avery brewing barrel

Avery vs. Pirate Life: Who Sold It Better

Last week, two craft breweries announced investments in their brands from outside companies. Avery Brewing Co. from Colorado sold 30% of their company to Spanish beer conglomerate, Mahou San Miguel. A couple days later, an Austrailian craft beer brewery called Pirate Life announced that they had been acquired by AB InBev for a cool $7.6 million. While you might not have heard of Pirate Life yet, it has been on a fast rise from its 2015 opening to being named Australia’s best craft brewery by Beer Cartel in 2017. Both Avery and Pirate Life pointed to international growth as reasons why they chose to sell part or all of their companies. Both companies are now not considered craft beer, though that definition doesn’t apply to Pirate Life since they aren’t in the under the umbrella of the Brewers Association here in the states.

The Investor Matters

The sale (in part or all) of these two breweries also brings up the shifting gray area that exists between the different sort of investments that breweries seek to help themselves grow. The simple fact is that in order to grow any business there needs to be an influx of money. In terms of the beer industry, this money can come in a variety of ways but most often it comes from private investors/investment firms or the sale of part or all of the company to a larger beverage company. But not all beverage companies are created equal, and this is where the gray area comes in.

Avery selling a minority stake in their company to Mahou San Miguel just doesn’t seem to have the same negative connotations that selling your whole brewery to AB InBev does. Mahou San Miguel is a large beer company with mostly Spanish beers in their portfolio and they also own 30% of Founders. A quick google search of their name with some choice words (investigated, illegal, pay-to-play) turns up nothing. The same cannot be said for our good old friend, AB InBev.

AB InBev At It Again

In fact, this past week it was announced that there is yet another investigation into AB InBev for breaching EU competition laws in Belgium. Basically, beer costs more in Belgium than it does in the surrounding countries, especially the Netherlands. There are many retailers with stores in multiple countries and would use that advantage to offer the beer at lower prices because it could be transported from their warehouses outside of Belgium. AB InBev sought to stop the cross-border beer in a couple of different ways; by limiting the volume that exporting retailers could get on promotion and taking away incentives and holding back the most popular brands unless the retailer promised to not sell their supplies to their Belgian stores.

Furthermore, EU officials uncovered that AB InBev’s decision to switch to single-language labels in France and Netherlands, 4 years ago, was done so to prevent the export of these more inexpensive beers into Belgium where labels have to be in both Dutch and French.

AB InBev has a history of playing dirty, getting fined, paying the fine (because their yearly revenue is $45.5 billion), and doing it all over again. They are so big that they are nearly untouchable because they can pay any fine that is thrown their way with ease. This is why it’s a much more bitter pill to swallow when they buy yet another independent craft brewery. Yes, Pirate Life has a right to grow and will likely do so a faster rate now that they have been bought out by the biggest beer company in the world. Most of the people who drink Pirate Life will have no idea that they are supporting AB InBev. Life will continue on for all.

The Gray-Scale

In the end, selling your whole brewery vs. 30% is a huge difference and really are two ends of the brewery-sale-spectrum. While both are enough of a sale to be kicked out of the craft beer consortium, selling 30% to a beverage company with a decent reputation and no history of trying to cheat the craft beer market in the U.S., is what it is. Likely the beer won’t change much if at all and the people who build the brand will stay in place. Selling your whole brewery to a beverage company with the track record that AB InBev does, stings a little more and also says a little more about that brewery’s commitment to the craft. Who knows what will happen in a years time to not only the original staff but also the control at that point is totally up to AB InBev, no matter what the old owners say. As more and more craft breweries sell part or all of their company to continue their vision of growth (or to get a sweet payday), we have become more desensitized to the act itself. It also shapes the conversation moving forward to think about whether the distinctions between the ways that breweries grow. Being committed to craft and buying independent brewers is going to get hard as we move along in these times so maybe we will have to adjust our expectations a bit and not be afraid to wade into these gray waters.

budweiser trash

Budweiser, Mexican Beer, and Millennials

Budweiser is not having a good year when it comes to U.S. sales and this last quarter only got worse for them. As more and more people turn to drinking craft beer, spirits, and wine, they have seen a continuous drop in sales for their flagship beers, Budweiser and Bud Light. The North American market was Budweiser’s bread and butter for years but ever since 2014, AB InBev has seen a drop in Bud and Bud Light sales every year with a steep 6.2% drop in this last quarter alone. The slide in sales isn’t just AB InBev, however. MillerCoors also saw a 3% drop in U.S. sales this last quarter of both their Miller Lite and Coors brands. While AB InBev is a huge global company, they appear to hold the U.S. market in the highest regard. AB InBev Chief Executive Carlos Brit0 recently said,

“The U.S. is our most important market and we recognize the need to continue to focus on driving topline growth across our portfolio.” 

To help with this focus AB InBev decided to fire their U.S. CEO and replace him with their current chief officer of global sales. But why is Budweiser experiencing such a slump?

Not All Macro Is the Same

Here’s the interesting part, not all macro beer is down. American beer drinkers are totally digging Mexican beer. Corona and Modelo are up 13% this year in U.S. sales. AB InBev actually owns Grupo Modelo, which makes both Corona and Modelo, but in 2013, they sold the U.S. distribution rights to Constellation in a move to settle the anti-trust issues that arose from AB InBev’s purchase of Grupo Modelo. Constellation paid a cool $4.75 Billion for the brand rights at the time, and the year-over-year growth of both brands has certainly been a boon to their portfolio.

