Bud and Miller Are Trying to Hijack Craft Beer—and It’s Totally Backfiring [View all]

[octoberlib]

—By Tom Philpott| Wed Jul. 30, 2014 6:00 AM EDT



For its part, Big Beer has responded to the declining popularity of its goods in two ways. The first is relentless cost cutting. When Belgian mega-brewer InBev bought US corporate beer giant Bud in 2008, it very quickly slashed 1,400 jobs, about 6 percent of its US workforce. And the laser-like focus on slashing costs has continued, as this aptly titled 2012 BusinessWeek piece, "The Plot to Destroy America's Beer," shows.

The second is to roll out phony craft beers—brands like ShockTop and Blue Moon—and buy up legit craft brewers like Chicago's Goose Island, which InBev did in 2011. Other ersatz "craft" beers include Leinenkugel, Killian's, Batch 19, and Third Shift. The strategy has been successful, to a point. Bloomberg reports that InBev has seen its Goose Island and Shock Top sales surge.

But there's a catch: These stealth Big Beer brands aren't "putting the microbrewers who started the movement out of business," Bloomberg reports. Rather, "the new labels are taking sales from already-troubled mass-market brands owned by the industry giants peddling these crafty brews." In other words, consumers aren't dropping Sierra Nevada or Dogfish Head and reaching for the Shocktop. Rather, ShockTop sales are being propped up by refugees from Bud Light and the like.

While Big Beer attempts to solve its problems with crafty marketing and yet more giantism, US craft brewers are trying out innovative business models. Big-name craft brewers Full Sail (Oregon), New Belgium (Colorado), and Harpoon (Boston) are all fully employee-owned. Here in Austin, Black Star Brewery and Pub is cooperatively owned by 3,000 community members and managed by a "workers assembly" as a "democratic self-managed workplace." It may sound like it should be a cluster, but the place is always packed, the service is brisk, the food is good, and the beer is excellent. And the employees proudly refuse tips, citing their living wage as the reason. Meanwhile, a forthcoming worker-owned project, 4thTap Brewing Co-op, is creating excitement among Austin beer nerds with its promise to "bring radical brewing to the forefront of the Texas craft beer scene."

http://www.motherjones.com/tom-philpott/2014/07/craft-beer-revival