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Big Beer's response to craft: If you can't beat 'em, join 'em

Discussion in 'Beer News' started by dauss, Dec 13, 2012.

  1. dauss

    dauss Advocate (565) Colorado Aug 9, 2003

    http://management.fortune.cnn.com/2012/12/12/sabmiller-big-beer-craft-brewers/
    Quite a turnaround from what Graham Mackay said in a piece from June 4, 2007, SABMiller's Beer Baron Opens Up.
    I also wonder how macro beer tasted 30-40 years ago, when the IBU's were in the high teens.
    einhorn and THANAT0PSIS like this.
  2. Holy Christ, this guy does not understand craft beer at all. Here are a few choice excerpts for the lazy:

    "For most beer, the proposition is emotional. It's not functional. The beer is not that different. And even if the beer is different, there are others that taste much like it."

    On whether he thinks craft beer will continue to flourish, "And I think it will become less fashionable. These things are fashion to some extent."

    "In a sense, what Tenth and Blake represents is a selling or a marketing organization oriented toward beers still in incubation mode. Once the brands become big, they can be handed over to the mainstream. Blue Moon is still handled by Tenth and Blake, but it's almost inevitable that at some stage in the not too distant future, you might contemplate moving Blue Moon out into the mainstream and just treat it as another brand."

    Wowzers.

    Even though I picked out what I thought were the good parts, read the whole interview. It is short, and lots of the things are gold, Jerry, GOLD!
  3. LMT

    LMT Savant (305) Virginia Oct 15, 2009

    The interview really didn't surprise me (but it was well woth the read). Any rep from BMC needs to publicly state that most of the growth in craft beer is due to trendiness, or anit-coprate feelings, or image, etc.

    If they actually admitted that yes, the growth in craft beer is mostly due to some really different AND better tasting beer being brewed, then they're just admitting that they sell an inferior product. No corporate exec is going to do that.
  4. I agree, for most beer, the proposition is emotional. I also agree that there isn't much difference between Miller, Coors and Tenth and Blake.

    I also agree that these things are fashion to some extent. How many people who like craft beer, also literally, wear it on their sleeve? (i.e. merchandise: tshirt).

    I also agree that Tenth and Blake is a marketing organization.

    I dunno, what was I supposed to disagree with? What do you (or others) disagree with about what he said?
    cbeer88 and rrryanc like this.
  5. He is talking about the proposition to craft beer being emotional, rather than based on it tasting better, which basically means that because craft breweries are the David to their Goliath, we are rooting for them and doing so through buying their products. He is not comparing Coors to Miller to Bud to Corona, he is comparing macros to craft and saying that there isn't much difference.

    He is essentially saying that because it is fashionable to like craft beer (or so he says), that it will also be ephemeral like fashion. Basically a rewording of the outrageously ignorant statement he made in the 2007 interview regarding craft brewing.

    Tenth and Blake IS a marketing organization. That is what's wrong with it. I don't think that Founders, Russian River, Dogfish Head, Lagunitas, New Glarus, or basically any true craft brewery are marketing organizations. They are breweries first. Their marketing is the quality of their beer, the word-of-mouth that stems from that, and the label that goes on it.
  6. Well, maybe if they did that they could finally decide to actually brew something with taste in order to compete, instead of the same bland, carbonated refreshment they've been brewing for years and fighting what is most certainly not a fad with something other than defamation. This beating around the bush bullshit is annoying to those in-the-know and patronizing to those who aren't as wise.
  7. I didn't read it that way. He was asked about Tenth and Blake, and never mentioned 'craft' beer in his answer. He never mentioned Bud, Corona, David or Goliath. Those are projections made by some readers. Regardless of which beer he was talking about, beer does have an emotional connection.

    It is fashionable to like craft beer. The numbers don't lie, 13% increase in volume in 2011. Its 'fashionable,' and beer people literally wear said fashion. Fashionable isn't a dirty word. In general, people who like to think of themselves as non-conformists are unintentionally entertaining, as they all seem to conform in their mission to let you know they don't follow trends. Typical for all sub-cultures pretty much: goth, punk, metal, redneck, hip-hop etc. . . they all look the same, despite holding themselves out as anything but. Same with beer geeks.

    Even great breweries are involved in marketing. Marketing isn't a dirty word.
    dbc5, cavedave, YogiBeer and 4 others like this.
  8. Since Tenth and Blake is a faux-craft company and is being used to attempt to break into the craft market, I think it is quite clear what he is talking about, even though he does not just come out and say it. Your mileage apparently varies.

