Brookston Beer Bulletin

Jay R. Brooks on Beer

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Beer Prices By Football Stadium

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nfl
Given the NFL owner’s wanton disregard for their fans with the labor dispute debacle earlier this year, I’ve been paying much less attention to the football season. I check in to see if my beloved Packers have won, but that’s about it. For a number of years now — since I’ve had kids — I rarely go to a live game, usually because it’s such a time-consuming hassle and so expensive, in part because there’s four of us so costs rise exponentially. That’s especially true when it comes to beer, if you can even find anything worth drinking.

To help find a better deal, and to prove my point, Save on Brew looked at beer prices at the 32 NFL stadiums in a post entitled the 2012 – 2013 NFL Stadium Beer Price Infographic.

SOB-2012-2013-nfl-stadium-prices

Here’s what they found:

Going to the game? It’s gonna cost you. According to FanCostExperience.Com (and the source for our stadium data), prices are rising across the sport. The average beer is up 15 cents from last year at $7.28. In this economy, every cent counts.

Rounding out the price-assault on the American public, the average NFL ticket is $78.38 (that’s a regular ticket, the “premium ticket” average is $243.70), a soft drink is $4.57, a ‘dog is $4.84, parking is $27.35, a program is $4.06, and a cap celebrating your favorite team will set you back $21.38 (on average) and, of course, a few of those $7.28 beers adds up pretty fast. In fact, a family of 4 will spend, on average, $443.93.

So wow, that’s even more expensive than I’d thought. That makes movie theater food and drink look like an absolute bargain. I guess they need to make that much profit so they can pay the referees. I feel so sorry for the owners, that they must be struggling so much that they need to charge close to six times the retail price for a beer. Because if the average price for a beer at an NFL stadium is $7.28 for 17 oz., that’s 42.8 cents per ounce! That works out to be about $5.14 for 12 ounces. A six-pack of Bud Light at my local BevMo costs $5.79, making it pretty close to six times the price. Now that’s gouging.

For a mainstream craft beer it’s almost as bad. A six-pack of Sierra Nevada Pale Ale costs $8.99 at BevMo, meaning 12 ounces of pale ale will cost you more than half of the price of an entire six-pack outside the stadium.

Notice the average cost for a family of four? $444! Seriously, how many people can afford that on a regular basis? Another similar survey of NFL prices on Visual.ly, entitled The Real Cost of Attending a Game, likewise concluded that the average cost to a family of four is $427.42. In that survey, they found the average price for a small beer to be $7.13, a pretty similar result. Given how much money the owners make, it it really reasonable to charge so much for tickets and other concessions at the game? I understand that in some sense they’re market prices. There are enough people willing to pay that much, and many games are sold out or nearly so. But does that make it right? Especially when owners complain they can’t afford to pay the refs. Every few years they fleece the community in which they live, threatening to move the team if they’re not given free money, or at least tax relief, to build a new stadium they probably don’t need. Don’t believe that? Read Field of Schemes.

It’s really a shame. I love the game. I like watching the games, cheering on my favorite team, especially with my son. I know it’s a business. I get that. But sports is really a part of the entertainment industry, so it’s not exactly like other businesses. As the recent strikes in baseball, basketball and football have shown, team owners really seem to believe that the people who consume their products — the fans — don’t matter all that much. But they could ease up on the beer prices and still make a healthy profit. That’s a decision I could drink to.

the-real-cost-of-attending-a-football-game

Beer Bouncing Back

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bouncingball
Nielsen, the company that tracks all things trackable, is speculating on their NelsonWire that beer is bouncing back and that this may signal the “beginning of a beer boom.” According to their data, “Beer sales are seeing a surge in growth, up 5 million cases (1.4 percent) in the last 12 weeks through September 1, 2012, in Nielsen-measured retail outlets. The same period last year saw a decline of 1.7 million cases.”

Total-Beer1k-2012

The main reason they cite for this is choice.

With more options on shelves and innovative product offerings, new consumers were attracted to the beer category. Nearly half of the households who were new to malt, or cider-based beverages (beer, flavored malt beverages and cider) in the past six months had bridged over from solely buying wine or spirits last year.

