Magnolia Pub & Brewery on Haight Street in San Francisco will be celebrating their 10th anniversary next Monday in grand fashion at the Great American Music Hall. On November 5th they will host a concert for a mere 20 bucks with all manner of cool stuff going on with many surprises planned. It looks like it should be a great time.
Okay, it’s not exactly a full-blown apology, but the words “for that we apologize” do appear in a statement released today by the Boston Beer Co. regarding what they characterize as “clarification” of “what really happened in Portland, Oregon.”
The statement begins:
The Boston Beer Company, brewer of Samuel Adams Boston Lager, wishes Portland City Commissioner Sam Adams the best of luck in his pursuit of higher office. And guess what – Samuel Adams Beer has in no way ever suggested that Sam Adams the candidate cannot use his own name. But, according to recent stories in the media, it sure hasn’t looked that way.
Which I guess is their way of saying Intellectual Property Manager Helen Bornemann never said “she’s willing to discuss Adams’ use of his name on his Web sites “probably for the length of the time the election is being held,” as was reported by the Associated Press. It sure looks like a direct quote. It would nice to have a more definitive answer about that statement, because frankly that’s the one that stuck in my craw. She either said it or she didn’t. Which is it?
Boston Beer continues:
A little history: last week The Boston Beer Company learned that an individual named Dave Anderson of Portland, Oregon had registered two domain names that featured the name Sam Adams. Not knowing his intent, we sent him a letter asking him not to use these sites. Next thing we knew, we had a call from the legal department at broadcasting conglomerate, Clear Channel, at which point we learned that Dave Anderson is a DJ at Clear Channel’s KEX radio and that a man named Sam Adams was indeed running for Mayor of Portland. We wish we had learned a little more about Portland’s race for mayor before sending out that initial letter, and for that we apologize.
Notice how in the statement they use the passive phrase “asking him not to use these sites.” Reread the original letter again and see if that sounds like they’re just “asking?”
The only thing they really admit to in the letter is that they “wish [they] had learned a little more about Portland’s race for mayor before sending out that initial letter.” Amen, that is the problem in a nutshell. And that’s the only thing they’re apologizing for, that they wish they’d “learned a little more.” I hate to keep beating a dead horse, especially over a company I generally like a great deal, but that sure seems like a pretty half-hearted apology. Notice that they’re not actually apologizing for sending the letter, making threats or not using a more measured approach or even for Bornemann’s statement that “she’s willing to discuss Adams’ use of his name on his Web sites ‘probably for the length of the time the election is being held.'”
They go on to say that they reacted so swiftly because they’ve had bad experiences in the past and characterize themselves as “a small company.” Technically that’s correct because the federal standard for a brewery business to qualify as a small business it must have less than 500 employees. According to Google Finance, Boston Beer has approximately 433. Certainly they’re smaller than Anheuser-Busch, Miller, Coors and even Pabst, but with total revenues last year exceeding $285 million they are the biggest microbrewery in the country, and by a pretty wide margin. The next closest brewery is Yuengling, and while they’re privately held so I don’t know their revenue, I do know they have only 185 employees and are not distributed nationwide. With numbers so much larger than a majority of their peers, calling them small seems a little hard to swallow. I doubt they talk about themselves that way to investors. But if you’re trying to garner a little sympathy, the underdog card is always a good one to play.
They go on to explain their actions:
Why did we ask Clear Channel and Dave Anderson not to use those domain names? In the past we have experienced times when individuals and organizations have tried to use our brand name for commercial purposes or to disparage our good name. We have learned that, as a small company, we need to protect our identity. At the least we wanted to prevent a situation where people looking for our Web site end up linked to a radio station promotional site.
On the other hand, there have been occasions over the years when individuals actually named “Sam Adams” have registered domain names that included the words Sam Adams, and we have had no quarrel with that.
