sam adams big beer

Too Big For Craft Beer?

Boston Beer Co. is having a rough week. The “Pappy” of craft beer has been seeing a slowdown in their growth for the last couple of years, but the course-corrections that they employed seemed to have fallen short.  According to the Boston Globe, they just announced that their yearly profits fell 12%, from $156.2 million in 2015 to only bringing in $137.6 million on 2016. Furthermore, their depletions (the sales of their products to retailers from distributors) fell by 5%. To make matters worse, depletions in the first 6 weeks of 2017 have been down 15% from this same time last year.

Jim Koch, the founder and CEO of Boston Beer Company, tried to make sense of it to his investors as well as the media who have been watching the decline of one of the founding fathers of craft beer.

“New craft brewers continue to enter the market and existing craft brewers are expanding their distribution and tap rooms, with the result that drinkers are seeing more choices, including a wave of new beers in all markets,” He stated. “I’ve heard speculation from a couple of retailers that perhaps the fact that there were too many choices has, in fact, turned consumers away from craft with its extraordinary variety and category clutter and confusion and pushed them to something simple,”

Too Many Choices?

While “too many choices” could be an issue for people just turning to craft beer (and that very well might be a barrier to entry for some macro-beer drinkers) this issue doesn’t translate into why the sale of Sam Adams has slumped. Sam Adams isn’t on the decline because there are too many choices in the beer cooler. That would mean that people who had bought Sam Adams in the past were walking into the stores now, feeling overwhelmed with the “category clutter” and doing what? Walking out without buying anything? Buying more clutter craft beer? Buying macro beer? It just doesn’t make sense. What’s more likely is that craft beer drinkers don’t think Sam Adams is “craft” anymore and are buying different craft beer. Sam Adams is losing customers from the very base that they helped build.

Big Craft Beer

While Boston Beer Co. is still considered a craft beer based upon their ownership (at least 75% ownership by a craft brewer) as well as the number of barrels they brew (less than 6 million), they are still a giant company compared to most of the craft beer market. It appears as if their success and growth is now the issue, but they aren’t alone in this situation.

Along with Boston Beer Company, four out of the top five craft beer brands (in production volume) saw declines this last year. Fortune reported that Sierra Nevada, New Belgium, and Craft Brewer’s Alliance (owns Redhook, Kona Brewing and more) all ceded share last year, with only Lagunitas seeing a slight growth. Lagunitas is 50% owned by Heineken which brings up an interesting angle.

It seems like there is a widening gap in the craft beer industry. On one side you have the hyper-local breweries and on the other side, you have craft breweries that are owned by big beer and therefore backed by big-beer-money. The little guys are considered “cool” and are heavily supported by their local communities and the bought out breweries have the resources. In fact, two craft breweries that were bought out by big beer, Ballast Point and Goose Island both saw growth this last year while many other breweries of their size didn’t. There may be a multitude of reasons for their growth but it’s hard to ignore the fact that once big-beer-money is behind a brewery there is an ability to spend millions on marketing as well as lower their price point on kegs and even in stores (except Sculpin…Ballast has locked that beer in a premium category where they can charge an insane $17-$18 a six pack on the East Coast).

This would leave the middle guys (big craft breweries but not “big beer”) in an awkward position. They aren’t as cool as the thousands of small breweries popping up in neighborhoods every year and they don’t have the cash to (pay to) play with the big dogs.

Local, Local, Local…

This past year in San Diego, we have heard two larger breweries describe “hyper-local” craft beer as one of the reasons for their slower than expected growth. Stone and Green Flash both talked about the increased competition from hyper-local breweries being a factor in their less-than-expected growth and subsequent layoffs this past year. While both of these brands are highly respected within the industry, maybe they are hitting that “middle zone.” Stone and Green Flash are big dogs in San Diego but still small when it comes to the overall beer market and it’s hard for them to compete with the cheaper kegs, giant distribution channels and million dollar marketing budgets of big beer. Add in the increased competition from super local brands and it’s understandable why it can be hard being stuck in the middle.

Expanding the area where your beer is available raises an interesting issue. For example, expanding into Orange County and Northern California are goals for many small San Diego breweries, but our local brands are outsiders beyond the borders of San Diego. What happens when after beating the “drink local” drum for years, your beer is no longer “local?” Thorn Street, along with numerous other smaller breweries that are poised to move beyond San Diego county distribution, are about to find out.

Stone and Green Flash made a savvy move with the opening of breweries in Virginia (Richmond and Virginia Beach respectively). Along with all of the other reasons that it makes sense to open up breweries across the country, they have to win over craft beer consumers in their local area and it’s much easier to do that when your beer is “brewed locally.”

Where Does Boston Beer Go From Here?

Who knows what will bring Boston Beer Co. back to their former glory. Will it be by focusing on their classic brands like Sam Adams Boston Lager and Rebel IPA? Maybe instead of focusing on recapturing the consumers who are already craft beer drinkers and have moved on to “craftier” beers, they should focus on bringing macro-beer drinkers over to the “dark side.” Their beers are easy-drinkers that paved the way for many craft beer palates. With such a huge market of macro-beer drinkers out there, the pool to pull from is huge. Craft beer is still only 21% of the overall beer market. Maybe it’s up to Sam Adams and all craft breweries, really, to figure out a way to convert just some of the other 80%. The beer drinking market is there for the taking, we just have to find a way to tap into it.

