Category: Craft Beer

Why the Anheuser Busch InBev – Goose Island Deal Is Good For Craft Beer…

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Now I have in the not-so-recent past been accused of being a Goose Island-apologist and even a touch sycophantic when it comes to my hometown brewer. And I have made clear my respect for Goose Island and its founding family, including John and Greg Hall. To their credit, the Hall’s have made no bones about their decision to enter into an equity agreement with the Widmer Brothers Brewery and to their participation in the Anheuser-Busch distribution channels.

Despite all of Goose Island’s successes, [Chicago’s] s notoriously competitive distribution challenges in part led to the brewery’s decision in 2006 to enter into an equity agreement with the Widmer Brothers Brewery and the Craft Brewers Alliance, which has ties with Anheuser-Busch InBev. With their decision quickly came harsh words from self-appointed craft beer purists. Greg Hall quickly dismisses the criticism by noting that the big guys give them better access to market but “zero direction whatsoever” as to the beer. For others he jokes, “Can’t you taste the beechwood in there? Don’t you think it makes it taste better?” Simply put, “the beer is coming on a different truck now, but it’s the same beer from the same brewery and people.”

I’ve visited the Fulton Street brewery twice in the past two years and have been continually impressed by Goose Island’s dedication to pushing the brewing envelope and to developing some very interesting beers. If you expected Goose Island to go on autopilot after the 2006 Widmer deal or to fall prey to some flavor-killing influence of Anheuser-Busch, you’ll have to take you beer geek insecurities elsewhere. Goose Island has done nothing but improve its operations, both in terms of efficiency and creativity, since the inking of those big deals. The brewery has also enjoyed unprecedented access to a notoriously rough market in Chicago.

For the doubters, you need only consider what Goose Island has done since 2006 and then ask whether your local, “independent” brewery has fared as well. GI has introduced Sofie, Fleur, Juliet, Madame Rose, Pepe Nero and Nightstalker, as well as a number of variations on Bourbon County Stout. It has instituted a sustainability project meshed with a session beer offering through Green Line. Matilda is now widely available throughout the city on draft and the brewery is fast becoming known for anything other than its flagship Honker’s Ale (which remains excellent).

Despite industry criticism and snarky beer geek attacks, Goose Island has proven its dedication to producing world-class beer and to being inventive. And despite the departure of longtime brewmaster Greg Hall, I expect the brewery will continue to innovate. The future will tell on how a full AB-InBev owned and Greg Hall-less venture proceeds.

After getting beyond the initial surprise of the deal, I’m left with the thought that the A-B deal is actually good for craft beer (and certainly for Goose Island). As I noted in last month’s BeerAdvocate Magazine, it is time for the big brewers to signal their intentions towards craft beer. To date, Anheuser Busch’s entries have largely come across as a series of half-hearted, faux-craft brands that have tried to co-opt craft’s cool while simultaneously portraying the trend as cartoonish. While a few of the offered A-B brands have been respectable in terms of flavor (such as the Michelob Porter or the brewery’s dunkelweizen), the rest have been busts.

The Goose Island deal looks like a more focused approach for AB-InBev. According to the Wall Street Journal, the brewing behemoth intends to focus on a few core brands (as it does elsewhere around the world), including the Blue Moon-killer Shock Top (a cartoon brand in my opinion) while purchasing a handful of successful craft brewers. This latter approach, more in line with the InBev model, allows the company to bet on already successful brands instead of undertaking a throwing things at the wall approach that long seemed to dominate the A-B releases.

The Goose Island sale to AB-InBev in one sense must be seen as a victory for craft brewers. Instead of simply trying to knock-off or belittle their efforts, the world’s largest brewery clearly appreciates some of the nuances of the American marketplace. And it is certainly vindication for the hard work and efforts of the Goose Island family.

I also expect that this will signal the end of the half-hearted, Budweiser American Ale stabs at flavorful beer that we have seen in the past. Better to have the behemoth support, promote, and deliver flavorful craft beer than to crowd tap handles with flavorless and embarrassing knock-off brands (beyond the handful that will remain, such as Shock Top).

The deal also gives us hope that AB-InBev will finally take baby steps towards getting serious about supporting better beer. I expect Goose Island will receive a helpful infusion of cash and greater access to more markets as the division grows. As the industry continues to gray, it’s inevitable that many other craft brewers will find a buyer in AB-InBev, which will in turn lead to craft brewers comprising a greater percentage (however negligible globally) of the AB-InBev brewery portfolio. Assuming craft beer drinkers do not abandon their favorite but now-sold craft brewers, AB-InBev will experience pressures to continue to brew brands and keep local breweries in operation that they have not before faced in places around the world, including in Belgium.