Those are, of course, all legitimate reasons and any company should protect its intellectual property. But as they say, a spoonful of sugar helps the medicine go down. When you use a bludgeon, you should expect things might go awry. Would it have mattered if Bornemann had waited another day or even a few hours to send the letter, giving her ample time to figure out the true nature of the situation she was facing? Would such a modest delay have weakened her case? Could she not have called her company’s local field representatives and/or the distributors of Samuel Adams beer working in the Portland area soliciting what they knew? Could she not have looked up the website of the radio station or the name “Sam Adams” along with the modifier “mayor?” I think any of these actions might have been quite revealing and saved her company much grief.
But there’s one more thing I think would make all of this go away, and that’s perhaps the hardest thing for any modern company or person, for that matter, to do: and that would be giving an unqualified apology or just saying a blanket “I’m sorry.” I’m not sure why that’s so difficult for people these days, but it does seem spin always gets in the way. You almost never hear people just simply say they’re sorry. Instead they “regret,” or “wish it had been different” or some other similar device so it sounds like they’re apologizing without actually doing so. There’s a great phrase used in a song by one of my favorite songwriter/singers, John Wesley Harding, and the line is “naked as a true apology.” And I think that nicely captures people’s feelings today about apologizing, that it somehow makes them vulnerable or open to attack. But sometimes it really is the best thing to do, right or wrong. I’ll even start the ball rolling. To all of the people I’ve met over the years and who are my friends at the Boston Beer Co., I’m sorry for having been so hard on the company over the last couple of days.
ABC News has a mildly amusing photo gallery up, one each from the top ten beer drinking countries.
From the number one country, China, a beer drinking contest during the Qingdao International Beer Festival in Qingdao.
I just got word that the Wet Hop Festival originally scheduled to take place this weekend at Tom Nickel’s place, O’Brien’s Pub, in San Diego, California has been postponed one week due to the fires raging through southern California.
From the press release:
I am going to postpone the Wet Hop Festival until next weekend, November 2nd, 3rd and 4th. I will have some wet hop beers on tap this weekend. Right now we have several from Sierra Nevada including Harvest Ale, 20th Street Fresh Hop Ale and the ESP — Extra Special Pale, which is the pale ale with wet hops added. I should also have the Port Brewing High Tide IPA on tap this weekend. I am still expecting about 25 beers for next weekend and we will have the Harvest and Riptide casks on tap on Friday, November 2nd.
Other word on the street is both Stone Brewing and Ballast Point are open again after being evacuated earlier this week.
I want to be clear from the start. There are people who have been bashing the Boston Beer Co. for a long time for a variety of reasons. I’m not one of those people. I like Jim Koch and think he’s done more good than harm to promote better beer to an ever-widening audience of consumers. I think Samuel Adams Boston Lager is a fine-tasting, if somewhat unremarkable, beer. When choices are thin, I’ll happily drink one, which is something I won’t do with several other high-profile popular beer brands. And the specialty beers Jim has made include some really terrific beers that have truly stretched the imagination and the very definition of what beer is.
That being said, I think Jim Koch is getting some awfully bad advice. First there was the ill-conceived radio talk show stunt that Boston Beer was involved with which challenged a couple to have sex in a church. Many were not amused — though personally I could have cared less — and there was some public relations fallout from the incident. Now there’s a new flap that’s not doing Jim Koch any favors and I think the blame rests squarely with his advisors and their poor handling of it.
The story concerns Portland, Oregon’s new candidate for mayor: Sam Adams. No, not the long-dead patriot and signer of the Declaration of Independence. And not the historical brewer personage that the Boston Beer Co. appropriated for their own use in 1984. No, this Sam Adams has been around since 1963, or at least 21 years before the beer brand was trademarked. This Sam Adams is running for the mayor of beertown, Portland, Oregon. When current mayor, Tom Potter, who’s led the Oregon Brewers Festival Parade two years in a row, announced he would not be running again, popular City Commissioner Adams stepped up and announced his candidacy to be the city’s next mayor.
Two DJs from KEX News Radio 1190 in Portland, Dave Anderson and Mark Mason, registered the domain names www.samadamsformayor.com and www.mayorsamadams.com on behalf of the candidate and promised to give them to Adams provided he went on their show to discuss politics, which he subsequently did.
