Perhaps it’s because stories about how beer is made and the people who make it are so interesting but if mosey on over to Rate Beer or Beer Advocate you’ll find plenty of enthusiasts discussing the business of beer. Quite often pricing, to the understandable chagrin of brewers since some participants don’t bother with facts.
In that spirit a couple of links this morning.
First, from Neal Stewart, ex of Flying Dog Ales and before that central to the revival of the Pabst brand: 10 Key Ingredients for Craft Beer Success.
Second, from Harry Schumacher of Beer Business Daily: Beer Veterans Speak On Big and Small Brands. (The second link courtesy of Jack Curtin.)
One quick quote, from JB Shireman, formerly in sales at New Belgium brewing and now a bar owner in Fort Collins, Colorado: “Bud Light Golden Wheat has been on fire. The other day there were six totally different types of customers in the bar, and all were drinking Golden Wheat. I don’t know if mega-brand strategy is a good or a bad thing, but if they’re trading Bud Light drinkers up to Golden Wheat, at least they’re drinking higher priced beers. It’s across the board: The young guys who were drinking Bud Light on tap are drinking it, the ladies who normally drink margaritas are trying it, two guys playing darts, even bikers are drinking it, but they’re the type of bikers who trailer their bikes to Sturgis and wear Rolexes.”
There’s an image for a Tuesday morning.
“…Quite often pricing, to the understandable chagrin of brewers since some participants don’t bother with facts…”
I take it that the reverse is also true as I have seen statements about price from brewers that would make a enterprise software salesman on commission blush.
I was thinking about a recent discussion – which I couldn’t find with a quick look this morning – in which a participant explained he thought the bourbon barrel version of Old Rasputin was overpriced because the regular version cost less than from many other breweries.
So to justify a higher price for the bourbon barrel should they raise the price of the regular version ($8.99 a 4-pack in our parts)?
Hmm… Isn’t that price informed by the volume that Old Rasp’ regular would carry compared to other smaller micros? What is the reason that X+barrel is not less than Y+barrel where X<Y?
I still, however, do not believe the price inputs have been well enough explained and sympathize with the purchaser. One can only bother with the facts when the facts are provided. When I found out that corked 750 ml bottles can add 2.00 to the retail cost, I was dumbfounded as to why anyone would use them who is not seeking to fake the price up to create exclusivity.
Craft beer is serious business. Thanks for the post, Stan. These are the gems us start-up folks look forward to reading.
Thanks for posting a link to my thoughts, Stan.
And I gotta say that I’m really surprised about the Bud Light Golden Wheat observations. As always, sustainability is the question, but it does seem like Bud Light Lime is going to be around for a while and maybe BL Golden Wheat has some legs. But But Light core brand’s numbers were negative in October. Maybe consumers are just sick of light beer with no taste?
I talked to one Bud Light drinker who finishes off the evening with Bud Light Lime because of the refreshing/drinkability factor.
Just reporting what I was told.