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Oh IPA, We Love You!

I love Indian Food, and the more authentic, the better. Cooking peppery-hot vegetarian dishes at home, I use recipes from Rajasthan and spices from Madras while listening to a CD of George Harrison playing the sitar. And the beer I choose is an India Pale Ale, shipped all the way from England.

ipaYes, England. Unlike Belgian waffles, Turkish coffee, and Irish stew, India Pale Ales owe their moniker not to their land of origin but rather the country to which they were historically shipped. Created by London’s Bow Brewery in 1790, this style was – and still is – generally characterized by a tawny orange color and high levels of both hopping and alcohol. The reason for this double-barreled approach had less to do with currying favor among the thirsty troops stationed in India than to ensuring that the product arrived there in quaffable condition.

Most of the standard ales of that time arrived at the subcontinent in pretty sari shape. Bow’s deployment, though, of more alcohol and hops proved to be just the right Taj – er, touch – in contributing to the beer’s stability and shelf life. Hoppily enough, this new type of brew grew so popular that other brewers soon followed Bow’s lead. Over time recipes change, though, and during the latter half of this century IPAs have gradually become as watered down as skim milk, with most sporting less snap than a day-old papadum.

Their American Cousins

Lately North American microbrewers have leavened some crispness back into the style. While many have looked to historical sources for guidance, brewmaster John Harris, of Oregon’s Full Sail Brewing Co., concedes, “We don’t really know what these tasted like in the 1800s.” Because hops were so dominant, Full Sail gives its India Pale Ale a solid Anglo angle through all-English spicing with Kent Goldings, Targets, and Challengers. “We try to balance that with alcohol and malt flavor,” Harris adds, “for a beer that’s both malty and bitter.” And dangerously drinkable.

Another ale that sails like silk down the throat is Pike Brewing’s LP.A. Huge hoppy florals are supported by a dry, estery palate that hints at oranges and apricots. Fal Allen, this Seattle company’s former brewing chief, agrees that malt provides an essential accent: “Not malty sweet, but you have to use a lot of grain to get that higher alcohol level.” Yet Larry Bell, president of Michigan’s Kalamazoo Brewing Co., observes that many brewers, in trying to balance their hops, end up “overly caramelly.” That’s not a problem with his own jab at the genre, Two Hearted Ale, which some timid tipplers may deem Sikh-eningly hoppy. Those who love the lather of hop oils will find the sultry perfume (like elder flower) of this bottle-conditioned gem heavenly.

Beers that Command Attention

These are, after all, “wake-me-up, shake-me-up, this-is-a-beer!” types of drinks, says Teri Fahrendorf, Steelhead Brewery’s brewmaster of operations, in Eugene, Ore. Primary to an India Pale Ale is “a young sassy hop aroma that smacks you in the face.” Or nose and mouth, as in Steelhead’s Bombay Bomber, a resiny hopsack of a brew marked most pleasingly by a generous deployment of grapefruity, piney Chinook hops.

In its IPA, the San Diego area’s Stone Brewery issues a similar sensory alert. “It’s not a beer for everybody, but then we choose not to pander to the public,” president Greg Koch says. Like many, Stone’s I.P.A. is dry-hopped, endowing it with the fresh fragrance of Humulus lupulus. Its malty mouthfeel provides some equilibrium, but this beautifully bitter brew, with a profound flavor of fruit lingering long on the tongue, is largely a showcase for hops.

So too is Hop Ottin’ India Pale Ale, the latest in the fine lineup at Anderson Valley Brewing, in Northern California. A touch of Munich malt lends some homogeneity to a spicy-fruity (mandarin oranges and tangerines), bombastically bitter palate. “It’s way out of style,” admits head brewer Brit Antrim. “Basically we shoved as much hops in as we could.” One might believe the same of Great Lakes Brewing’s Commodore Perry, an outstanding IPA from Cleveland that virtually explodes with esters of yeast and hops. “We try to introduce hop flavor by loading as much hops as we can in the boil and whirlpool,” says brewmaster Andy Tveekrem. The Commodore’s pronounced bitterness stems from a reliance on Galena hops, and its heightened florals are indebted to Canadian-grown Goldings.

