Molson Coors To Increase Its Focus On The Better Beer Segment

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Reports in the Wall Street Journal and the Rocky Mountain Daily News today bring news that the Molson Coors Brewing Company has incorporated a high-end beer division to compete in the better beer segment. The RMDN article reports:

Coors Brewing Co. plans to roll out upscale beers via a new Golden-based unit called AC Golden Brewery.

The new “brand incubation company” will “introduce above-premium beers to the marketplace using a new approach” that’s less splashy than typical “national rollouts,” according to a Coors announcement obtained by the Rocky Mountain News that was distributed to company employees and distributors.

The news was first reported by Beer Marketer’s Insights Express, a trade industry publication.

Golden-based Coors’ chief brands are Coors Light, Keystone Light and Blue Moon.

Incorporation papers filed in April with the Colorado secretary of state’s office list an AC Golden Brewing Co. formed by Pete Coors. Coors is chairman of Coors Brewing and vice chairman of parent Molson Coors.

According to the Coors announcement, AC Golden Brewery will introduce its brands in the similar stealth way Coors built up its Blue Moon brand. A number of craft beer drinkers who enjoy Blue Moon Belgian White Ale aren’t aware it’s a Coors product.

Coors has long been slow to adjust to changes in the beverage alcohol market (Aspen Edge anyone?). Despite its missteps, Coors has a long proven dedication to the better beer segment. Check out the Beer Scribe interview with Tom Hail, brewer for the Sandlot Brewery at Coors Field to learn more about Coors’ history in the better beer segment.  I look forward to seeing what offerings this division serves up and whether the brewery continues to treat its specialty releases with respect.

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Craft Beer Continues Its Tear…

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The Brewers Association has just released its mid-year numbers and craft beer has continued its impressive growth streak. The highlights of the release, which is quoted below, include the following feats:

• Craft beer growth continues to break records with a volume increase of 11% and dollar increase of 14% in the first half of 2007 compared to the same period in 2006.

• For the first time ever craft beer has exceeded more than a 5% dollar share of total beer sales.

• In the first half of 2007 the beer category sold one million more barrels with 400,000 of these new barrels produced by craft brewers.

• Craft beer sales, in barrels, for the first half of 2007 was 3.768 million compared to 3.368 million barrels sold in the first half of 2006

The numbers for the craft beer segment continue to impress, especially the growth in
dollar share of beer sales (a crucial indicator too often cast aside for the focus of volume).

Dollar Share

On a final note, Julia Herz, the Brewers Association’s new director of craft beer marketing, has done a solid job of improving the way the trade association promotes the craft beer industry. This mid-year release, with pretty graphs and all, is a product of her continuing efforts to better promote craft beer.

Boulder , CO – August 15, 2007 – The Brewers Association, the trade association that tabulates industry data for craft brewers, reports craft beer sales and growth continue to break records. The volume of craft beer sold in the first half of 2007 rose 11% compared to this same period in 2006 and dollar growth increased 14%. For the first time ever craft beer has exceeded more than a 5% dollar share of total beer sales.

Overall, the U.S. beer industry sold one million more barrels in the first half of 2007 compared to 2006, with 400,000 of these new barrels produced by craft breweries. This equates to 3.768 million barrels of craft beer sold in the first two quarters of 2007 compared to 3.368 million barrels sold in the first half of 2006.

Scan data from Information Resources, Inc. provide additional data points that confirm strength for the segment. Craft beer sales in the supermarket channel through July 15th, 2007 showed a 17.4% increase in dollar sales compared to the same period in 2006. This growth in sales was higher than any other alcohol beverage category.

“The 1,400 small, independent and traditional craft brewers in the U.S. have hit their stride,? said Paul Gatza, Director of the Brewers Association.“United States craft brewers are making many of the world’s best beers, and the marketplace is responding.?

Coupled with the growth statistics has been a tidal wave of media coverage in the first half of 2007 including NBC’s Today Show on July 3 stating, “Beer is the new wine and can go with just about any food.? Additionally, Gallup, in its latest poll on alcohol beverages, announced for the second straight year that “Beer Again Edges Out Wine as Americans’ Drink of Choice.?

Julia Herz, Director of Craft Beer Marketing for the Brewers Association concluded, “Craft beer market share is steadily and consistently growing. A grassroots movement is responsible for this success as appreciators continue to trade up.?

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The definition of craft beer as stated by the Brewers Association: An American craft brewer is small, independent and traditional. Small = annual production of beer less than 2 million barrels. Beer production is attributed to a brewer according to the rules of alternating proprietorships. Flavored malt beverages are not considered beer for purposes of this definition. Independent = Less than 25% of the craft brewery is owned or controlled (or equivalent economic interest) by an alcoholic beverage industry member who is not themselves a craft brewer. Traditional = A brewer who has either an all malt flagship (the beer which represents the greatest volume among that brewers brands) or has at least 50% of its volume in either all malt beers or in beers which use adjuncts to enhance rather than lighten flavor.

