, Sam Seasonal $$ +6% for 4 wks thru Jul 14 in IRI multi-outlet + convenience data, now down just 1.5% YTD. Yet total craft seasonals off double digits for both periods. Within craft in general, Jim expects, over “three to five years” that “retailers are going to be more selective about what they put on shelves”…
Publishing Info
- Year 2019
- Volume 10
- Issue # 66
Growth isn’t just going to “new” or “small,” but “local.” All of craft’s growth these days is local, according to off-premise data shared by Nielsen alc bev veep Danelle Kosmal during today’s BA Power Hour. “Local craft,” defined as any brand with 85+% of its volume in one state or retailer, is up 5% by $$ in Nielsen’s broadest all outlet (with convenience, liquor and military) data for 52 wks thru 6/22. Such brands represent just over 10 share of total Nielsen craft $$ (including big brewer brands), but gained almost 1 full share pt in the last yr. And they tend to sell for about $5 more per six pack, with an avg price of $14.34/6-pk compared to craft avg of $9.26. Then too, pull “Local” out of craft and the rest of the segment is down 1.7%. So perhaps no surprise that “local” is important for most craft consumers. A “locally made” craft beer plays an important role in purchasing decisions for 59% of regular craft drinkers and 64% of weekly craft drinkers, according to poll results shared by Nielsen’s Caitlyn Battaglia. So “local” tracks within a point of interest in “Independent” for both casual and core craft…
Publishing Info
- Year 2019
- Volume 10
- Issue # 63
A number of notable in-state declines offset strong growth from fast movers in California in 2018. Such is craft these days, tho. In total, CA brewers shipped about 3 mil bbls of craft beer in the state last yr, we estimate based on state reports. That’s in the neighborhood of 70% of the craft beer produced by CA brewers and up about 3.4%, 100K bbls over our 2017 estimate. As with national trends, all of that growth came from the smallest players. We track the 30 largest brewers, based on in-state shipments, all over 15K bbls in-state, in the table below. While it includes plenty of strong growth, collectively these 30 brewers were down less than 1% from 2017 to 2018. So all other Calif brewers, some 800-850 of ’em, collectively grew about 17% last yr. Those smaller brewers still totaled less than 800K bbls tho and the vast majority of them produced and shipped just a few hundred bbls or less (see below for more). …
Publishing Info
- Year 2019
- Volume 10
- Issue # 61
It’s only gonna get worse before it gets any better for Ballast Point, it seems, following co’s decision to close locations, “halt” any “broad-based” new brand launches and brewpubs a couple mos ago (see Apr 16 issue). Ballast Point declines steepened to $$ down 38%, volume down 36% for latest 4 wks thru Jun 15 in Nielsen All Outlet data cited by Morgan Stanley’s Dara Mohsenian. $$ sales now down down 34% for 12 wks and -21% for latest 52 wks. That’s as avg price/case declines slowed to down 3% for 4 wks vs -5% for 12 wks and -8% for 52 wks, following cos decision to restructure pricing via Discovery Series, Sculpins and Specialty brews. Ballast declines continue to have little-to-no effect on Constellation Beer Brand Divisions’ overall results. Total Constellation beer sales-to-retailers grew 6.6% in Mar-May qtr, with shipments up 4.2 mil cases, 5.4%, and revs up $100 mil, 7.4%, to nearly $1.5 bil for fiscal Q2, co reported earlier today.
Publishing Info
- Year 2019
- Volume 10
- Issue # 58
BrewDog USA is cruisin’ in 2019 even amid “toughest environment I have seen in 23 years of selling craft beer,” Chief Rev Officer Adam Lambert shared in email update to his network (as he used to frequently do back in his Dogfish days). BrewDog depletions are up 114% YTD thru May, following co’s best month yet in May with 51K CEs. Recall, BrewDog USA initially expected to hit 25K bbls and $18+ mil in revs last yr, yet co ended up surpassing 36K bbls in 2018, according to Brewers Assn stats (unclear if any contract volume included in BA number). Over Half of Biz in OH; Mid-Atlantic Growin’ Most; MD with Bond and Buck Dist Notably, 56% of its volume is in OH, growing 90% YTD. Midwest (IN, IL, MI) and Mid-Atlantic divisions are gaining ground, up 132% and 182% respectively, now representing 18% and 22% of total BrewDog biz. Then too, BrewDog added north central WV earlier this yr, as well as 8 new wholesalers in existing territories, DC mkt with Reyes’ Premium Bev in Mid-May, and this week is rolling out MD with Bond and Buck Dist, bringing total footprint to 11 states + DC total (OH, IN,…
Publishing Info
- Year 2019
- Volume 10
- Issue # 55
After solidifying itself among top MO brewers with a sizable presence in hometown, St Louis-based Urban Chestnut Brewing is moving at strong yet steady pace in 2019 and beyond while also beginning to seek potential oppys in new spaces, co-founder David Wolfe told CBN during visit earlier this week. Recall, Urban Chestnut opened in 2011 by ex-AB exec David Wolfe and brewer Florian Kuplent, and co quickly grew to regional status (15K bbls or higher) by 2015. Growth since settled down and last year slowed to mid-single-digits, up 1K bbls to 22K bbls in 2018, according to Brewers Assn stats. But this year co expects to pick up pace and reach 25K bbls, David shared. Urban Chestnut has ample room to grow if needed, after expanding into 70K sq-ft production facility and bier hall location in 2014, set up to be its home for the future, David explained. Currently capacity is around 30K bbls/yr with ample space for new tanks and equipment, ultimately capable of reaching upwards of 80K bbls/yr. Even as canned packages have taken off and pulling away as its leading package, co still operating 40 cpm canning line that’s proven to be a notable “pinch point” in…
Publishing Info
- Year 2019
- Volume 10
- Issue # 54
More...
