business strategy

At a 2009 National Alcohol Beverage Control Association (NABCA) panel discussion, Boston Beer Company’s Jim Koch boldly proclaimed that “beer is the new wine.” According to Wine and Spirits Daily, Koch said:

With the emergence of the new mentality about beer driven by small craft brewers, America is starting to create a beer culture in the same way America has created a wine culture.

Is Koch right? The labels tell part of the story. Lately there are many examples of beer labels with terms and elements formerly associated only with wine. First is Sierra Nevada’s Estate Brewer’s Harvest Ale. TTB sets forth strict rules for wine labeled with the word “estate.” One such rule is that the wine must be produced from grapes grown on land owned or controlled by the bottling winery. According to Greg Kitsock of the Washington Post, Sierra Nevada produces their Estate Ale with hops and barley grown only at their brewery in Chico. The label adds that “this ale reflects the flavors of our surroundings in California’s fertile Central Valley.” Second is Trader Joe’s 2009 Vintage Ale, produced by Unibroue of Canada. For wine labels, it is clear that a vintage date means one thing: the year in which the grapes were harvested. What exactly does it mean...

We got to thinking that the much-ballyhooed swimsuit issue, published in Sports Illustrated every winter, might shed some light on trends in the economy, alcohol beverage advertising, and print advertising more generally. In the past, the swimsuit issue has been a prime place for beer and spirits advertising. This year’s issue is 178 pages, chock full of bikinis. Only 7.3 pages are devoted to alcohol beverage ads. This is nearly a 50% drop off from two years ago, when the economy (and print advertising) were flying a lot higher. A big part of this is due to one brand. Budweiser advertising was at seven pages in 2007 and down to a skimpy two pages in 2009. Almost all of the 2009 ads seem to be customized for the swimsuit edition. Back in 2007, it was about half and half. There is essentially no wine advertising in any of these three issues, and beer accounts for 2/3 while spirits are at about 1/3. Herewith, two of the better alcbev-centric ads tailored to this magazine.

The text on this Glenlivet Scotch ad may be hard to read, and is worth repeating. It says:

THE GLENLIVET was ESTABLISHED when SWIMWEAR was a lady’s SAFEGUARD from the elements. Back in 1824, even the SLIGHTEST display of ANKLE could put the FIRE in...

Bacardi revamped its 151 proof rum labels in May. At almost 76% alcohol, this rum is of course flammable as well as potent. The labeling includes not less than eight warnings to this effect. The bottle also includes a flame arrester. One of the main warnings says, “Do not use this product for flaming dishes or drinks.” It’s a little bit like a Maserati with a warning that you should not exceed 55 mph. We kind of thought flaming drinks were one of the main purposes for this product. If not, we went in search of the more conservative uses for this product. We found very little, with no trace of this product on Bacardi’s US website. This group seems to have no idea what to do with it either. At an even higher concentration of alcohol is Golden Grain Grain Alcohol. It is 95% alcohol and is also plastered with warnings throughout the front, back and neck labels. This is a rare example of TTB allowing warnings other than the specific health warning mandated by Congress (see this for an example of a warning not allowed). It’s hard to say the extra warnings are not warranted here.