If there were an office of India Pale Ales, one would expect veteran hop-master John Maier, of Newport, Ore.’s Rogue Ales Brewery, to be its honorary manager. Yet Maier disdains to offer an IPA, scoffing wryly, “Everybody’s doing those.” Rogue’s proffered pint is [I.sup.2]PA, with the first I implying “Imperial.” Floor-malted barley yields a complex caramel-toast taste, but it’s the uber presence of domestic Saaz and Cascades that captures one’s attention. Each barrel is also dry-hopped with a pound of Kent Goldings.

Finding the One You Like

Beer browsers sipping from one India Pale to another will find several that put less emphasis on the vine. For example, Minnesota’s Summit India Pale Ale is fruity, delicately dry, with overtones of caramel malt. Also worth inhaleing are the Brooklyn Brewery’s gypsum-rich East India Pale Ale, with muscular maltiness tempered by English hops; Shipyard’s (Maine) Fuggles India Pale Ale, with whiffs of honey checked by fresh-gristed malt and an appley hoppiness; the wonderfully fruity (plums and cherries) Victory Hop Devil (Pennsylvania), notable too for a luscious malty-bitter equipoise; and the spritzy Bridgeport (Oregon) Firkin I.P.A., a tasty top-fermenter showcasing caramel, fruit, and an assertively dry finish.

India Pale Ales, while “cutting edge, will never become mainstream,” Tveekrem argues. They’re overly aggressive flavor-wise, he figures. That’s probably true. For most people a Weizen or an “ice” folly is just fine. Like Indian food, IPAs pack too much flavor, are too astringent, too potent, too mouth puckering. Just the thing for those of us looking to bitter ourselves.


Plastic is just too expensive, no matter how you look at it.

wnpbbThat’s what leading U.S. brewer Anheuser-Busch found when it experimented in the summer of 1998 with bottles made from polyethylene naphthalate (PEN). The biggest advantage of the PEN bottle was that it stayed rigid under heat, which allowed for in-bottle pasteurization.

“You can pasteurize the bottle with beer in it, and if you get it to the place where it’s going to be drunk fast enough, it’s a quite excellent bottle,” says Allan Silverman, a vice president with the Constar unit of Crown Cork & Seal, Philadelphia, which blowmolded the bottles.

Time was the major problem. Although PEN has a tighter molecular structure than PET, its barrier still is insufficient, meaning it doesn’t yield a good enough shelf life, Silverman says: “You could have given it away or charged a million dollars – it wouldn’t have worked. The barrier isn’t good enough.”

To make plastic bottles with a sufficient barrier requires a multi-layer structure. These designs tend to push the bottle’s price significantly beyond glass and aluminum.

The price ain’t right

Price was the reason Anheuser-Busch recently terminated another trial of a plastic beer bottle: a test market in Dallas and Phoenix, Ariz., convenience stores. The three-layer bottle comprises a layer of oxygen-scavenging copolyester between two layers of PET, with more oxygen-scavenging material in the closure liner.

Anheuser-Busch concluded the test market after six weeks because of disappointing sales, says Norm Nieder, senior director of packaging technology. The bottle, from Twinpack Inc., Mississauga, Ontario, Canada, protected the product well, but its extra cost led to a price of $1.29 to $1.59 per unit, compared with $1.09 to $1.19 for cans and glass bottles (although the more established packaging benefits from economies of scale). Consumers “were not prepared to pay a premium for the package,” Nieder says.

But there’s one type of outlet where plastic bottles have special advantages and their higher price isn’t as much of a drawback: outdoor events. Consumers are more comfortable with plastic beer bottles than with open cups, and the bottles’ lighter weight removes the need for cups.

That’s why several big-league ballparks are experimenting with beer in plastic bottles. Fans of the Baltimore Orioles and Arizona Diamondbacks, among others, can buy Miller Brewing Co. products in PET bottles.

In Baltimore’s Camden Yards, fans have been able to buy 16-ounce bottles of Miller Lite since May 18. Customers must walk to portable locations in the stands to buy the bottles, while vendors continue to deliver beer poured from cans into paper cups to fans in their seats.

The vendors turn over the bottles to consumers minus the caps, insuring that fans won’t be able to throw the bottles onto the field, says David Haines, assistant concessions manager for Aramark Corp., which handles concessions at Camden Yards. Tests showed that even a full bottle, when thrown without a cap, usually won’t travel far enough to reach the field, Haines says.

Bottles of beer at Camden Yards cost $4.75, the same as paper cups. Although the bottles are more expensive than aluminum cans, the money saved on cups makes the end cost even, Haines says.

