[00:00:00] Justin Kendall: Next on The Brewbound Podcast, a CBC vibe check with Brewers Association CEO Bart Watson. Hello and welcome to The Brewbound Podcast. I'm Justin Kendall.
[00:00:21] Jessica Infante: I'm Jessica Infante. And I'm Zoe Licata.
[00:00:24] Justin Kendall: And we have an interview this week with Brewers Association CEO Bart Watson. We're going to bring that to you after we talk a little bit about our trip to CBC. We'll get into some of the news. But first, the people are dying to know, Zoe. So we got to get a rundown of your indie motorsports experience as well as your trip to F1 in Miami.
[00:00:49] Jessica Infante: The people really do want to know, Zoe, like after you left, like several people approached the booth and were like, one, you didn't ask her on this week's pod and two, where is she? So please.
[00:00:59] Zoe Licata: Well, I appreciate that people care. Indianapolis feels like a million years ago, but yes, I did sneak in some motorsports things. I was very lucky to be able to go with Natalie and Vinny Chalurzo from Russian River. They invited me to come with them to a NHRA, which is like Drag Racing League garage and meet with the driver Antron Brown, who also helps run the team. And we got to see their shop and them working on the cars. And it was very, very cool. I didn't really know anything about, you know, drag racing, which is basically going 300 miles per hour in a very short amount of time. very crazy stuff. So shout out to the Russian River crew. They have a really cool relationship with the team. They started going to the brewery after races in town and just really big fans of Craft Brewers and then met Natalie and Vinny and they formed this relationship. They do kind of a mini sponsorship now for the team when their race is in town. They showed us they have this fuel tank on the back of the car and they branded it Plenty for President last year. So it's cute. It's a fun little relationship they have. So yeah, just fun Craft Brewers connection.
[00:02:10] Justin Kendall: I think we briefly met them too at St. Joseph's Brewing. Yes. Justin and I did when we went over for that Russian River happy hour.
[00:02:19] Zoe Licata: Yeah. Vinny and Natalie were talking about how they invited them to come to that happy hour and meet some Craft Brewers folks because they're like craft nerds. They knew the people and Garrett Oliver was also with us on the tour. So they knew about Brooklyn and they're really excited to meet him. And yeah, it was a good time.
[00:02:36] Jessica Infante: Do Natalie and Vinny also race? Because that would be awesome.
[00:02:39] Zoe Licata: I need to learn more, but apparently Natalie's family has a history of racing. Her dad was really into racing and motor sports. So Natalie has been on the tracks basically her whole life at Tom's Lake. Crazy.
[00:02:53] Jessica Infante: Yeah. Crazy. Somebody came over to our booth and asked all about your time and where you were and how your week had been going. And we were all talking and I was kind of like, Well, I need a thing that I get interested in because I feel like, Justin, you have your various topics and Zoe, you have yours and I'm boring. And then one of our coworkers was like, you have Cora. I'm like, yeah, okay, well. No, the kid doesn't count. The kid doesn't count. The kid is great, but the kid does not count. The kid kind of connects because her like go-to nap song is racing in the street.
[00:03:25] Zoe Licata: Nice. We just need to like, I don't know, we'll find you the like crossover between craft and Bruce or something. It's got to be there. Yeah. We'll find it. Yeah.
[00:03:35] Justin Kendall: There's got to be something.
[00:03:36] Zoe Licata: So yeah, that was really fun. And then I kind of left a little bit early, just a day early and headed to Miami for the Grand Prix. And that was one of the greatest weekends of my life. It was so much fun. A very full weekend and Ferrari did absolutely horrible and it didn't matter because it was a great time. Then capped it all off. We flew back yesterday as we were recording this and I met Susie Wolfe in the airport. Susie Wolfe is the managing director for F1 Academy, which is the women's racing league that was founded a couple of years ago. Chatted to her very briefly. She was so sweet, so nice and like an absolute legend. She also happens to be married to the team principal for Mercedes. So she's just like a notorious person in the F1 world. So very cool to meet her. And then was walking down still filled with that adrenaline and made awkward eye contact with a driver who was walking past and looked directly down at our shirts that had another driver's face all over them. So that was nice and embarrassing, but shout out to Pierre Gasly. We had that fun, embarrassing moment. So yeah, it was really fun. It was a good time.
[00:04:40] Jessica Infante: Racing Zoe's weekend of glory.
