I'm Josh Noel, author of "Barrel-Aged Stout and Selling Out." Beer me anything!

Discussion in 'Beer Me Anything' started by joshnoel, Aug 2, 2018.

  1. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    Hello beer lovers,

    It’s a pleasure to talk with you.

    Quick background on me, my work and the book: I’ve been writing about beer for the Chicago Tribune since 2009. For several years, I was the Tribune’s travel and beer writer -- more travel than beer. As newspaper budgets tightened (less money to travel) and the beer industry blossomed (from 1,650 in 2009 to more than 6,650 today … and counting), the ratio flipped. I now write almost entirely about beer and the beer industry.

    Among the most fascinating breweries from the start for me has been Chicago’s Goose Island Beer Co. It’s been an important brewery in the American beer pantheon if for no other reason than its innovation – from Bourbon County Stout to 312 Urban Wheat Ale (which, yes, was a brilliant innovation in its own way; it almost single-handedly turned a struggling company profitable at a time that craft beer wasn't yet ascendant). However Goose Island leaped from important innovator to outsize force with its 2011 sale to Anheuser-Busch InBev. As it has become the lead national, and now international, craft brand for the world’s largest beer company, its stature and meaning have only grown.

    Shortly after Goose Island’s sale, I reached out to Goose Island founder John Hall, suggesting that there was a book-length narrative to be written about the brewery. I had no idea what form the book would take in those early days, and the story indeed only morphed as time went on, as Anheuser-Busch continued to gobble up American craft breweries. As you probably know, ABI ultimately bought 10 of them -- from Goose Island (2011) to Wicked Weed (2017).

    Eventually the narrative came into view, and “Barrel-Aged Stout and Selling Out” was released June 1, 2018. Reaction has been largely positive. I’m very thankful.

    I thought I’d get started by answering some questions that have already been posed by someone who goes by “thebeers” here at BA. Please jump in and ask me anything! I mean … beer me anything …

    The most important question first. Favorite styles: IPA and DIPA, of course, and as people who have read my stories and watched my tweets know, I have mixed feelings about the haze craze. That said, I still adore IPA and DIPA with explosive fruitiness so long as it is balanced against pine/resin/bitterness/etc. Also I love a good, funky Brett beer, a 5.5 percent oatmeal stout (or porter) and fresh pilsner. Oh, and BA English Barleywine. I’m really open to any style done well with the exception of American barleywine. To me, American barleywine just doesn’t work on a fundamental level.

    Not a lot. I’ve been doing a series of events and readings in and around Chicago, and Greg Hall has showed up at four or five or them, though we haven’t discussed the book in any depth.

    I think we’re firmly in the “execution” phase of AB’s move into craft. They spent six years understanding craft and what they needed from it, as well as buying 10 breweries that began with Goose Island and ended with Wicked Weed. Now they’re growing the brands, scaling up recipes for AB production, opening brewpubs of the acquired brands and creating new concepts (such as Veza Sur in Miami). They’re also delving deeper into other aspects of craft beer and craft beer culture, such as its additional acquisitions that everyone here knows well (RateBeer, Northern Brewer), getting deeper into beer media and launching events, such as OctFest. Seems pretty clear they’re intent on dominating craft beer in every conceivable way. That said, ABI is a company forever reevaluating its needs and “closing gaps.” I think it’s safe to presume they will acquire more breweries (and possibly even sell some) when it sees opportunities for improvement and efficiency that will serve its goals in the U.S. beer market – and the stock price.

    My book is focused on the US market; that’s the heart of the craft effort for them. But the effort has most certainly grown wings, and now extends across the globe. They’ve bought breweries in another dozen or so countries, and made Goose Island its lead global American craft brand, with pubs in China, Korea, Italy, Belgium, England, Brazil and others. It’s a global company with endlessly global ambitions.

