Next Glass CEO Analyzes Untappd Data to Peer into Stone’s Post-Sapporo Future
What could the sale of a long fiercely independent craft brewery to a global brewing giant mean for consumer sentiment?
Following last month’s announcement that Sapporo has struck a deal to acquire Stone Brewing, Trace Smith – CEO of Next Glass, parent company of Untappd, Beer Advocate and Hop Culture – analyzed Untappd user ratings of three California craft breweries (Ballast Point, Lagunitas, and Golden Road) before and after their acquisitions (by Constellation Brands, Heineken, and Anheuser-Busch InBev, respectively).
“Using data from millions of Untappd check-ins (a check-in is a consumption moment logged by an Untappd app user) on the pre- and post-acquisition periods for the three California breweries, we can predict what’s coming down the line for Stone,” Smith wrote in the inaugural edition of Untappd Insights, a new monthly newsletter.
All three breweries “experienced a clear but far from catastrophic drop in average rating in their local markets,” Smith wrote.
San Diego-based Ballast Point’s average home market rating had the steepest decline, dropping -0.11 points from 3.99 (out of 5) in 2015, when the brewery was acquired, to 3.79 in 2021. Petaluma-based Lagunitas had the highest average score (3.93) in its home market (greater San Francisco) in its acquisition year (2017), and the smallest decline, -0.03 points, to 3.9 last year.
Of the three, Los Angeles-based Golden Road had the lowest home market average (3.71) in its acquisition year (2015), and declined -0.04 points, to 3.67 last year.
Ballast Point also recorded the steepest declines in its statewide average (3.95 in 2015, 3.81 in 2021) and its national average (3.99 in 2015, 3.84 in 2021). Of the three, Ballast Point’s acquisition – and eventual sale – has generated the most headlines. Constellation Brands paid $1 billion for the brand in 2015, and later sold it to little-known, Chicago-area craft brewer Kings & Convicts in 2019 for an estimated $68 million.
To a lesser degree, Heineken’s acquisition of Lagunitas likely has also not panned out the way the global brewer was hoping. Heineken acquired a 50% share in Lagunitas in 2015, and acquired the rest two years later in a deal that reportedly totaled $1 billion. However, Heineken’s 2020 annual report included a $279 million impairment charge related to the Petaluma-based craft brewery.
“Brand perception of highly-regarded craft breweries seems to suffer nationally in the wake of these transactions,” Smith wrote. “In the social media/late-Web 2.0 era, the brand cachet associated with beloved brewers is no longer locally controlled – breweries are followed globally on Instagram, Untappd, BeerAdvocate, and, to an increasingly alarming degree, even TikTok.”
In addition to user rankings, Smith also tracked retail accounts connected with Untappd check-ins for each of the three breweries.
“Ballast Point (+47%), Lagunitas (+26%) and Golden Road (+116%) all grew seemingly overnight into new retail venues in 2016, each of their first full years beneath corporate parents with broader distribution reach,” Smith wrote. “While Ballast Point and Lagunitas essentially stabilized after torrid year one growth, the red network continued to grow Golden Road’s reach in each successive year pre-pandemic.”
Golden Road was checked in at 2,679 retail outlets in 2015, a number that skyrocketed to 14,219 in 2019. In contrast, by 2019, Ballast Point was checked in at 23,260 locations, about 700 fewer than the 23,956 locations where it was consumed in 2015.
What could lie ahead in terms of consumer sentiment and retail distribution for Stone? Smith wagered that its “domestic consumer sentiment will almost assuredly decrease.”
“I suspect its average rating in San Diego, across California and nationally will dip about a tenth of a point over the next two years and settle to an average between 3.75 and 3.80,” he wrote.
Stone’s average user rating in San Diego is 3.86, slightly higher than its average rating in California (3.85) and the U.S. (3.85), Smith told Brewbound. He expects the brand’s retail outlets to increase 140% in the next two years, to about 35,000 locations.
“Only Sapporo knows what is planned for distribution, but our data found Stone beers in 26,483 retail venues worldwide and receiving >500 check-ins annually in 30 countries,” Smith wrote. “I’d bet Sapporo leverages its international distribution and increases Stone’s reach.”
Gopuff Lays Off 1,500 Employees, Set to Close 76 US Warehouses
Gopuff laid off 1,500 employees this week, about 10% of its workforce, Bloomberg reported Tuesday, citing a memo to investors.
Additionally, the e-commerce convenience delivery platform will close 76 U.S. warehouses, about 12% of its network.
The cuts were made in an effort to “remove overhead and drive operational efficiencies,” and will help the company reach profitability by 2024, Gopuff CEOs Yakir Gola and Ragael Ilishayev said in the memo.
“These shifts are not only accelerating our timeline to profitability, they are taking us back to our roots and keeping profitability at the core of every decision,” Gola and Ilishayev wrote. “We remain committed in our ambition to building a generational business and feel confident as ever in Gopuff’s performance and capability to capitalize on the moment before us.”
This is at least the third round of layoffs by Gopuff this year, including the release of hundreds of employees – possibly more than 1,000 according to former employees – in April. It’s a significant departure from last year, when the company was focused on expansion and acquisition.
In July 2021, Gopuff closed a $1 billion Series H funding round, raising its valuation to $15 billion. Last year, the company opened more warehouse square footage than in its previous three years, which included an expansion into New York with 24 warehouses. Five of those New York warehouses will close, Bloomberg reported.
Additionally, the company acquired brick-and-mortar alcohol retailers such as Liquor Barn and BevMo, and partnered with Uber to allow consumers to order Gopuff items through UberEats (a partnership that drew an investigation by the Federal Trade Commision).