Mexican imports aren’t the only mass-produced beers that have seen growth, however. There is one mass-produced, super premium (their category, not ours) beer that is defying all expectations. Michelob Ultra is the largest share-gainer brand in the U.S. for the last seven quarters for a 10.9% growth up from last year at this time. Why the growth from a not-new and by-all-accounts tasteless beer? The answer appears to be in the marketing. Michelob Ultra has positioned itself as the beer of choice for the low-carb movement as paleo and keto diets along with workout lifestyles like CrossFit continue to be popular in the U.S.

Michelob’s marketing continuously targets a health-conscious Millennial demographic which is a booming demo by all accounts. The growth of Michelob Ultra is a bright spot for AB InBev because, of course, they own that brand too.

Enough Pie To Go Around?

Remember when AB InBev made that video slamming the Brewers Association’s seal of independence? In the video, they wax on about the “clear threats from wine and spirits” and lament that the BA’s label is divisive in this common fight against liquor and wine. The funny thing is that based on the numbers we’ve seen so far this year, wine, spirits, and craft beer can all see growth together. Let’s look at the growth the different categories have seen so far this year; wine sales are up 7%, spirits sales are up 4.5%, and craft beer is up 5.7%. While there is no denying that craft beer growth has slowed down, this trend has been expected in the booming industry for a while. Unprecedented growth can only happen for so many years before the market begins to correct itself and we seem to be in that correction.

Is there enough pie to go around? It seems like there could be. People aren’t over all macro beer, as evidenced by the substantial growth in both Mexican beer markets as well as for the “ultra-premium” Michelob Ultra. People appear to be turning away from the “American” mass produced brands, though. Budweiser, Bud Light, Miller Lite and Coors are slumping in sales, possibly because they have failed to catch on with a younger generation of drinkers. As an example, here’s the breakdown of who buys Budweiser in stores:

budweiser who buys it

Based on these numbers Budweiser is most likely to be purchased by older, low-income, Asian people. The fact that 24-44 year olds don’t buy Budweiser, yet are the largest demographic in the U.S., is definitely a thorn in Budweiser’s side. Whereas Mexican imports have been growing in sales as the Hispanic population grows, that only accounts for about half of their sales. The other half are Millennials who love a good Pacifico or Modelo. So get used to seeing Budweiser trying to peddle itself to a younger, hipper demographic, because once again, it seems that Millennials matter a lot when it comes to the success of a beer brand. Budweiser is down, but it’s certainly not out.

beer week donuts

San Diego Beer Week with Thorn

It’s our favorite time of year…San Diego Beer Week! Being that San Diego is the Craft Beer Capital of the world, it’s our duty to make SD beer week the best beer week in the world. Here at Thorn, we take this responsibility very, very seriously. We pull out all the stops to bring you the best in beer events at both our North Park tasting room as well as throughout San Diego. Here’s a rundown of what we have going on during the next 10 days…

AT THORN NORTH PARK

beer week events

Nomad Donuts Pairing:

11/4 12:30 – $25 (plus tax) for the 4×4 pairing with 2 donuts and 2 wood-fired bagels. We not only pair each treat with a beer but Kristiana Zabala, the chef behind the creative concoctions at Nomad Donuts, uses a different, complimentary beer in the food. Yum! Find tickets here…https://www.eventbrite.com/e/nomad-donuts-and-beer-pairing-tickets-38447373128

Mastiff Sausage Co. Pairing:

11/5 12:30 – $30 (plus tax) for a 5×5 course featuring delectable dishes from Mastiff Sausage Co.! Tickets available herehttps://www.eventbrite.com/e/mastiff-sausage-co-beer-pairing-tickets-38545928911

Here’s a peek at the menu…

Course One

Savory Rye Bread Pudding

Toasted Rye Bread, Mastiff Breakfast Sausage, Wild Arugula, Cheddar Cheese

Abbey Wall Belgian Dubbel

Course Two

Sausage Taco

House Made Al Pastor Sausage, Charred Scallion Crema, Cotija Cheese, Red Cabbage, Tomatillo, Cilantro

Barrio Baja-Style Lager

Course Three

Fall Vegetable Hash

Potato and Butternut Hash, Brussels Sprouts, Green Peppers, Creme Fraiche

Chilicabra Pale Ale

Course Four

Chicken Coconut Curry

House Made, Chicken Curry Sausage, Heirloom Rice, Red Pepper Coulis, Candied Peanuts

Got Nelson? IPA

Course Five

German Chocolate Cake

Rich Chocolate Cake, Coconut, Brown Sugar Frosting

Cocomotive Coconut Porter

Truffles & Beer Pairing:

11/5 5:30 – $12 (plus tax) for 2×2 pairing featuring 2 handmade truffles using two of our beers, paired with that beer! You can come in anytime between 5:30 and 9 pm to get your pairing. Get your tickets here…https://www.eventbrite.com/e/truffles-and-beer-at-thorn-street-brewery-tickets-38546192700

Venissimo Cheese Pairing:

11/11 1 pm – $30 (plus tax) for a 5×5 pairing (with something extra too) and an afternoon chatting with Rob Graff from Venissimo and Eric O’Connor, Brew Master here at Thorn. Tickets available here…http://venissimocheese.vendecommerce.com/class-schedule/products/11-11-beer-cheese-sampling-thorn-street

TSB EVENTS – NO TICKET NEEDED

11/8 Beer Trivia with America’s Finest Trivia at 7 pm

11/9 IPA LOUNGE at 5:00 features 10 of our IPAs on tap in our back room making for a hoptastic evening!