“Customer reaction been very good,” he says. “People tell us they feel like they’re at home. They’re able to walk around with the container, and they like it a lot.”

A hit in Phoenix

At the Arizona Diamondbacks’ Bank One Ballpark, vendors have been delivering 20-ounce bottles of Miller Genuine Draft and Miller Lite to fans in their seats since the beginning of the season. “The Miller products have been a real success here,” says Bill Cutler, concessions director at ProDine Inc., which handles the park’s food and beverage sales. The vendors, who also handle other brewers’ products in glass bottles, like the Miller bottle as much as the fans do, Cutler says: “The case of glass bottles probably weighs about 12 pounds more than the plastic.”

The Miller bottle, blowmolded by the Continental PET Technologies division of Owens-Illinois, consists of two layers of oxygen-scavenging polymer between three layers of PET. The idea is that the oxygen-scavenging layers will be able to absorb the small amounts of oxygen that make it through the bottle’s PET component. The bottle is advertised with a four-month shelf life.

This technology is the subject of litigation, however. Crown Cork & Seal filed suit in April against Continental PET, claiming that the Miller bottle infringes on Crown patents for oxygen scavenging. (The discontinued Anheuser-Busch bottle, which uses a different kind of oxygen-scavenging material, is not involved in the suit.)

Overseas, some brewers use other technologies for plastic bottles. England’s Bass Brewers is using a bottle blowmolded by the Pet Plas Packaging division of the Pechiney Group. This bottle consists of a layer of ethyl vinyl alcohol (EVOH) between two layers of PET; the crystalline structure of the EVOH polymer provides a sufficient barrier for six months of shelf life, the company claims.

Another barrier-based PET beer bottle is being used by Australia’s Carlton & United Breweries. Blowmolded by Australian converter Containers Packaging, the CUB bottle uses a spray-on epoxy amine coating brand-named Bairocade, produced by PPC Industries Inc., Pittsburgh. CUB is advertising a three-month shelf life for its bottle; John Lewis, PPG’s marketing specialist, calls that claim “conservative,” saying that the company’s own tests have shown shelf life of up to 10 months with certain container factors. One of the biggest advantages of the Bairocade coating is that it washes off during ordinary recycling processes, leaving the recycler with clear PET, Lewis says. Other plastic bottles are being used by brewers in Germany and Switzerland.

The multiplicity of plastic-bottle structures is one of the reasons plastic beer bottles are slow to catch on with brewers, Lewis says. Part of the problem is that proper shelf-life studies can take up to eight months.

“The biggest hurdle in terms of major launch in the U.S. is that the water gets really muddy every time there’s a new technology,” Lewis says. “Every time someone comes out with something new, someone says, ‘Oh, let’s take a look at that.”‘


“On the other hand,” says a recent report, “fewer than 5 percent of unemployed Americans drink craft beers; not surprising considering the beers’ premium pricing.”

As for income, more than 60 percent of craft beer drinkers live in households with incomes greater than $50,000, and close to 40% live in households with incomes greater than $75,000. The audience is primarily white and Asian, and “the coverage of $75,000 household consumers is a high 21 percent, compared to less than 6 percent from households earning less than $35,000.”

Everything’s Relative

cbeAccording to Jim Koch, founder and president of Boston Beer, the nation’s No. 1 specialty brewer, you have to go inside the numbers to get a true read on the importance of specialty beers (which he calls “better beers”) in the off-premise retail mix.

“You get into some problems extrapolating the numbers at the high end,” explains Koch. “Unfortunately, the high end of the category skews to on-premise consumption. The low end is generally skewed to off-premise. As for relative rankings, if Bud outsells Miller Lite 2-to-1, it’s probably going to look like that in the overall market.”

And never discount the importance of the profitability of the segment in your shelf sets.

“The direct product profitability is greater for a high-end beer than a regular premium beer,” notes Koch. “For example, let’s say you sell a 6-pack of Bud for $4 and a 6-pack of Sam’s for $6, and you make 25 percent on each. So you’ve made a buck on Bud and a buck-50 on Sam Adams. And let’s say it costs you 75 cents to move that beer in and out. So you take that out and you find, in fact, that you made a quarter on the 6-pack of Bud and 75 cents on the 6-pack of Sam Adams. It doesn’t take up any more shelf space, it doesn’t cost you any more to move it in and out. A lot of your costs are volume-related. A case of beer is a case of beer.

