Anheuser-Busch Hopes Multi-Packs Will Stoke Growth of High End Brands

Last month, industry consultant Bump Williams cautioned craft brewers — some of whom have recently introduced lower cost 15-packs — against competing with Anheuser-Busch InBev and MillerCoors on price.

“If you come out with a low price point, they’re going to beat you on it,” he said during a Brewers Association-hosted Power Hour. “They have a whole portfolio that can beat you, so do not sell on price.”

How prophetic.

Felipe Szpigel, president of A-B’s High End, told Brewbound that more of his division’s craft breweries will be releasing 15- and 18-packs in the next couple of months.

“Consumers are demanding it,” said Szpigel, who was in Virginia to participate in the company’s quarterly Craft Advisory Board Meeting. “After Founders kicked it off and opened that space, there’s no reason why we shouldn’t be addressing it as well.”

Szpigel was referring to Michigan’s Founders Brewing, which in March 2014 switched from 12-pack cans of its flagship All Day IPA to 15-packs without raising the suggested retail price.

Currently, some core offerings from the High End portfolio — Goose Island IPA and 312, Golden Road Wolf Pup session IPA and a Breckenridge Brewery sampler pack — are available in 15-packs for about $19.99 or less.

To highlight the success of the multi-pack strategy, Szpigel pointed to the a 472 percent increase in volume sales of Wolf Pup, per market research firm IRI Worldwide.

Additionally, Szpigel said Blue Point Brewing would take advantage of expanded capacity at its soon-to-open brewery in Patchogue, New York, and launch its flagship Toasted Lager brand in 18-packs as well as 25 oz. cans in the next couple of weeks. He declined to share the price point but said “it’s going to be a competitive price point equivalent but not the same as the 15-packs that are out there.”

Szpigel added that Devils Backbone will begin offering its Trail Angel Weiss in 15-packs in the next six-to-eight weeks. The beer company will also donate $1 per case sold to the Appalachian Trail Conservancy.

Devils Backbone co-founder Steve Crandall told Brewbound that more of the Virginia brewery’s offerings could be released in 15-packs in the future, “but we’re still working on the details.”

Szpigel said he anticipates other High End craft brands in expanded pack sizes, but only “where it makes sense.” Although he anticipates canning more offerings from the Wicked Weed and Elysian portfolios, those brands won’t be offered in larger pack sizes due to “sitting on the higher price point and the super premium bucket,” he said.

Szpigel also shared first-quarter highlights noting that the average performance of its 11 craft acquisitions is up 19 percent, according to IRI. He said sales of Seattle’s Elysian Brewing are up 62 percent and Los Angeles’ Golden Road are up 139 percent through the first three months of the year.

Those two brands are being led by their respective flagships, Space Dust IPA and Wolf Pup session IPA, which are up 107.2 percent and 111.8 percent, respectively, according to IRI’s multi-outlet and convenience store data.

“We had distribution increase last year, and this year is really more rate of sale than it is actual distribution,” he said. “As consumers try it, get to know it and now see it on the shelf, they’re now picking it up and on draft as well.”

Szpigel admitted some of its acquired craft companies are having a “tougher” quarter, notably Chicago-based Goose Island, whose core brands are down double digits (with the exception of Goose Island IPA). The company is hoping the launch of two new offerings — Dry Hopped 312 and Next Coast IPA — will help turnaround the sluggish trends. It also hopes added exposure via an official sponsorship with the White Sox and the company’s 30th anniversary block party will help “create momentum in Chicago.”

“The summer of Goose is going to be really, really strong,” he said.

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