 

 

 

triple ipa pliny the younger

Triple IPA Season is Here

If you are into the craft beer scene, you might have noticed that recently there has been a lot of talk about triple IPAs. More hops, more alcohol, and a bigger beer are the hallmark of this gonzo style and if it’s one thing that San Diego craft beer drinkers can handle, it’s big beers.

Where is all began…

The triple IPA hoopla all started with a “little” beer called, Pliny the Younger from Russian River Brewing. Pliny the Younger (pronounced, Pline-y not Plinny, like the man) is a bigger version of their popular, Pliny the Elder Double IPA. Double IPAs should be hopped twice as much as the regular recipe and in the case of Pliny the Younger being a triple, it’s got 3 times the hops and then is dry-hopped 4 different times. Clocking in at 11% ABV, it certainly packs a punch but as it often happens with high alcohol beers, it’s incredibly balanced with the extreme bitterness of the hops offsetting the sweetness of the sugars from the high alcohol.

This beer is in incredible demand with people waiting in lines for hours and kegs getting kicked in minutes at popular spots. Russian River shows their marketing mojo by only having this beer available for 2 weeks every year. Since it’s human nature to want what we can’t have, creating that kind of limited-time demand is a proven method to increasing buzz and desire for a product. This wouldn’t work if the product itself wasn’t high quality and this beer is definitely impressive.

Triple Fever

At this point, you can only find it in a handful of accounts in San Diego and don’t look for that to expand anytime soon. We recently had Russian River sales gal, Gina Fronke, on our Live Cast and she said that while Russian River is expanding their production facility and they will be producing more Pliny the Younger, at this point their plan is to give more beer to their accounts that they have now rather than expand their distribution to more bars/restaurants. For some of their accounts who only getting one keg of this revered beer and it then kicks in under an hour, this is great news. For the rest of San Diego, this means we might have to get our triple fix elsewhere.

With the success of Pliny, it’s no small wonder that breweries all over are also getting in the triple-game during this time of year. Thorn Street Brewery is right there too and we just released our own triple, Brother Scotty’s IIIPA 10.5% ABV. This beer is big, hoppy and balanced with notes of pine, citrus and pineapple lingering together from the Amarillo, Citra, Simcoe and Centennial hop bill. While it’s a hop-bomb for sure, it’s still a smooth drinker with a lingering sweetness that’s neither cloying nor overpowering.

Here are a few triple IPAs that you can get right now, on tap, here in San Diego. All delicious, and all local; make it your mission every February to taste as many of this style as you can while they are available!

Thorn Street Brewery – Brother Scotty’s IIIPA 10.5% ABV

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Benchmark Brewing – Hildigard IIIPA 13.5% ABV (from Ratebeer.com)

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Society Brewing  – The Miser “Really Big IPA” 10%+ ABV

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Monkey Paw Brewing Muriqui IIIPA 10% ABV

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What San Diego triple IPA do you love?

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Switchback Brewing Co. Sells to Employees

Switchback Brewing Co.

There’s some good news in craft beer coming from the Green Mountain state! Switchback Brewing Company, the producer of Vermont’s top selling craft beer, has just sold. While it seems like this sort of news is most often followed up with…sold to MillerCoors or AB-InBev, this sale is just a bit sweeter. That’s because owner Bill Cherry announced at their company meeting on Monday that the 30 employees were all now owners of the brewery.

Switchback was started in 2002 and is known for their unfiltered, naturally conditioned, flagship amber ale, Switchback Ale 5%ABV. Naturally conditioned means that the beers are carbonated during the fermentation by the yeast. This lends a complex flavor to their beers that fans love from across five states. All of their beers are naturally carbonated in this fashion and include a wide range of styles from Marzen, to extra pale ale, to porter.

Looking at the comments on their FB page, you can almost hear the sighs of relief from their faithful fans:

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Why Sell To Employees?

When asked why he decided to sell to his employees, Cherry said this to WCAX-TV, “I wanted Switchback to be Vermont-owned forever. Entrusting the brewery to the employees ensures the company will carry on with its mission to provide great beer and great jobs to the local community.  It’s theirs to grow and nurture and reap the benefits. It is the right thing to do and I hope all Vermonters show their support by keeping Switchback beers on their go-to list.”

This story warms our beer-soaked hearts and really gets to what being a craft brewery is all about. Many brewers/owners look for ways to ensure their companies’ futures while also looking for avenues to grow. Cherry was looking down the road to retirement and realized that he wanted the beer to remain the same while also spreading out his responsibilities in the present. “In my heart of hearts, really wanted to have this brewery stay Vermont-owned and locally controlled forever,” Cherry said. “They’re going to keep the legacy going.”