“So you’ve got two things driving the profitability of high-end beer,” continues Koch. “The gross profit number is higher, and a lot of the costs for the grocery store are the same for a $12 case of beer and a $24 case of beer.”

You’re also more likely to get female consumers not just shopping in the segment, but purchasing the product for themselves vis-a-vis domestic premiums, which skew highly toward male consumers. The same trend, of course, holds true with imports.

“Women enjoy the flavor of Sam Adams and other micros and are drinking less and are more interested in taste, flavor and education,” observes Koch.

According to Koch, the key to making money in a flat segment that yields high profit is in its marketing. Why deep discount when you have such a highbrow consumer base? Seasonals are a perfect example.

“When we roll out our seasonals, we only make a limited quantity and it always sells out,” says Koch. “So don’t discount it. Display it. That’s something this high end should educate grocery buyers to. When you’ve got something special, it will sell without being discounted. We encourage our customers to make money. We discourage them from losing money. My job is to make beer that is so good that it’s worth selling without discounting.”

And placement is everything in this business. Often, a retailer will set up a high-margin malt beverage, like Zima, next to a Budweiser display in the front of the store in an effort to get the Bud buyer to sample the high end. It usually doesn’t work.

“It’s a little weird because the guy who wants Bud is not interested in Zima,” says Koch. “I argue that the retailer should make the beer drinker walk past a $6 6pack of Sam Adams to get to a $3 6-pack of Bud.”

According to Beverage Marketing, the West remains the citadel of craft beers, with 16.5 percent of consumers favoring the homemade expensive stuff. The Northeast comes in second, with a 12.1 percent usage rate. The Midwest and the South lag behind, with 8.6 and 7.0 ratings, respectively.

‘Micro-Darwinism’

Not all news is bad on the craft front, mind you. Overall, specialty beers have stalled. But within the segment, one can ascertain growth-some even reminiscent of the halcyon days of the mid-’90s. According to figures released by the Institute for Brewing (Boulder, CO), 21 of the top 50 craft brewers in the US grew by 10 or more percent in 1998. That surge offset whatever-shortfall occurred throughout the rest of the segment.

“Many companies are bucking the trend of the overall zero growth rate,” explains David Edgar, director of the Institute for Brewing Studies (IBS), the leading educational association for the craft-brewing industry. According to IBS, the craft brewing industry anticipates new category growth in the new millennium, as revised stability continues to provide successful regional

breweries, microbreweries and brewpubs with a better environment for expanding their companies. This stronger community of craft brewers will be better positioned to introduce more consumers to the category.

“The quality of the average brewpub and the average microbrew on the shelf is continually improving,” continues Edgar. “Call it microbrewery Darwinism, but while many weaker, of lesser-quality, companies are closing or selling out, the brewpubs and craft beer brands that are surviving represent better-organized, better-managed companies, and better beers.”

Craft Brewers: We’ve Only Just Begun

The myth of the phoenix tells of a great Egyptian bird that lives for hundreds of years and then consumes itself in flames, only to reemerge from its ashes renewed, restored and stronger than ever.

The brewers who gathered in Phoenix for the 16th annual Craft-Brewers Conference and Trade Show (“Phoenix Rising: Building a Better Craft-Beer Market“) were the first generation of craft brewing’s second life. Wary of expansion, keen to the threat of imports, struggling with distribution, they have weathered a storm that has brought the once-booming industry firmly to heel in less than three years.

Falling marketshare has blanketed the industry in ash since 1995, when two back-to-back years of 50 percent growth leveled, then plummeted to 25 percent in 1996, followed by percent in 1997. For the first time since the industry’s flush years, the abacus in 1998 recorded zero growth. As many microbreweries and brewpubs closed in 1998 as opened. The shakeout warned of two years ago looms.

But apparently even zero growth has a bright side. Despite the disappointing year, Institute for Brewing Studies director David Edgar told the assembled attendees that he sensed good things brewing down the road.

“In 1996, there was a lot of nervousness because things were changing, but there was no sense of how fast or how far they would change,” Edgar said. “But one consensus about the slowdown is that it was ultimately good for this industry. Yes, the ‘wingnut’ days are over, but that’s good, because the wingnut days attracted a lot of wingnuts to the industry who weren’t serious about the beer they were producing.”

