Categories
Generalisations about beer culture marketing

Why people choose to buy beer brands

Consciously or otherwise, people take into account all sorts of factors when choosing which beer brands to buy – and when it comes to indie/local status, there’s plenty of ground between ‘I don’t care’ and ‘I would die before buying from a multinational’.

In the pub on Friday night, we were amused to hear two lads discussing Beavertown at the bar.

“Ah, they’ve got Neck Oil!”

“Tell you what, you see that everywhere these days.”

“They’ve done really well for a small independent brewery, haven’t they?”

A large chunk of Beavertown is, of course, owned by Heineken, which is why it can afford to have ads on the side of every bus in Britain and now turns up in all sorts of unlikely places.

Do we think these lads would have ordered something else if they’d known about Beavertown’s ownership? Probably not.

Do we think they’d have been furious or felt betrayed? Again, probably not. But we bet they’d have looked a bit crestfallen and said, “Oh.”

We say that because we’ve had this conversation with friends and colleagues, with regard to both Beavertown and Camden. These are people who like beer and are conscious of their choices but not, it’s fair to say, obsessed with it.

To generalise about their response, we’d say (a) mildly disappointed and (b) a bit embarrassed not to have known already – a sense of having been tricked by sneaky marketing.

Without conducting a full-on survey (tempting) we can’t say with any certainty how people weight different factors when buying beer. We reckon, though, that for most people, it’s something like this:

1. Want a lager or IPA.
2. Want the best available version.
3. Like the brand.

If you break down ‘liking the brand’ you might find all sorts of other stuff going on, including a preference for independent and/or local.

When you learn that a beer isn’t independent/local, it might stop you buying it – but you’ll probably still want the best IPA or lager on offer in the pub you’re at.

That’s certainly how it goes for us.

But if there’s a choice of another beer that’s also in the right style, and tastes decent, but is also indie/local, you might choose that instead. In fact, you might even be willing to compromise a bit on the quality. It’s a matter of preference.

As we’ve said before, if multinational brewers didn’t think independent/local appealed to consumers, they wouldn’t keep buying independent/local breweries and would proudly declare their ownership on the packaging.

Categories
marketing

Killian’s, Irish red ale and French beer drinkers, 1978

During 1978, Guinness got twitchy: a new beer was muscling in on their turf in France. Did George Killian’s Irish Red present a threat, or an opportunity?

From its London base at Park Royal, Guinness commissioned Market Behaviour Limited to go to France and investigate:

RESEARCH OBJECTIVES

1. To study the premium beer market sector in France. To explore beer drinkers’ attitudes towards the sector and the various brands of beer within that sector. (The research concentrated on the bottled beers within the sector.)

2. To explore attitudes towards Killian’s, and to find out which elements of the marketing mix are leading to its current success.

3. To undertake exploratory research into the idea of a new bottled beer to compete with Killian’s, positioned somewhere between the Spéciale and Luxe categories. To explore reactions to the new beer both with and without the Guinness connection.

The report they turned in in December 1978 is interesting not only because it provides more information on the creation of a new beer style but also because it hints at the craft beer culture to come.

The best place to start with the story of Killian’s is Martyn Cornell’s recent in-depth piece on its genesis at Zythophile. It was that which reminded us of the document we’ll be digging into in this post, which we got hold of via former Guinness head brewer Alan Coxon’s papers.

In summary, though, it was launched in 1974 by the French brewery Pelforth, based on a strong ale recipe bought from the Irish firm of Lett & Co., and presented to the French market as a traditional Irish ‘style’. It was a huge success which made other breweries keen to produce their own takes on Irish red ale. That included Guinness.

Commodity blonde vs. quality rousse

Guinness’s market research team focused on drinkers of what we would probably call premium beer – why, and when, did they consider it worth upgrading?

The majority of people seem to split their beer drinking into two main categories: firstly, occasions when the taste and quality of the beer are thought to be important enough for the drinker to exercise his choice in terms of the type of beer, (blonde, brune, rousse, Geuze) and the brand; and secondly occasions where the taste and quality of the beer are far less important and the drinker tends. to choose a cheaper brand of ‘blonde’ beer, almost as a ‘commodity’ product.

French beer drinkers appear to take more care in choosing their beer when they want to relax and when their objective is the enjoyment of the beer. On these occasions they tend to choose a slightly more expensive beer which they feel has a more identifiable taste than an ‘ordinary beer’. This would, for instance, be the occasion when the majority of drinkers of ‘rousse’ and ‘brune’ beers would switch from drinking an ordinary French ‘blonde’ to their favourite type of beer, and when confirmed ‘blonde’ drinkers would switch from an ordinary French ‘blonde’ to either a foreign ‘blonde’ beer or a better quality French ‘blonde’ beer.