But as they’re focused to a greater extent on the bigger players in the category, they mean choice in a different way than you and I normally understand it. When Nielsen refers to choice, they mean “flavors, formats and packaging,” though in my experience it’s always “packaging options” that seem to get the most attention. But even with the term as common as flavor, it’s used here as more jargon instead of what you’d ordinarily think it means. By “new flavors,” they don’t mean more different styles or kinds of beer on the average beer set shelf. No, they mean line extensions like the two they give as examples: “Bacon Maple and Blue Raspberry Lemonade,” as a part of other already-established brands.

So while this is good news, and we should all welcome a coming “beer boom,” I can’t help but wonder if this “boom” of which they speak — which quite frankly the craft beer side has been seeing for a decade — is not going to favor them as much as the regional breweries and even the smaller craft breweries. That’s what it’s been doing for several years now, and I can’t see any reason to suspect that will change in the coming months or years, no matter how “bright the last quarter of 2012 may be for beer.” Still, a coming “beer boom” sure has a nice ring to it.

Politics & Big Beer Brands

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politics-balloons
Here’s a curious piece of data, showing how which big beer brand you prefer may determine how likely you are to vote in the upcoming election and whether you lean more to the Democratic side of the aisle, or the Republican. The poll was conducted by Scarborough Research and the results written up in the National Journal as What Your Beer Says About Your Politics.

But it’s only the big brands that were tallied, the domestics and the most popular imports. The only one close to craft is Samuel Adams, who in most people’s mind, I think, is straddling both worlds right now. Even so, there are a few surprising results, at least to my mind. I would not have thought, for example, Samuel Adams drinkers would skew so heavily Republican. Maybe it’s the naked jingoism, the patriotic perception of the brand, I don’t know.

The other one that surprised me was that Heineken skewed so far on the Democratic side. I tend to think of Heineken as a brand that people who don’t know any better think is a high end, premium brand, in the same way bald, middle-aged men drive Corvettes to recapture their youth, not realizing it’s no longer the hip car it once was. But maybe that’s just my own bias. In any sort of polling, I rarely fall under the “typical” findings.

Take a look at the chart below and see what you think. Does it make sense to you?

beer-politics-2012
The chart is tough to see this small, but you can see it full size, or look at on the original National Journal post.

Cheap Beer Label Quiz

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quiz-can
I got an e-mail today from someone at Cleveland’s Plain Dealer newspaper, letting me know about a quiz created by their beer columnist Marc Bona. It’s a fun one, asking you to identify 31 labels from budget, or cheap, beer brands. It shows each label or can, with the name removed, and then you have to choose from a long list of possible answers. I got 94% right (which I believe translates to 2 wrong) and, be warned, there are some regional brands that may not be as recognizable to a national audience. You can take the Budget (OK, Cheap) Beer Label Quiz and it will tell you the percentage you got right, but you’ll have to wait until August 1 to find out all the answers. How many did you get right?

Welcome To The World ABInBevMo

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abim
By now you’ve already seen the news that Anheuser-Busch InBev has taken another step closer to realizing their quest for world domination in the beer business. They’d already owned half of Mexican powerhouse brewer Grupo Modelo — makers of Corona, among other brands — but it was non-voting stock and they asserted very little control over them. In fact, Corona is often a competitor in the U.S., usually with non-Bud distributors. The irony, of course, is whether you bought Bud or Corona, eventually at least some of that money still made its way to ABI. The phrase “laughing all the way to the bank” springs to mind. Hard as it to believe, they already have a new website up even though the merger’s only been finalized in the last twenty-four hours. The name of the new site is Global Beer Leader. Does anybody else think that sounds ominously close to North Korea’s “dear leader?”

ABI is paying Grupo Model $20.1 billion to become ABIM, making it the second-biggest deal ever brokered in the beer world. The first was the $52 billion InBev paid to merge with Anheuser-Busch in 2008. The deal still needs government approval, and will likely be addressed and decided in the first quarter of next year.