The diehards who remain, Edgar said, will face new challenges from imports, as well as old challenges from the large domestic brewers. Led by Corona and Heineken, the import segment swallowed an 0.8 percent gain in US marketshare from domestic beers (-0.7 percent) and domestic specialty beers (-0.1 percent). On the distribution front, meanwhile, large-scale domestic brewers continue to tighten the noose around traditional wholesaler channels.

During his keynote address, Boston Beer president, founder and brewmaster, Jim Koch, argued that craft beers and imports are lumped together in the consumer’s mind as higher-priced, so-called “better beers.” Embrace the category, he seemed to say, but beware of the competition.

“We are in the growing part of the industry,” said Koch. “We’re just not getting our share. Ultimately, we will prosper or not prosper together.”

The combination of zero growth and shrinking distributorships has resulted in an emerging zeitgeist among craft brewers, one that is really a return to its original mandate: Focus on the local. Craft brewers now realize they can no longer count on going national as an inevitable trajectory of business growth.

“Don’t dilute your efforts,” warned David Blossman of Abita Brewing, during one panel discussion. “Grow on a controlled basis. Take care of your backyard first.” Panel discussions brainstormed out-of-the- box solutions to the distribution squeeze, such as consumer-direct Internet sales and distribution co-ops.

For those who stick it out and nurture their backyard, veteran consultant Robert Weinberg painted a rosy picture of the future: “The general outlook for the brewing industry is going to be sensational… For any brewer making less than 100,000 barrels, the only limitation on your growth over the next 10 years is probably you.”


Some Import Winners

Moosehead

Featuring such activities as knot-tying (bikini strings), swimming (skinny dipping with a cooler of beer) and calisthenics (running from bears), Camp Moosehead swings into session for the months of June and July. This latest promotion from Moosehead beer, with POS materials that include a 6-foot Camp Moosehead “counselor” decked out in the predominant camp colors of khaki and forest green, and wearing a Camp Moosehead T-shirt, hat, khaki shorts and hiking boots.

Moosehead, Canada’s oldest brewery, is located in St. John, New Brunswick, and is distributed in the US by The Gambrinus Company, San Antonio.

St. Pauli Girl

pgSt. Pauli Girl invites retailers to score a hole-in-one with a new summer promotion featuring a golf gear consumer sweepstakes and special mail-in offers for merchandise. The Gear Up for Golf sweepstakes asks consumers to answer five golf trivia questions, and those who answer all five correctly qualify for Taylor Made golf merchandise, including the grand prize of a golf tour bag and clubs. Golf enthusiasts can enter by calling 1-877-STPAULI, by logging on to the brand’s website (www.stpauligirl.com) or via mail-in coupon.

Consumers can also purchase Taylor Made and St. Pauli Girl golf merchandise via a mail-in offer at retail displays, or via the brand’s website. Items include golf caps, balls, towels and ball/tee kits. POS materials sport the image of Jaime, the 1999 St. Pauli Girl. St. Pauli Girl Lager, Dark and NA beers are brewed and bottled by the St. Pauli Brauerei in Bremen, Germany, and imported into the US by Chicago-based Barton Beers, Ltd.

Heineken

Heineken USA (White Plains, NY) has launched a major marketing campaign targeted specifically at Hispanic Americans and sporting the tagline, No Cabe Duda (“There’s No Doubt About It”). Included are three TV spots, seven radio ads and outdoor signage. All feature Hispanic actors and Hispanic specific situations. Concurrently, a summer concert series, En Vivo, kicks off at the Puerto Rican jazz Festival, with shows in New York and Los Angeles featuring such Latino favorites as Cristian Castro and Ricky Martin.

The Hispanic push is part of a $42 million effort in media spending–or roughly double the figure spent in 1998–including TV advertising on NFL telecasts, sponsorship of the US Open Tennis Championships, and new packaging coordinated with a special promotion with New Line Cinema’s Austin Powers –The Spy Who Shagged Me starring Mike Myers. (See page 24.)

And in another ethnic-driven effort, Heineken celebrates Black Music Month in June with Heineken’s Lifestyle Sweepstakes. The contest will give consumers a chance to win a 1999 Ford Expedition, Philips home electronics and apparel from Phat Farm, one of the country’s hottest-selling urban labels. To enter, consumers need to name one city that Sky, the Heineken Lifestyles correspondent on the nationally syndicated Russell Simmons’ One World Music Beat show, visits during June.