SDBW EVENTS AROUND TOWN

beer week calendar

Don’t forget about all the events we are participating in around town! For a full list, check out our events calendar on our website.

We hope to see you for San Diego Beer Week! Please contact events@thorn.beer for any questions about our events.


Taking Craft Back One Funny Video at a Time

Recently, the Brewers Association rolled out a new marketing campaign called “Take Craft Back” which purports to be a crowdfunding effort to buy AB InBev. While they are only $2.5 million to their $213 Billion goal, the movement is gaining steam and national attention. Here’s the video that launched the campaign:

After watching this, is there any question as to the seriousness of this venture? It’s exceedingly clear from not only the video but also the website that this is a marketing campaign meant to further the conversation about how Big Beer is buying up craft breweries which in turn creates more obfuscation in the marketplace and ultimately whittles down choice in the marketplace.  One of the best lines on their website reads, “It only seems impossible if you really think about it.” Which is funny AND true.

Let’s be clear, the Brewers Association doesn’t really expect to raise the money needed to buy a company that would be unlikely to sell even if the money was raised. Also, doing some simple math shows that we would have to raise 1 million per day for the next 583 years to reach that total. So, yeah, it’s not happening. That didn’t stop some people who didn’t watch the video, didn’t go to the website and didn’t read most articles about it from spouting off their opinions. These are from the American Home Brewer’s Facebook page in the comments of the video after it was posted:

“This still doesn’t offer anything. What does a pledge ACTUALLY do? How will you collect? What’s to say AB would ever even accept an offer or allow this to happen? Why should homebrewers be in charge of this and not breweries?”

“This is stupid and a waste of time. And if this did succeed, who is self-appointing to be the board, CEO, CFO, etc. what is the end game plan?” 

 “What in the hell? Where does the money go when they don’t get enough? Who is getting rich here?”

This guy, however, gets it:

“Society has done gone and lost its chill… This tongue in cheek campaign catches fire in a matter of hours and responses range from skeptics crunching numbers to marketing geniuses explaining how this won’t work… 
Financial geniuses: Would a limit of $1,000 pledges be put on this campaign if it was serious? 
Marketing gurus: Count the shares, count the comments, count the likes…BA is WINNING!”

People wondering about where the money is going, how it the buy-out will work etc. are missing the mark. Once again, it shows how people only read the title of a post, article or video and are more than happy to barf their outrage all over social media. It’s unclear what possesses people to comment on something they didn’t read/watch, especially when they want to bash it. In this case, if they just took a minute to go to the website, it would be extremely clear that this is a marketing campaign aimed at getting attention and bring awareness to the issue at hand. They aren’t taking credit cards for pledges, there are jokes all over the site, and the video is dripping in satire.

In the end, the “Take Craft Back” campaign is doing its job. Not only is the beer community talking about it (New Belgium, Stone both shared and posted about it) but it’s actually getting national attention in publications like the Chicago Tribune, Men’s Journal, Forbes and more. To outline how important this is to the cause, don’t look any further than a recent interview with a MillerCoors executive where he waxed poetically about the craft beer industry. Pete Marino, the head of Tenth and Blake (MillerCoors craft beer division) was interviewed about the state of craft beer. While that alone is an eye-roller, his comments were interesting in the wake of this Take Back Craft Campaign.

“It’s no longer good enough to brew an interesting beer, throw a catchy name on it, throw it on the shelf and expect it’s going to sell. So you’ve got to start thinking about awareness. You’ve got to start thinking about building and driving a brand.” 

Well then, good job, Brewers Association, because this campaign is all about building awareness. While he was speaking about bringing awareness to a specific brand, it’s not a stretch to apply this mindset to awareness on the topic of independence vs. Big Beer. When asked if he thought that the BA’s Independence label is effective he said:

“Is there some small percentage of consumers that are going to be seeking that? I’m sure. But the overwhelming majority I don’t think are going to care. They want a good beer drinking experience from brands they can identify with.”

Does this “overwhelming majority” not care because they just want a “good drinking experience” from brands that have a large marketing budget or do they not care because they don’t even know about the issue? With the help of this marketing campaign, maybe more people will become aware and start to think about which companies they support. The more info that gets out to the average drinker, the more likely they are to care about what happens in the craft beer industry. The rest of the article is rife with big beer talking points (people are tired of too many choices, branding is going to win in the end) so it’s definitely worth read. In the meantime, I pledged $1000 and got a sweet koozie out of it. Totally worth it.

