SAVOR, Beer Writing and Ethics, Totally Unrelated Topics In This Post…

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Things have been pretty quiet here lately, with some traveling, legal work, and more recently, work on the new book project. And I expect it’ll be quiet here, a bit of a summer hiatus perhaps. I’m leaving on Thursday for DC to attend the second annual SAVOR event and the promotion for this year’s event has been much quieter than last year. I had some concerns last year over a perceived snobbery attached to the event. This year we haven’t seen any admonitions to “dress to impress” or the like. The Brewers Association has settled on a target market for the event: the national media. All told, it’s a pretty expensive proposition, trying to entice and cajole positive media coverage about craft beer by throwing a pricey, money losing event. SAVOR also has the side effect of propelling beers’ place in the thoughts of our nation’s leaders. In a time when beer is threatened with ever increasing taxes, securing beer as a positive beverage may be worth twice SAVOR’s price tag. In any event, I look forward to the event and to seeing whether DC’s beer scene (and pricing) has improved.

On an entirely unrelated note, the Wall Street Journal has an interesting blog post up right now (thanks to Maureen Ogle for pointing it out to me) about the ethics of wine writing as it relates to Robert Parker, known for his Wine Advocate. In light of some of the discussions we’ve had here, it’s worth a read.

UPDATE: It appears I was a little quick on the axing of the Dress to Impress line for SAVOR. We’ll let the event speak for itself this year.

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The Washington Post Sends A Shot Across The Brewers Association’s Bow…

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In an article in today’s Washington Post, author Greg Kitsock writes a lengthy column on the long-running dispute over the Brewers Association’s restrictive and political definition of craft beer. Loyal and unloyal readers alike will recall that the definitional debate is something we have covered here on a number of occasions, and here, here, and here. [Ed: Maybe I need a new subject].

Make no mistake, a week before craft brewers and the Brewers Association head to the nation’s capital for their keynote event, one intended to impress the national media and the nation’s legislators, the article is a political shot of a different stripe. It’s an issue the association has preferred to address in private despite the very public misgivings of prominent brewers, including members of the association’s own board.

One thing that the Post article overlooks, however, is the Brewers Association’s recent statements, including at the recent Craft Brewers Conference, that the two million barrel mark does not include non-beer products, such as so-called flavored malt beverages. While it is not completely clear, it appears that some portion of the Boston Beer Company’s present production is related to its Twisted Tea products, which do not count towards the two million barrel mark. If the association doesn’t move to change its definition or create some sort of legacy exception for Boston Beer, we may soon learn the exact production numbers for the Samuel Adams brands versus the FMB’s the company produces.

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Craft Beer and the Economy…

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With massive layoffs, precipitous drops in consumer spending, and a near complete drying up of the credit markets, the American economic scene looks positively dreadful. And while things look bad in the broader economy, beer industry people have been biting their fingernails over how their businesses will fare. In recent months, beer lovers across the country have seen the closure of a small handful of brewpubs and packaging facilities that were unable to meet their day-to-day financial needs. These tough times are testing the old micro-economic maxim that beer is recession proof.

A few months back, the Nielsen Company issued a press release listing its top five recession proof consumer goods. While it was no surprise to see dry pasta and sauce on the list, beer was tucked in the middle amongst the more unusual neighbors of candy and seafood. Thirty or forty years ago, we could understand what such a list meant in terms of defining beer. But today, with the increased presence of craft and imported beers, it’s more difficult to determine whether “beer? is really recession proof.

In another recent press release, the Brewers Association announced that craft brewers managed another strong year in 2008 despite the troubled economy. “Small independent craft brewers? increased their sales 5.8-percent by volume and 10.5-percent in sales over the previous year and reached 4-percent of total U.S. production. While the numbers fall behind the double-digit growth experienced in recent years, it seems to suggest that craft beer has recession legs. Compare that to imported brands, which were down nearly 4-percent from last year.

Industry analysts have a quiver of theories as to why craft beer is performing so well in a down economy. Some posit that high-end wine drinkers are essentially slumming it with less expensive craft brands, while others believe that a “Buy American? nationalism has influenced consumers away from imported brands into the arms of craft brewers. Others caution that craft beer is not recession proof but merely recession resistant.

While things may be stable for craft breweries, the same cannot be said for many consumers, even those who prefer craft beer. The American unemployment rate is presently at its highest level in a quarter-century and cuts across all economic sectors. In one of BeerAdvocate Magazine’s first issues, I wrote an article bemoaning a phenomenon I called “price creep.? After years of stagnant prices and faced with increasing prices for raw materials and shipping, craft breweries started raising their prices. In response, some bar owners saw the opportunity to tack on additional price increases onto otherwise modest cost raises.

Fast forward two years and on-premise accounts across the country are beginning to see greater numbers of empty bar seats and restaurant tables as people choose to do their drinking at home. In response, craft brewers are beginning to alter their thinking about the future. Consumers looking for cost savings but unwilling to trade down have helped twelve-pack sales increase. Even at the higher end of the craft price spectrum, distributors recently convinced Dogfish Head to release a mixed twelve-pack of its 60, 90, and 120 Minute IPA family, at a 20-percent discount over individual pricing. On the other coast, Stone Brewing’s CEO Greg Koch recently told local business students that he wanted to change the company’s expansion model. Instead of selling more than 90,000 barrels of beer in thirty-three states, as Stone will do this year, he’d prefer to save on fuel costs and sell more beer in just five states.

While the craft beer juggernaut has continually chugged along, even surviving some near-death experiences along the way, things will have to change. With no end in sight for the lagging economy, craft brewers will have to continue to develop new ways of serving the now ailing consumers who have treated them so well.

–Article appeared in Issue 27 of BeerAdvocate Magazine.

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So Quiet Here, So Much Running Around…

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Things have been pretty quiet around here, with only the occasional Twitter update in recent weeks. I’m still trying to square the impact of Twitter on this site, balancing the convenience and lure of short, quick Twitter posts and the longer ones required here. In any event, it’s been a long and busy few weeks, starting with the Craft Brewers Conference (which seems like several weeks ago) and leading into a week-long trip to Belgium. I’m back now and it continues this evening with the Cambridge Brewing Company’s 20th Anniversary Party. I’m optimistically hoping to attend at 5 pm or so but realistically think it may have to wait until tomorrow as I arrived home from Europe late last night. So we’ll get back at it here soon but things may continue to be a little slow as I need to pen a few columns and articles and eventually get around to writing more of the new book.

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