    Great question. So long as a small brewer remains small, and depends on fairly little distribution, the answer is there’s fairly little impact from the AB juggernaut. In fact, AB depends on those smaller brewers to raise awareness of craft beer, and continue building its credibility. However, the ability of those smaller breweries to grow is what gets compromised by Anheuser-Busch’s forceful entry into craft beer. As long as they’re small, other craft breweries largely create awareness of the category. Once they get too big, they become competition.

    Undoubtedly. (Hello, moles!)

    Keep firing away, BeerAdvocate folks ...
     
  2. thebeers

    thebeers Poo-Bah (1,989) Sep 10, 2014 Pennsylvania
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  3. JackHorzempa

    JackHorzempa Poo-Bah (3,574) Dec 15, 2005 Pennsylvania
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    Josh, thanks for participating in the Beer Me Anything forum!

    Over the years there has been significant debate as to the strategy that AB is adopting in the production of the craft beer it has purchased. There are folks who are firmly convinced that an AB strategy is to ‘cheapen’ the production of the beer brands they have purchased (e.g., using cheaper/lesser quality ingredients, etc.) as a cost cutting method to increase AB profits. Have you found any evidence to support this ‘conspiracy theory”? Is it AB’s goal to ‘cheapen’ the production of the craft beers it has purchased? Is there any indication these AB craft beers are of lesser quality?

    More specifically some the top selling Goose Island beers are now being produced at AB breweries (e.g., Baldwinsville, NY). Are those beers different from when they were brewed at the Goose Island brewery in Chicago?

    Cheers!
     
  4. AZBeerDude72

    AZBeerDude72 Meyvn (1,260) Jun 10, 2016 Arizona
    Premium Trader

    Josh,
    Thank you for taking part of Beer Me Anything!

    There has been a lot of talk about craft beer using the "Independent" label on their cans/bottles. You have folks who think it is great and others who feel it is an unfair label. What are your thoughts on this and do you think it is a good thing in today's environment, do we need this separation?

    Cheers and thanks again for taking our questions.
     
  5. debaun27

    debaun27 Initiate (0) Oct 3, 2014 Massachusetts
    Premium

    Josh,

    Thanks. Two questions:

    1) Where do you see craft beer going in the next 5 years?

    2) As beer fans continue the hunt for exclusive and elusive great beer (small breweries, minimal distribution -Trillium, Treehouse in MA, Hill Farmstead in VT), any predictions on how big beer will react and create the same kind of exclusivity that make beer fans wait in line?
     
  6. Squire

    Squire Poo-Bah (1,854) Jul 16, 2015 Mississippi
    Premium Trader

    Hello Josh, thanks for taking the time to join us. A tangential question perhaps which I pose in case you have any thoughts. Over the years AB has made some noteworthy experimental or limited trial beers using all malt traditional recipes but were not able to market them in enough quantity to justify adding them to the regular line. My question is do you think AB might now reintroduce these prototype brews through one or more of their collective Craft holdings?
     
  7. EvenMoreJesus

    EvenMoreJesus Crusader (748) Jun 8, 2017 Pennsylvania
    Premium Trader

    First of all, awesome that you entertained this, man. Just one question for you: What do you see as the positives of Big Beer being involved in craft beer's expansion?
     
  8. TongoRad

    TongoRad Poo-Bah (2,408) Jun 3, 2004 New Jersey
    Premium Trader

    Josh, thanks a lot for doing this and apologies in advance for not having read the book yet, and hopefully you're not duplicating too much that may already be in there by answering this question: can you expand on any changes in procedure, and especially the culture, around the Barrel House and Fulton Street Brewery since the Bourbon County infection of 2015? Has it become more restrictive an environment for the brewers and cellar staff?
     