To the extent that craft brewers can maintain an ownership, controlling, or operational interest in their breweries, using AB-InBev’s capital resources to expand their breweries will also lead to a greater availability of craft beer in markets across the nation. We have all seen our favorite breweries quickly expand their footprints across the country, only to have to pull back to a few or even a single state due to the inability to meet demand. This will continue to be a challenge for breweries for many years to come.

There are of course dozens of questions remaining to be answered in determining what effect AB-InBev’s growing involvement in the craft beer sector will have. We have no idea whether AB-InBev will be content to take a hands-off approach, as it has so far with Goose Island, and just see fit to help great craft brewers grow and showcase their brands or whether the large brewer’s shark-like corporate culture will cannibalize brands and move to shutter breweries and centralize brewing operations.

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What Will The Big Brewers Do About Craft Beer?

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America’s largest commercial breweries have long had a love-hate relationship with craft beer. Often run by families with long brewing pedigrees, the macro brewers took serious offense at suggestions that their beers-pictures of consistency and efficiency-were somehow inferior to those produced by the bands of ragtag, scraggly haired, tattooed wannabes. The big brewers didn’t view the newcomers so much as competitors, but curious interlopers riding a brief fad.

In response to the early rise of craft brewers, Anheuser-Busch developed and released a series of half-hearted, faux-craft brands that tried to co-opt craft’s cool while simultaneously portraying the trend as cartoonish. Over at SABMiller, CEO Graham Mackay flippantly gave Fortune Magazine as late as 2007 his thoughts on craft beer. “I think it’s going to fade. It’s inevitable.”

With the explosive and long-sustained success of craft beer over the past decade, even through the terrible economy of the last two years, Mackay’s comical statements likely signify the last time a big brewery CEO doubted craft beer’s staying power. The only question remains, where do the nation’s biggest breweries go from here?

Having purchased substantial stakes in several craft breweries, from Redhook to Old Dominion, A-B InBev’s future in the better beer segment remains an open question. With the company’s primary focus on developing its core brands and its massive outstanding debt, it seems unlikely that future purchases and partnerships will occur. Add in the company’s dedication to premium brand building, and not to cultivating smaller craft brands, and the situation leaves a decided air of uncertainty hovering over companies such as Goose Island and Widmer. Within its own portfolio, A-B’s more flavorful beers also appear to be on the outside compared to Stella and its bland brethren.

With craft beer continuing to grow in dollar and market share, the big guys can’t be expected to sit back and watch their brands get ridiculed and become culturally irrelevant. After nearly two decades of flat out denying that consumers would switch from interchangeable beer widgets to characterful ales and lagers, macro brewers face some very difficult choices. Do they focus on foreign markets and continue to follow the old playbook in the United States? With the slow growth of craft beer from Scandinavia to Italy and Brazil, this seems like a poor response. Buying a stake in or taking over aging craft brewers also hasn’t panned out for the big guys as savvy beer consumers tend to hold such alliances against them. And when not taken seriously, their own organic products have tended to be resounding failures.

For its part, Coors appears to be the only big brewer to have not taken the upstart flavorful beer segment for granted, having developed and supported the now category leading Blue Moon brand despite some uncertainty along the way. And while some beer geeks may slam down their pints in anger when Blue Moon advertises on the Discovery Channel’s Brew Masters show, the new MillerCoors has doubled down on the better beer segment with its recent formation of the Tenth and Blake brewing outfit. The division’s new president, Tom Cardella, recently admitted to a Milwaukee newspaper that “[y]ou are seeing a tremendous amount of consumers gravitating to craft beer. Consumers are being more discerning about beer.”

A watershed moment in the history of craft brewing, it’s time for the macro brewers to acknowledge the new role flavorful beer plays in this nation, the strength of its future prospects, and help raise the bar for beer in America. Instead of trying to demean, ignore, or dismiss characterful beer, A-B InBev and MillerCoors should endeavor to help usher in the next era of great American beer. Because one thing remains clear for the big guys in the midst of all this uncertainty: those meddling craft brewers aren’t going anywhere.

–Article appeared in Issue 48 of BeerAdvocate Magazine.

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Is It About Beer Or Beer Politics: The Brewers Association’s Baby Step…

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The Brewers Association today released news that it had once again changed its definition of the term ‘craft brewer.’ The change relates to the association’s use of the word small to refer to its qualifying members. As the press release noted:

In the BA’s craft brewer definition, the term “small” now refers to any independent brewery that produces up to 6 million barrels of traditional beer. The previous definition capped production at 2 million barrels.

