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| DAILY BRIEFING | | Today's news & insights for the beer industry. |
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| In this issue | - 🍊 Two Robbers Trades Seltzer for Spirits
- 🏈 Mixed Results for Big Game Beer Ads
- 🍻 UK NA Brand Mash Gang Coming to the US
- 🚚 Keg 1 Missouri to Acquire Summit Distributing
- 🔮 On Tap This Week
- ⏮️ ICYMI: 2 Lawsuits Against Non-Competes
- 📸 The Long Drink Makes a Cameo with Taylor Swift
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| Today's Top Story | | | If you frequented the Two Robbers’ website or Instagram in the past month, you’d notice a significant change. The website’s homepage now says “Two Robbers Spirits Company” with a “Website Coming Soon!” banner. And the Philadelphia-based hard seltzer company’s Instagram has been completely cleansed, with previous posts deleted and a handful of new photos in their place. The shakeup is all to promote the launch of Two Robbers Vodka Soda, a line of vodka-based ready-to-drink cocktails (RTDs) that started hitting the Philly market last week. The product will be the company’s core focus in 2024. Two Robbers co-founder and CEO Vikram Nayar told Brewbound: “The whole genesis behind this entire product was us going back to the drawing board and asking the question, ‘Based on everything we’ve learned over the last five years, if we had to redesign this idea of a seltzer product from the ground up … to be the best version of itself, how would we do that?’” The 4.5% ABV RTD will be available in four flavors: Pink Grapefruit, Cara Cara Orange, Sweet Gold Pineapple and Lemon Lime. The offering will be available in single-flavor 4-packs and a variety 8-pack, line-priced with the leading vodka soda brands ($11.99 and $19.99, respectively). Nayar and his brother and fellow Two Robbers founder Vivek Nayar started planning the “next chapter” for the company more than a year ago. The company previously produced sugar-based hard seltzers, expanding into hard juice in 2023 with Double Punch. To differentiate themselves, Two Robbers is focusing on two key elements: a premium alcohol base and the use of real fruit. A great deal of the spirits-based hard seltzer innovation recently has been “copycats to your typical vodka soda, which you saw in the early days of hard seltzer as well, [with] copycats of White Claw,” Nayar said. Those brands “from a formula standpoint, an ingredient standpoint,” are all “very similar:” “bulk corn sugar vodka,” clear liquid, natural flavors and other extracts, with “not much differentiation from the category leaders,” he said. Two Robbers is taking a different approach. The company did blind tastings of “tons of different types of fruits” and “tons of different types of vodkas” to find the right high-quality ingredients. Packaging includes callouts to the ingredients, including “premium vodka distilled from French Winter wheat;” “sweet gold pineapple from farms in Costa Rica;” and “pink grapefruit from farms in Southeast Texas,” among others. The cans also include graphics to highlight “real fruit from real farms” and “no artificial flavors.” Nayar said: “We’re leaning in quite a bit on the marketing front on talking about the liquid, which is something that frankly, a lot of RTD brands are unable to do.” Insiders can read more, including why Two Robbers is focusing on the on-premise, and what the new RTD means for the company’s existing hard seltzers. |
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| From the Wire | | | The 2024 Super Bowl ad rankings are beginning to filter in, and the results are all over the place for the big game commercials from Anheuser-Busch InBev (A-B) and Molson Coors. In USA Today’s Ad Meter rankings, A-B’s Budweiser spot was the only beer spot to make the top 10, with a 6.08 rating. “Budweiser brought the Clydesdales back to the Super Bowl commercial lineup in this 60-second spot, a nostalgic move that struck a positive chord with commercial fans,” the outlet wrote. A-B’s Bud Light “Easy Night Out” ad featuring the debut of the Bud Light genie ranked No. 19, while the Michelob Ultra “Superior Beach” spot featuring futbol legend Lionel Messi, actor Jason Sudeikis and retired Miami Dolphins quarterback Dan Marino ranked No. 20. Molson Coors’ Coors Light ad, featuring the return of the early 2000s Chill Train with LL Cool J as conductor, placed No. 32. None of the beer ads placed in AdWeek’s list of the 13 best commercials. However, AdWeek’s look at the most effective ads found that the Michelob Ultra spot “struck a note with fans” and “took top marks from viewers,” per an analysis of ad testing data from market research firms Kantar and System1. The ad ranked 10th in