In the meantime, Boston Beer’s Intellectual Property Manager, Helen Bornemann, got wind of the web addresses and fired off a boilerplate cease and desist letter without, apparently, doing any research whatsoever or even picking up a phone to ask anyone about the domain names. I’m no lawyer, though I did work in a law office for eight years and I’m also married to one, but that strikes me as a pretty sloppy way to react. I know IP is something companies take very seriously and often vigorously protect, but a little fact-checking might have gone a long way toward keeping them from placing their foot so deeply in their mouth. The letter is up on the radio station’s website for all the world to see.
In the letter, she announced that they’ve been using the trademarks since 1984, to which the bemused mayoral candidate quipped. “I’ve been using it since 1963.” But Sam Adams the candidate is also concerned and his staff is talking with attorneys, too. Adams is already using the campaign slogan “Sam Adams for Portland Mayor” on his own website and it will likely appear on signs and bumper stickers. too.
According to an AP story, “Boston Beer’s Helen Bornemann said she didn’t know there was a real Sam Adams running for mayor when she sent the letter.” But she sent it anyway without bothering to find out. To me that’s a bully’s arrogance. It’s saying I must be right and you have to prove me wrong … or else. She further tries to excuse her behavior by claiming that “she feared someone was copying the advertisements” that Boston Beer Co. ran years ago, a marketing campaign called “Sam Adams for President.” Feared, but again didn’t try to find out any facts to support those fears.
So okay, she made a mistake. I could almost excuse her behavior up to this point as being over zealous in trying to protect her client’s or her company’s interests (it’s not clear if she’s a lawyer but if not she’s clearly consulted with one and cites specific law in her letter to the radio DJs). But then she pours gasoline on the fire with this statement, again from the AP story. “Bornemann said she’s willing to discuss Adams’ use of his name on his Web sites ‘probably for the length of the time the election is being held.'”
Oh, really. She’s “willing,” is she, to talk about whether Sam Adams should be allowed to use his own freaking name in his own campaign website as he runs for mayor of a prominent American city? How magnanimous. How insulting. Oh, and after the election she may not allow him to be able to continue using his own name? This is an excellent example of how to get yourself some very negative PR. I don’t think it’s even about a strict interpretation of law, it comes down to how the public — your potential customers — view your actions. And the city of Portland is not amused.
If you didn’t know, the state of Oregon has already had a somewhat tenuous relationship with the Boston Beer Co., ever since they had another contract brand that they marketed under the name Oregon Beer Co. in the mid-1990s To be fair, I really liked the Blackberry Porter they made, but Oregonians were not particularly thrilled with having their own beer prestige co-opted by a beer that — and somebody correct me if I’m not remembering this correctly — wasn’t even brewed in Oregon. Boston Beer had, of course, a legal right to use the name but it struck many people at the time as somewhat dishonest.
There’s already a backlash and calls to boycott Samuel Adams beer over this latest gaffe. In addition to the AP story that’s been picked up all over the place, such as in the Washington Post, there’s also been local coverage in the Oregonian and Willamette Week. Naturally, it’s Portland bloggers who are setting the tone and calling for boycotts, such as Rusty’s Blog, who’s following it day by day. Today, for example, his post is called Sam Adams Post, Day 3. Others include Beervana, Blue Oregon, The Champagne of Blogs, Jack Bog’s Blog, Metroblogging Portland, Witigonen and the ZehnKatzen Times. But my favorite take on all this is from Isaac Laquedem’s blog, who advances the novel theory that Boston Beer Co. may be in violation of local election laws (as set forth in ORS 260.695). The way the election laws are written it’s possible to interpret them so that if they continue to sell the Samuel Adams brand people could confuse the bottles as a political endorsement for the candidate. Hilarious.