Corona

The new top gun in the imported beer category is unique in that it is imported, distributed and marketed by two separate companies: The Gambrinus Company (San Antonio) to 25 eastern states, DC and the Caribbean; and Barton Beers, Ltd. (Chicago) to the rest of the US, primarily west of the Mississippi.

On tap for Corona are a new $13 million national TV campaign, and a summer promotion called Beer Isle, In addition to the ads, the Modelo brands utilize significant local marketing initiatives and sponsor the popular Jimmy Buffett concert tour. The 1999 plan also includes Hispanic market advertising with TV spots for the Corona and Modelo Especial brands.

Beer Isle, a Gambrinus initiative, includes loads of eyecatching POS, including inflatable Corona seaplanes, case cards, pole toppers and an expanded grocery display. The summer initiative will be supported by radio, TV and outdoor advertising.

Guinness

The folks at Guinness Import Company (Stamford, CT) are hoping to recreate the pub experience in the beer aisle by introducing a new “floating draught system” in a can, designed to produce a “Perfect Pint of Draught Guinness”– identical to a pint served from the tap.

The new system is designed in the shape of a small ball–approximately half the size of a golf ball–which floats inside the can and can be heard moving around when pouring. The system is filled with a gas mixture of 75 percent nitrogen and 25 percent carbon dioxide. When the can is opened, the gas is released and a cascade effect takes place when the product is poured, giving Guinness its trademark white, creamy head and black body.

Dos Equis

Consumers can “let their tastes travel” this year by entering the Dos Equis Getaway Sweepstakes, offering 75 winners trips to Cancun, Mexico. The contest will be promoted on P05 materials reinforcing Dos Equis’ Mexican heritage and the “XX” logo of the brand. Images of Cancun and the new tagline for the brand– “Let Your Tastes Travel”–will be featured on case cards, Materials will be refreshed throughout the program with new images for the duration of the program.

Mail-in entry forms are available via tear pads at POS. Winners will be selected at random throughout the year, and will enjoy an all-expense-paid trip for two. The contest will run through December 31, 1999. Dos Equis is imported and marketed in the US by Norwalk, CT-based Labatt USA.

Murphy’s

It’s “tee time” for Murphy’s Irish Stout and Irish Amber as the brands host the annual Murphy’s Irish Open golf tournament. One lucky consumer will win an 8-day, 7-night grand prize trip to the Emerald Isle this summer to watch the tournament and play in the Pro-Am.

Entry forms for the 1999 Swing With Murphy’s Irish Open Sweepstakes are available on case cards. Other themed POS and merchandise tied to the contest include Murphy’s golf balls, hats, tee packs, putters and a mini-golf game that can be set up at retail for consumers to really Swing With Murphy’s.

Beck’s

Another brand jumping on the golf gravy train is Beck’s, the leading German import. One Beck’s golf aficionado will have the chance to putt–live on national television–for a grand prize of $2 million Deutsche marks. (That’s over a million American greenbacks).

The Putt & Win national sweepstakes will culminate at the 10th annual NBC Sports Celebrity Golf Championship over the July 4 weekend. Beck’s is the official beer sponsor of the Lake Tahoe, NV event. In addition, Beck’s created a hint-filled, 24-page Guide to Golf, available at POS.

Beck’s North America of Greenwich, CT imports the Bremen brew.

Foster’s

If the hue of the yellow brick road in the Wizard of Oz reminds you of the golden tone of beer, then Foster’s Lager has a promotion for you in the Oz Experience, a sweepstakes that will escort winners on an adventure vacation

through Australia. Secondary prizes include Foster’s apparel.

Follow the oversized cardboard kangaroos, pole toppers and floor decals to the sweepstakes entry forms. The sweeps will run from mid-May through mid-September. Foster’s Lager is brought to American soil by Molson USA, Miller Brewing’s import unit.

Sol

The fastest-growing brand South of the Border for the last five years, Sol becomes available in Dallas, Houston and San Antonio this spring. The brand was introduced in Austin last spring, and in Southern California in 1998.

New outdoor ads featuring graphics of the brand’s sun icon and clear, long-neck bottle will accompany the launch in the three new Texas markets. Radio spots will run through September, while TV ads are also planned for the summer. POS will support Sol’s Texas expansion.