Kantar’s analysis, placing “high for enjoyment.” Meanwhile, the highest marks for beer ads from AdAge went to A-B’s Bud Light and Michelob Ultra spots, each receiving 3½ stars. AdAge described the Bud Light ad as “a frenetic, gleefully juvenile fantasy-fest that feels (not surprisingly) like a throwback to Bud Light’s bro-forward, untroubled past.” Although the Michelob Ultra ad was “nothing revolutionary,” its “playful, sunny, upbeat vibe” earned it decent marks. The return of the Clydesdales could only muster a 2½ star rating for Budweiser. “[T]he story lacks any real emotional heft,” AdAge wrote. “And bringing back the golden Lab from the ‘Puppy Love’ era of spots, a decade ago, feels like a failed grasp at old glories.” There was no chill in AdAge’s rankings, with Coors Light receiving only 2 stars. AdAge wrote that the Chill Train “return to yesteryear – something Bud Light is trying, too – feels a little warmed over.” |
| | | | Mash Gang, a U.K.-based non-alcoholic (NA) beer brand, is taking its product to the U.S., through a partnership with Pilot Project, a Chicago-based brewery incubator. Pilot Project has helped jumpstart companies such as Luna Bay Hard Kombucha, Azadi Brewing, Funkytown Brewery (winner of the 2021 Brewbound Pitch Slam) and more. Mash Gang launched in London in 2020 as a “pandemic homebrewing project,” and has grown to be “one of the U.K.’s largest, award-winning non-alcoholic brands,” according to a press release. The company will bring two of its offerings to the U.S.: - Stoop Lite, Mash Gang’s flagship, inspired by “the beers of Milwaukee” and the beers the founders “on the stoop” of their New York apartments in the ’90s;
- Journey Juice, a mango IPA named for the British slang term for “a beer you drink between bars.”
The two beers will be available at Pilot Project’s two taprooms in Chicago and Milwaukee and will be distributed nationally, starting February 20. |
| | | | St. Louis-based Summit Distributing has agreed to sell to three different buyers: the Keg 1 LLC network of beer distributors, and fellow Missouri-based Molson Coors distributors Heart of America Beverage Co. and Central States Beverage Co. Each acquirer will receive one-third of Summit’s business, and will form the Keg 1 Missouri consortium to complete the deal, expected to close in late March, according to Beer Marketer’s Insights. Summit owner Tom Stillman, also the owner of the NHL’s St. Louis Blues, told St. Louis Today: “Over the years, Summit has grown tremendously and has become a leader in the industry and our market. We believe KEG 1 Missouri will not only continue our growth and success but also be an exceptional steward of the business in the years ahead.” The complicated deal was forged in this manner to appease Missouri’s residency law, which requires 60% of distributor ownership to live in-state. Summit’s portfolio includes Molson Coors, Constellation Brands, New Belgium, Mark Anthony Brands and Boston Beer. Summit serves the city of St. Louis and St. Louis, St. Charles, Lincoln, Warren, Franklin and Jefferson counties, according to its website. |
| | On Tap This Week | | | In the wake of the Super Bowl – the first major beer industry touchpoint of the year – we’ll share the shopper data points that will likely filter in this week, as well as where this year’s beer ads placed in the advertising rankings. Molson Coors will report its Q4 and full-year 2023 earnings on Tuesday morning. Expect coverage from the earnings call – and likely more comments from management on whether those negative Bud Light trends are still sticky. This week’s Brewbound Podcast will feature MikMak founder and CEO Rachel Tipograph, who will explain the fallout from Uber’s decision to shutter e-commerce alcohol delivery platform Drizly and the players to watch in its absence. Look for it midweek. |
| | ICYMI | | | A pair of former Boston Beer Company employees are suing their former employer over the company’s enforcement of non-compete agreements that members of the organization’s workforce are required to sign. The lawsuits, filed separately in U.S. district courts in Massachusetts and Washington state, share several commonalities, Brewbound managing editor Jess Infante reported. Both alleged the company used the non-compete clause to limit employees’ opportunities within the beverage-alcohol industry. They also claimed the company fostered a “toxic work environment.” Boston Beer has taken legal action against at least two former employees for allegedly breaking its non-compete agreement. One of the plaintiffs in the recent lawsuit claimed that his new employer fired him after receiving threats from Boston Beer. Ashley Pileika, an attorney representing three former Boston Beer