    I do think that fashionable is a dirty word to describe people who aren't in it for the fashion. I also think non-conformity is necessary for progress. Some people don't avoid conformity for the "fashion" or stylishness of it, they avoid conformity because they honestly believe that those following trends are ignorant sheep, and they believe that there is something better out there than what everyone else likes.

    When your company is set up as a marketing machine first and a brewery second, as is the case with Tenth and Blake, straight from the horse's mouth, there is a problem. That's what I was saying.

    It's pretty clear you're not reading into the article the same as me (and some others), and that is, of course, perfectly fine (especially given the ambiguity of some of his answers, but I suppose these are simply, good, safe, rote answers). I was just trying to explain to you what other people (myself included) feel is inherently wrong about this man's philosophy regarding craft culture and beer in general.
    cjoc83 and Beerandraiderfan like this.
  9. Palesmith

    Palesmith Zealot (80) California Mar 6, 2010

    The only thing thing Mackay is good at "crafting" is the point of view that craft beer is really no different than BMC except for market share. Pretty good poker face, I must admit. If that was really the case, then the BMC's of the world wouldn't be trying to discredit, emulate and/or buy up the competition.
  10. nicnut45

    nicnut45 Savant (290) Illinois Jan 6, 2007

    If anything, I see big brands ruining the craft beer scene for any willing BMC drinker who wants to dip their toe into the craft brew world. They may give these knock off craft brews that BMC comes up with a try, but will resort back to macro's because there really isnt much of a difference between macro's and the new shit there trying to push.
  11. What's it like to go through life with blinders on, Mr. Mackay?
  12. LivingBuzzed

    LivingBuzzed Initiate (20) Dec 13, 2012

    Interesting point. I think that to some extent, craft beer is a fashion. But the product and principles will keep it going. Somebody once might have said that drinking California wine was a fashion too. But even though it's not the hot new thing, US wines have a permanent place in the market. The dust will settle, and the buzz will probably die down somewhat, but people will continue to drink craft beer. Organic food was a fashion a few years ago, and even though it's not all the rage anymore, tons of people are eating organic, sustainable, raw, and local now. The fashion may die, but a couple things won't:
    1) The quality of the product (although the macros can mimic the products to some extent)
    2) The principle of drinking local, U.S. made product will have continuing appeal. This is the same reason that whiskey, although still far behind vodka, is the fastest growing spirit class in U.S. consumption. In economic and environmentally "challenging" times, people try to help the environment by buying local, or at least domestic, as well as support the economy by supporting companies and products that keep jobs in the U.S.

    If ABI and Miller Coors had stayed headquartered in the U.S., perhaps they could regain a big chunk of the market. But even after this recession, people will continue to try to buy American, and, outside of heir branding, that no longer includes AB or Miller.
    Beerandraiderfan and kpanter like this.
  13. This guy sounds like a butthead.
  14. mychalg9

    mychalg9 Advocate (660) Illinois Apr 8, 2010

    They would get a lot more respect if they just openly admitted the competition and welcomed craft beer with open arms to the playing field. Making ignorant comments just makes them seem like bigger buffoons.
  15. First, I like that we can have a nice civil discussion full of substantive disagreement without some dweeb hitting the report button.

    I just don't really care to bother much with other people's philosophies. It's beer first for me. What is kind of interesting is that you say its about beer first too, but then get upset about the marketing, the 'fashionable' statement etc. . . ; I don't care, its the marginal product that makes me go 'meh' at best to anything Tenth & Blake, which maybe makes me more sympathetic to why they would need to go on the offensive even moreso from a marketing/advertising standpoint.

    I still think holding yourself out as a non-conformist is a form of marketing itself, and usually accompanied by others who also conform to the same ethos and image of non-conformity.

    Hey if you're at least gonna paraphrase people, give 'em credit ;). (non conformity necessary for progress = "All progress has resulted from people who took unpopular positions." Adlai Stevenson). I don't necessarily think change = progress though.

    Here's one I like:
    "When people are free to do as they please, they usually imitate each other" --Eric Hoffer
    albertq17 and THANAT0PSIS like this.
  16. I think you said it pretty well, but I'll also add that he was speaking to stockholders (existing and potential), not beer geeks. If you frame his quotes from that perspective, he "gets it" just fine.
    cavedave and Beerandraiderfan like this.
  17. Holy shit. I didn't know I was paraphrasing anyone. I just put what I thought in words that made sense. Plagiarism is really easy to do on accident. Thanks for the real quote, writing it down now. The other quote is a good one I hadn't heard either.