I think when all the dust settles, this will be remembered and perhaps even taught in business schools as a stellar example of how and why not to react to a potential IP threat in a kneejerk fashion. Yes, Bornemann will cling to the excuse that she was just doing her job and perhaps she even has a leg to stand on, legal-wise (though I sort of doubt it), but had she exercised even a modicum of common sense and tried to learn something about the true nature of what she perceived as a threat to her company’s trademark, she could have avoided creating a PR nightmare that will doubtless continue to haunt her company for years to come, especially in Portland, Oregon and the Pacific Northwest. How much ill will has been created and how much business will Boston Beer ultimately lose over that simple failure to investigate and the bullying tactics of their IP Manager? Obviously, that’s hard to say, but I wouldn’t want to be in her shoes come performance review time.
UPDATE: Yesterday the Wall Street Journal Law Blog dubbed this issue the Trademark Dispute Of the Day: Sam Adams v. Sam Adams. Apparently they’ve received a call from a spokeswoman for Boston Beer claiming “they never had an issue with the mayoral candidate using his name but they do have an issue with the radio station using Sam Adams for its own business purposes.” Hmm. That’s new. Sounds like revisionist backpedaling to me. Let’s not forget that Boston Beer’s IP Manager, Helen “Bornemann said she’s willing to discuss Adams’ use of his name on his Web sites ‘probably for the length of the time the election is being held.'” That certainly goes beyond the scope of merely having an “issue with the radio station using Sam Adams for its own business purposes.” And while we’re at it, what exactly would be the “business purposes” that Boston Beer is so worried about? Given that the word “mayor” is in both domain names and there really is a person named “Sam Adams” who’s running for and quite possibly will be elected mayor (and I’ve got to believe all this publicity will give Adams a big assist in getting votes) it’s hard for me to understand their concerns. Wouldn’t a reasonable person conclude that the first domain name would be used by the mayoral candidate and the second by mayor Adams (assuming he’s elected) and not for any nefarious “business purposes.”
Eric Asimov had another great beer piece yesterday at The Pour, this one was an overview on cask-conditioned beers. Personally, if I have a choice I always go with the cask version. In fact last night while out with some old high school buddies, I enjoyed Sara’s Ruby Mild on cask at Magnolia and later Moonlight’s Sublimmminal at the Toronado. Yum.
And here’s some general information on casks.
The parts of a beer barrel.
Cask Sizes:
A Bulletin fan (thanks Jim) sent me this link to a an article by Jascha Hoffman in the New York Times, in fact it was from the Magazine section’s Idea Lab this past Sunday and was titled Criminal Element. It’s a very interesting and provocative read, especially if, like me, you’re a fan of economic theory and the kind of oddball ways economics can be used in new ways, in the mold of the recent book Freakonomics. It centers on an idea by Jessica Wolpaw Reyes, an economist at Amherst College, that eliminating the lead from gasoline caused crime rates to fall in the 1990s.
Reyes found that the rise and fall of lead-exposure rates seemed to match the arc of violent crime, but with a 20-year lag — just long enough for children exposed to the highest levels of lead in 1973 to reach their most violence-prone years in the early ’90s, when crime rates hit their peak.
Such a correlation does not prove that lead had any effect on crime levels. But in an article published this month in the B.E. Journal of Economic Analysis and Policy, Reyes uses small variations in the lead content of gasoline from state to state to strengthen her argument. If other possible sources of crime like beer consumption and unemployment had remained constant, she estimates, the switch to unleaded gas alone would have caused the rate of violent crime to fall by more than half over the 1990s.
What an interesting theory that …. hey, wait a minute. What was that? “[O]ther possible sources of crime like beer consumption!?!” WTF! Since when did drinking beer become a source of crime? Where are those statistics? I’ve heard of hardcore heroin addiction leading to crime to support a drug habit, but beer? I don’t think so. If anybody out there has access to more than just the abstract of the article I’d love to run down where she got this idea. All I can find is that “beer consumption” is one of eleven “state-level variables” listed in the article’s appendix and that the information on “Beer consumption is from the Brewers Almanacs, published by the Beer Institute. It is measured as consumption of malt beverages in gallons consumed per capita.” But how does mere consumption lead to crime? Curiously, there’s no mention of spirits or wine consumption leading to crime, just beer, despite the fact that hard liquor was a permanent fixture at every high school and college party I ever attended. Has the demonization of beer just become so internalized and taken for granted that academia doesn’t even need to justify it? Frankly, I’m flummoxed. Am I missing something or just over-reacting as I’m so often accused? I’ve never resorted to crime to support my beer habit? How about you?