Tsingtao

A recent consumer article reported that Tsingtao Beer had been out-produced by a rival Chinese brewer. Not so, says Tsingtao. It has been and remains the No. 1 beer in China and the No. 1 Chinese beer in the US.

It’s also the most recognized branded consumer product exported from China, which is to say a lot, since Chinese exports have grown mightily in recent years.

Shanghai

If the import beer market’s been multiplying like rabbits (having doubled during this decade), it’s appropriate that a new brew from abroad arrived in time for the Chinese calendar’s Year of the Rabbit.

Miller Brewing’s Martlet Importing subsidiary is bringing Shanghai Beer, brewed in–you guessed it, Shanghai–to the US, hoping to hop onto a hops heap traditionally dominated by Tsingtao. Kickoff markets include New York, DC, Los Angeles, San Francisco, San Diego and Las Vegas.

Stella Artois

Stella Artois, the world’s best-selling Belgian lager, is now available in the metro New York market. With a history that spans seven centuries, Stella Artois has become a classic European lager. Still brewed in the town of Leuven, Stella Artois is available in more than 60 countries. In the UK, where Stella Artois’ retail value falls just behind Pepsi, the golden lager is the No. 1 imported beer.

Labatt USA imports the brand.

Spanish Takes a ‘Damm’ Good Look at US

With Corona having overtaken Heineken as the United States’ top-selling imported beer (see page 22), and South-of-the-Border stalwarts like Tecate and Dos Equis having successfully flowed north, are Americans ready for another Spanish-accented brew–particularly one that’s from nowhere near Mexico?

That’s exactly what they’re trying to figure out in Spain. Damm Brewery, a Barcelona-based producer, is moving into global markets in full force and finding success and profitability as an international competitor. It’s a challenge, but the rewards of internationalization, as the company is no doubt learning, are worth the effort many times over. Damm understands that at home, as well as on the road. In Spain, it is the local producer of Budweiser.

Spain, even in Europe, isn’t normally thought of as a font of beer. The Iberian nation has been long known for its excellent wines and sophisticated spirits, but its. brewing credentials are relatively obscure. Nevertheless, Spain trails only Germany and England as volume brewers in the European Union, having recently moved. ahead of traditional Continental powerhouses Austria, Belgium and Ireland.

Consumers around the world must be getting the message. Spanish beer exports grew by nearly 40 percent in 1997 Riding that tide, Damm, a dominant player in several regions of Spain, saw its sales rise by around 7 percent.

Damm’s enthusiasm for cracking the US–the big enchilada of export markets–will not be dampened. Exports director Edward Verbraeken, a Belgian who has worked on the Corona brand, indicates a US launch may be but a year away.,


The consumer mindset has contributed greatly to the beerscape. “Drivers of imported beer growth include the ‘mainstreaming’ of imported beer brands,” says the report. “Twenty years ago, the only consumers of imported beer were beer connoisseurs and foreigners. Today, though imports remain an upscale product, consumers from every economic, social and cultural group consume imports on occasion.”

ibdsbImports have delivered the mass that craft beers never could. While microbrews and other specialties were racking up impressive annual gains of between 22 and 42 percent from a relatively tiny base between 1991 and 1996, imports, with a more significant base, were beginning to register increases in the low double-digits. The craft explosion left a halo around imports as well–and it’s the foreign beers that have continued to benefit as domestic specialties have sagged (actually off by 1 to 2 percent in ’98, says BMC).

So it’s a bittersweet legacy left by the major micro excitement of the mid-’90s. “Once content with mass-produced domestic lagers, consumers are more frequently opting for higher-quality, fuller-bodied, rich-tasting beers,” notes the report. “In addition, the brand preference set for any given beer drinker is likely to have expanded. Where once a consumer would be loyal to a single brand, he or she is now more likely to select different brands based on the consumption occasion. Of no lesser importance is consumers’ current willingness to pay a premium for high-end brands.”

That circumstance could describe domestic specialties and imports…but it only works for the latter. The report explains, “The imported market seems to have benefited from the rise of the craft segment, and may now benefit from its weakening.” Blame new-product fatigue for consumer disenchantment with crafts, but credit the importers who have been in the game for the long haul.

“As opposed to the new, less-established craft beers,” says the report, “imports have the infrastructure and resources to compete long-term in the marketplace against the domestic beer giants.”

The IMPORT Files

* Corona’s ascent to Numero Uno means Heineken isn’t the top-selling foreign brew for the first time in modern history.