However, most of the beer drinkers to whom we spoke tended to drink an ordinary French ‘blonde’ beer most of the time. The ‘normal’ beer to drink in the cafe/ brasserie/bistro is a ‘demi’ of the establishment’s draught ‘blonde’ beer, which is usually an ordinary French ‘blonde’. The important feature of this type of drinking is that, most of the time, the drinker is not aware of which brand of ‘demi’ he is drinking.

A few things strike us as interesting there:

  1. The perceived connection between the colour of a beer and its depth of flavour. We all know that pale beers can be flavourful, and that dark beers can be bland, but there is still a popular perception that darkness equates to intensity.
  1. The idea that people could identify as drinkers of quality beer some of the time while also enjoying necking “Whatever normal lager you have, mate,” on other occasions.
  1. That brand becomes more important with ‘savouring’ beers.

The research confirmed that, almost overnight, French drinkers had accepted the existence of a new style, even though only one example of that style existed:

The research seems to indicate that George Killian’s has been successfully introduced into the French beer market.

The majority of people accept [Bières Rousses] as a legitimate category and not just a description of George Killian’s beer… George Killian’s seems to have attracted beer drinkers because it aroused their curiosity through its unique positioning as a ‘rousse’ beer and because of its taste. Killian’s originally drew its drinkers from ‘blonde’ drinkers as well as ‘brune’ drinkers, but we feel that its major appeal now lies with ‘blonde’ drinkers who are seeking something more than a ‘blonde’ beer but who do not want the heaviness or the bitterness of a real ‘brune’ beer. We feel that a ‘rousse’ beer will not have great appeal to the majority of ‘brune’ drinkers as it lacks the bitterness and heaviness which are characteristics which these people look for in a beer.

Reading that, we can’t help but think of the success of Camden Hells and similar ‘mainstream upgrade’ beers. If the majority of drinkers like standard lager, giving them something a bit more characterful, but not too scary, is a good way to win market share.

The researchers also reached the conclusion that beer was primarily drunk in France as an accompaniment to a night out with “the lads” (their phrase). On almost every other occasion, wine, spirits, coffee or other drinks were preferred. Beer was also seen as almost exclusively a drink for men; when asked why women might drink beer, one respondent said:

Par snobisme essentiellement. Vous ne pensez pas qu’elles le font pour fair plaisir a l’homme? (To be fashionable, essentially. Don’t you think that they do it to please the man?”)

Another interesting finding was that Killian’s was popular with drinkers in France despite being French, and despite being a Pelforth product. An imported product, with Guinness’s name attached, would surely be able to steal some of Killian’s thunder.

The result of all this activity was, we think, the launch of a stronger version of Smithwick’s under the name Kilkenny – hey, that sounds a bit like Killian! – on to the French market in the 1980s.

Categories
marketing pubs

FAQ: Which brands would have been on sale in a 1960s pub?

“Which brands would have been available in an ordinary English pub of the 1950s or 1960s, including spirits and wines?” – paraphrased from correspondence

To answer this, let’s pick a year; and let’s make that year 1965 because we’ve got a good reference to hand: James H. Coombs’ Bar Service: careers behind the bar – volume one.

We’ve written about this little volume before. First, there was a post about its advice on beer. Then there was a companion piece with some nuggets on pub life.

The bit we’re going to look at today, though, is arguably the most boring section in which Mr Coombs provides a long list of the types and variety of booze a good pub ought to carry.

Here’s the raw information from those, oof, twelve chapters. We’ve only included items where a brand name was mentioned, plus a couple of example of beers where ‘brewery’s own’ would be the brand.