I happened upon this cool bit of history while searching for some images the other day. It’s the Museum of Anti-Alcohol Posters, a collection of old Soviet propaganda posters on the evils of drinking. There are more then thirty of them here, with translations. What struck me most in looking through them is that they’re really not all that different from the propaganda used by neo-prohibitionists working today in the United States. It’s the same sort of sensationalist nonsense with little basis in facts. But it’s somewhat comforting to know that propaganda is propaganda, no matter where it came from, and they are sort of fun to see. Enjoy.
Translation: “Rich inner substance.”
Translation: “Profiteer is a worst enemy.”
I happened upon this item from across the pond at Zythophile, who appears to be a soul mate when it comes to disliking neo-prohibitionists and their attendant propaganda. The UK’s Times Online made a rather startling, if not altogether surprising, revelation that the Department of Health in Great Britain, in defining what it means to be a “hazardous drinker” in 1987 did so by essentially just making it up and pulling the numbers out of thin air. I’ll let that sink in. As the Times’ article puts it, the “guidelines have no basis in science. Rather, in the words of a member of the committee that drew them up, they were simply ‘plucked out of the air’.” The twenty year-old standards by the Royal College of Physicians set “safe limits” at 21 units of alcohol a week for a man and 14 for a woman, apparently without regard to weight so far as I can tell. Britain defines one unit of alcohol as “8 grams of pure ethanol.”
In the article, a doctor involved in creating the standard, reminisces:
Richard Smith, the former editor of the British Medical Journal and a member of the college’s working party on alcohol, told The Times yesterday that the figures were not based on any clear evidence. He remembers “rather vividly” what happened when the discussion came round to whether the group should recommend safe limits for men and women.
“David Barker was the epidemiologist on the committee and his line was that ‘We don’t really have any decent data whatsoever. It’s impossible to say what’s safe and what isn’t’.
“And other people said, ‘Well, that’s not much use. If somebody comes to see you and says ‘What can I safely drink?’, you can’t say ‘Well, we’ve no evidence. Come back in 20 years and we’ll let you know’. So the feeling was that we ought to come up with something. So those limits were really plucked out of the air. They weren’t really based on any firm evidence at all. It was a sort of intelligent guess by a committee.”
Well how scientific. And I’d think all well and good if it were just a guideline, some advice to tell a patient. But, of course, that’s not how the government used these numbers. They instead not only endorsed the numbers — and indeed why shouldn’t they having come from a supposedly reputable health organization — they essentially set them in stone, terrorizing citizens with them the same way America’s health bureaucracy does likewise by defining binge drinking at a ridiculous “five or more drinks in a row.”
Not only that, but they continued to cling to the numbers as gospel, despite numerous subsequent studies that contradicted those numbers. For example, here are the results of a 2000 study by the World Health Organization:
The WHO’s International Guide for Monitoring Alcohol Consumption and Related Harm set out drinking ranges that qualified people as being at low, medium or high-risk of chronic alcohol-related harm. For men, less than 35 weekly units was low-risk, 36-52.5 was medium-risk and above 53 was high-risk. Women were low-risk below 17.5 units, medium between 18 and 35 and high above 36.