    I agree that non-conformity has its own conformers, which is ironic and somewhat hypocritical, but going against everything just to be unique in your position is simply being an obnoxious contrarian asshat and does not have the value that challenging the status quo on grounds that you truly believe in does, but you clearly understand that.

    It is really interesting that we care about the same thing, but reached that conclusion through a completely different path.

    Good talk, BeerandRaiderFan. Sorry about the Raiders... Loyalty is admirable, though! Even though I'm from WI, I am a Titans fan first, so I feel your pain. Being a Pack fan second makes the load easier to bear, however.
    Beerandraiderfan likes this.
  18. "We have our own craft brands. We also look selectively to acquire, or form partnerships with, or cozy up to people who have incubated good businesses. It's difficult for big companies to incubate small brands. That, at its heart, is the dilemma. To start a small brand in a credible, consistent, sticking-to-it kind of way is hard for big companies. That's what small entrepreneurs do best."

    This sounds to me like a really great opportunity for craft brewers/drinkers. As long as SAB Miller forms a sort of hands-off partnership with the smaller brewers this means that they be able to get their good beer (presumably) to a wider customer base. This seems like the smartest move that the big macro-brewers can make when the market is moving to tastier smaller batch beer. I know a lot of folks in the movement detest the idea of a craft beer being in leagues with a macro brewer, but I say what the hell? So long as the beer remains good it sounds win-win to me.
    creepinjeeper likes this.
  19. Its pretty simple you compare their words to their actions.

    aka publicly we want to distance ourselves from craft beer because its more a trend
    In reality we are hedging our bets and buying stake in craft breweries and creating new brands that appear at first glance to be craft.
    Bud Platinum is a direct response to liquors growing market as well as the demand for better crafted beers
  20. einhorn

    einhorn Savant (345) California Nov 3, 2005

    Bud Platinum a better crafted beer? I respectfully disagree. And malt liquor drinkers are grabbing Four Loko, the brewer's answer to anti-freeze. Not a step up by any means.
  21. YogiBeer

    YogiBeer Savant (485) Illinois May 10, 2012

    I've had the stuff that Big beer is trying to push as craft beer, and nothing even comes close... except for Big Eddy. Also, I know some tenth and blake guys, and they're actually pretty solid, beer savvy guys (they have homebrew comps as part of work, drink good beer, really nice, etc), but they will always tell you that the beer they push is good... even when the both of you know that it isn't.
    AnotherImperial likes this.
  22. beercanman

    beercanman Savant (485) Ohio Dec 17, 2012

    For Passion not fashion! This dude is a turd. Bet he doesn't even drink.
    Blueribbon666 likes this.
  23. cavedave

    cavedave Champion (930) New York Mar 12, 2009

    If a sizable number of folks starts wearing the same sort of clothing because it is the most comfortable clothing to wear, is it fashion, or is pragmatism?

    Big beer is right that craft beer is a fashion, but that doesn't mean only what they might believe it to mean. But we also shouldn't shy away from realizing that craft beer has become fashionable, as ironic and distasteful as that seems to old anti conformists like myself.
  24. aasher

    aasher Champion (900) Indiana Jan 27, 2010

    I don't see what's so surprising about the response from those invested in BMC. They obviously aren't craft beer drinkers. To expect them to acknowledge publicly that their product is inferior is insane!
  25. I was just simply restating the reason why they came out with platinum. Pretty much tricking bud and bud light drinkers in to stepping up to a better more premium beer. They market it as a better crafted premium beer but it really just has a higher abv. Big beer recognizes people want variety. This beer is just a away to keep those people from reaching out to true craft beers and providing them this "premium" option
  26. kexp

    kexp Savant (265) North Carolina May 10, 2007

    Craft beer is not "fashionable." It is the natural progression of beer since the repeal of prohibition. Prohibition was an outside force which altered and affected the market for over half a century.
    RyanMM likes this.
  27. frazbri

    frazbri Advocate (600) Ohio Oct 29, 2003

    Well, at least he sounds less evil than Carlos Brito of ABInbev.
  28. Fred9

    Fred9 Initiate (20) Connecticut Jan 31, 2013

    Did I read that Goose Island is owned by ABInbev?
  29. Firstly, thank you for your post and the link to the article; it was an interesting read.