According to the deal, Crown Imports — the current importer of Corona and other Grupo Modelo brands under the Constellation Brands umbrella — will continue to be the importer to the U.S. In fact, part of the deal includes the sale of the half of Crown Imports owned by Grupo Modelo to Constellation Brands, who had owned the other half, for $1.85 billion. That gives them 100% control over the distribution of the Modelo brands in America. ABIM head honcho Carlos Brito told Harry Schumacher this morning that they’re looking at this as a golden opportunity primarily to combine Bud and Corona outside the U.S. in the global beer market.

Adam Nason at Beer Pulse has a helpful chart showing that the merger gives ABIM control over 8 of the top 15 global beer brands, just over half.

Full details of the deal can be found at the new website Global Beer Leader.

abim
NOTE: This NOT their official new logo, I made this up as a parody.

Diageo’s Anti-Competitive Bullying Tactics Revealed

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Diageo vs. brew-dog
Wow! Just wow. Anyone paying attention knows that the corporate world doesn’t like to play fair if they can get away with it, and they usually can. They bigger they are, the more resources they command, the easier it is to bully, cajole and generally get their way. It gives them an unfair advantage, of course, but that’s the way of the world, from the playground bully to the largest multi-national. Obviously, that behavior is not restricted to the alcohol industry, but since that’s the world I’m most familiar with, that’s where I see it the most. From free t-shirts, tickets to the 49ers and even free kegs, it’s been an underlying current in the beer business for at least the twenty years I’ve been paying attention to it, and undoubtedly far longer. It’s one of those things that everybody knows about but few people talk about openly. But this one is pretty hard to ignore.

This past weekend, while much of the beer world was listening to the World Beer Cup awards being announced, over the pond in Glasgow, Scotland, another award show was taking place. This one was the 2012 British Institute of Innkeeping Scotland Annual Awards, which celebrates “success in the license [pub] trade in Scotland.” BrewDog, whose pubs have been making quite a splash, were up for the “Bar Operator of the Year” award. When it came time for the announcement, the award went to another company. But one of the BII judges was seated at the BrewDog table and cried foul. According to BrewDog’s blog, the surprised judge said “this simply cannot be, the independent judging panel voted for BrewDog as clear winners of the award.” When the alternate winner went up on stage to accept the award, they found that “BrewDog” had already been engraved on the award and refused to accept it.

Yesterday, BrewDog received a call from the BII explaining where and how things went awry:

We are all ashamed and embarrassed about what happened. The awards have to be an independent process and BrewDog were the clear winner.

Diageo (the main sponsor) approached us at the start of the meal and said under no circumstances could the award be given to BrewDog. They said if this happened they would pull their sponsorship from all future BII events and their representatives would not present any of the awards on the evening.

We were as gobsmacked as you by Diageo’s behaviour. We made the wrong decision under extreme pressure. We were blackmailed and bullied by Diageo. We should have stuck to our guns and gave the award to BrewDog.

Wow, right? I give credit to the BII for at least admitting what happened and taking whatever consequences will likely come their way. Diageo, on the other hand, is claiming it was a “rogue agent,” an employee who went too far. The makers of Guinness released this statement today:

Diageo has provided the following statement in response to communications from independent brewer, BrewDog, in relation to the British Institute of Innkeeping Scottish Awards on Sunday 6 May 2012.

A Diageo spokesperson: “There was a serious misjudgement by Diageo staff at the awards dinner on Sunday evening in relation to the Bar Operator of the Year Award, which does not reflect in any way Diageo’s corporate values and behaviour.

We would like to apologise unreservedly to BrewDog and to the British Institute of Innkeeping for this error of judgement and we will be contacting both organisations imminently to express our regret for this unfortunate incident.”

So somebody probably had to fall on their sword and be the patsy for what is more likely business as usual. Pete Brown asked Diageo for a statement, and they responded with the same one that now appears on their website. Pete also added the following:

I’ve got more to say about the increasingly shameless bullying and anticompetitive tactics employed by some (but not all) big brewers, but this one really takes the biscuit. Diageo, having been caught red handed, had no option but to blame it on a rogue element, and we must take them at their word. But does this reveal something deeper about the attitudes of some global brewing corporations?