Government bureaucracy has a habit of becoming entrenched even in the face of contrary evidence. At least one blogger I respect sees this as no big deal, that everyone simply knew the numbers were made up. Perhaps I wouldn’t be so bothered by that if I didn’t strongly believe my own government, in collusion with Big Pharma and much of the guilt-ridden medical community, has been lying — and continues to lie — to my face about my own son Porter’s autism. I think it’s a mistake to take lying so cavalierly, especially when it comes from an area of society that we’re conditioned to place great trust in: the medical community. The Hippocratic Oath was undoubtedly a good start, but the more I learn about the way doctors, their protectionist professional groups, along with medical insurers, pharmaceutical companies, hospital administrators and the like manipulate patients and society at large for their own purposes, the more that oath seems hypocritical and largely an anachronism in our modern world that medical science seems quick to ignore whenever it doesn’t suit them.
I think it’s precisely because people tend to trust doctors and so-called medical science that they often can’t conceive of it being used as propaganda or to support an extreme agenda. And that’s why I find this sort of lying so dangerous. We may take for granted that our government will lie to us or that people trying to persuade us of something might do likewise, but I don’t see how that makes it acceptable or something we shouldn’t get worked up about. Have we really all been lied to so much that we no longer recognize it? That it becomes acceptable if it’s for our own good? I can see how telling a fib to a child to keep him or her safe as a temporary solution has some merit, but if we don’t fess up when they get older, that’s an entirely different matter. Though personally, I think nowadays we overprotect children and go too far in trying to keep them from experiencing any adversity. As a result, they are incapable of dealing with even the smallest slight as young adults. This also makes it easier for our own government to continue becoming more and more paternalistic as each successive generation becomes increasingly comfortable with being told what to think and within what narrow range is acceptable. We’re all adults and yet more and more governments treat their citizens like children to be taken care of instead of allowing everyone to have a real say in decisions made on our behalf. That’s a classic example of a slippery slope. If you accept one lie because you believe it’s for your own good, then it becomes easier for you to accept the next one, and the next one after that, etcetera. I find this whole subject fascinating, and if you want to read more about it, I recommend Lying: Moral Choice in Public and Private Life, by Sissela Bok, and The Liar’s Tale, A History of Falsehood, by Jeremy Campbell.
As usual, I’ve veered off on a tangent, so let’s hear from another British doctor who also conveniently believes that the specific limits are superfluous.
Christopher Record, a liver-disease specialist at Newcastle University, suggested that “it doesn’t really matter what the limits are”. “What we do know is, the more you drink, the greater the risk. The trouble is that we all have different genes. Some people can drink considerably more than [the limits] and they won’t get into any trouble.”
Well that doesn’t mean it doesn’t matter. That means using a standard that doesn’t work is useless and counter-productive for predicting how a person will react to a given amount of alcohol. And if government continually uses false statistics to manage its population, it does them great harm, both psychologically and possibly physically. It would be one thing if for the last twenty years health officials told people that drinking too much had dire consequences and advocated that people take care in that regard. That would be quite sensible and without question in the public interest. But that’s not what the health agencies did. Instead, they made up a number and told people not to drink more than this amount or there would be dire health consequences, knowing full well that the the levels they set had no basis in science whatsoever.
I’m confident that our own definition of binge drinking had a similarly unscientific genesis and I know how that definition has been used to skew statistics toward a specific agenda by neo-prohibitionists. I would be shocked to learn that our British cousins never did likewise. When you officially and purposely set what it means to be a heavy drinker at a level you know to be too low, you can claim with a straight face that there are many more alcoholics plaguing society than there really are. Armed with these false statistics, committed anti-alcohol organizations can do a lot of harm to society.
I’m not entirely sure why governments tend to embrace neo-prohibitionist agendas, but Zythophile’s hypothesis bears examining.
My personal guess is that too many politicians — and members of public health committees — are in the game because they want to control others, and they associate drinking with loss of control, and therefore want to stop it: except they know, after the failure of prohibition in the United States, that stopping people drinking is impossible, and so they try to make us feel as guilty as possible about one of life’s best pleasures.
But whether they meant well or were being maliciously manipulative, this sort of lying by those entrusted with the public health is pretty hard to swallow.