employees, told Brewbound: “Boston Beer’s non-compete agreement ended all three of our clients’ careers in the craft beer industry. Generally speaking, non-compete agreements suppress healthy competition, wages and employee mobility. I am not aware of any other craft brewer, besides Boston Beer, that requires employees sign a non-compete agreement as a condition of employment.” For its part, Boston Beer said its use of non-competes helps protect its investment in employee training. A company spokesperson told Brewbound: “We invest a substantial amount of time, effort and money on training, and we share sensitive information widely with our coworkers to help them understand our strategy and build goodwill with our customers. A one-year non-compete helps protect customer goodwill, prevents confidential information from immediately being used to benefit a direct competitor, and enables us to benefit from our best-in-class training programs.” Insiders can read the full story here. |
| | | In other news last week … Sierra Nevada has named its next CEO. The Chico, California-headquartered craft brewery has hired Pryce Greenow as its next top leader. Greenow comes over from Beam Suntory. It’s another outside-of-the-beer-bubble hire that Sierra is becoming known for following the addition of former Procter & Gamble exec Ellie Preslar as VP of sales. An outsider’s view may be welcomed after spirits (42.2%) edged beer (41.8%) in market share last year, according to numbers from the Distilled Spirits Council of the U.S. Need another reason? The Beer Institute reported that U.S. brewers shipped 10.59 million fewer barrels in 2023. More than 151.49 million barrels of beer were shipped in 2023, a decline of -6.5% versus 2022. Those numbers could still be revised, in either direction. The struggles in craft aren’t limited to breweries. Craft-centric retail franchise Craft Beer Cellar closed at the end of last year, and the company has now filed for Chapter 7 bankruptcy. Insiders can read all the details. The retail landscape for beer in general is also becoming more challenging. Some retailers are replacing beer shelf space with carbonated soft drinks and energy drinks. Brewbound reporter Zoe Licata offers highlights from Bump Williams Consulting’s monthly report. |
| | | One of the juiciest middle-tier lawsuits may be nearing a resolution. The members of the Sheehan family appear to be on the verge of ending a three-year legal battle among them that will see four of the family’s sons “consolidate ownership” of the multi-state distributor by buying out their brethren. Should the deal close, Timothy, John, Christopher and Matthew Sheehan would acquire operations in Massachusetts (Craft Massachusetts, Seaboard Products, L. Knife & Son), New York (Craft New York, Union Beer, Tri-Valley Beverage, TJ Sheehan Distributing), Wisconsin (Beechwood Sales & Service) and Virginia (Specialty Beverage). Craft Connecticut and Beer House of Kentucky are carved out of the deal. Las Vegas is known for big events, but how do you get ready for a Super Bowl? Breakthru Beverage Nevada’s Deacon Nauslar joined the Brewbound Podcast to discuss why a 5% to 10% bump was expected. The second edition of Brewbound’s new Friday feature, A Round With …, features Haidar Hachem and Marilyn “Mari” Orozco, the husband-and-wife duo behind Miami’s Shōjō Brewing. Get to know them and the challenges and opportunities they’re experiencing. Miss the first one? Catch up with Earth Rider founder and CEO Tim Nelson on the Minnesota craft brewery’s recent visit from President Biden, its biggest challenge and fostering a successful employee culture. The shift to higher ABV products isn’t limited to craft beer. Massachusetts cider brand Downeast is launching an 8% ABV line called Overboard. Insiders can catch up on Downeast’s new products, its 2023 results and much more. Insiders can also dig into all of the headlines, plus jokes and GIFs, via our weekend newsletter. |
| | Parting Shot | | | While other bev-alc companies were spending seven figures on Super Bowl ads, the Finnish Long Drink was receiving free run next to the biggest celebrity at Sunday’s Super Bowl. Miles Teller, who starred in last year’s Bud Light Super Bowl ad with spouse Keleigh Sperry, was sporting a black Long Drink hat (and Grateful Dead tie-dye shirt) while watching the game in Taylor Swift’s suite with Sperry. Teller is an investor in the gin-based, ready-to-drink canned cocktail brand. This shot was captured during the San Francisco 49ers’ fourth quarter drive, with Swift noticeably sweating the outcome. For her part, Swift was caught on the jumbotron chugging a beer in a plastic cup with a friend. |
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