From a practical standpoint, this change allowed the Boston Beer Company, maker of the Samuel Adams line of beers, to remain a qualifying member of the craft beer club, for purposes of definition by the Brewers Association. It also allowed the association to continue to include Boston Beer’s explosive sales growth and category dominating production volumes in the craft beer segment’s total numbers.

Now, some of you may be thinking, here comes another rant on the definition of craft beer, the likes of which we’ve seen here many times before. To the contrary, I applaud the Brewers Association’s action today. In truth, it was an inevitability. Like a woman who is perpetually turning 29, Boston Beer has been coyly telling everyone that its beer production numbers were below two million barrels per year for at least a few years after many people believed it likely blew past that number. Point being, the definition of small, like much of the rest of the Brewers Association’s craft brewer definition, is entirely arbitrary and the two million barrel number, while finding some viability in tax law, really had no relevance for purposes of determining which breweries qualified as craft.

I have to admit that over the last three years I have experienced a growing disconnect between my own thoughts on the definition of craft beer and those held by many in the craft brewing community, including some very close friends. The prevailing view among hardened beer geeks seems to be that while Boston Beer may have helped craft beer along, that it is now some how now indistinguishable from brewing giants InBev and SABMiller. This view, in my opinion, combines the twin sins of ingratitude and short-sightedness, a rare feat to be sure. As Brewers Association board president Nick Matt himself said in today’s release, “Rather than removing members due to their success, the craft brewing industry should be celebrating our growth.”

So with this part of the issue addressed, there remains the sticky proposition of dealing with the association’s most controversial definitional language, namely that of excluding breweries where more 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.”

For those who have not lived and relived this fight, the definition excludes a handful of brewers, including Redhook, Widmer, Kona, and Goose Island, Magic Hat and Pyramid, Mendocino Brewing, and others.

I remain disappointed that some well-known craft brewers, for some reason I have yet to fully comprehend, continue to play a game of us versus them, all while perpetuating this myth of the small, hand-crafted brewer. Because an otherwise small brewer, certainly smaller than many of those bitching about their independent status, sends his beer out on trucks run by Anheuser-Busch affiliated distributors or have some twisted corporate tie to a bigger brewery, that their membership in the craft beer club should suddenly stand revoked continues to confound me.

Because, in the end, at least for me, it really is about the beer and these associational definitions actually do a disservice to the cause of better beer. While I can understand excluding Coors and its Blue Moon product from the craft brewer party, it is to my mind and palate indisputably a craft beer. Not the greatest beer I have ever had nor a shining example of the style, but perfectly acceptable nonetheless. But the exclusion of its nearly two million barrels of production (you read that number right) under-reports and undersells the advances better beer has made in the United States in the past fifteen years.

When craft brewers and beer enthusiasts mindlessly disrespect Boston Beer by deriding it as just another “macro beer” or big brewer, I worry about the future of better beer in America. Beyond its pioneering role in the development of craft beer in the United States, Boston Beer continues to be one of the greatest innovators in the industry and its thoughtful, flavor forward advertising campaigns do nothing but help progress the cause of better beer in this country.

Along these same lines, it thoroughly disturbs me when beer geeks and even my beer writing colleagues disrespect and dismiss craft beer pioneers, such as the Goose Island Brewing Company of Chicago, who have found themselves on the outside of the Brewers Association, looking in. As I wrote of company founders John and Greg Hall in a recent issue of BeerAdvocate Magazine:

Despite all of Goose Island’s successes, the city’s notoriously competitive distribution challenges in part led to the brewery’s decision in 2006 to enter into an equity agreement with the Widmer Brothers Brewery and the Craft Brewers Alliance, which has ties with Anheuser-Busch InBev. With their decision quickly came harsh words from self-appointed craft beer purists. Greg Hall quickly dismisses the criticism by noting that the big guys give them better access to market but “zero direction whatsoever” as to the beer. For others he jokes, “Can’t you taste the beechwood in there? Don’t you think it makes it taste better?” Simply put, “the beer is coming on a different truck now, but it’s the same beer from the same brewery and people.”

Having just spent another afternoon at the Chicago production brewery, I can honestly say that I have visited few breweries with such a dedicated passion for producing great, flavorful beers and to pushing the edge of brewing. The brewery simply puts many other regional breweries, with all of their independent, craft brewer puffery, to shame. Put crudely, if Goose Island is not craft, then I have no fucking idea what is. The Hall’s were brewing great beers while many pro-exclusion “craft brewers” were busy playing beer pong with Carling Black Label.