Since he’s closer to the British (and Scottish) beer business than I am, it will be interesting to hear his take on things in the near future as he promised to expound on this incident and talk about the larger issue of institutionalized influence by the global beer companies. But still, I can’t help but shake my head and just keep repeating, “wow.”

The Top 50 Annotated 2011

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ba
This is my sixth annual annotated list of the Top 50 so you can see who moved up and down, who was new to the list and who dropped off. So here is this year’s list again annotated with how they changed compared to last year.

  1. Anheuser-Busch InBev; #1 last six years, no surprises
  2. MillerCoors; ditto for #2
  3. Pabst Brewing; ditto for #3
  4. D. G. Yuengling and Son; Same as last year
  5. Boston Beer Co.; Same as last year
  6. North American Breweries; 2nd year on the list, up 2 from #8 last year
  7. Sierra Nevada Brewing; Down 1 from #6 last year
  8. New Belgium Brewing; Down 1 from #7 last year
  9. Craft Brewers Alliance; Same as last year, after dipping down 1 the previous two years
  10. Gambrinus Company; Same as last year, though now listed as Gambrinus instead of Spoetzl
  11. Deschutes Brewery; Same as last year
  12. Matt Brewing; Up 1, after moving down 1 last year
  13. Bell’s Brewery; Up 2 from #15 last year
  14. Minhas Craft Brewery; Same as last year, after dropping 2 the prior year
  15. Harpoon Brewery; Up 1 from #16 last year
  16. Lagunitas Brewing; Jumped up 10 from #26 last year, their second such jump in 2 years, having been at #36 two years back
  17. Boulevard Brewing; Same as last year
  18. Stone Brewing; Up 5 from #23 last year
  19. Dogfish Head Craft Brewery; Same as last year, after shooting up 5 from #24 last year, being up 9, 5 and 4 the three previous years
  20. Brooklyn Brewery; Up 5 from #25 last year
  21. Alaskan Brewing; Down 1 from #20 last year
  22. Long Trail Brewing; Down 1 from #21 last year, after leaping up 14 from #35 the previous year
  23. August Schell Brewing; Down 1 from last year
  24. Shipyard Brewing; Up 4 from #28 last year
  25. Abita Brewing; Down 1 from last year
  26. World Brew/Winery Exchange; Up 11 from #37 last year
  27. Great Lakes Brewing; Up 4 from #31 last year
  28. New Glarus Brewing; Up 2 from #30 last year
  29. Full Sail Brewing; Down 2 from #27 last year
  30. Pittsburgh Brewing (fka Iron City); Up 3 from #33 last year
  31. Summit Brewing; Down 2 from #29
  32. Anchor Brewing; Same as last year
  33. Firestone Walker Brewing; Up 3 from #36 last year
  34. Cold Spring Brewing; Jumped up 13 from #47 last year
  35. SweetWater Brewing; Up 3 from #38 last year
  36. Rogue Ales Brewery; Down 1 from #35 last year
  37. Mendocino Brewing; Up 2 from #39 last year
  38. Flying Dog Brewery; Up 2 from #40 last year
  39. Victory Brewing; Up 2 from #41 last year
  40. CraftWorks Breweries & Restaurants (Gordon Biersch/Rock Bottom); Now combined, last year Gordon Biersch brewpubs were #42 and Rock Bottom was #48
  41. Oskar Blues Brewing; Up 8 from #49 last year
  42. Odell Brewing; Up 3 from #45 last year
  43. Stevens Point Brewery; Up 1 from #44 last year
  44. Ninkasi Brewing; Not in Top 50 last year
  45. BJs Restaurant & Brewery; Down 2 from #45 last year
  46. Blue Point Brewing; Not in Top 50 last year
  47. Bear Republic Brewing; Not in Top 50 last year
  48. Goose Island Beer; Plummeted 30 from #18 last year, after selling their production brewery to Anheuser-Busch InBev
  49. Lost Coast Brewery; Not in Top 50 last year
  50. Narragansett Brewing; Not in Top 50 last year

Some new companies made the list, one from a merger — Gordon Biersch and Rock Bottom — now CraftWorks Breweries & Restaurants, along with Bear Republic, Blue Point, Lost Coast (which had been on the list two years ago), Narragansett and Ninkasi.

