Beerlines

Insights on beer marketing & PR by a beer-war vet

Archive for the 'Dan Murphy’s' Category

02 December
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CUB weakens Foster’s Lager. Why?

I was attracted to the bright blue pallet load of Foster’s Lager at Dan Murphy’s.

But what caught my attention was the alcohol content of Foster’s Lager now at 4%.

[UPDATE/CORRECTION 7 December: IT’S CLASSIC!! A case of reading the fine print! This brew is called Foster’s Classic and apparently is being sold exclusively through Dan Murphy’s; the comments at this web site about how ‘Classic’ it is are worth a read. Thanks to beer writer Matt Kirkegaard for the heads-up.]

fosters 4 percent

Previously, as you can see from the pic below from Carlton & United Breweries‘ website, Foster’s Lager was 4.9%. (Perhaps CUB should update its website.)

That’s a whopping 18% reduction!

fosters

Brand histories ignored
Why is CUB, or rather parent company SAB-Miller, doing this?

Okay.. Foster’s glory days are long over. Nonetheless it’s fair to say it remains an iconic beer brand recognised globally as Australian.

So has CUB learned nothing from the consumer backlash when they did this to VB? Remember CUB’s letter of apology in the press when they ‘fixed’ it?

Have they not checked their history and wondered at the demise of other strong CUB brands like Abbots Lager, Reschs Pilsener and Brisbane Bitter when alcohol was sneakily reduced?

CUB has recently cut the alcohol content of Cascade Premium too.

Perhaps Foster’s Lager is set to be yet another discount brand fighting on price. Call me nostalgic but that would be a sad end to this famous brand.

Cost cutting your way to growth
There is only one reason this is happening of course. It’s to reduce the Federal Excise the brewery has to pay which is based on alcohol content. Okay .. it’s the job of business to reduce costs. Consumers understand that.

What they don’t understand is a decision to ignore them and to reduce the essential ingredient and, invariably, the taste of a brand they prefer – or used to prefer.

SAB-Miller’s global webpage says it has “A commitment to growth.” Perhaps they’ve not heard the marketing truism which states “you can’t cost-cut your way to growth.”

However I suspect those making such decisions at CUB are not listening: certainly not to consumers. Pity.cheers

 

30 March
Comments Off on Craft beer winning the ‘eye level’ war in retail

Craft beer winning the ‘eye level’ war in retail

For decades major brewers have competed and paid heftily to secure choice, high-profile positions in major retailers’ bottle shops and liquor barns.

The visual customer-facing beer war at POS
Every customer-facing cubic centimetre was precious turf. It was (and remains) a very competitive visual war for beer brand presence in major retailers.

And the big brewers were all over it! They owned it – they thought. Indeed, they devised their own science to prove it: ‘space planning’ and ‘planograms’ and whatever.

The most highly sought after POS placements in retailers’ fridges are, of course, at eye level. The grab-and-go slot.

So for years, what have we seen at eye-level? Usually six packs of VB or Tooheys Extra Dry or XXXX Gold; the result of big brewers with big brands paying the big retailers big bucks.

Craft now dominates at eye level
But a trip to Woolworths’ owned BWS shows how times have changed. Craft beers are front and centre.

This pic from BWS South Melbourne was central to the fridge fronts. There was no VB or Carlton Draught in this frontage at all. Those brands were back in the cold room.

bws2

Clearly BWS is on top of consumer interest at retail. And the consumer increasingly wants something new to try: an interesting brand or style to drink and brag about.

Okay, quite a few of the craft brands in this BWS are Woolies’ own private labels (often called faux craft) and clearly the retailers are making better margins, but the takeout is clear: craft has won this particular POS battle.

Big brewer versus big retailer – control of the POS
For years the big brewers believed this key point of sale in retail was theirs.

That sense of entitlement, I suspect, has rankled the big retailers for some time.

These facings must seriously be pissing big brewers off no end. Especially, as you can bet many of these small craft brewers are paying nowhere near as much for the privilege.

Interesting times at POS. And for that .. Cheers!

08 March
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Beer provenance revisited: lack of transparency still a hot issue

On the matter of beer provenance I must highlight and hat tip the role Matt Kirkegaard, arguably Australia’s leading beer commentator and blogger, has played in bringing this issue to prominence.

After penning my previous post I came across an earlier post and podcast by Matt about beer provenance concerns. I urge you to read and listen to this interview with Dr Chuck Hahn by clicking on the RBN pic immediately below. Maybe miss the preamble and start 10 minutes in.

rbn chuck

While contacting Matt, beerlines took the opportunity to quickly interview him on beer provenance and secure an update on his thoughts.

Beerlines: “As Editor of Australian Brews News is provenance becoming more important? If so is there any variation between small and big brewers?”

Kirkegaard: “It’s an interesting question.

“As our shelves become more cluttered with a wider array of beers, consumers are looking to brand values as much as flavour to aid their selection.