 

gabf

5 Things I Learned at GABF

5 Things I learned at GABF 2017

The Great American Beer Festival was held this past weekend in Denver, filling the city with more than 60,000 people ready to celebrate the wonderful elixir that is craft beer. 800 breweries from across the country attended, pouring 3,900 beers for thirsty attendees. There were almost 8000 beers entered in the competition, in 98 style categories. With so much beer to drink in so little time, the Thorn team knew that we had our work cut out for us. Attending this year was me, Jay Jones (sales), Eric Shelley (NP head brewer) and Scott Smith (Barrio Head Brewer). While it was my first year attending the fest, the other three are seasoned veterans. Other than being an insanely fun weekend filled with craft beer, delicious food, and…other enjoyments, there are five things that I learned about GABF which make this festival bucket-list-worthy.

Denverites Are Absurdly Nice

While the city of Denver is really pretty and clean, what was most notable about the city was how incredibly nice the residents were. Now I like to think that San Diegans are nice and helpful, but we don’t hold a candle to Denverites. Not sure where you are going and looking at your iMaps to figure it out? No problem, someone will stop and ask if you need help with the directions. This happened at least 4 times. Yes, maybe we were lost more than the average bear, but the Uber app is very confusing when it comes to pick-up points! People sitting at tables beside us in the restaurant were always friendly and offering advice. The staff from the breweries, restaurants, and bars that we visited were incredibly accommodating and just friendly. And that goes for the whole city…just super friendly people all around.

So Much Beer, So Little Time

This sentiment goes not only for the actual GABF festivals but also the surrounding watering holes. There is so just much great beer. At the fest, the hall is so huge, I’m pretty sure there are parts that we didn’t even get to, even though we walked and walked around tasting beers. One ounce pours at each booth made it so you could taste more beers than a normal festival, but even then, with 3,900 beers pouring, it was nearly overwhelming. When not working the fest, we set out to experience Denver’s beer scene. We hit up Recess Beer Garden for a kick-ass food and craft brews, Star Bar for live music and more beer, Prost Brewing, Denver Brewing Co., The Source, and Trve Brewing Co. for some damn fine sours.

Awesome Volunteers

One thing that really struck me (and maybe this goes along with Denverites being nice) was that all of the volunteers working the festival were awesome. Whether they were pouring our beer and learning all they could about the brewery so they could be the best ambassadors or they were trying to keep the brewers and festival attendees safe by patrolling the stairs leaving the venue (I guess sliding down the bannister was a beloved and dangerous pastime of festival goers), they did so with humor and grace. They had so many volunteers you could always find one when you need one, and the festival organizers treated the volunteers well, making the whole event enjoyable and a real party-like atmosphere.

Shame is the Name of the Game

One of the funniest aspects of the fest was immediately apparent on the first night. I was sipping on some fine craft beer and all of a sudden I heard a huge rise in the crowd noise. Every few minutes you could hear the crowd start cheering/booing and in a venue that huge with so many thousands of people it was certainly loud. Turns out, like a lot of fests, when someone drops their taster glass the whole crowd around starts cheering and pointing. When it happens at GABF, it’s a hole other ballgame based on the sheer size of the crowd. Yes, you are getting shamed by hundreds if not thousands of people at once, but it lends to the party atmosphere of the whole event and somehow turns the embarrassment of dropping your glass into the entry to an exclusive club of slippery fingered people. Thanks to What’s on Draft for capturing the madness on video…

Brewers Are Romantics

Saturday morning was the Awards Ceremony. There is an electricity in the air as brewers file into the huge conference room, hoping to bring home one (or more) of the nearly 300 medals given out in 98 different style categories. The IPA category is always the most popular one with more than 400 entries, so in an effort to keep the hall filled with brewers until the end, they announce it last. While Thorn didn’t bring home a medal this year, lots of our San Diego beer-brethren did and we were super excited for them, cheering extra loud whenever an SD brewery pulled a medal (14 in all!). But the sweetest moment of the awards ceremony came when a brewer from Wibby Brewing, from CO, got down on one knee, on stage, after winning an award and proposed to his girlfriend. The ceremony stopped for a moment as all of the hardened, beer-soaked, brewers cheered like crazy as the two lovebirds celebrated the proposal. She said yes, thank goodness because that would have been awkward otherwise, and after a few moments, the ceremony continued.

The Proposal from WhatsOnDraft on Vimeo.

All in all, the weekend was a huge success. Coming together with brewers from all over the country was an incredible time and one that we are only just now recovering from. If you are a serious craft beer fan, I would highly recommend making the trip to at least one GABF in your lifetime, not only for the fun that can be had in Denver and GABF but also for the awesome people you will meet throughout the entire weekend.

 

selling out beer and coffee

Selling Out: Aussies, Americans, and Coffee

Photo Cred: justdoc.com

Last week, it was announced that 4 Pines Brewing, Australia’s largest independent brewery, was purchased by AB InBev through its ZX Ventures which they have coined their “global disruptive growth group.” While AB InBev buying up a craft brewery is hardly news anymore, this brewery purchase if a first fo ZX Ventures. It was recently reported by Forbes, that the High End, the craft beer division of AB InBev, was no longer looking to acquire new breweries, that it was instead going to focus on organic growth (i.e. open up breweries that were even murkier when it comes to AB InBev’s ownership). They must have meant, “in the U.S.” Possibly this deal was on the books long before that interview with Forbes or perhaps ZX Ventures is the newest golden child at AB InBev and for some reason, AB InBev is going to funnel their acquisitions through that arm now. Either way, 4 Pines has learned some things from the sell-outs that came before and they took an unapologetic stance in their announcement on Facebook, trying to get ahead of all the brouhaha that was sure to come by pre-emptively answering the most-asked questions when a brewery sells out. From their Facebook announcement:

Here are some answers you might be looking for:

Yes. 4 Pines will continue to operate all existing venues.
Yes. Everyone keeps their job.
Yes. 4 Pines is now 100% owned by ABI.
Yes. The Brookvale brewery will be expanding its capacity in the very near future.
Yes. Some people will think our beer tastes different.
No. It doesn’t.
Yes. We will have access to even more ingredients and better brewing toys.
Yes. 4 Pines has already started developing plans for national and global expansion.
Yes. ABI and 4 Pines fat cats have a squash game and a hot sauna locked in to celebrate.
No. Costs won’t be cut; in fact, we’re looking to invest.
Yes. Our commitment and investment to sustainability will grow.
Yes. We will join ABI’s global plan to be a 100% Renewable Energy Brewery.
Yes. As part of ZX Ventures, we will be part of the global forefront of beer innovation.
Yes. Our current beers will remain.
Yes. We’re looking to grow Keller Door and Keller Door Barrelled even more.
Yes. The founders and all the key people are hanging around.
Yes. 4 Pines did treat themselves to a case of Crownies to celebrate.

While some of the commenters on their page felt that this cheeky reply was disrespectful to their very real feelings of disappointment, it does show that 4 Pines did their homework before announcing the sale or they got the “selling out talking points” memo from AB InBev. All of these answers are well and good but they don’t address consumers’ concerns about putting money in the coffers of a business that consistently undermines smaller breweries at a legislative and business level (i.e. pay-to-play). So yes, all of these elements of 4 Pines may stay the same, but that’s not really the point for people who are anti-AB InBev because of their business practices vs. their ability to create opportunities for breweries that they buy.

Do Aussies handle indie beer sellouts the same way that American craft beer lovers do?

4 pines vs. Wicked Weed

It turns out, maybe not. In an entirely unscientific examination of the Facebook pages of 4 Pines Brewery and Wicked Weed (which sold to AB InBev earlier this year), a couple of things stood out. First, I took a look at the posts on each page announcing the ownership change. We can compare the “likes” to the emojis for “Angry” and “Sad.” For 4 Pines, their likes on the announcement post were at 498, “Sad” came in at 98, “Wow” got 44 and there were no “Angry” emojis. Seems pretty reasonable when you compare that to the Facebook page of Wicked Weed. Not only did the “strategic partnership” announcement on their page show 2005 “Likes”, 1045 “Angry” emojis and 982 “Sad” emojis (bringing the negative reaction tally ahead of the positive one) but even though the sale was back in April, the most recent posts are still dumpster fires. People are still posting negative comments on every post, making jokes about Wicked Weed selling out or just expressing their undying displeasure no matter what the topic of the post is.

This was a surprise because when I checked the Facebook pages of other breweries that sold to AB InBev (Karbach, Devil’s Backbone, Breckenridge), most show no recent activity from the anti-big-beer crowd save for a few stray comments on random posts. Maybe it has to do with Wicked Weed being the most recent of the American acquisitions or maybe it’s because Wicked Weed was beloved for its sour program and specialty beers and fans feel like the sellout is an especially big slap in the face. Either way, it’s a stark contrast to the more mellow reaction from our Australian brethren.

Coffee vs. Beer

It’s not just craft beer consumers who freak out when their beloved, local shop sells out to a global conglomerate. It turns out coffee lovers are just as testy.  This past week, it was announced that artisan coffee company, Blue Bottle Coffee, based out of the Bay Area, sold a majority share of its company to Nestlé. The resulting online fury was swift as former fans raged all over Blue Bottle’s Facebook page. Nestlé not only has been accused of pushing infant formula in developing countries where access to clean water is a struggle but apparently, they siphon water out of National Parks as well as drought-sensitive areas to the tune of billions of dollars in profit, paying little to nothing for the water taken. Furthermore, a recent NY Times article outlines how Nestle is contributing to getting people hooked on junk food in isolated areas of Latin America, Asia, and Africa and the resulting negative impact on those communities. People were angry the company they loved and supported was now controlled by a corporation with such a track record.

In the end, these sorts of sale/acquisitions/investments will continue on in the business world, so where does the outrage come from in the craft beer and coffee industries? Maybe it has to do with the demographics of consumers who can afford to buy craft beer and craft coffee and the luxury of being in that socioeconomic class which allows one to spend time being socially conscious. Or maybe it has to do with the handmade, artisan nature that sits at the soul of both of these craft communities. They offer something thoughtful, something special and people get to feel good supporting companies that often boast about their community focused, fair-trade, earth-friendliness. Maybe when those companies sell out, that craft consumer feels fooled and embarrassed they thought the company was something different than it was, because it’s ok for it to be about the money, just don’t pretend it’s not.

 

 

high end lay offs

Efficiency Experts: AB InBev Makes Deep Cuts to The High End

Yesterday was a rough day for many of the employees at The High End, AB InBev’s craft beer division. The night before, around 10 pm, The High End district managers and sales people started getting calendar invites for a conference call the next day. By the end of that call, approximately 360 employees or 90% of the national sales force were let go. According to Alex Medicis, the Vice President of Sales for AB InBev North America, the cuts were made in the name of efficiency. It makes sense too. After acquiring 10 craft breweries in the last few years, they added quite a few people to their payroll. Most of these breweries came with their own sales team and since sales people are often the face of the brewery to accounts, it makes sense that they would want to keep the “craft beer faces” around vs. the corporate sales employees. AB InBev is stressing to the media that this is not a big cut for AB InBev since it only amounts to 2% of their North American work force, which tops out around 18,000 workers.

