Last month, Jim Koch wrote an op-ed in The New York Times that slammed the United States for not enforcing antitrust laws and allowing two multinational brands to dominate the U.S. beer market. Koch knows a thing or two about beer: he founded the Boston Beer Company, best known as the producer of Samuel Adams beer.
Koch said this lax regulation was setting American craft brewers up for failure, forcing them to close or sell to those conglomerates. The result would be a loss of the authenticity and diversity that helped turn brewing into an art, along with less consumer choice and fewer craft brewing jobs.
All across the country, executives at mid-size regional brands feel Koch’s frustration. In industries dominated by multinational conglomerates, competition can feel like a futile effort. Why even try to build a company when the odds of success are so small? And what does success even look like, unless the goal is to sell your company to those industry giants?
If you believe in your product, then your biggest challenge is finding an audience. It’s never easy to go up against global corporations, but it isn’t impossible. Although the craft beer industry remains at risk, the key to its endurance is an emphasis on authenticity—a lesson that can be applied to any industry.
Image attribution: Maia Eli
David and Goliath
As of the latest round of consolidation in 2016, two major beer corporations, MillerCoors and Anheuser-Busch InBev, account for 90 percent of American beer production, per the NYT. The immediate results were clearly anticonsumer, according to Koch. With the market controlled by two companies, American consumers wound up paying $2 billion more per year for the same amount of beer. Meanwhile, the duopoly laid off a combined 5,000 brewing jobs, lowered their tax bills, and moved their profits overseas. Similar anticompetitive changes have swept through the beer distribution chain, as wholesalers have been consolidated along with craft beer companies.
Multinational conglomerates have every advantage. They have incredibly deep pockets to fund their marketing spend, they enjoy enormous brand visibility, and the size of their operations creates economies of scale that lower their costs significantly. They can push the price point for their products or services down to a level unsustainable for their smaller competition.
In many cases, the goal for Goliath companies boils down to either eliminating competition or absorbing it, and either scenario suits them just fine. If your brand can’t take the heat, then the major corporations will wave goodbye as you bow out of the business. If your brand proves resilient, and your consumer base remains strong despite their efforts to push you out, they’re likely to write a fat check to absorb the amazing company you’ve created.
But getting rich by selling to a larger brand isn’t the dream of most craft brewers, nor is this true for many business owners. If you’re committed to maintaining your independence, take a page from successful independent brewers and embrace your identity as an alternative to the multinationals.
Image attribution: Allagash Brewing
Thinking Like a Craft Brewer
From California’s Russian River Brewing Company to Minnesota’s Dangerous Man Brewing Company to Maine’s Allagash Brewery, many craft brewers across the country have built a solid base of success with an emphasis on authenticity. These brands have a well-defined mission and a company identity, and they embrace that identity rather than trying to be something they’re not. What do they have in common?
Product Comes First
These beer companies aren’t run by slick executives in suits; beer artisans run them with a passion for drink and a desire to put out a great product, and the content reflects that. Their content strategy is one that often highlights the people hard at work behind the scenes and showcases the quality ingredients and time-honored processes that go into craft beer production.
Allagash Brewery maintains a healthy blogging presence that speaks to their love of their craft. Their website and social channels are full of insta-worthy photos, behind-the-scenes beer knowledge, and beer-inspired recipes.
They Grow Slow
These companies also choose to build a steady following in their local markets instead of trying to expand their footprint into other, more competitive regions. Deschutes Brewery is one of the more widely distributed craft brewers in the country, but this expansion is a fairly new initiative that came only after decades of building a base of support in Oregon.
Other small brewers turn their production limitations into an asset: Russian River leverages a limited supply to keep its brews in high demand. And Dangerous Man is among the most exclusive of them all, as it doesn’t bottle or can its beers for retail sale (and doesn’t even distribute its beer to other bars and restaurants). The only place you can get Dangerous Man beer is at its taproom or its growler filling station, and this exclusivity makes it a local favorite.
They Celebrate Local Ties
Successful craft brewers also engage with their communities, emphasizing their local presence and partnering with other organizations for fundraisers, charity projects, local tap invasions, and other events and initiatives that serve their local community. New England favorite Harpoon is known throughout the region for hosting an annual Octoberfest, several road races for charity, and numerous events throughout the year. They are also a near-ubiquitous sponsor of local charity events.
Jim Koch’s own Sam Adams—the brewery that introduced much of America to craft beer—trades heavily on its Boston ties: they took their name from local Revolutionary War hero and founding father Samuel Adams, and many of their beers sport Boston-themed names. Though Sam Adams is now the second-largest American-owned beer producer (their number-one status was taken by Philadelphia’s Yuengling in 2014), their brand identity remains intimately connected to their Boston roots.
Quality Over Quantity
Craft brewers prove that a great brand story starts with a great product. Big brands have advantages in nearly every other arena, so smart craft brewers (and the regional brands in other industries that emulate them) are all about quality. Instead of trying to beat multinationals on their own field, lean into what makes your brand unique and compelling. A devoted customer base will follow.
Featured image attribution: Yutacar
The post Craft Beer and the Quest for Authenticity: What the Industry Can Teach Marketers appeared first on The Content Standard by Skyword.
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BiographyMore Content by Jonathan Crowl