On Friday, the New York Times ran an editorial by Garrett Oliver entitled Don’t Fear Big Beer. Oliver is the brewmaster at Brooklyn Brewery as well as the author of the seminal book on beer and food, The Brewmaster’s Table. I have a lot of respect for Garrett’s opinions, generally, and he makes some good points here, too. I certainly agree with him when he announces that “today the United States has by far the most exciting beer culture in the world.”
And I love his suggestion that the craft brewing segment has shed its “fad” status after nearly thirty years of ups and downs to emerge as a mature, stable part of the beer industry, or in Oliver’s words — “a welcome return to normality.” Historically, that makes sense. For most of the years since Europeans washed up on America’s shores, the small and regional brewery held sway. It’s only been since the rise of our big, national corporate society that things have gotten so out of whack. The consolidation of countless industries has been bad for everybody, except of course the big corporations and their shareholders, over the last fifty plus years. When I graduated from high school — ahem, thirty years ago — there were only 40 or so breweries left in the entire nation and it looked like the industry was doomed to make insipid caricatures of European lagers in perpetuity.
Then a few things happened. Airfare got cheaper and more people started traveling, discovering diverse beers all over the map. Based on this new demand, a number of the larger import brands started selling their beer in larger U.S. cities. This was the setting where I personally discovered better beer, haunting small jazz clubs throughout New York City that were serving Bass Ale, Guinness and Pilsner Urquell. Then there was homebrewing, which came up and out from the underground, when Jimmy Carter signed a federal law decriminalizing it in 1978. Those three changes to 1970s society, along with others I’m sure I’m forgetting, conspired to create a backlash among a small but thirsty minority who wanted beer that tasted of something more than the watery concoctions the big brewers were — and still are — passing off as beer. Thanks to those cranky few who wouldn’t settle for the beer landscape as it was, the microbrewery revolution forever changed what was possible and as a result, today the diversity of great beer available here in the states is better than anywhere else on Earth. The fact that this was accomplished in the face of an advertising and marketing blitzkrieg sending the opposite message about what beer is makes it all the more remarkable. Their success seems to have prefigured similar returns to quality local and regional renaissances in all manner of goods, such as coffee, bread, cheese, chocolates and organic food generally.
Is “[t]he age of American industrial brewing,” as Garret teases, “over”? Not today, certainly. Even Garrett knows that “it’s not going away tomorrow” but I absolutely love his notion that “there is no future in it.” On a level playing field, I think things would indeed run their course fairly quickly, in perhaps a generation, with flavorful beers gaining the upper hand among anyone taking the time to think about their choices and learn something about what they’re drinking. Unfortunately, real life is nothing like that. Large corporations have almost all the resources, not to mention the ear of a political system that knows that helping the status quo keeps them in office. They’re not going gentle into that good night without a fight. And, sadly, I think they have enough of an advantage that they could hang on a good long time absent a social and economic revolution. Government tends to bail out big corporations and lets small ones die every single day. Which is not to imply Garrett doesn’t know that, but he’s decided to accentuate the positive, certainly a laudable approach.
Oliver ends his editorial with some truly inspiring words:
If we truly want to restore the vibrant beer culture that flourished in this country before Prohibition, craft brewers need to retain the values and goals — creating beers that are flavorful, interesting to drink and made from proper beer ingredients — that put us on the map in the first place. Let’s not undo American beer again.
I wish I could be that sunny and optimistic. I think what he says, while correct, is not really the problem faced by small breweries. Oliver seems to imply that craft brewers hold the keys to their own success and that all they need do is stay true to themselves, that simply making a great product is enough to guarantee continued growth. Maybe I’m mis-reading that, but it seems far more complicated to me, and it ignores the fact that the big brewers will not give up their own hard won market share easily.
That’s why I think Garrett is overlooking something when he says “America’s 1,500 craft brewers are undaunted by the prospect of a juggernaut that would have 30 percent of the domestic market” and that “MillerCoors is not a threat to craft brewers.” He ties that last statement to over expansion, and while that has been a problem for many small brewers trying to grow too quickly, it’s not really the reason Miller or Coors are combining their efforts to challenge Anheuser-Busch’s market dominance. I think craft brewers should feel a bit more daunt about that task. There is a problem that 95% of the market believes the beer they drink is good enough and are either too busy or too ignorant to know the difference. That’s a real problem.
