musing

Are beer drinkers really trading down?

Tired of hearing about trading up? How about a little trading down?

This from the Association Press:

Cash-strapped drinkers are starting to trade down to economy beers, the chief executive of Miller Brewing Co. said Thursday.

The Milwaukee-based brewer saw some shift between higher-priced, premium beers and economy beers such as Miller High Life and Milwaukee’s Best starting in January, Tom Long told reporters on a conference call.

“We think it’s primarily driven by decline of disposable income and pocket money that American consumers are feeling right now,” he said.

Mr. Long said the volume of beers sold remains stable, but the company expects to sell more lower-priced beers this year if gas prices continue to rise.

Look closely. This is a discussion about drinkers already wed to industrial lagers moving from one price level to another. Also, if you read on in the story you’ll see that Milwaukee Best sales were down. Doesn’t that present a contradiction?

Brewers of more expensive beers face plenty of challenges between rising ingredients prices and an economic slowdown, and maybe beer drinkers will opt for less expensive beers, but has anybody seen that yet?

A bottle of Shiner put to good use

I’m not going to tell you that Shiner Bock is my favorite beer or even that it is a bock. I think it deserves better than it gets at the ratings sites (2.6/5 at Rate Beer and C+ at Beer Advocate), but we don’t seek it out when eating smoked meat in Texas. Just as a f’rinstance.

But I like some of the beers more — the Shiner 99 is a pretty nice Helles, at least if you have it fresh, as I did — and that this little brewery with a certain amount of German heritage and Texas terroir will soon celebrate 100 years of business.

Now they’ve produced this commercial that gives us one more reason to appreciate the old fashioned Western saloon.

Pencil us in for a visit on their 100th anniversary.

Beer still costs more than gas

Beer: Cheaper than GasFunny T-shirt today at Shirts on Sale (no affiliation deal; just a link), but the fact is that beer costs a lot more than gas. A gallon of gas around here — $3.35 to $3.45 in these parts this morning — will set you back less than half what a half-gallon growler of beer costs at a local brewery.

So don’t wimp out. Oppose suggestions we need a gas tax holiday.

Fact is our family would almost surely benefit more than yours (since our summer is full of diesel-powered travel), and we’re not biting on this short-term fix.

Could Magic Hat be a local beer on the West Coast?

You don’t have to come here to read that Magic Hat is acquiring Pyramid.

It’s here, there and everywhere. Including the possibility that Pyramid will brew Magic Hat beers for the West Coast and perhaps vice versa.

So some stuff you may not have seen, mostly about the business of beer but bound to affect what ends up happening with the beers themselves.

Magic Hat CEO Martin Kelly previously worked for Pyramid (one of many stops on his resume). He left Pyramid in 2004 and shortly thereafter began at Magic Hat. Vermont Business Magazine provided details in a 2006 profile of Magic Hat founder Alan Newman.

Kelly, a self-described “a corporate gypsy,” served time at Coca Cola, Miller Brewing Co, Borden Foods, and was CEO of Pyramid Brewery, a craft beer company on the West Coast, before he came to Magic Hat to develop a five-year plan.

“I had the explicit intention of not being here more than three months,” Kelly said. “But in working through, I became excited about the potential for Magic Hat: the brand, the company Alan had created, and the opportunity for organic growth and expanding. Alan said, ‘Now, don’t you want to stay on and execute the plan?’ And I said yes.”

According to Kelly, who runs Magic Hat under the whimsical title of Potentate, Pilot & Primary Prestidigitator (P4), he has three major areas of focus: “Build the relevance of our existing brands in existing markets and grow market share; continuously evolve our portfolio of beers to keep it fresh, interesting and relevant to our community of consumers; and maintain our methodical expansion into new markets.”

Shortly before he left Pyramid, Kelly closed a deal to take over Portland Brewing, providing perspective by comparing it to agreements such as Anheuser-Busch taking a stake in Widmer and Redhook.

“The craft brewing business is very competitive and changes daily. To stay ahead, breweries must keep moving forward,” he said. “Some breweries have chosen to go the route of aligning themselves with large, multinational, industrial brewers. We believe that approach can stifle creativity and lead to less choice for consumers. Our approach aligns two independent Northwest breweries and retains the creativity and integrity craft brewers are known for.”

But Portland wasn’t particularly independent after Kelly left Pyramid. The Portland brand essentially disappeared, although MacTarnahan’s seems to be thriving.

That’s good enough reason for me to pass on making predictions. Instead I’ve posted a rather long interview with Kelly from 2002. Lots about distribution, but that’s part of the business of beer.

And he also talked the importance of “where.”

“We are local, we are in Seattle. An import can’t be from Seattle, they can’t,” he said.

So if Magic Hat is brewed in Berkeley and sold in Berkeley is it a local beer or a Vermont beer? And which will Californians want?

I don’t know.

Monday morning musing: Grading on a curve?

To jump start your brain this morning: Two beer posts and a wine link that provoked one of the posts.

Stephen Beaumont on Great Beer vs. Popular Beer.

The number one beer in the United States, for example, is Bud Light, a pale lager with, frankly, some complexity of character, but a flavour profile so that thin it’s almost unnoticeable. This is the choice of the general public, and the general public is well served by it. I am not. I prefer more flavour, more aroma, greater depths and complexities of character and a more notable and lingering aftertaste, and I prefer those general traits in any beer I drink, under any set of circumstances.

Jeff Holt at Wort’s Going on Here? wonders why not a single American macro can get a decent score at the beer rating sites.

So, Corona versus Landshark? On both sites, both beers are rated as “To be Avoided.” Say you are stuck in a resort in Mexico that doesn’t have a beer above 8% ABV, as the top 12 beers on the Beer Advocate list of the top beers. So you can only choose between ten or twelve “D-” beers?

There’s something fundamentally flawed about these beer ratings. Are you telling me that sitting under a Live Oak Tree on a hot, Texas July day a Trappist Westvleteren 12 is better than a cold Budweiser?

And from Eric Asimov of the New York Times, whose notes about the upcoming book “The Wine Trials” provide Beaumont with a starting point. (You’ll want to click over for the entertaining comments &#151 wine people get snippy in such an amusing way.)

In the end, the book seems to divide wine consumers into the casual buyers who are pushed this way and that by forces they don’t understand, and the wealthy conspicuous status seekers who also are not quite aware of capitalism and marketing. Unacknowledged are the serious wine lovers who are knowledgeable, experimental and passionate, and who, yes, are in control of their own destinies.

Perhaps we should be happy beer doesn’t “merit” such serious academic study.