“It’s here that provenance can really matter. It’s also here that large and small brewers can be pushing things a little too far and muddying the provenance waters.Byron_Bay_Pale_Lager_Carton_6_x_4_330ml

“While it’s very easy to point the finger at beers such as CUB’s outright deception with Byron Bay Lager, or LION’s highly dubious labelling of Kosciuszko Pale Ale, they can quite rightly point their fingers at smaller brewers who have taken the ‘we don’t hide it, but we just don’t advertise the fact’ line when it comes to own their own contract brewing.kosciuszko

“It really doesn’t matter to the quality of the beer, but the unwillingness to be open gives everyone the right to hedge a little and that hurts craft.

Unwillingness to be completely upfront .. lowers the craft bar
“While in one sense I can understand their thinking, it’s the craft brewers’ own unwillingness to be completely upfront that allows the debauching of the craft beer market by the likes of Coles’ Steamrail brand for example: indeed one beerlines used in earlier posts.

new dan murphys_1480

“When Coles can point to their product and say, quite honestly, that it comes from the same brewery as Mountain Goat’s Steam Ale and Summer Ale, and Mountain Goat offers nothing to differentiate their beer .. well, it lowers the craft bar. Read more…

09 February
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Does beer provenance make a difference?

The title of this follow-up to ‘Australian owned: does it make a difference?’ was going to be ‘Australian made: does it make a difference?’

But I’m diverted by growing rumblings of a more fundamental issue: and that’s provenance.

Often used in connection with wines, the provenance of a beer, I understand, relates similarly to transparency over where and how a beer is brewed and, sometimes, who brews it.

I hear of a growing number of beer outlets where the owner/manager is choosing to serve only beers with very clear provenance.

Priggish about provenance
Indeed, some are taking a strict, verging on priggish, line on provenance.Soup-Nazi

This will surely upset some brewers both big and small.

For big brewers like CUB/SAB-Miller and LION, provenance concerns may rule out serving a beer brand which was not brewed at its home brewery: preferring brewery of origin as it were.

This may apply to a few global brands sold in Australia: Stella Artois, Heineken, Becks brewed in Australia or Asahi brewed in Thailand are candidates.

Concerning the big guys also, this thinking may extend to brands like Matilda Bay’s (i.e. CUB) Fat Yak ‘craft’ brand which, I understand, outgrew Matilda Bay’s new Port Melbourne home and is brewed at scale at CUB’s large Yatala Brewery in SE Queensland.

For smaller brewers this strict interpretation of provenance might rule out those who own a brand but choose to contract brew or cuckoo brew elsewhere via commercial arrangement. The craft brewer Doctor’s Orders admits it is a cuckoo brewer for example.

Breweries are the equivalent to terroir in wine making
“What I offer is breweries and all that goes with that. It’s like terroir with wine. I’m much less interested in the wine maker or the brewer in this case,” said one hotelier who was particular about this.

Faux craft fail whales
I don’t think there are any surprises that provenance concerns were quick to exclude contracted ‘craft’ brews by big retailers like Coles and Woolworths.

Often with cartoon-like branding, the thin credentials/provenance of many of these brews clearly deserve disparagement as ‘faux craft’ beers.

new dan murphys_1480

Does provenance make a difference?
For me: yes.

My time in brewing exposed me to many prolonged frustrations experienced by brew teams trying to match beer brand tastes from one continent to another.

Have you ever tried Foster’s in England? Ok – probably not. QED.

Or even within Australia; Castlemaine Perkins’ brewers for example could never brew Swan Premium at Milton – it always tasted like XXXX (funny that). And VB or Carlton Draught in Queensland are decidely different to their Victorian-brewed equivalents: to my taste anyway.

And let’s face it: why is there such a strong parallel import market for the original Stella and Becks and other global brands?

It’s because those who loved the original taste aren’t getting it. And ‘yes’ of course, there is the issue of knowing that it’s not the ridgy-didge original anyway.

Brewers always say drink fresh local beer. I fully endorse that.

However I’m also fine drinking a Heineken or Guinness if it comes from the brewery of origin – aged though it may be.

Transparency rules: inform inform inform
There will always be purists and ‘beer nazis’ who will never rest. From a marketing communications perspective however, what the consumer wants most is transparency.

Don’t try to be tricky with me. Don’t make the print small. Don’t hide stuff I might be interested in.

Be open; make a clear effort to over-inform.

Little Creatures Geelong
Provenance, as I said, relates to transparency. I’ve appreciated the openness and transparency which Little Creatures has displayed in opening a like-named brewery in Geelong. The label is up-front about its Geelong origins.

But it begs the question.

I wonder what those who are very particular about provenance think of Little Creatures having multiple breweries. Is it any different to Stella being brewed under licence here?

Cheers!

20 October
3Comments

Will big retail replace big brewing?

Swan Brewery’s closure was announced by LION this week. 

I could go on about how sad that is in many ways.

Instead, taking a bigger view of the beer market, I suggest that in that swan-song we can hear chords of big retail replacing big brewing in Australia.

In many respects Swan Brewery was a dinosaur. It reflects the entitled view of ‘owning’ state markets that the big capital city breweries had for decades. Indeed, almost all these big breweries – like Swan, Tooheys, CUB and Castlemaine Perkins – were constructed to produce enough beer for 100% of ‘their’ state’s market.