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  9. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    Jack, thanks for this question. In a very literal sense, cheapening production is the whole point; doing it in bulk -- buying ingredients, materials, brewing -- makes it cheaper for Big Beer and cheaper is the name of the game, especially a company like ABI that's so hyper focused on profit -- Carlos Brito's very handsome bonuses depend on it! -- and the stock price. Craft is now following suit. When we see someone sell to CANarchy (that name though ...) or even one of the smaller mergers, such as Southern Tier & Victory folding in together, there's always talk about how things become cheaper by teaming up.

    But you asked about "cheapening" production, which I think means corrupting it as a byproduct of AB taking over the process. When it comes to Goose Island, there's ample evidence that, yes, this has indeed the case. Goose Island likes to flaunt all those GABF medals that its IPA has won -- six between 2000 and 2012 -- but guess how many it has won since ABI took over production? Zero. All those medals are from when the beer was still made in Chicago. (The 2012 medal did happen after the sale, but it was one of the very last batches of the beer brewed in Chicago.) I don't think that's coincidental. Goose Island IPA is ubiquitous now, but it has become sub-standard in my opinion. Same for 312 Urban Wheat. That was once a pretty good if unspectacular beer. Now? Average as average can be. Scaling up is not a simple process, especially when you're dealing with volatile ingredients such as hops and entirely different tank geometry in the transition, as Anheuser-Busch and Goose Island were. Portions of the Goose Island portfolio have suffered as a result, and we see it in the sales, which are tanking all over the place.

    That said, I think AB has learned from its mistakes with Goose Island. From what I understand, a Golden Road brand like Wolf Pup has only become more consistent since AB started brewing it. I've also heard good reports on the AB-made Space Dust, which has become the most important beer in the AB craft portfolio. I'm not familiar enough with either beer to comment about how they are these days versus before those breweries were sold. If anyone has thoughts to share on this issue, would love to hear it.

    I don't think AB actively wants to make bad beer after buying these craft breweries. But making it as good as it may have been pre-sale isn't so simple. I think the real question is the slippery slope: Space Dust may be pretty good now. But what will it taste like in 20 years, if/when it is the top-selling IPA in the nation and the heat is off? What corners do they cut then, when they can more easily get away with it and are perhaps facing even more intense financial pressures than they are now?
     
  10. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    The Brewers Association's role in the craft beer battlefield has been interesting to watch during the last few years. I feel like they've done a pretty good job of identifying an issue to which they want to bring awareness and then undertaking efforts to raise that awareness. But there has been a lot of blow back. Plenty of people seemed put off by the mock bid to buy Anheuser-Busch InBev; I thought it was pretty amusing, and a novel way to draw attention to the fact that ABI has become a serial acquirer, buying its way to prominence in American craft. Plenty of people disagreed though. I never fully understood why. Some argued it was a poor use of member dues. Well guess what? Those members are going to have a harder time getting taps and shelf space due to ABI's forceful entry into American craft beer. Some people didn't seem to like the Brewers Association picking a fight with ABI. But what is the Brewers Association supposed to do? Just roll over and embrace ABI as the dominant craft beer player in the US? Seems to me the Brewers Association is upholding its very mission -- supporting small breweries (which let's not forget are also small businesses) -- by throwing up some roadblocks for the uber/mega/global corporation that is ABI during its march to American craft beer supremacy. (And, yes, not all Brewers Association members are terribly small and some have sold stakes to private equity -- but that's still light years from what it means to be a part of Anheuser-Busch.)

    The most visible effort for the Brewers Association has obviously been the upside down bottle logo. I thought the intensity of the reaction was interesting, including from people within craft beer: "Why draw lines?!" "What is 'independence' anyway?!" "The logo is ugly!" "WHY IS THE BOTTLE UPSIDE DOWN?!?!" And so on. I think it serves a valid purpose that is meaningful to some shoppers. Not all -- but some. The best justification for the upside down bottle logo is AB itself; when someone is standing in the beer aisle making a shopping decision, there's almost no transparency about who actually makes AB craft beer. As detailed in the book, there are plenty of Goose Island beers dolled up to make the consumer think the beer is made by Goose Island in Chicago when it fact it is made by Anheuser-Busch in New York, Colorado or New Hampshire. Now we're seeing the same thing for Elysian, Blue Point, Golden Road, 10 Barrel and others. The upside down bottle logo isn't perfect, but it does convey a degree of clarity and awareness; anything that provides more transparency to consumers is good with me.
     
