Longtime Vermont Cider Co. VP of sales Terry Hopper became fast-growing Montauk Brewing Company’s 10th employee in eight years.
Hopper’s exit from the maker of the Woodchuck cider brand after 15 years was announced in a memo to wholesalers and retailers one week ago.
The addition of Hopper, who started Monday at the New York craft brewery, is a reunion of sorts with Vermont Cider founder Bret Williams, who is now a board member and investor with Montauk.
Williams himself exited Vermont Cider in March 2014, about 16 months after selling the business to C&C Group for $305 million.
Williams told Brewbound that Hopper’s addition to the 8-year-old craft brewer was a key hire.
“We’re little, but we’re quick,” he said. “And now we’re a lot stronger than we’ve ever been. That was a major void for us and we needed a VP of sales with an industry guy like Terry.”
For his part, Hopper said Montauk’s trajectory reminded him of Vermont’s in the early 2000s.
“This thing’s got something special cooking,” he said.
Montauk, which contract brews its offerings at Wachusett Brewing in Massachusetts and Two Roads Brewing in Connecticut, has grown from a 2,450-barrel microbrewery in 2014 to a 45,783-barrel regional brewery in 2019, when it increased production 23%. All of that beer is sold in New York City and Long Island.
“You know the old saying, you can go an inch deep and a mile wide,” Hopper said. “We want to go a mile deep and an inch wide and just keep driving this thing.”
Montauk is the No. 5 brand family in dollar sales in the New York metro area, trailing the brand families of Molson Coors’ Blue Moon, Boston Beer Company’s Samuel Adams, Heineken-owned Lagunitas, and Brooklyn Brewery, according multi-outlet data from market research firm IRI shared by co-founder Vaughan Cutillo. The brand did so with just 58% category weighted of distribution.
“We’re knocking on the doorstep of a lot of big brands out here like Lagunitas and Blue Moon and Sam Adams lager,” Hopper said. “We’re really starting to pull some weight for a little tiny brewery that’s eight years old with 10 people in it.”
Cutillo, citing IRI data, noted that Wave Chaser is the No. 1 SKU in chain and convenience in New York and No. 1 in dollar sales per point of distribution. Additionally, in multi-outlet retailers, Wave Chaser is the top brand in revenue added and the No. 4 overall SKU, Cutillo shared.
With an outsider’s perspective, Hopper said the initial opportunity is to increase distribution in all sales channels of Wave Chaser IPA, which currently accounts for 30% of Montauk’s volume. As such Montauk is exploring additional packaging formats for Wave Chaser, which is currently sold only in 6-pack cans. Additional packs might include 12-packs and 19.2 oz. single-serve cans.
“People are really connecting with this Wave Chaser IPA,” Hopper said. “It’s such an approachable brand, and I think the Montauk thing is such a lifestyle that it’s so aspirational. Everything we’re kind of doing right now, we’re hitting a lot of home runs, I mean we’re just trying to keep up at this point., And with July 4 coming, and the stores are starting to pack out out here, it’s crazy.”
Earlier this year, Montauk launched its own hard seltzer brand, which Cutillo said fits Montauk’s ambitions as a lifestyle brand. However, he admitted launching the brand as the COVID-19 pandemic set in the U.S. proved challenging. Still, the brand has “exceeded expectations,” with consumers pulling its mixed 12-pack packs.
“It’s not even July 4 yet, so we’re thrilled with how that that started,” Cutillo said. “We’re just trying to keep it in stock.”
How big can hard seltzer be for Montauk? Cutillo estimated about 200,000 case equivalents by the end of 2020.
“The volume that we’re getting now is in a lot of independent,” he added. “We did get into a good chunk of supermarkets, but we’re still muscling it in as best we can.”
“When you see what seltzer is doing this year already, if we can just get a little piece of that, it’s a huge win for the company,” Hopper added, noting hard seltzer capturing 10% of beer category dollar sales over the last two weeks. “And it allows us to continue to reinforce and invest in the brands in the end the company and keep driving the growth.”
With the addition of hard seltzer, Montauk is projecting slight growth in the 50,000 to 55,000 barrel range.
“We’re fortunate that the retail pull has been so good, but we can’t make up 30% of our volume which was on trade,” Hopper said.
“In 2019, we finished the first quarter at plus 10,” Cutillo added. “And we ended up finishing the year at plus 25. Our first quarter in 2020, before the pandemic hit, we were up 40% and we hadn’t launched the seltzer yet. So, we were on a rocket ship ride prior to that happening so our revised budget, we think because of the lost sales due to the virus, we should come in around plus 10. But we’re starting to second guess that thought on a daily basis because of the trend that we’re experiencing before this, but we could be significantly higher than that.”