* Mexico and Canada combine for more than half of all imports. When the Netherlands is factored in, three countries account for more than 75 percent of all beer imported into the US.

* Given the price differential between North American and European imports, the Netherlands still contributes more dollars–over a third of the segment total–than any other nation to imports’ bottom line.

* New York drinks more imports than any other state, accounting for over 25 percent of the nation’s total. California and New Jersey place and show. Despite Texas’ proximity to Mexico, the Lone Star State ranks sixth.

* Boston may be home to craft standard-bearer Samuel Adams, but it’s also the fifth-biggest import-consuming metro area in the US. New York, Los Angeles and Chicago are 1-2-3.

Corona Pushes Onward (and Light-ward)

With Corona Extra well in front as the leading import, the Gambrinus Company, which distributes the brand in the Eastern US, is betting that Corona Light will succeed with the introduction of a new look and advertising campaign. The new graphics and campaign are reminiscent of the current imagery, but more clearly define Corona Light as a “light” product.

“The new graphics were designed to essentially improve the brand’s visibility in the marketplace,” says Don Mann, Modelo products director for The Gambrinus Company. “The label accomplishes this by introducing the new color of yellow, and placing additional emphasis on the word ‘light.’ From the consumer’s standpoint, the package should be instantly recognizable as a Corona product but also recognizable as a ‘light’ product.”

The prior package, adds Mann, was simply a white outline and generated poor visibility in the marketplace. “It limited our ability to promote arid market the brand,” he explains.

Gambrinus considers Corona Light to be its next major growth opportunity in the Corona franchise. “In recent years,” says Mann, “we have applied increasing efforts to building the distribution of Light. But in 1998, Corona Light represented only 6 percent of total Corona volume, and the total beer category is 44 percent light beer.”

This relaunch of Corona Light will be different from previous incarnations, says Mann. Corona Light will now have its own radio, television and outdoor advertising campaign, due to kickoff this summer. The themeline is “Miles Away From Other Light Beers,” which is in keeping with current Jimmy Buffett-style Corona imagery, but distinct in its emphasis on ‘light.’ The radio spots will air across most of Gambrinus’ markets, and while outdoor media, or billboards, have been mostly used in recent years for Corona Extra, in 1999 they will be used to support Corona Light. The new ads compare Light to a flamingo, and regular light to a buzzard.

Gambrinus will also be introducing regional television spots in key light beer markets; this marks the first time that the Corona Light brand has received its own television campaign. The total media investment for The Gambrinus Company is in the neighborhood of $2 million-plus, says Mann.

“The television campaign presents Corona Light in the context of an alternative to other light beers, rather than as an alternative to Corona,” says Mann.

Heineken’s New ‘International Can of Mystery’

Heineken may have slipped behind Corona to the No. 2 spot in the import pecking order, but the longtime king of foreign beers is hardly standing still. Last month, Heineken rolled out a new single-serve keg can as part of a special promotion linked with Mike Myers’ new Austin Powers flick, The Spy Who Shagged Me. The design of the contoured can is meant to “play off consumers’ memories of fun times at keg parties,” explains Ken Kunze, marketing director for the brand. Test-marketed in the New York area during the fourth quarter of 998, Heineken Keg Cans were greeted with enough enthusiasm that the company decided to go nationwide with the promotion.

A full merchandising program accompanies the rollout, so that “swingers” can “dig” merchandise made available from POS catalogs. Among the items listed in Austin Powers “Groovy Grab Bag”: a flowered lava lamp, a “talking” T-shirt that uses voice-chip technology, a Heineken Red Star neon light, a Mojo pendant, specially identified pint glasses, temporary tattoos, flowered coasters with the Heineken logo and a video/soundtrack combo set of the original movie.

In an effort to meet a wider variety of drinking occasions. Heineken has also brought to market a more standard 6-ounce can. (Until March. Heineken only had a 12-ounce can available in the us.) Targeted specifically to c-stores, delis and other off-premise outlets where single-serve purchases make up the bulk of beer sales, this i6-ounce can is ideal for immediate consumption.

“What we’re doing with these two different can packages is making the product more relevant for more occasions, and this i6-ounce package in either a 6-pack or single-serve is a very popular package for the convenience store channel,” says Dan Tearno, vice president of corporate affairs for Heineken USA (White Plains, NY).



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