What does this mean for the future of The High End? AB InBev said that it didn’t lay off anyone that worked directly with the craft breweries, so it sounds like they just went through a good ol’ efficiency downsizing. Interestingly enough, Forbes sat down with Felipe Szpigel, the president of The High End, on Wednesday, the day before the layoffs, and a few things came up.

First, Szpigel said that they would no longer focus on acquisitions. Does this mean they are done with their big, buying spree? Craft beer is still a bright spot on their less than stellar American sales record (of course they are doing just dandy internationally), so aren’t getting out of the craft beer game. Szpigel then stated that AB InBev would now “pivot to growing its ground-up model.”

As an example of this “ground-up model” Szpigel offered up the new  Vesa Sur brewpub in Miami, “a first-of-its-kind partnership between AB InBev-owned 10 Barrel Brewing in Bend, OR, and Colombia’s Bogota Beer Company.” Just an FYI, AB InBev also owns Bogata Beer Co., so they are really just partnering with themselves.

Now, this pivot is making sense. AB InBev is good with the 10 American craft breweries it already has. With the acquisition of these craft breweries, not only did they get a whole league of local sales people, but they got years of craft brewing experience. They don’t need to buy any more breweries because now they can create completely new craft breweries with the people they already have bought out. If you go to the Vesa Sur facebook page, things look great at the brewery. Who wouldn’t want to go to a new beautiful brew pub with Colombian inspired craft beer?

AB InBev has finally done it. They have managed to almost completely obscure their involvement in this new venture because it goes through 10 Barrel and Bogata. It’s just another degree of separation that will confuse consumers and people who don’t know about all the shadiness AB InBev has pulled in the industry over the last number of years. The more degrees of separation they create, the more likely people who aren’t specifically invested in the craft beer scene (ie. the majority of beer consumers) won’t have any idea that they own these new ventures.

The people over at AB InBev are definitely crafty. With the Vesa Sur venture, they have essentially leveled up when it comes to obscuring their involvement within the craft beer industry. In a few generations of opening breweries and brew pubs using these sorts of partnerships, people won’t be talking about AB InBev at all. They don’t need to buy any more breweries because they now have enough ammo to blast through the craft beer market one collaborative venture at a time.

wine tasting in the valle

Just Another Day in the Valle

One of the coolest things about living here in San Diego is our close proximity to Mexico. From the brewery, it’s a 15-minute drive to the border and from there the possibilities of international fun are endless. Superb food, delicious wine, craft beer, warm people and a scenic drive are all waiting for you in Baja, so grab your passport and use this day-trip itinerary that the Thorn crew recently followed in Mexico.

Mexican Insurance is Your Friend

heading to the valle

First things first, you’ve got to get Mexican insurance before heading across the border. Most American insurances will not cover you down there and you don’t want to have to foot the bill for both your damage and any damage you might cause. Mexican insurance is cheap and it’s easy to get. There are tons of places to stop at the border before you drive across. Our favorite is Baja-Mex, which is right by the outlet mall at the border, because not only can you get coverage there but you also can exchange your dollars into pesos. You can also buy get coverage through their website from the comfort of your own home, print out the documents and you are good to go. The exchange rate was 17.8 pesos to $1 when we went. To quickly calculate costs, just divide the cost of something (in pesos) by 17.8 and you will get the dollar cost of whatever you are buying. We were quickly taken care of by Chuy, the owner, and were off on our way within minutes.

Food First

dona estela in the valle

When setting out on a day of drinking, it’s always a good idea to put down a good base first.  There is no better place to get an authentic Mexican meal than La Cocina Dona Estela. This family-owned restaurant is at the end of a long dirt road in the Valle de Guadalupe. The restaurant is spacious with plenty of seating and while it doesn’t have AC, it does have lots of fans that keep it cooler in there than the 100 degrees it was outside when we got there. The highlights of the meal were the rojo chilaquiles, nopales, fresh tortillas, hand-squeezed lemonade and if you are feeling frisky in the morning, the sangria. Also, when you sit down they bring you a heap of freshly made tortilla chips, salsa, and queso fresco to get you started. The restaurant is surrounded by a bevy of animals like pigs, cows, and goats and we were treated to the incredibly enjoyable sight of pigs swimming on our way out.

Wine Next

wine tasting in the valle

After filling up on Dona Estela’s delicious food it was time to start wine tasting. Valle de Guadalupe is home to over 151 wineries ranging from small family-owned wineries to expansive wine-focused resorts. Being that this was a quick day-trip and we had plans in Tijuana at 5 pm, we decided to hit up 2-3 stops for wine. We started out at Adobe Guadalupe, a winery that is also a horse farm which happens to be the largest breeder of Azteca Sporthorses in the world. This winery is in a church type building and is air conditioned, which is a major bonus on a hot summer day. The wines were really tasty, especially the Bordeaux, and only $10 for a tasting of 5 wines.