Off the list was Straub, Independent Brewers United (IBU), which was swallowed up by North American Breweries, Kona Brewing, which was folded into the Craft Brewers Alliance, and individually Gordon Biersch and Rock Bottom were combined into CraftWorks Breweries & Restaurants.

If you want to see the previous annotated lists for comparison, here is 2010, 2009, 2008, 2007 and 2006.

Top 50 Breweries For 2011

By

ba
The Brewers Association has also just announced the top 50 breweries in the U.S. based on sales, by volume, for 2011. This includes all breweries, regardless of size or other parameters. Here is the new list:

  1. Anheuser-Busch InBev; St Louis MO
  2. MillerCoors; Chicago IL
  3. Pabst Brewing; Woodridge IL
  4. D. G. Yuengling and Son; Pottsville PA
  5. Boston Beer Co.; Boston MA
  6. North American Breweries; Rochester, NY
  7. Sierra Nevada Brewing; Chico CA
  8. New Belgium Brewing; Fort Collins CO
  9. Craft Brewers Alliance, Inc.; Portland, OR
  10. Gambrinus Company; San Antonio TX
  11. Deschutes Brewery; Bend OR
  12. Matt Brewing; Utica NY
  13. Bell’s Brewery; Galesburg MI
  14. Minhas Craft Brewery; Monroe WI
  15. Harpoon Brewery; Boston, MA
  16. Lagunitas Brewing; Petaluma CA
  17. Boulevard Brewing; Kansas City MO
  18. Stone Brewing; Escondido CA
  19. Dogfish Head Craft Brewery; Lewes DE
  20. Brooklyn Brewery; Brooklyn NY
  21. Alaskan Brewing; Juneau AK
  22. Long Trail Brewing; Burlington VT
  23. August Schell Brewing; New Ulm MN
  24. Shipyard Brewing; Portland ME
  25. Abita Brewing; New Orleans LA
  26. World Brews/Winery Exchange; Novato CA
  27. Great Lakes Brewing; Cleveland OH
  28. New Glarus Brewing; New Glarus WI
  29. Full Sail Brewing; Hood River OR
  30. Pittsburgh Brewing; Pittsburgh PA
  31. Summit Brewing; Saint Paul MN
  32. Anchor Brewing; San Francisco CA
  33. Firestone Walker Brewing; Paso Robles CA
  34. Cold Spring Brewing; Cold Spring MN
  35. SweetWater Brewing; Atlanta GA
  36. Rogue Ales Brewery; Newport OR
  37. Mendocino Brewing; Ukiah CA
  38. Flying Dog Brewery; Frederick MD
  39. Victory Brewing; Downington PA
  40. CraftWorks Breweries & Restaurants (Gordon Biersch/Rock Bottom); Chattanooga TN/Louisville KY
  41. Oskar Blues Brewery; Longmont CO
  42. Odell Brewing; Fort Collins CO
  43. Stevens Point Brewery; Stevens Point WI
  44. Ninkasi Brewing; Eugene OR
  45. BJs Restaurant & Brewery; Huntington Beach CA
  46. Blue Point Brewing; Patchogue NY
  47. Bear Republic Brewing; Cloverdale CA
  48. Goose Island Beer; Chicago IL
  49. Lost Coast Brewery; Eureka CA
  50. Narragansett Brewing; Providence RI

Here is this year’s press release.