Gopuff also acquired the European delivery platforms Dija and Fancy in 2021. As part of the company’s focus shift, it will be increasing its international investment, particularly in the U.K., according to the memo.
Boston Beer VP of Brewing David Grinnell to Retire After 34 Years
Boston Beer vice president of brewing David Grinnell will retire next month after nearly 34 years at the company.
“David set incredibly high standards while building what we all know is the finest brewing team in the world,” CEO Dave Burwick wrote in a memo to employees that was shared with Brewbound. “Through 33 years of brewing hundreds of beers, however, David never lost his obsessive focus on perfecting the Boston Lager recipe as the engine for this work.”
Founder and chairman Jim Koch recruited Grinnell to join the fledgling Samuel Adams brand in the late 1980s by placing a personal ad in the Village Voice: “D. Grinnell. I need a brewer.”
During his career, Grinnell helped pioneer the Samuel Adams seasonal family, a first for craft beer, according to the company. He also shepherded Boston Beer brewing operations through more than 17 contract operations in the U.S., U.K. and Europe before the company ultimately acquired its own facilities in Ohio and Pennsylvania.
Grinnell will be backfilled by Annette Fritsch, who has been promoted to vice president, product design, research and development, effective immediately, and will report to Burwick.
Anheuser-Busch InBev Names Alissa Gordon Heinerscheid VP, Bud Light
Alissa Gordon Heinerscheid has been named VP of Bud Light, Anheuser-Busch InBev’s (A-B’s) largest beer brand and the country’s best-selling beer in off-premise scan data.
Heinerscheid announced the news on LinkedIn Thursday:
“I’m excited to share that I’m starting a new position: VP, Bud Light, the largest beer brand! I am the first woman in Bud Light’s 40-year history to lead the brand,” Heinerscheid wrote. “A true dream come true, not only as a mother of a little girl but also as a woman who feels acutely now, more than ever, that representation matters.”
Heinerscheid has worked at A-B for more than seven years in various positions, primarily with the Bud Light brand, according to her LinkedIn profile. In January, she was named VP, draftLine (A-B’s in-house agency) and digital, after more than two years as VP of direct-to-consumer marketing.
Allagash Launches Bottle 6-Packs of Tripel and Night Sky
Allagash Tripel, the Belgian-style golden ale from Allagash Brewing Company, has gotten a refresh.
The Portland, Maine-based brewery is upgrading the 9% ABV offering from a 4-pack 12 oz. bottle format to a 6-pack. Tripel isn’t the first Allagash offering to transition to a 6-pack. In 2020 the brewery added the format for its flagship White as well. The packaging also features an updated design, with “a picnic table topped with beers, situated in an idyllic setting that evokes both the rolling hills of Maine and the landscapes that their brewers have seen on trips to Belgium,” according to a press release.
“Tripel is the kind of beer that can turn everyday occasions into special occasions, so we’re evoking Tripel’s celebratory spirit with our new label and bringing more beers to the pack, giving our customers the opportunity to invite more friends to enjoy our take on an iconic Belgian style of beer,” Allagash brewmaster Jason Perkins said in the release.
Tripel will still be available in a 750mL cork-and-cage bottle as well.
North Sky, a 7.5% ABV Belgian-inspired stout, will now also be offered in a six-pack of 12 oz. bottles, in addition to the existing 16 oz. can 4-pack. The offering will keep the packaging design it launched with in late 2020.
Allagash produced 117,798 barrels in 2021, a +34% increase year-over-year, according to the Brewers Association.
North Carolina Eliminates ‘Private Bar’ Requirements in Omnibus Bill
New North Carolina liquor laws went into effect last weekend, including the elimination of “private bar” permits and patron membership fees, local outlets reported.
The changes are part of an omnibus bev-alc bill (H.B. 768) signed by Gov. Roy Cooper, along with 10 other bills, on July 7. Prior to the bill’s signing, for North Carolina establishments to sell mixed beverages – not including permit holders such as distilleries and entertainment centers – they were required to receive either a restaurant permit (which requires a full kitchen) or a “private bar” permit. Private bar permit holders had to treat consumers as members, and were required to obtain patrons’ names and addresses, and collect a membership fee.
Concerns were raised by consumers about privacy violations from the law requirements, and bar owners claimed the law impacted business, WSPA reported.
In the new law, the private bar definition has been eliminated and replaced with “bar,” defined as “an establishment that is primarily engaged in the business of selling alcoholic beverages and that does not serve prepared food,” not including a brewery, winery or distillery.
Cooper also signed H.B. 211, clarifying the state’s open container laws for “multi-tenant establishments” – i.e. allowing patrons to carry alcoholic beverages from one area that is permitted into another area that is permitted.
Michigan Permits Self-Service Kiosks for Beer, Wine and Cocktails
Michigan bars and restaurants will be able to offer self-serve beer, wine and cocktail dispensers after Gov. Gretchen Whitmer signed Senate Bill 656 into law this week.
Self-serve dispensers cannot be installed at individual tables, but must be “beer walls” where patrons can tap a key card loaded with payment information to pour a drink, according to the Detroit Free Press.
State Sen. Jim Runestad introduced the bill after discovering that the practice is permitted in 45 other states.
“Michigan has one of the country’s largest craft beer industries, and this reform will make a big difference in the technology available to business owners looking at new ways to better serve their customers,” he said in a statement.
Pours are limited to 16 oz. for beer and 12 oz. for wine and cocktails. Straight liquor is not permitted to be dispensed through the machines. Consumers must reactivate their key cards with a staff member after 32 oz. have been dispensed, and on-premise establishments cannot use the dispensers to promote all-you-can-drink specials.