  11. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    1) I think craft will continue to grow for the next five years, both in terms of number of breweries (maybe up to 8,500?) and in terms of sales. I think the own-premise trend is here to stay, and if we think of breweries as bars (taprooms) and restaurants (brewpubs), there's still a lot of runway for growth. There are and will continue to be a ton of pitfalls amid intense competition -- under capitalized, overbuilt, bad branding, mediocre beer, picking the wrong distributor -- that will lead to plenty of closures. But plenty more will get those things right. We're in an interesting spot right now; tons of new openings as growth slows from the go-go days of 3-4 years ago. In the 90s that was a recipe for the so-called bubble bursting; I do think this is a different era of beer drinking now, though, and the fallout won't be as dramatic. And for those who do it right, there is still plenty of opportunity.

    2) Goose Island has historically been as good as anyone at getting people to stand in line. Little wonder Anheuser-Busch wanted to buy them! Once apathetic to what was happening in local markets, AB has learned this is where the action is, and what provides the halo effect for their loftier ambitions (such as getting your to buy an 18-pack of Goose Island IPA at Walgreens). They seem deeply invested in trying to create quality beer at the local levels at their craft acquisitions. They have come to realize that this is an essential piece of the craft landscape.
     
  12. cjgiant

    cjgiant Poo-Bah (4,029) Jul 13, 2013 District of Columbia
    Premium

    An interesting take. I have had the Space Dust post-takeover and enjoyed it. I also wonder how much freedom they have left to Wicked Weed. I've always wondered if the "appealing to more consumers" would lessen a beer's desirability [to this crowd] even if its consistency and "quality"/consistency increased.

    I also admit (like TongoRad) to not having read the book, but I am intrigued now. Not to spoil your work, but hopefully to intrigue me more, Ill ask: what (in short form) do you think the Goose Island team most disliked about the takeover? Conversely, what did they actually (beyond the corporate speak) really like?
     
  13. mactrail

    mactrail Poo-Bah (8,405) Mar 24, 2009 Washington
    Premium Trader

    I think a good introduction to the issues you write about is Jacob McKean’s (Modern Times founder) wonderful rant called “What 'Selling Out' Is Actually About.” He concludes: “Here’s the truth: selling to a macro-brewer is the fastest, simplest way to turn equity in a craft brewery into cash. That’s the only reason to sell to them. Anyone who claims otherwise is full of shit.”

    I am looking forward to reading your book and hope it inspires more attention to how global players affect our beer, and how the ultra-local brewers we love can continue to thrive.
     
  14. 2beerdogs

    2beerdogs Poo-Bah (2,059) Jan 31, 2005 California
    Premium Trader

    Hi Josh,
    I appreciate you taking the time for questions. I was wondering how you see BeerAdvocate in the big picture. And I noticed you haven’t been very active on the site even though you’ve been listed for a while. Simply curious.
    Thanks.
     
  15. thebeers

    thebeers Poo-Bah (1,989) Sep 10, 2014 Pennsylvania
    Premium Trader

    One of the positives (at least IMO) that I remember from the book was an increased investment and focus on workplace safety.

    Along those lines, I've seen lists where Goose Island is listed as a Teamsters brand. I assume that's because a lot it is now brewed at AB facilities that were previously unionized.

    Josh, do you know if the facilities that are strictly Goose Island production and sales are unionized? And did most rank-and-file GI employees get a raise or better benefits as a result of the buy out?
     