But the more proper question is whether Miller and Coors separately or MillerCoors together makes that problem any different. I’ve been giving this a lot of thought since I first heard the news the morning I arrived in Denver for GABF last week, trying to figure out what it will mean for the marketplace, and especially for the smaller players. I can’t help but think this will change the nature of distribution, especially in smaller markets. All over the place in the last decade, we started seeing markets with three distributors (with each having one of the three big brewers in their portfolio) consolidate down to two, with one Bud house and the other carrying both Coors and Miller. And while I suspect neither Coors nor Miller was particularly thrilled to have to share the spotlight, for distributors it was a boon. But two distributors usually means less places for small brewers to find someone to carry their beer and sell it to retailers, bars and restaurants. If that spreads to larger cities, it would certainly reduce the choices available to a small brewer. In Bud houses that are owned by A-B (where that’s legal) or ones that tow the 100% share of mind that leaves a small brewer with a choice of exactly one, not really a choice at all. San Francisco is like that, to some extent. Cal Bev went out of business five or so years ago, leaving Golden Brands — now called DBI Beverage Distributors (with Miller and Coors) and Matagrano (with Bud). In the City by the Bay, at least two independent distributors, that is ones without a big flagship brand, also bring smaller brands to market, but that’s not the case in many other places.
Will that continue to happen with the consolidation of the two major brands? No one can say for sure, of course, but it certainly seems logical that we’ll begin to see more two-distributor territories in the near future. And that I think could be very bad for some small brewers, especially the ones without the resources to hire a field representative to work with the distributors in markets outside their home. The regional breweries, which are already fueling most of the craft beer segment’s growth, should have no problem keeping a distributor, but it could be problematic for the smaller, more local breweries. It may also make it more difficult for cusp breweries just on the verge of growing larger. With only two distributors to choose from (and effectively one in some places), instead of three, it seems likely some breweries will have a hard time finding a home to sell their wares and that this could effectively keep some breweries from expanding their business.
Also, it seems to me the prices wars among the big three will not go away in a reconfigured landscape of the big two. Those price wars have kept beer prices artificially low for quite some time, and that has also made it difficult for craft brewers to charge a more premium price for their beer, even though it’s warranted. The recent scarcity of barley and hops and the attendant price hikes that will now finally have to be taken will only increase the gap between the big brands and the craft brands, especially if the big two go head to head (which seems likely, doesn’t it?). It’s my feeling that makes it harder to persuade people to trade up to better beer. So while it may be too early to tell if any of this will indeed have an effect on the beer industry generally, it seems foolish to carry on and just assume it won’t.
Perhaps Oliver is correct with his advice not to be afraid, but we can’t ignore them either. Just as they respond to gains by the craft segment and view us a threat to their market share, we have to protect our more modest gains just as vigorously. To me, that’s how we lay to rest the age of American industrial brewing. It’s not merely enough to make a more flavorful product that people want, we also have to work together as a united front. That’s the real lesson of the MillerCoors merger. The two small giants finally realized that fighting each other for number two was a fool’s game and did nothing but help number one. The craft segment, for all its collegial atmosphere, does include ugly examples of infighting for a larger share of our tiny slice of the pie. The only way we win this fight, is if we all win this fight. Not even the largest craft brewer can come close to being anything but a speck of a David to the Goliaths of our industry. It’s only together as an idea and as a movement that we register at all. That’s our strength, that we’re everywhere all at once, a many tentacled benevolent beast. Cut off one, and there are still 1,499 more left to fight the fight. But we must work together to have any effect at all. Can I get an Amen, brewer?
NOTE: Stan sent me two links to posts where my friend and colleague Maureen Ogle has also addressed this issue, the first, Pondering the Fear of Beer, and the second, Pondering Beer’s Future, both address questions raided by Garrett Oliver’s NY Times op-ed piece. Thanks Stan.