Next, we headed to Monte Xanic (pronounced Monte Shaneek) for the next round of wine tasting. This winery is perched up on a hill and has probably one of the best views of the Valle. While not air conditioned, it’s hilltop location meant that there was a nice breeze that came through as we tasted away. Again, the tastings were a smashing deal at $10 for 6 tastings of both reds and whites. 

More Food

Any trip to the Valle isn’t complete until you stop at Finca Altozano from renowned chef, Javier Plascencia. This expansive, open-air restaurant has beautiful views of the Valle and some of the best food we’ve had anywhere. What’s cool about this place is that rather than just having one brand of wine to taste, they have an extensive wine and craft beer list from the local wineries and breweries. We settled on bottles of a dry Rose that was chilled and refreshing. Maybe it was that we were finally acclimating to the temperature or maybe it was that this was our third stop of th day but even though it was 100+ degrees, sitting on their deck sipping wine in the shade was relaxing and comfortable. The food was the star here, though. Our favorite dishes were the grilled octopus, handmade sausages, grilled corn, octopus ceviche, ahi tostada and their freshly baked bread with 4 different sauces of varying degrees of heat. The grilled octopus was definitely the must-have dish of the meal, with a savory, wine and butter sauce that was to-die-for.

Xolos Fever

Finally, we headed back to Tijuana for the last stop in our Baja day-trip, a Club Tijuana soccer game. For many of us, it was our first time at a Xolos game and it really was a blast. The huge red and black stadium arose out of a packed parking lot filled with tailgaters and bands. Not Mariachi bands, though, more like small vagabond marching bands which were jamming all throughout the parking lot, lending a celebratory feel even before entering the stadium. Once inside the stadium, it was impossible not to be caught up in the general excitement that was flows through the crowd. The soccer game was entertaining, but perhaps one of the best things at the game was La Masakr3, or the Massacre, which is a group of rabid fans that sit behind one of the goals. They literally never stopped moving the entire game. Whether flag waving, fist pumping or clapping, they moved to the intoxicating beat of multiple drums that would kick any drum circle’s ass from our hippie college days. In fact, it’s rumored that if the fans in this section stop moving, they get poked or are asked to leave, so they take their cheering pretty seriously.

Bonus: on our walk back to the van from the game, we came across a random zoo or big cat enclosure. There were tigers, white tigers, jaguars and more, all within arms reach and without the pesky safety enclosures that American zoos have in place. You could literally walk right up to the cages and if you are dumb enough stick your fingers through. I think that they are owned by Agua Caliente but it’s unclear from my internet sleuthing.

So there you have it, an easy Baja day-trip itinerary that will leave you full of food, wine, and fun. The best part is that it was a quick crossing at the border at 10 pm on a Tuesday night and we were all tucked in our own beds by 11 pm. If you have a weekend to spend at the wineries, that’s even better, but it’s such an easy day-trip, don’t put it off if you are searching for the time.

Want to win a trip for 2 to tag along the next time we go to the Valle? Just sign up for our Facebook Messenger group at http://bit.ly/2eqTcJp and type in the word “Valle” and you will be entered!

Gabf crowds

GABF Brewery Preview: Notable Omissions

The Great American Beer Festival is coming up in a couple of months and they recently released the 2017 list of breweries that will have booths at the fest. With more than 800 breweries represented every year, it has become the biggest beer event in the country. That number is only some of the breweries that wanted to be at the fest, however, since a lottery has been in place since 2014 to help organize the huge number of breweries that are eager to participate. In 2013, a surge of attendees entered GABF and the result was that the booth spaces sold out within 2 hours leaving many long time attendees as well as popular newer breweries out in the cold. Now there is an entry period over a few weeks where everyone can apply to pour beers and then they run a regional lottery to determine who can actually attend. Not everyone wants to go to GABF, however. Some breweries are not interested in trekking to Colorado or the large costs associated with the trip.

Dude, Where’s Vermont?

One notable omission from the fest is the entire state of Vermont. Not one brewery is representing the Green Mountain State this year and I, for one, am bummed. I grew up in Vermont and remember my first Otter Creek Pale Ale that ushered me into the wonderful world of hops. I think most craft beer lovers would agree that a Hillstead Farm, Lawson’s Finest Liquids or The Alchemist showing would make us incredibly happy and might even be a highlight of the trip. On the one hand, this omission is surprising because Vermont is known for producing some of the best craft beer in the country, but on the other hand, we have to remember we are talking about Vermont. Vermonters by nature don’t give a crap about most conventional accolades. They aren’t ones for tooting horns, blasting BS on social media, worrying about national distribution, or as it turns out, national exposure at the GABF. Vermont breweries have won a few GABF medals over the years and they certainly could be entering this year (that list is not available), so we will see if they pop up on in the winner’s circle in October. And if any Vermont breweries do need someone to hop on stage at the GABF awards and accept a medal for them, this Vermonter will be more than happy to help.

Big Boys Stay Home

Another notable omission from this year’s GABF list is most of AB InBev’s portfolio as well as other big beer owned breweries like Lagunitas. Big beer is just as welcome as any other beer to compete at this fest, but it seems that many of the “craft” breweries bought out by AB InBev decided to stay home. This is actually the first year that Breckenridge Brewery won’t be attending since 1991. Maybe they are making a stand against the Brewers Association which recently released an emblem designed to signify whether a brewery is a craft brewery or not. The High End’s video about the emblem is both hilarious and worth a watch to see their strong reaction.