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  16. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    One of my first major breakthroughs in understanding the Goose Island and Anheuser-Busch stories -- and where they merged -- was the realization that the beers you describe didn't do what they needed to for Anheuser-Busch, especially the beers under the Michelob banner: Michelob HefeWeizen, Michelob Honey Lager, Michelob Pale Ale, Michelob Porter, Michelob Hop Hound, Michelob Ginger Wheat and Michelob Winter’s Bourbon Cask Ale among them. There were other examples, too, such as Pacific Ridge Pale Ale, though that was mostly intended to confuse customers in California and take a bite out of the dominance of Sierra Nevada Pale Ale. I don't have any recollection of how most of those beers tasted, but my understanding is that some were decent if unspectacular. Not hard to believe since there were indeed quality people involved in making them, including Mitch Steele (formerly of Stone) and Florian Kuplent (of Urban Chestnut). However, they never resonated with the intended consumer. Anheuser-Busch therefore had to pivot: instead of attempting to make credible craft beer itself, it needed to buy credible craft beer. That effort began in the 90s with stakes in Redhook and Widmer, was revisited with the minority stake in Goose Island in 2006 -- and then exploded in 2011 with the Goose Island sale followed by the other nine. They're leaving the craft innovation to their acquisitions, and then will scale them up as Anheuser-Busch beers as necessary. Anheuser-Busch very much sees their craft acquisitions as labs of experimentation; the order with every sale has very much been: "Innovate. Find the next hit."
     
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  17. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    I love this question, because so much energy is expended in the other direction. There have to be positives, right?

    The answer is in the eye of the beholder, of course, but I think there is certainly something to be said for the "rising tide lifts all boats" argument, despite whatever outsize advantages Anheuser-Busch and its craft acquisitions have when it comes to distribution. Anheuser-Busch and Miller and Constellation and so forth -- but especially mighty Anheuser-Busch -- would certainly seem to raise awareness of craft beer. How many people discovered IPA by seeing Goose Island in their local convenience store? Probably a lot. Not in Denver, Chicago, Seattle, Portland and so forth, but it's a big country, and it's not beyond the realm of possibility that someone makes their first IPA purchase there, then experiments backward -- "Wait a second, maybe that little brewery a few miles from my house makes IPA too. Maybe I should go check it out?" Would love to know how often a scenario like that plays out. I imagine it does. Would love to hear other opinions on this matter.
     
  18. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    The 2015 Bourbon County infections were a watershed moment for Goose Island. It made clear they were not toiling in the minor leagues anymore. Yes, other breweries had dealt with infection issues; but not all were on Goose Island's massive stage. The brewery still encourages experimentation, especially from the barrel program, but has certainly tightened its practices and procedures and upped its standards. Look no farther than pulling back its Reserve Barleywine at the last minute last year. The truth is that the BCS Coffee infection was starting to present itself even before the release; six weeks before Black Friday that year, here's what I wrote after a press preview: "I'm usually a huge fan of this beer, but this year's version tastes off to me. The first word that came to mind was 'peppery' which was the exact same word that came to the gentleman sitting across from me. And I can be wrong, but there's no way we could both be wrong. Right?" If a couple of media doofuses could tell something was wrong, I'm still sort of amazed it ever made it to the market. I'm fairly confident that that beer wouldn't pass muster in 2018 based on mere taste panel. And now that they have more sophisticated equipment in their lab, it most definitely wouldn't pass muster. So all this is to say that I don't think brewers are being stifled, but Goose Island is certainly doing things differently as a result of the 2015 infections -- including flash pasteurization, which is among the the most obvious and helpful moves of all.
     
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  19. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    I actually dig pretty deeply into both of these things in the book. It was a delight to tell the counter narrative to most negative assumptions about the sale: some really good things came out of it for Goose Island. I don't want to spoil it for you because I worked pretty hard to get into these issues as part of a very long narrative, but I will nod to increased safety, limitless capacity, the ability to dump production of a beer like 312 Urban Wheat Ale which was essentially clogging the tanks and, of course, the possibility of unending growth. Also, they had bottomless clout. Any ingredient they needed they could get. If you'd been driving a 15-year-old Accord, well, that's a good, dependable car. But if your rich uncle suddenly gives you a (insert awesome car here; I'm not a car guy in the least), well, that's gonna be kind of fun.