Based in Boulder, Colo., U.S.A., the Brewers Association (BA) is the not-for-profit trade and education association for American craft brewers and the community of beer enthusiasts. Visit the website: to learn more. The association’s activities include events and publishing: World Beer Cup®; Great American Beer Festival sm ; Craft Brewers Conference and BrewExpo America®; National Homebrewers Conference; National Homebrew Competition; American Craft Beer Week (May); Zymurgy magazine; The New Brewer magazine; and books on beer and brewing. The Brewers Association has an additional membership division of 12,000+ homebrewers: American Homebrewers Association.

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Old Dominion Purchased By A-B, Craft Partnership

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Though it has long been rumored, the sale of Old Dominion is now in its final stages.  I have a lot to report on this topic (including some coverage in the next issue of BeerAdvocate Magazine, but for now, here is the press release. 

New Joint Venture, Coastal Brewing Co., To Purchase Old Dominion

ANNAPOLIS, Md. (March 2, 2007) – Coastal Brewing Co., a new joint venture between Maryland-based Fordham Brewing Co. and minority partner Anheuser-Busch, Inc., announced today it will purchase Old Dominion Brewing Co., a Virginia-based craft brewer and brewpub operator with primary distribution in the Mid-Atlantic region of the United States.

As part of the deal, Coastal Brewing Co. will assume ownership, sales and marketing responsibilities for both the Old Dominion and Fordham brands, including Dominion Ale, Dominion Lager, Oak Barrel Stout, Fordham Copperhead, Fordham Lager, Oyster Stout and others. Coastal Brewing Co. also assumes ownership of the Old Dominion brewery and Old Dominion Brewpub, both located in Ashburn, Va.

Bill Muehlhauser, chief executive officer of Fordham Brewing Co., will serve as managing partner for Coastal Brewing Co. Coastal Brewing Co. has hired Scott Zetterstrom as a vice president of brewing operations to oversee brewing of the Old Dominion and Fordham brands. Zetterstrom previously served as head brewmaster for Old Dominion and most recently worked with Fordham as an independent brewing consultant. Coastal Brewing Co. also has hired Barry Newmiller as vice president of sales and marketing. Newmiller previously was a regional sales manager for InBev USA.

Additionally, effective April 1, 2007, Anheuser-Busch will become the master distributor for the Old Dominion and Fordham brands, giving Coastal the benefit of Anheuser-Busch’s logistical expertise in managing distribution and access to more independent and chain retail accounts in the Mid-Atlantic region.

“I’m proud to entrust the wonderful beers we have brewed at Old Dominion since 1990 to Fordham and Anheuser-Busch,? said Jerry Bailey, founder and president of Old Dominion Brewing Co. “Under Coastal’s stewardship, the quality of Old Dominion brands will be protected and there’s no limit to what they can accomplish.?

Coastal Brewing Co. will be led by Fordham Brewing Co., which holds 51 percent ownership, with Anheuser-Busch holding the minority stake of 49 percent.

“We are eager to expand the distribution of our Fordham brands through Anheuser-Busch’s wholesaler network and are looking forward to working with the company through this alliance,? Muehlhauser said. “We are excited about the opportunities Coastal Brewing Co. will provide to both the Old Dominion and Fordham brands and introducing them to even more beer lovers in the Mid-Atlantic States.?

“Old Dominion and Fordham are two of the leading craft brewers in the Mid-Atlantic region, with a strong following among craft consumers and a tremendous opportunity for growth,? said Dave Peacock, vice president of business operations for Anheuser-Busch, Inc. “Together with our partners at Coastal Brewing and our wholesaler network, we will enhance the distribution and sales support for these exceptional beers and continue to provide new, distinctive products to adult consumers.?

Based in St. Louis, Anheuser-Busch is the leading American brewer, holding 48.4 percent of U.S. beer sales. The company brews the world’s largest-selling beers, Budweiser and Bud Light. Anheuser-Busch also owns a 50 percent share in Grupo Modelo, Mexico’s leading brewer, and a 27 percent share in Tsingtao, the No. 1 brewer in China. Anheuser-Busch ranked No. 1 among beverage companies in FORTUNE Magazine’s Most Admired U.S. and Global Companies lists in 2006. Anheuser-Busch is one of the largest theme park operators in the United States, is a major manufacturer of aluminum cans and is one of the world’s largest recyclers of aluminum cans.

Based in Annapolis, Fordham Brewing Co. was originally founded by Benjamin Fordham in 1703, in what would become Maryland. In 1995, it was reborn in the heart of old Annapolis. Rapid growth resulted in the building of a new brewery in Dover, Del. in the spring of 2003. For more information, visit 

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