Bottled beersBrand
Pale ale (light ale)Brewery’s own
Brown aleBrewery’s own
Double DiamondInd Coope
John Courage (JC)Courage
Red BarrelWatney Mann
Ben Truman (Ben)Truman
Barley WineBrewery’s own
IPAWorthington
Colne Spring AleBenskins (Ind Coope)
White Shield (natural beer’)Worthington
Bass (Red Shield – ‘natural beer’)Bass
Green Shield (pasteurised)Worthington
Bass (Blue Triangle – pasteurised)Bass
LagerCarlsberg
LagerTuborg
LagerHolston
LagerLöwenbräu
LagerOranjeboom
LagerHeineken
SKOLInd Coope
Black LabelCarling
GuinnessHarp
Mackeson (milk stout)Mackeson (Whitbread)
Guinness Extra StoutGuinness
Russian StoutBarclay’s (Courage)
Draught beers (cask)Brand
Mild ale (XX)Brewery’s own
BitterBrewery’s own
BassBass
EWorthington
Draught beers (keg)Brand
Red BarrelWatney Mann
Red HandInd Coope
TobyCharrington
FlowersFlowers (Whitbread)
TankardWhitbread
TavernCourage
BassBass
EWorthington
CiderBrand
Apple Vintage WineMerrydown
Babycham (sweet)Showerings
Babycham (dry)Showerings
Baby BubblyGoldwell
Pink LadyGoldwell
Soft drinks and mixersBrand
Coca-ColaCoca-Cola
Pepsi-ColaPepsi
7-Up7-Up
Perrier WaterPerrier
Vichy WaterVarious
Apollinaris (water)Apollinaris
Hunyadi-Janos (water)n/a
Contrexeville (water)Perrier
Evian (water)Evian
Malvern (water)Schweppes
Buxton (water)Buxton Mineral Water Co.
Springwell (water)n/a
WinesBrand
Tio Pepe (sherry)González Byass
Dry Fly (sherry)Imported by Findlater Mackie Todd
Double Century (sherry)Pedro Domecq
Celebration Cream (sherry)Pedro Domecq
Bristol Cream (sherry)Harvey’s
Bristol Milk (sherry)Harvey’s
Bristol Dry (sherry)Harvey’s
Various sherriesWiliams and Humbert
Carlito (sherry)Wiliams and Humbert
Dry Sack (sherry)Wiliams and Humbert
Canasta Cream (sherry)Wiliams and Humbert
Walnut Brown (sherry)Wiliams and Humbert
Various sherriesVarela
PortCroft, Dow, Fonseca, Cockburn, Sandeman, Warre, Rebello Valente, Taylor, etc.
Porto BrancoSandeman’s
ChampagneAyala, Bollinger, Clicquot, Goulet, Heidsieck, Pol Roger, Moet, etc.
Ginger WineStone’s
VermouthMartini
VermouthNoilly Prat
VermouthCinzano
SpiritsBrand
“Straw-tinted” ginBooth’s
Gin (Geneva)Holland’s
GinPlymouth
London Dry GinSquires
London Dry GinCornhill
Fruit cupPimm’s
Caroni RumTate & Lyle
Lemon Hart RumUnited Rum Merchants
Lamb’s Navy RumUnited Rum Merchants
Daiquiri RumUnited Rum Merchants
Ron BacardiBacardi
Various brandiesMartell, Hennessy, Otard, Courvoisier, Remy Martin, etc.
Bitters and aperitifsBrand
BittersAngostura
BittersUnderberg
Fernet-BrancaFratelli Branca
DubonnetDubonnet
Pernod 45Pernod
AmerPicon

Now, clearly, you wouldn’t find all of these in every pub but, per the original query, if you included these brands as dressing for a film set in 1965, they’d probably look appropriate.

So, that’s the boring list. What about other, sexier sources? Advertising from the period, for example…

Stone's Green Ginger Wine
SOURCE: Brewery Manual 1966.
Hi! Heineken.
SOURCE: Brewery Manual 1966.
Varela sherry
SOURCE: Brewery Manual 1966.

…or beer mats…

A selection of beer mats from around the 1960s.
Some beer mats from our collection from the 1960s and 70s.

… or old photos.

The bar of a pub.
The Crown Hotel, Hadleigh, 1965. SOURCE: Hadleigh and Thundersleigh Community Archive.

In the above pic, also from 1965, we can’t make out many brands but we’ve definitely got Watney’s Red Barrel, Double Diamond and something not on Mr Coombs’s list, Tia Maria.

Categories
marketing opinion

Startups and the runway to buy-out

Some businesses are founded with the intention of being sold for big money in five, six or seven years’ time. How can you spot them?

This isn’t a post about a specific brewery – though clearly Cloudwater has been on our minds this week. Perhaps our observations don’t apply generally. And maybe they don’t apply in brewing at all. But let’s have them out anyway.

We’ve both ended up with day jobs where we’ve been working with or on behalf of a number of startups recently. They’ve been across a range of businesses including food production, professional services and technology.

What we’ve noticed is that, despite the range of sectors and business models, they all have certain characteristics in common.

Six tell-tale signs

First, they tend to have a c.5-year business plan which acknowledges the business may not make a profit for several years, if ever.

Secondly, they have external funding from private sources – either founders and family, or venture capitalists. Funding from the latter is usually raised in multiple stages with late funding being dependent on hitting certain targets relating to sales, number of customers, market share and so on.

When late-stage startups make surprising decisions, this may well be what’s driving it.

Thirdly, they put sales to the fore. While it’s nice for them to be able to show that eventually the business will be profitable, the sales-growth trajectory is more important.

Consequently (item four) marketing will be conspicuously important to the business early on. There will be highly sophisticated marketing collateral from an early point in the business’s life, such as a cutting-edge website, a full suite of professionally-designed brand assets and a strong social media presence. It’s not unusual for these companies to have permanent marketing staff before they have an in-house finance team, or even their own manufacturing capability. 