Goose 312 Urban Wheat and IPA prices in Chicago are extreme examples of AB’s willingness to go low on core craft brand prices. Yet co’s also experimenting with low price points across many of its acquired craft brand families. Collectively, AB acquired craft cos avg prices dipped 2.5% to $37.91 per case in IRI mutli-outlet + convenience data. That’s not far off from total craft segment prices (+1.1% to $38.26/case). Indeed, low prices below far from across the board. Top AB acquired craft brand Elysian Space Dust still well above craft avg at near $49/case. Others too. But avg price for each brand family is down YTD, including sizable price drops on several lead brands emphasizing larger pack sizes (15-, 18-, 24-pks, etc.), and newer intros at low prices. For example, Golden Road Wolf Pup session IPA and Mango Cart each down at $30-31/case markers in MULC ($29.42 and $27.23 in grocery channel); Goose 312 Urban Wheat and IPA at $28.50/case and $31.88/case nationally in IRI MULC ($26.87 and $28.05 respectively in grocery channel); Blue Point Toasted Lager down $4.30 per case to $31.82 in MULC ($28.50/case in grocery); Breckenridge Nitro Irish Stout prices plummeted to $29.56 per case, down…
Publishing Info
- Year 2019
- Volume 10
- Issue # 52
05/31/2019
Legislative Notes: Maine Franchise/Self-Dist Bill Brings More Compromise; CT Off-Prem Sales
Inter-tier compromise continues to be clearest trend in state-level legislative actions in 2019. Importantly, franchise law a frequent (and perhaps surprising) subject of compromises between small brewer and distributor advocates. Both groups support bill intro’d in Maine last week, raising self-distribution volume cap and creating franchise law carve out for small suppliers, according to Portland Press Herald report last night. Recall, discussions over this issue in ME noted during CBC seminar by atty Marc Sorini (see April 10) as example of growing number of states where parties traditionally not aligned figuring out the give and take needed to get on same page. That page hit Maine legislature about 10 days ago, currently still in committee. But backing by key stakeholders could mean smooth sailing, if process tracks results of compromise elsewhere.The deets: proposal would raise current volume cap on “small brewery” license in state to 30K bbls, under which breweries can self distribute. Same volume threshold would apply to state franchise law, allowing brewers from in- and out-of-state to give 30 days to move from one distrib to another (or to self distributing). Brewer has to represent less than 3% of distrib volume over last 12 mos. Distrib gets FMV,…
Publishing Info
- Year 2019
- Volume 10
- Issue # 51
Yesterday’s blockbuster deal announcement that Boston Beer will acquire Dogfish Head for combo cash/stock deal valued at $300 mil turned everyone’s heads. Even those already paying close attention to what Dogfish was up to with proposed legislation in Delaware. It’s largest craft player to sell since Lagunitas sold remaining half of its biz to Heineken in 2017. But largest new tie-up since Ballast Point sale to Constellation in 2015. Yet a strange, coincidence: both Dogfish and Ballast essentially the same size when these transactions announced. Dogfish Head just shy of 275K bbls last yr. Ballast at 277K bbls in 2015. Ballast grew by almost 100K bbls in 2016, but then over next two years lost all of those bbls. Declined to essentially exact same volume as Dogfish Head last yr, 275K bbls. Fact that both of these deals also involve public cos require additional financial disclosures, which could broaden their impacts. Simply: while terms of other deals more private, details available here provide much clearer measuring stick for the industry, against which many others seeing how they stack up. In that respect, will this deal “reframe craft beer M&A”? That’s intriguing question posed by Consumer Edge’s Brett Cooper in extensive…
Publishing Info
- Year 2019
- Volume 10
- Issue # 45
Perhaps now more than ever, in this age of constant innovation and intense competition, brewers have to find their “brewery religion” in order to determine “what you’re going to do and what you’re not going to do….Our religion as brewers is going to be challenged by all sorts of things” and it’s “different” for everyone, stated Brooklyn Brewery brewmaster Garrett Oliver on panel of craft brewers for Brewers of PA’s annual Meeting of the Malts event. As BA’s Bart Watson called upon craft brewers to seek new consumers, Garrett, along with Yuengling chief admin officer and 6th gen family member Wendy Yuengling, 21st Amendment brewmaster/co-founder Shaun O’Sullivan, Troegs brewmaster/co-founder John Trogner, and Rhinegeist co-founder/vp of sales & marketing Bryant Goulding each expressed different ways their breweries are experimenting and expanding within this context. Brooklyn Bel Air Sour Could Be Brooklyn’s #2 Brand by Year-End; 51% of Brooklyn Sold Outside US Brooklyn Brewery’s Bel Air sour ale has quickly become #2 sour beer sold in the country and on track to become #2 best-selling beer for co, possibly by this year, Garrett shared. Recall, co launched Bel Air year round just last yr. Bel Air can be more suited for cocktail…
Publishing Info
- Year 2019
- Volume 10
- Issue # 40
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★ANNOUNCING★
The 2019 Beer Insights Seminar will be held in New York City, on Sunday evening, November 17th to Monday, November 18th at Convene.