Big Changes At A-B InBev

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ab-inbev
Wow, there’s a lot going over at Anheuser-Busch InBev, and besides the slip in sales of their core brands. Last week, rumors abounded that ABI was planning to roll out some version of 100% Share of Mind, which had been the “unofficial” policy until a few years ago, when it became unworkable. I wrote about it four years ago as it started to wane in Losing Their Share of Mind, and you can get the history and background of the policy there, assuming you’re unfamiliar with it. In a nutshell, A-B insisted that their distributors focus ONLY on A-B and A-B-related brands, and there were ways they had for dealing with those distributors that didn’t toe the line. And it worked well enough while A-B brands were selling well, but when they began to slip, it became harder to enforce and harder for distributors to remain profitable without taking on non-A-B brands, especially craft brands.

According to Beer Business Daily, ABI “is again turning up the leverage with Sales Opportunity Teams starting next week.” Apparently “Sales Opportunity Teams” (SOT) is the new buzzword for it this time around. They continued:

The SOTs, which A-B chief Dave Peacock has repeatedly said are not punitive in nature, will certainly be uncomfortable for distributors with growing competing brands in the house, as they try to explain this or that competing display or tap handle on the floor.

It’s got to be even harder this time, with craft beer riding a wave, with great growth, higher rings and consequently more profits. Sell less, make more. Hard to walk away from that, but of course having the best-selling brands is also pretty attractive, too. So what’s a distributor to do?

Today, the other shoe dropped, as Anheuser-Busch President Dave Peacock — and the last of the pre-InBev top executives — resigned effective today. According to ProBrewer

Peacock was one of the few remaining high-level holdovers who had stayed with the company after it was acquired in 2008 by InBev. He was only one of two non-Busch family members to hold the title of CEO.

Peacock is well liked by wholesalers and is known as reasonable, fair and an advocate for the second tier. The latest pressure on wholesalers by InBevAB may certainly have prompted Peacocks departure.

Peacock began his career at A-B in 1992 and was promoted to president in 2008 in the wake of the acquisition after serving as VP-marketing since late 2007. Many U.S. executives departed after the InBev takeover, but Peacock was handpicked by the new owners to lead the U.S. operation.

Harry Schuhmacher, in his Beer Business Daily, broke the news this morning, calling it “a watershed moment in the history of A-B since its acquisition by InBev.”

Coincidence? Hard to imagine the two developments are completely unrelated, especially since Beer Business Daily, presumably working from a press release, states he’s leaving “to spend more time with his family and pursue other business interests.” I’m always more than a little suspicious when that’s the official reason for leaving, as it so often is in circumstances like this one.

Peacock is succeeded by Luiz Fernando Edmond, who until today was the Zone President of North America. Oh, and Bud Light Platinum is coming soon, in the cobalt blue bottle, and should be on store shelves as early as this week. They’re calling it a “game changer,” but I tend to think these other two developments will change the beer landscape far more than a Bud Light line extension.

bud-light-platinum-sixer

Coors Light: Now The Avis Of Beers

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coors-light
I’m not exactly sure why this appears to be such big news, but it seems to be everywhere. Beer Marketer’s Insights is reporting that, based upon estimated numbers for 2011, Coors Light has overtaken Budweiser to become the 2nd best-selling beer in America. According to the report, “[t]his is the first time in almost 20 years, since 1993, that AB didn’t have top 2 brands.” But I note that according to IRI data, Miller Lite held the #2 spot at least as recently as 2007. Though to be fair, it’s true that Bud Light and Budweiser have enjoyed the top two spots, if off and on, for quite some time.

But the story isn’t so much about Coors Light being up (they were, but only 0.8%). What’s more interesting is that Budweiser was down 4.6%, which had more to do with the switch in positions. InBev seems to be struggling with the A-B core brands ever since they took over Anheuser-Busch. It can’t help that they’ve laid off countless employes, bullied suppliers and lost a great deal of goodwill through their cost-cutting way of doing business. They don’t seem to have the same relationship with consumers that the company did when it was run by the Busch family. And while the big breweries are losing ground to craft beer overall, ABI seems to losing more. So it makes sense that another brand would pick up the slack, catapulting Coors Light into the number two position, a spot Avis once upon a time used to great effect in their advertising. Maybe we’ll see Coors do something similar. “Coors Light is No. 2 in beer. We try harder.“