And why not? In the good ol’ hey days (not so long ago in the 1970/80s) Swan had over 95% of the Western Australian market and Castlemaine had almost 90 of Queensland for example.

But times changed and those breweries haven’t.

It’s been a challenge for them. On the one hand, the tradition of owning mega-brands, market dominance and the advantages of economies of scale. While on the other, pressured for flexility to create small batches of new styles and innovative beer brands.

Hard to do in one brewery where you’ve already invested heavily in the biggest brewing equipment available on the planet. Hard to have both mindsets in the one company.

I’m not saying that Swan’s closure means we’ll see more big breweries in Australia ‘rationalised’. However, no matter how you spin it – they got their marketing wrong.

In that market you can almost hear brakes screeching as big brewers rapidly seek more flexible operations.

LION has invested in smaller craft breweries, notably Little Creatures and James Squire. CUB took over Matilda Bay. Both of them are rapidly topping up their traditional big-brand portfolios with small craft and niche boutique brands from both domestic brewers and international.

This sense of urgency to ‘get niche’ is almost palpable.

Big retail: big threat
One very big reason for this urgency by LION and CUB is because of Woolies and Coles.

Big retail and the colossal impact they can have on brands has been a big threat to the big brewers for years.

Now that competitive tension is really out there for all to see.

Retailers have tried in various ways, year on year, to squeeze more and more profit from the brands of the big brewers. They’ve tried just about everything including bringing in their own imported premium beers.

Now retailers are becoming brewers. Well .. almost.

Four new Sail & Anchor craft beer brands in pride of place at Dan Murphy’s

Here’s a recent case study: Woolworth’s through its Dan Murphy’s owns the Sail & Anchor brand. They also have an interest in another WA brewer, Gage Roads. Dan Murphy’s has just released a clutch of new ‘craft’ Sail & Anchor beer styles/brands which have been brewed under contract at Gage Roads.

Own the brands: not the brewery
It’s a great position to be in: own the brands but not the brewing equipment as well as owning almost all the retail. And given that LION’s website focuses exclusively on ‘brands’ as opposed to breweries (and all the heritage that used to go with them) perhaps that’s their plan too?

So who will own the title for ‘BIG’ in future? BIG brewer or BIG retailer?

Clearly the tectonic plates of beer market ownership are shifting. Maybe that’s a good thing. One benefit is that as the big guys battle for niches, their marketing has a halo effect for small craft brewers like Cavalier or Mountain Goat.

Woolies Lager?
One outcome of bigger retail power in the beer market that I am not looking forward to is homebrand beer. The huge UK retailer Sainsbury’s provides their version of Crown Lager for example. Shudder…

Cheers!

 

04 July
2Comments

Crafty invasion by US brews

It looks like small American craft brewers have achieved what big US beer brands, like Bud and Miller, have consistently failed to do: secure a viable foothold in Australia. Why?

  1. Craft beers – both local and imported – offer new and different beer styles to a beer market increasingly looking for alternatives.
  2. These alternatives reflect the expanding ‘preference portfolio’ of Aussie beer consumers. Not all: but clearly an increasing number including many opinion leaders. They are cool with choosing a different beer at different times and occasions.

Part of the US line-up at Dan Murphy’s

Tasty more than crafty?
At the end of the day perhaps these US brews are being supported locally because they offer alternative tastes to a market thirsty for them. More to do with taste than being designated ‘craft’ perhaps?  And let’s not forget they are: —

  • NOT LAGER: many are not lagers. Australia has a solid line-up of domestic lagers and a burgeoning choice of European imports. We’re awash in lager!
  • YOU CAN TASTE THEM: historically mainstream US lagers have been of a lighter style and taste. Not in ABV, as urban myth promulgates: but certainly in taste. A product of post-Prohibition use of rice and corn in place of scarce malt.

Whatever the reason: Australian beer drinkers did not take to America’s big beer brand imports. But lately they seem quite partial to their craft brews.

Makes for an interesting dynamic in the Australian beer market. Bring it on!

Cheers!

30 June
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ZYWIEC! BOOM! Porter with balls

My new ‘porter radar’ pinged in the local Dan Murphy’s picking up this ?ywiec brew from Poland. I took a bottle home.

The part of the label I could read highlighted its ABV as 9,5%! BOOM! Porter will balls.

Zywiec porter in its home setting: pic courtesy of Lonely Planet’s best beers

To my palate it clearly is a damn fine porter – complex and peculiarly bitter – however the gravity overshadows the smoothness. The alcohol shines through just a bit too strongly on the back palate: like an added nip of vodka or even scotch.

Dan Murphy’s web site provides the following description:“?ywiec Polish Porter has a full bodied, medium gold colour. Sharp and focussed flavours, with oily, bitter hops and a background of toasty malt.”

The ‘oiliness’ is likely to be the alcohol I believe.

Drinkable -vs- Sippable
Some of the best dark beers have higher ABV; it carries the depth of flavour we love in these brews. My preference is for a drinkable porter rather than one for sipping.

Perhaps I just need to give it another go….

Cheers!