Part of the reason for the low attendance by craft breweries probably has to do with the rules that GABF recently rolled out in 2014 which limits the number of beers entered from breweries owned by any one company to 20. When your “brand family” owns so many breweries, those 20 entries are spread out and limits the submissions from companies like AB InBev and MillerCoors.

But AB InBev does have a couple of breweries representing. Blue Point and Four Peaks will be pouring beers at this year’s GABF. Interestingly enough, these breweries are two of the most lo-pro crafty breweries with many people not knowing they are owned by AB InBev. While 10 Barrel, Elysian, Golden Road and even Wicked Weed have been much higher profile breweries for the High End (AB InBev’s craft beer division), the other two breweries have slipped by with less negative publicity surrounding their buy-outs.

To be fair, most of this is speculation at this point. We don’t really know why these breweries are staying home anymore than we know the reasons why breweries attend the fest. Thorn will be there this year pouring and your’s truly will be attending too, so look for more blogs coming you way about the biggest beer event of the year!

 


Big Ideas in Beer?

Craft beer is an industry built on creativity and imagination. Most of the time that creativity leads to tasty beer and innovative products, but other times it can leave you scratching your head and wondering, “What were they thinking?”

We thought we would give you a round-up of some of the most creative products we have seen recently, for better or for worse. All of these products raise the question of whether it’s a product meant to meet a real need or it’s a gimmick. Not that gimmicks are necessarily a bad thing. Sometimes the things done in fun and meant to be gimmicky ends having surprising legs (I’m looking at you Rocky Mountain Oyster Stout).

Shower Beer

shower beer gimmick

Shower beer is certainly not a new concept. In fact, enjoying a cold beer while taking a warm shower seems to be a universal activity that spans the world. This simple pleasure spawned the idea of Shower Beer by Swedish brewery Pang Pang and Snask Creative Agency. This beer is a 10% brew sold in 6 oz bottles to help kick start your night out. It’s meant to be a quick shower beer, though this might be the first sticking point for veteran shower beer lovers who want more than a couple of sips of beer. This has gimmick written all over it not only because it was co-created by an ad agency, but also, is it really filling a need? It seems that the ultimate shower beer might be any beer you love in a can. How can this be the ultimate shower beer when it comes in a glass bottle? Now that so many craft beers come in cans, it’s easier than ever to get your favorite brew into the shower. There’s even a website for people who love to drink beers in the shower: www.showerbeer.org. Their directions for drinking the perfect shower beer are short and sweet:

big idea

Mad Hops

This could be the product that no one asked for but might fill a need for some people; flavorings for cheap beer to make it taste like expensive beer. Not kidding. Wild Blueberry, Apple Amber, Mexican Lime, and Pale Ale are just a few of the flavorings Mad Hops offer that you can squeeze into “everyday” beer to make it taste like a craft beer. The Mad Hops marketing shows them transforming Coors Light into a delicious craft beer. The admittedly good reviews on Amazon highlight things like;

“It makes Bud taste like something from a local micro brewery. “

“People had a blast changing the regular old beer into a craft beer of their choice!”

“Completely transformed my cheap beer into a craft beer. So yummy and cheaper!

Craft beer is certainly more expensive (and for good reason). But maybe the people who would buy this product don’t have access to the plethora of amazing beer we have around here. In the end, there seems like there could be a market for this, but not likely in San Diego.

Fried Fried Chicken Chicken Beer

We’ve survived many strange beer ingredients over the years, some of which we blogged about in the past including, beard yeast, pizza, and bull testicles. Now, Veil Brewing and Evil Twin Brewery have collaborated to put out a beer called Fried Fried Chicken Double IPA, made with real pieces of fried chicken tenders from Chick-Fil-A.

Creative beer ingredients will always get a pass as long as they taste good. This beer is unabashedly a gimmick because the brewers fully admit the beer tastes nothing like fried chicken. In fact, it only has trace amounts of fried chicken in the beer, amounting to less than .4% of the total weight of mashed ingredients. People seem to be enjoying the beer for what it is, a hoppy double IPA bursting with Citra, Simcoe, and Enigma hops. The two breweries, meanwhile, get a huge boost in media exposure from the dubious idea of fried chicken in a beer.

Canvas Barley Milk

Brewers are often looking for ways to reduce, reuse and recycle their beer-waste. Now, a company called Canvas developed a product called Barley Milk made with the spent grains from breweries. They call it “saved” grains to gussy the name up a bit but it doesn’t sound like a half-bad idea. Lots of people will drink anything high in fiber and protein and we certainly can take the help with disposing of brewery waste. They currently sell their drinks on Kickstarter and have raised more than $40k towards their $25k goal. The only thing that makes me go hmmmm is that at the very bottom of their Kickstarter page, it says they are backed by AB InBev’s “global disruptive growth group,” Zx Ventures. It’s unclear why a company backed by a multi-billion dollar company need to use Kickstarter to fund their products, but only time will tell if this barley milk has any staying power.

In the end, these companies should be applauded for their boldness to try something new. Whether it’s a gimmick or not hardly matters if the company gets positive buzz created around their business. So congrats to these guys for boldly going where no brewer/company has gone before and having some fun while doing it.