    You asked: “I also wonder how macro beer tasted 30-40 years ago, when the IBU's were in the high teens.”

    I would suggest that a beer that will get you close to an American Adjunct Lager (AAL) of 40 years ago is Batch 19 which is brewed by Coors. Now, let’s discuss Batch 19 a bit. That beer is described as being a Pre-Prohibition Style Lager on the label of the bottle. The story behind this beer is that the recipe, which was formulated by Keith Villa a brewer from Coors, is based upon old logbooks discovered in the basement of Coors. Since the recipe is based on an old logbook it could be argued that the beer is similar to what was brewed by Coors prior to Prohibition. I have read details on the Batch 19 recipe and I am of the strong opinion that Keith practiced way to much ‘artistic license’ in formulating his recipe. I have had Batch 19 several times and it tastes like a modern day American Amber Adjunct Lager to me. It has 26 IBUs so it is a tad higher than the high teens but I am of the opinion that Batch 19 is not too far off from being an AAL of circa 1960s from a hopping perspective.

    Another beer which may also be an example of a 1960’s AAL could be Third Shift Lager. This is also an American Amber Adjunct Lager which is being brewed by Miller-Coors in ‘stealth mode’: the brewery on the packaging is listed as Third Shift Brewing (or something like that) but is brewed at a Miller brewery in Texas. I tried to see what the IBUs are for this beer but a web search came up empty.

    I took note within the article that Graham Mackay stated:”It's difficult for big companies to incubate small brands. That, at its heart, is the dilemma.” That is probably a truthful statement. I would imagine that for a big company like SABMiller (or Miller-Coors) the bureaucracy would not be conducive to genuine innovation. Based upon Batch 19 though, I am convinced that the bigger breweries are capable of marketing stuff.

    So, what beer could a brewery like Miller-Coors readily make which is flavorful and therefore worthy of being a craft beer? While it may be extremely difficult for them to think too far outside the box they have already shown they can think backwards; but where afraid to truly execute properly? Why not make a real beer like was made before prohibition beer? A beer that is called a Classic American Pilsner (CAP) by homebrewers. The big breweries facilities are already set-up to produce Adjunct Lagers and making a CAP would be very easy for them:

    In a nutshell:
    · Grain: 80% 6 row malts, 20% corn
    · Hops:
    - For Bittering: Cluster hops 25-40 IBUs (I prefer 40 IBUs)
    - For Flavor: Medium to high hop flavor from noble hops
    - For Aroma: Medium to high hop aroma from noble hops
    · Lager yeast

    A CAP would be very much in the ‘comfort zone’ for the big breweries to make and if they could market a bullshit version of this beer (i.e., Batch 19) they could certainly market a real version of this beer. I do not think it is obligatory for marketing to only be bullshit; a ‘good’ marketing organization should be able to market genuine products as well.

    Cheers!
  30. Prospero

    Prospero Advocate (610) Colorado Jul 27, 2010

    I actually really like Batch 19, although I'd make a few tweaks, it's way better than any other AAL on the market. To me this is where macro-brewers need to head, just make a better AAL. I was just in a BJCP homebrew competition here in Denver where the BOS went to an AAL (still trying to get over that)... but what it showed me was that if they just stuck to what they know and brewed it better with better ingredients and better recipes, the AAL market could sustain itself by those masses that just want a session-able lager and really have no interest in other types or styles.

    Follow the craft beer scheme, minimal advertising, better beer. Instead they opt for maximum advertising, poor beer.
    hopfenunmaltz and Crusader like this.
  31. teal

    teal Aficionado (195) Wisconsin May 3, 2012

    Craft beer is "fashionable" and a "fad" the same way Levi's were in the 50's.

    Worn by a few and eschewed by the status quo as never unseating the twill/khaki that was the routine of the day.

    Then it became the de facto "uniform" for everyone, every day. The ability to wear jeans at work is so highly valued that getting to do so is considered a "perk" - casual Friday.

    I see craft beer in the same position.
  32. If Blue Moon is their idea of a craft beer, we have nothing to worry about.
  33. Crusader

    Crusader Savant (345) Sweden Feb 4, 2011

    I thought I would provide an example of this strategy from Sweden which might be of some interest.