Underlying all that there will be (five) a remarkably clear brand position and proposition, often focusing on an exaggerated difference between their product and established competitors. This is the essence of ‘disruption’ – at last someone is going to do this properly, cut through the bullshit and show the complacent dinosaurs what’s what!

This isn’t to say the product isn’t important. You certainly have to believe in it and be able to talk about it with convincing passion for several years. So, six, there will probably be a focus on new product development and heavy investment in it, at least in the early years.

What’s the endgame?

The final goal for this type of startup is usually a buyout of some description, in a set period of time – often five years.

Even if the founders want to stay in the business after that, they need to repay capital to early investors, so there’s always a ticking clock built in.

In the final stretch, you’ll often see a flurry of activity as they seek to maximise the value of the brand and of the company, which is what we were getting at when we last tackled this topic back in 2018:

There might be surprising partnerships with ‘evil’ companies; there may be contracts to supply supermarkets; or plans to have beer produced under contract, with more or less transparency… This kind of thing usually comes with a rush of blurb explaining how, actually, this way is even crafter because it widens access to the product, challenges the status quo, and so on, and so forth… The tying off of loose ends is another thing to watch out for, e.g. the sudden settling of legal disputes… The emergence of a dominant beer in the portfolio might be the biggest red flag of all.

The thing is, these companies will rarely, if ever, admit to their customers that the endgame is to sell it. After all, it’s a bit awkward when your marketing messages are all about what makes you distinct, different and superior.

That, we think, is why buyouts always seem to land as a massive surprise to customers and suppliers.

Contrary to what you might hear, people get just as narky about independence in other sectors as they do in beer. For example, we’ve both observed surprise and fury among boutique software users when products they love are bought out by a much bigger competitor. “I chose Quirple specifically because I liked their different approach and didn’t want to work with X-Corp,” they say, “and now I’m an X-Corp customer whether I like it or not? Quentin has betrayed me!”

It’s also worth saying that many businesses of this type never make it past the early stages. There is a high rate of failure with startups and even industry experts may never have heard of the ones that didn’t work out, or will forget them quickly.

What’s the alternative?

What does a growing business look like if it wasn’t built with that planned five-year-on payday in mind? Well, these businesses can still be successful, and still sell for big money, but their growth will tend to be organic, showing…

  • Lumpy sales growth and production – growing in fits and starts instead of on a smooth curve. 
  • A reluctance to invest in slightly intangible things like marketing because it all hits the bottom line.
  • A tendency to be behind the curve with new technology and production methods – they want to see it works before they invest hard-earned cash reserves.

As we said at the start, this isn’t really a post about breweries. We don’t work with breweries and it’s possible that not a single brewery has ever been founded as a startup with the aim of eventually selling to a larger competitor.

Perhaps every single one of those success stories (“Wow, great work guys, and well deserved!”) is a genuine surprise to the founders.

But it seems pretty unlikely, doesn’t it?

Categories
marketing

More breweries = dafter beer names

Drinking our way through a selection of canned craft beers, we’ve caught ourselves rolling our eyes at the long, strange, often pun-laden names.

And we’re not the only ones, either.

What we’d never asked ourselves before is… why? We reckon the answer lies with the proliferation of breweries in the past 30 or so years.

A hundred years ago, most beers had exciting, distinctive names like ‘mild’, ‘bitter’ or ‘X’.

Then, in the mid-20th century, national brands emerged with snappy names such as Red Barrel or Double Diamond.

Next, the CAMRA-led real ale revolution kicked off, and brewery numbers began to climb in the 1970s and 1980s. These breweries were, in their own way, also national brands, competing for space at beer festivals and in specialist real ale pubs up and down the country.

Premium bottled ales (PBAs) also came along, filling supermarket and off licence shelves.

In this phase, beers with distinctive names such as Summer Lightning, Old Nick or Spitfire had a clear advantage.

Ale ticking culture must also have had an effect. Breweries with ranges of three, five or maybe seven beers are one thing; when you’re producing a new beer every month, or every week, you’re obliged to get creative. Or resort to crude puns.

Jump forward a couple of decades and instead of a few hundred breweries, we’ve got more than 2,000. And that culture of guest ales has morphed into a need for a constant flow of novel, Instagram-friendly products for keg, bottle or can.

The scramble for unique web addresses during the dot com boom led to companies with names like Accenture, Consignia and Moonpig.com. In much the same way, a crowded beer market inevitably calls for Experiments in Evil, Big Raspberry Dog Chew and Grainsley Harriot.

Plus, of course, it’s fun – another outlet for creativity in a subsector that prizes that over blazer-wearing conformity.