Thursday, November 03, 2011

To make beer or to market it? Chicken and Egg dilemma?

Wow, now here's a question that I'm having a difficult time wrapping my head around to arrive at a position.

Read this, then come back and weigh in.

[Link to]

Unfortunately, and I expect to be beaten up a bit over this, but I think marketing trumps. Here's why.

Much as we'd like to dismiss marketing — and, really, isn't a fair amount of that reaction due to what we've seen "The Bigs" do with the marketing of lifeless beer — you can make the most interesting and tasty beer in the world, but if it can't get to market, there's little chance that a significant enough portion of the beer-drinking market is going to find you to keep your brewing business going.

On the other hand, make some mediocre, passable beer and have someone create the right packaging, find the shelf space, generate the events and associated buzz and you've got a leg up and more of a fighting chance than the great brewer with no marketing.

Cynical as it may sound, I believe that there are enough untrained palates and undiscerning tastes that if you make approachable beer at, importantly, the right price point with an intelligent marketing plan, you're likely to come out ahead.

Of course, the ideal position to be in is one that balances the proper mix of both. But, the question posed was much more of an either/or.

Like I said, that may be cynical Bryan's thinking alone, but how else do you explain that more than 90% of beer drank in the States is of the cheaper, less interesting beer (I know, I know...subjective...what are y'gonna do?) with massive marketing budgets?

Weigh in....


Rich Isaacs said...

I think this may be true as far as the big guys, but not for a small company. No one is going to drink your beer if it's more expensive than BMC but doesn't have any distinguishing characteristics. The woman whose name I forget who was selling that Caffeine beer is a good example. She failed miserably because it was all marketing and she discovered there's no room for that.

For a brewpub like the article was talking about, it depends on who does what. There's no reason a fantastic brewer can't hire a marketer or vice versa so the question is kind of silly in the end anyway.

Scoats said...

From my vantage point, marketing usually loses. Marketing only "wins" if tons of money is continually spent, case in point Red Dog. Once the advertising was cut, sales followed. Contrast that with Sierra Nevada Pale Ale, which still has rather little marketing. The highly advertised stuff sold more, but I don't think it actually made any money after marketing costs.

If win = sales, then yes. If win = turn a profit, then no.

Small businesses that try to sell on marketing only always fail. Moonshot, Three Stooges Beer, Knightshead, Pennsylvania Lager/New Jersey Lager (not gone yet), Blue Hen (which was relabled Lionshead), and Intercourse are just a few I have seen attempt to come and definitely go.

Bryan Kolesar said...

You guys both make valid points and provide good examples.

My approach in attempting an answer, though, was in looking only at a one-man operation trying to get their life-long dream of opening a brewery off the ground and up-and-running.

On one hand, I'm looking at a homebrewer with tremendous skills in the brewhouse but lacking in the social and marketing arena.

And on the other hand, we've got the guy who can brew sorta decent beer, but excels at talking, presenting, socializing, networking, marketing, etc.

I wonder as we hear about these 600 or so breweries in the various stages of startup, how many of them are the one-man nanos where they've got some mix of these two skill sets, but rarely the best mix of the two.

As for "hiring a marketer or vice versa", most of these nano startup guys can't even afford to quit their day jobs, let alone take on additional staff. Therefore, they need to wear nearly every hat in their business until volunteers come on board or until they turn enough of a profit to be able to afford paid staff.

I'll maintain that the one-man show with better marketing skills stands the better chance of success (at least in the short term).

Of course, as some of these guys grow, I'd surely expect them to take on additional staff to complement the business and position themselves for future success.

But, it will be interesting over the next 5 years or so to see how many of these one-man nano shows will make it past this point.

Rich Isaacs said...

Well, you're tipping the scales a bit in the marketers favor if he's making even semi-decent beer. The companies that Scoats brought up were making almost okay to downright bad beer which is why they failed. You have to have a certain level of competency in brewing before the marketing will help.