    In Sweden the Swedish macro brewery Spendrups have launched two separate pilsners via the monopoly over the last 3 years or so. Both times it was for a limited time only. The first offering was so-so, a bit too sweet and not enough bitterness. The next time around they had shapen up considerably. The first beer they produced was launched under their namesake label Spendrups and it didn't last (the Spendrups brand is not an up-and-coming brand anymore, so no surprise there given the so-so taste of the beer itself).

    The second time around they pulled out a now deseased brewery name that they owned the rights to and wrote together a story about it being, an albeit modern, interpretation of the pilsner-type beers which would have been brewed by this brewery during its existence between the years 1904-1955. So a similar background story to Batch 19 (only without the prohibition part). For the malts they used pilsner and some münich malt (not enough for it to take on a dark color), for hops they used hallertau magnum for bittering and then Saaz hops for flavoring in the late hop addition. The beer had 30IBU and a dry body along the lines of a German pilsner. 11,3 degrees plato and 4.8% abv. From what I understand they had more success with this second brew and I can understand why, it was delicious. My aunt served the beer at a family gathering and it was enjoyed by alot of the people present, including my mother and grandparents.

    [​IMG]
    That was the bottle when it was released. It was called vårpilsner or spring pilsner since it was supposed to be a limited release, but it proved popular enough that they're now relaunching the beer under the name utmärkta pilsner (excellent pilsner) via the restaurant trade (since they couldn't get a product slot for it in the monopoly this year undoubtedly). Granted this was an all-malt beer, but I don't think the flavor would have been wretched had it contained a certain degree of adjuncts (to make the beer more suitable for the big American breweries and their brewing set-ups). Whether the same beer could have had much success in the US, in an Americanized form, I can't say. What I can say is that a big brewer using state of the art brewing equipment and technology can produce truly excellent tasting beers that still fit into their overall portfolio of pale lager style beers.
    JackHorzempa and jmgrub like this.

  34. “For the malts they used pilsner and some münich malt (not enough for it to take on a dark color), for hops they used hallertau magnum for bittering and then Saaz hops for flavoring in the late hop addition. The beer had 30IBU and a dry body along the lines of a German pilsner. 11,3 degrees plato and 4.8% abv.”

    Well, it is not always certain from reading about a beer (vs. tasting it) but I am willing to bet that I would enjoy drinking this beer.

    As a side-note, I am drinking a Sam Adams Double Agent Imperial Pilsner Lager right now and I am enjoying it. It is apparently an American style IPA type beer which used a lager yeast. It is indeed an intriguing beer!

    Cheers!
  35. sbxx

    sbxx Savant (465) Illinois Mar 21, 2011

    Sadly, he's not really wrong.

    For some people, it is a trend or a fad. I've seen boxed wine drinkers get into craft because their friends said it's the new, hip thing.
  36. Blueribbon666

    Blueribbon666 Savant (490) Ohio Jul 4, 2008

    The posers will fade & perhaps there'll be a dip but really why is ANYONE surprised by what Madison Ave. Beer Inc. has to say...Of course the people on the top are going to trash those underneath their boot. Much like Walmart, do you think they give a shit about your opinion of their tactics & business practices, pshhhhh please.o_O There's plenty of myopic zombies lining up to buy as we speak.
  37. Blueribbon666

    Blueribbon666 Savant (490) Ohio Jul 4, 2008

    Lol, RIGHT...tell me that name doesn't smack of DICtator!
  38. rlcoffey

    rlcoffey Savant (480) Kentucky Apr 20, 2004

    The problem for them is that a new brand that sells 100k bbls is a failure, not a success.

    Look at the lists of the top new brands for each year and how quickly that get canceled.

    It is a truthful statement, because the scale for profitability is different for the big guys. To move the meter on the quarterly/annual reports it has to sell BIG.
  39. Do you happen to know how many barrels of Ziegenbock are sold per year. That beer is brewed by AB InBev and my understanding is that it is only sold in Texas. This beer has been produced for many years and it is still being produced (AB InBev has not cancelled it even though it is not a large seller).

    Cheers!
  40. rlcoffey

    rlcoffey Savant (480) Kentucky Apr 20, 2004

    That seems to be the "one" exception. Im sure there are others actually. I dont have any clue, but it doesnt make any top selling lists. Im guessing it is only made in one brewery and as long as they have the capacity there, it isnt an issue. Also, they dont advertise it.

    The national rollouts get advertised, so they have to sell a lot to justify the advertising. It is weird that they continue to make this one regional product though.

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