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One interesting thing about this deal is that the employees aren’t paying anything upfront. Instead, they receive Switchback stock and the beer profits pay off their debt over the next 15 years. So while these employees aren’t going to be reaping big money from their ownership anytime soon, they now get something that is even possibly more important. They get a say in their livelihood and have a voice in the future of the company. This sort of employee buy-in is such a benefit to companies because it encourages an ownership mindset which helps team members contribute to the long-term success of a company.

Plant Engineer, Gretchen Langfeldt is excited about her new status at Switchback, “It’s fun to say we’re all part if it now together,” she told WCAX-TV with a smile.

With this bold move, Switchback becomes the first employee-owned brewery in Vermont. It now joins the ranks of other employee-owned breweries like Harpoon, New Belgium, Deschutes, Odell and Left Hand Brewing Co. Not a bad crowd to be associated with…

So let’s raise a glass to the employees of Switchback Brewing Co. and their newfound ownership and here’s hoping we can get some of their unique and delicious beers out our way soon!

 

super bowl party with ralph in the corner and a beer on the table

Best Craft Beers for the Super Bowl

The Super Bowl is almost here and along with the actual game that is played, this Sunday is also a big day for food and beer. According to Forbes, Americans are expected to consume more than 12.5 million pizzas and 1.33 billion chicken wings during this year’s Super Bowl. 1.33 BILLION! What do people need to wash down more than a billion chicken wings? Why beer, of course.

Best Beers for the Super Bowl?

Shape just put out a list of Super Bowl Beer picks based on the most searched beers this week on Google. They were suggesting that this would be a good list of beers for the Super Bowl based on their obvious popularity. Here was their suggested list of beers for your party:

  1. Miller High Life
  2. Budweiser
  3. Yuengling
  4. Guinness Draught
  5. Sierra Nevada
  6. Sam Adams
  7. Stella Artois
  8. Foster’s
  9. Chimay
  10. Ommegang

Better Beers for the Super Bowl

Two things stand out about this list. First, Americans love their lagers and Belgians. Second, we need to give people a better list of beers to choose from! To help all of the craft beer lovers out there, we thought we would put out our own list of “Best Beers for Your Super Bowl Party.” We tried to keep it local (which is why Sierra Nevada Pale is off the list even though that’s a solid beer), so this is more of a list of local craft beers you can easily get around San Diego that will take the place of the beers on Shape’s list and help you throw a killer Super Bowl Party.

Although we stuck to the lighter side of beers to best mirror some of the styles of the original list, being in San Diego, you can’t get away without a few hopp-tastic beers.

1. Pizza Port Pick Six Pilsner  

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This hoppy pilsner is 5.3% of pure goodness. Why reach for a watery macro when you can get a refreshing, light-bodied lager in 16 oz. cans for a cool $9.99?

2. Iron Fire Gunslinger Golden Ale 

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This beer is perfect for the craft beer newbie or anyone looking for a golden, light-bodied, cream ale. It’s also perfect to cool the heat of spicy foods like Buffalo wings and nachos.

3. Mother Earth Honcho Hefeweizen

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This 5.0% hefe is a balance between a traditional German Hefeweizen and an American amber. It’s unfiltered and refreshing and pairs great with sausages like bratwurst, knockwurst or any-wurst, really.

4. Second Chance Tabula Rasa Toasted Stout

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Toasted oats lend the nutty, roasted flavors with notes of chocolate and coffee. This beer is a sipper, but also smooth, making it an ideal pairing to the sweeter treats like chocolate cake and mud pie.

5. Alesmith San Diego Pale Ale .394

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This San Diego classic is hoppy and refreshing, with a subdued bitterness and malty finish. .394 was Tony Gwynn’s career high batting average and this beer was made in honor of this baseball great. Drink up because a portion of the proceeds from each beer sold goes to the Tony and Alicia Gwynn Foundation, a charity that provides educational and financial resources to underserved members of the San Diego community.

6. Modern Times Blazing World Hoppy Amber

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The trio of Nelson, Mosaic and Simcoe hops help this amber ale pop while still giving the malt background and drinkability that people love in amber. This is another beer that comes in 16 oz cans.

7. Alpine Pure Hoppiness San Diego Double IPA

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An iconic beer in San Diego and beyond, Pure Hoppiness has helped define what a West Coast double IPA is. With hops on top of hops on top of hops, this 8% beer packs a punch in both alcohol and flavor. IPAs are the prefect pairing to smoked meats and spicy foods.

8. Benchmark Table Beer

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This Belgian table beer is a good choice for your party with its peppery and citrusy notes as well as its extreme drinkability at 4% ABV.

9. Thorn Street Foreplay Belgian Blonde

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Czech Saaz hops and Belgian Pilsner malt blend together for a saucy Belgian blonde ale. No joke at 6.8%, it has light notes of apricot, pepper, and pear that bring it home. While it’s not available in cans quite yet (soon!), you can come and grab a growler of this Belgian beauty at the tasting room.

10. Coronado Brewing Co. Orange Ave. Wit

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This beer is a Belgian witbier with a SoCal spin. Orange zest, orange blossom honey, and coriander are used in the brew to impart a spicy, yet earthy wit that is as easy to drink as it is tasty.

Which San Diego beers will be at your Super Bowl party?