After Difficult First Half, Boston Beer Aiming To Stay Flat In 2016

After achieving solid volume growth in both 2014 and 2015, Boston Beer Co. is now striving to stay flat in 2016, following a first half in which the craft brewer’s depletions declined by 5%. Boston Beer’s revenue also fell, by 4% to $433.6 million, in its first half ended June 25.

“Our Samuel Adams brand lost share of craft due to the increased competition and continued growth of drinker interest in trying new styles,” said Boston Beer chairman Kim Koch in a statement. “While the launches of our new beers, including the Samuel Adams Nitro Project and Samuel Adams Rebel Grapefruit IPA, have been successful and well-received, they have not offset declines in Samuel Adams Boston Lager and our Samuel Adams seasonal beers.”

Meanwhile, Boston Beer CEO Martin Roper said the company’s depletion trends have improved over the past few weeks, and that new packaging and advertising will be launched to support the Sam Adams range in the second half. Boston Beer is also planning to increase investment behind Angry Orchard, which continues to dominate the cider category even though it’s lost ground following several years of explosive growth. Additionally, Jon Potter, who previously headed marketing efforts for Diageo North America and Moet Hennessy USA, is joining the brewer as its CMO next month.

For the full year, Boston Beer is projecting depletions and shipments trends to range from a 4% decline to flat. The craft brewer plans price increases of 1%-2% by year-end.

Argentina’s Domaine Bousquet Targets Organic Wine Trend

Seizing on rising interest in organic wines, Argentina’s Domaine Bousquet is on pace to surpass 120,000 cases in the U.S. this year, and has set the goal of more than doubling its U.S. volume to a quarter-million cases by 2018. “Our aim is to sell around 50% of our volume in the U.S.,” says Domaine Bousquet CEO Al Ameri. The winery, which self-imports and is present in 45 states, produces around 400,000 cases annually.

Based in Mendoza’s Uco Valley, Domaine Bousquet’s volume is led by its core Premium tier ($10-$12 a 750-ml.), but its Reserve wines (around $15) have emerged as the fastest-growing offerings. While the Premium lineup accounted for around 80% of Bousquet’s U.S. sales in 2014, that share shrank to 60% last year, thanks to the rapid growth of the winery’s Reserve Malbec and Cabernet Sauvignon, which have gained traction in the chain retail channel. At the high end, the lineup also includes the Gaia red and white blends ($17-$20), a Grande Reserve Malbec and Chardonnay ($20-$22) and upscale red blend Ameri ($30-$35).

“A lot of retailers—including Costco, Whole Foods and Wegmans—are seeking high-quality organic wines, which can be hard to find, as well as wines that are well-rated and within that $15 sweet spot for pricing,” says Ameri, noting that the off-premise accounts for about 65% of Bousquet’s sales. “Consumers are looking for wine between $12-$20. Argentina has a lot to offer within that range, and due to the fact that we have a lower cost of production, we can overdeliver on quality.”

News Briefs:

•Bacardi Ltd.’s John Dewar & Sons unit will release two new single malt expressions, Aberfeldy 16-year-old and Craigellachie 17-year-old, this fall. Retail pricing hasn’t been determined, the company said. Previous releases for those brands include Craigellachie 13-year-old ($55) and 23-year-old ($280), and Aberfeldy 12-year-old ($45) and 21-year-old ($195). According to Impact Databank, Aberfeldy sold about 7,000 cases in the U.S. last year, while Craigellachie was at 2,000 cases. Bacardi’s single malt portfolio also includes Royal Brackla, Glen Deveron, The Deveron and Aultmore.

•Prestige Beverage Group’s Kinky brand has extended its RTD cocktail range with the launch of Extra Kinky Red. The new 8%-abv addition features a blend of watermelon and strawberry flavors and is available in 16- and 23.5-ounce cans. Slated to roll out by Labor Day, Extra Kinky Red joins Kinky’s existing cocktail range, which includes the core Pink, Blue, Red and Gold expressions, as well as the higher-alcohol Extra Kinky Pink, Blue and Gold labels. The franchise also comprises the Kinky Liqueur lineup and Kinky vodka.

•Southern Glazer’s has appointed Richard Crossland as executive vice president, general manager of Indiana. Crossland has more than 30 years of industry experience, and has spent the past 16 years with the former Southern Wine & Spirits—most recently as executive vice president, general manager for Colorado. He’ll report to Mike McLaughlin, Southern Glazer’s central region president. While Southern and Glazer’s previously each had their own operations in Indiana, they were recently integrated upon the distributors’ merger, which was completed late last month.

Craft Brewing and Distilling News:

•Michigan’s Founders Brewing Co. is set to launch Pale Joe, a new pale ale. Rolling out this September, Pale Joe is brewed with Ethiopian coffee roasted by Grand Rapids-based Ferris Coffee and Nut. The 5.4%-abv entry will be offered on draft and in six-pack bottles throughout Michigan, Wisconsin, Missouri, Iowa, Illinois, Ohio, New Jersey, New York City and Boston, with limited draft availability extended to additional markets. Pale Joe marks the fourth brew in Founders’ ArtPrize series, created to benefit the ArtPrize international art competition in Grand Rapids.

•Specialty beer importer Merchant du Vin is preparing to release Samuel Smith’s Yorkshire Stingo 2016, a barrel-aged, bottle-conditioned strong ale. Debuting in limited quantities on August 1, Yorkshire Stingo is at 8% abv and was aged in oak barrels that previously held cask-conditioned ale. Stingo is a traditional strong ale style that originated in the north of England. In addition to Samuel Smith’s, Seattle-based Merchant du Vin imports the Lindemans, Ayinger, Orval and Du Bocq brands, among others.

•With some 40,000 people expected to visit Cooperstown, New York this weekend for the Baseball Hall of Fame’s 2016 induction ceremony, Cooperstown Distillery is promoting its new Spitball whiskey through a series of local cross-marketing events with baseball manufacturer Huntington Base Ball Company. Launched in April, Spitball is a 70-proof, cinnamon-flavored whiskey produced in Indiana and bottled by Cooperstown Distillery. Spitball is currently available at the Cooperstown Distillery and also at select retailers in upstate and metro New York. The distiller expects to sell around 700 cases this year and is planning to expand into more states in 2017.

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