Perhaps it is time to just call it like we see it. Wouldn’t it just be easier to name the breweries that we don’t believe are craft breweries rather than trying to set arbitrary and meaningless definitional labels for entry into the craft beer cool kids club? I say let’s just have a voice vote and move on. We can all agree that when we’re talking about craft brewers, we’re not talking about Anheuser-Busch, Coors, Miller, or Pabst. We might split a bit on Yuengling but frankly, those guys could give a shit what you think about their solid beers.

Because if we’re really getting down to which breweries qualify as craft, I have a whole list of Brewers Association members whose beers scream faceless, nameless mediocrity, akin to those beers brewed by the big guys. Many so-called “craft brewers” make a lot of soulless, boring, clumsy, and inartful beer that I am far more troubled by than the fact that Goose Island needs A-B’s might to help do battle in the Windy City.

With this definitional change, the Brewers Association has taken an important first step in the process of resolving its internal identity crisis. I remain hopeful but not optimistic that the group can manage to figure out how to plan a great family reunion so that the craft brewing clan can once again stand united.

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Craft Beer, All Growed Up…

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All grown up and ready to don his crown, the prince busily makes plans for the future. All hail the new king of beer. If you read the beer press lately, you’d be forgiven for thinking that craft beer has conquered all. The Brewers Association’s recently released half-year numbers demonstrate that despite the economic downturn, craft beer sales continue to boom by double-digits, to the enduring shame of macro beer producers. Without question, no other brewing industry segment can touch craft’s fire.

But before we start the next round of mutual back-slapping and pint raising, America’s smaller brewers should stop and consider the decidedly unsettled course of American beer’s future. We have lived through the Age of Extreme and experienced the Era of Collaboration, reveling in years of unparalleled success. Yet the toughest times lie ahead as craft brewers move from the lighthearted teenage growing years to the increasingly responsible adult decades.

For one, succession issues will continue to pose challenges for brewers small and big. As brewers continue to merge or purchase their craft brethren (and competitors), brands and brewing histories may become diluted or lost. In the wake of the recent transitions of Anchor, Magic Hat, Old Dominion, and others, consumers are learning the painful truth that beer is a business and craft brewing is not some fun hobbyist project. Your favorite beer of today may become a fond memory tomorrow in someone else’s brand portfolio.

Growth also brings its own challenges and has already contributed to some serious identity crises in the industry. After years of predicting the event, the Boston Beer Company appears poised (if not already there) to exceed the magic two million barrel mark that the Brewers Association uses to define the size limits for craft brewers. While many recoil at the suggestion of disinviting Sam Adams from the craft beer party, the truth is that many craft brewers are far from small operations. How the industry defines itself, while caring for its pioneering elders will continue as a rolling boil.

Beyond trying to define “craft”, the industry’s success also challenges the consumer’s understanding of what the whole industry stands for. As growing pains set in, brewers find themselves stretched increasingly thin. Due to demand and quick sales, brewers send beer to markets thousands of miles from home, sometimes while their local patrons can’t find their favorites. To date, only a handful of brewers (craft or not) have chosen to brew their beers in distant breweries to satisfy new markets, but this trend will rise. But if Goose Island brews its Honker’s Ale or 312 in New Hampshire, is it really still Goose Island? Many consumers don’t think so.

Craft brewers also have to contend with the increasing interest of macro brewers in their profitable and growing market segment. As I predicted several years ago, Blue Moon has become the nation’s best selling craft/faux-craft beer. It’s a sales juggernaut that shows no signs of slowing, especially with MillerCoors’ creation of the new Tenth and Blake Beer Company spinoff. Expect the big guys to be more aggressive as they spend more time playing in the craft beer sandbox.

Finally, craft brewers need to get their own houses in order. In the very first issue of BeerAdvocate Magazine, I took craft brewers to task for refusing to put bottling or brewing dates on their packaging. While we have seen some progress in recent years, freshness dating continues to be a problem that many of the industry’s biggest players refuse to adequately address. While I personally love Bell’s Two Hearted Ale and included it in Great American Craft Beer, I shouldn’t have to go to the brewery’s website and enter a batch code to find out when it was made. A few stale bottles have caused me to rethink buying this longtime favorite and many others from craft brewers that should know better.

–Article appeared in Issue 48 of BeerAdvocate Magazine.

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Upcoming Events for Great American Craft Beer…

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So now that we have a few weeks of interviews behind us, now comes the fun part: celebrating Great American Craft Beer. The lovely folks at Cambridge Common will be hosting the book release party for Great American Craft Beer on Thursday September 2, 2010, from 6-8pm. There is some information on Facebook and a little more about this event on BeerAdvocate. Everyone is welcome to join us and beer will be pay as you go.