    However, there has also been nearly 100 percent turnover on the brewing staff since the sale. There are, I believe, two brewers who remain. Turnover is going to happen in a brewery regardless, but there was unquestionably some fallout from the sale. Drug testing was a big deal. A lot of brewers like to smoke weed. Not all, of course. But plenty do. When I ask owners of small and independent breweries if they drug test, the answer is almost always, "No -- otherwise I wouldn't have any brewers." There are a handful of people who quit Goose because of the drug testing that comes with life as part of AB -- though obviously they found enough non-weed smoking brewers to replace them -- and others left because they just didn't like the cultural drift that happened under AB. It's a wholly new place versus what it was pre-sale. Probably fair to say the brewery is both better and worse off for it.
     
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  20. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    Thanks much -- I look forward to you reading it!

    Jacob, I think, is one of the most interesting brewery founders from the newer generation. I saw him speak on a panel at GABF a couple years ago about the importance of "independence" in craft beer, and he sat alongside the likes of Rob Tod of Allagash, Sam from Dogfish and someone else ... Bill from Victory maybe. Anyway, Jacob said he was amazed to be in that company. But he has very much earned his place. He has a strong and compelling point of view and he is not afraid to share it. I particularly appreciate the piece you linked to; I read it multiple times while reporting my book. The original article was a very strange piece of journalism, and it deserved the retort that Jacob published.
     
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  21. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    I'm a fan of BeerAdvocate. Always have been, and always have preferred it to RateBeer -- for the interface and readability if nothing else -- and needless to say, that's even more the case now. There are enough questions over RateBeer since its mysterious and unpublicized minority sale to Anheuser-Busch that I don't even bother with it anymore. I really don't like what Untappd has done to beer discourse; it's almost as if beer exists simply to be evaluated -- not even evaluated, but "rated" -- in some circles, and while I'll never tell anyone how to enjoy their beer (or anything else) I do think it's unfortunate, and reflective of a cultural shift. Kind of a bummer also that we now see far more people simply rating beers on BeerAdvocate without tasting notes. The ratings/reviews here were always so compelling and thoughtful. In the Untappd generation, seems like people are increasingly just throwing scores up. Too bad.

    As for the reason I've been silent here ... I find BeerAdvocate to be a useful tool to see what people are saying about beers and current trends/topics (the forums ... hoo boy!), but usually confine my thoughts and opinions to my work at the Tribune. I imagine I'll always read BeerAdvocate, but doubt I'll ever become a very active member. (Beyond this very enjoyable Beer Me Anything of course.)
     
  22. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    Don't know about unionization at the Goose locations, but can find out. As for raises, yes, a lot of those went around as a result of the sale. Brewers in particular got a bump, though that was also due to Revolution Brewing and Lagunitas opening sizable production breweries here, and Goose Island suddenly losing staff. Goose management made clear to the AB folks that they needed to get more competitive with salaries to keep people around in the new era of increased competition. AB didn't hesitate to agree. If there's one thing they have plenty of, it's money.
     
  23. 2beerdogs

    2beerdogs Poo-Bah (2,059) Jan 31, 2005 California
    Premium Trader

    Thanks so much. I expected a thoughtful answer, and you gave even more.
     
  24. cjgiant

    cjgiant Poo-Bah (4,029) Jul 13, 2013 District of Columbia
    Premium

    First, thanks for your responses.
    Second, maybe you’ll change your mind after you retire, hopefully soon as a wealthy man due to sales of your book :slight_smile:
     
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  25. joshnoel

    joshnoel Initiate (77) Mar 7, 2010 Illinois

    I like the way you think! Thanks much.
     
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