Great American Craft Beer Book Release Party.

Come join us for the release party for beer writer Andy Crouch’s new book, Great American Craft Beer. He’ll be leading one of Cambridge Common’s Beer Skools, talking about selections from his book (all available on tap at the Common), and also will be signing copies of the book. There will be snacks, great beers, a wee bit of education, and a great night celebrating American craft beer.

Gordon’s Culinary Center and Beer Education.

Starting next month, I will be hosting a series of beer related events at the Gordon’s Fine Wine and Culinary Center in Waltham. We’re calling it “The Art, Beauty and Complexity of Beer; A Series of Not-So-Serious Discussions.” I will be hosting “a revolving lineup of engaging craft beer personalities as they dish out their opinions on everything from the state of American craft beer to the preposterous amounts of facial hair in the industry. As any good beer discussion must be, these intimate conversations will take place over samples of beer from the brewers themselves.”

The first installment of the series, “Brew to the Future,” first event will be held on September 8, 2010, and will go from 7-8:30 pm. I am fortunate to be joined by two of New England’s most interesting and exciting brewers: Dann Paquette, co-owner and brewer of Pretty Things Beer and Ale Project and Jon Curtis from the Haverhill Brewery. These two experienced and adventurous brewers will be discussing the impact of traditional brewing cultures on their work, from Jon’s modern take on German classics to Dann’s roots in English methods. With Jon and Dann, there will be no shortage of opinion, hilarity, and (of course) period costumes.

From the folks at Gordon’s on the venue: “Gordon’s Fine Wine and Culinary Center is the preeminent venue for beer education in the Boston area. Through trips, classes, festivals and electronic media, our knowledgeable beer staff is constantly busy championing the necessity for respect and admiration for mankind’s original beverage of choice.”

Great American Beer Festival – The Great American Craft Beer Experience.

We of course will be holding an excellent beer education and tasting event in Denver during the upcoming Great American Beer Festival. Join us for the Great American Craft Beer Experience, a tasting event featuring three of America’s most exciting and talented brewers.

Part book-release party, part celebration of American craft beer, the event will give attendees an excellent opportunity to taste beers from around the country and interact with the brewers.

Brewers will be attending from Duck-Rabbit Craft Brewery (Paul Philippon), Firestone Walker Brewing Company (Matt Brynildson), and Odell Brewing Company (Doug Odell).

Beers: Duck-Rabbit: Milk Stout and Wee Heavy Scotch Ale; Firestone Walker: Double Barrel Ale, Union Jack, and Parabola; Odell: IPA and 90 Shilling. Other beers may be added.

Sponsored by BeerAdvocate, the event will feature at least six beers from these breweries, selected from Great American Craft Beer, in a tutored tasting event with the brewers themselves. Andy Crouch will moderate a panel discussion and attendees will be able to ask questions of the author and the brewers.

Limited to 50 tickets, for a more intimate event, so get yours while they last.

Ticket price is $45 and includes beer tastings, a signed copy of Great American Craft Beer, light appetizers, and a 6-issue subscription (just a taste) to BeerAdvocate magazine.

Buy Tickets

Please note tickets will be “will-call” (physical tickets will not be shipped; guest list at the event). And sorry: No refunds. No door sales. No media passes.

Newly opened, Stoney’s Bar & Grill is located at 1111 Lincoln Street in downtown Denver, Colorado.

ABOUT THE BOOK
Published in August 2010 by Running Press, Andy Crouch’s Great American Craft Beer takes readers on a passionate and informative journey through the most palate-pleasing ales and lagers produced by American craft brewers today. A personal guide and companion to the exciting world of American craft beer, this unique book also touches upon several related subjects including food, travel, history, and the stories and personalities of America’s best brewers. More than 60 styles and 350 beer profiles are accompanied by full-color photographs and illustrations of the beers and beer labels. It also includes perfect pairing recipes and profiles of 25 of the best beer bars in the country.

ABOUT ANDY CROUCH
Andy Crouch, an award-winning freelance writer, has provided articles to Ale Street News, American Brewer, Celebrator Beer news, New Brewer Magazine, Yankee Food News, and through his website, BeerScribe.com. He writes columns for both Beverage Magazine and BeerAdvocate Magazine. In addition, Crouch’s first book, The Good Beer Guide to New England, was published by the University Press of New England in May 2006. He resides in Cambridge, Massachusetts.

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