[00:04:42] Zoe Licata: Yes. Yeah.
[00:04:43] Justin Kendall: That is way more exciting than having a garage sale and starting to watch Severance. Which I would recommend.
[00:04:51] Zoe Licata: I mean, also sounds fun. I love a garage sale.
[00:04:55] Justin Kendall: Hey, we got some cash for some things that we do not need. I went to four different playgrounds, so be jealous. I am. That's more out there for a time than being in the garage. So you can check out some of our coverage, not of F1 on Brewbound.com. Insiders are getting all the scoops from there, including Jess's rundown of the media breakfast with Bart Watson, who is this week's guest on the podcast, as I mentioned. But I think we need to do a final vibe check on CBC because we did sort of like a day one thing, which, you know, you get the, the first keynote with the founders of Trillium, but we didn't get really the state of the industry with Bart, which you're all going to get a dose of in this interview coming up. But I think in general, we got some time to walk around, check things out. How are we feeling about CBC now that it's all over?
[00:05:57] Jessica Infante: I mean, you'll hear it from Bart. You know, we talked about it a lot where he had mentioned that the crew that comes to CBC is a little self-selecting. You've got to be able to have the financial resources to make the trip. You also need to have enough support onsite at your brewery to be able to take time away. I think the vibes were pretty good among attendees. Everybody seemed really happy to see each other, which is great. And you know, I was happy to see everybody and I'm sure you guys were too, but something that he did cover in our media breakfast was that attendance is down. They clocked about 8,000 preregistered attendees. And usually about a thousand people like roll up to CBC without a ticket and buy one that day, which to me is nuts, but people do it and I get it, you know, goes back to that time thing. Like you have no idea if you're going to have somebody to brew, somebody to run the taproom, all of that. But the biggest driver behind the declining attendance was international attendees. Far fewer came than usually do. I believe Bart's line was something along the lines of like, do the things you can probably imagine, which I get it. Like if I lived in another country, would I want to come here right now knowing what's been going on to non-citizens? Maybe not. I'm also in the process of getting my passport renewed, so I don't have it with me right now. So who knows?
[00:07:16] Justin Kendall: We're in the midst of the real ID taking effect too, and then... Dude, I got scolded for leaving Indie. Yeah. I didn't realize that.
[00:07:26] Jessica Infante: Yeah. Yeah, they were like, you, like, you know real ID is coming next week. And I was like, I know real ID is coming next week.
[00:07:33] Zoe Licata: I'm getting a passport card. No, I don't know. They haven't said it like 800,000 times.
[00:07:36] Justin Kendall: It felt like Real ID was coming for like the last five years, which I think it actually probably was.
[00:07:41] Zoe Licata: It has. I mean, I've had mine since 2018. It's been a while, but they just kept getting delayed because of the pandemic and things. Yeah, but like I've also renewed my license like twice since then. You have to do it in person. Oh, yeah. That's the whole thing. Like if in order to get a Real ID, you have to have an in-person appointment, which is why all these people are now like I can't get an in-person appointment.
[00:08:04] Jessica Infante: No, homegirl ain't got time. Yeah. And I thought like, oh, well, like no problem. I have a passport until I realized my passport expired the same year that Cora was born. So I was a little busy. So I'm in the midst of remedying, but I'm just, I don't have to go anywhere right now.
[00:08:17] Zoe Licata: No, we have a nice little quiet moment, travel-wise, mostly.
[00:08:23] Justin Kendall: You both do.
[00:08:24] Zoe Licata: Yes.
[00:08:25] Justin Kendall: I will be on the road on Monday to the Beer Marketers Insights meeting in Chicago.
[00:08:29] Jessica Infante: But you get to take a direct flight.
[00:08:31] Justin Kendall: I can take a direct flight. Wow.
[00:08:34] Jessica Infante: Somebody once asked how we figure out who does what. And I was like, kind of since Justin moved, I like to think that if he can get there on a single shot flight, we should let him do it. So he gets to enjoy that small delight.
[00:08:46] Justin Kendall: It's a double edged sword though, because it's like, I get a single flight, you know, nonstop. I can go to Chicago. But the problem is I can't fly on Delta. which has become my primary carrier here. And then, yeah, I'm just adding some United miles while I'm at it.
[00:09:05] Zoe Licata: In the past week, I took JetBlue, Delta, and American. It's all over the place these days.
[00:09:11] Justin Kendall: Yeah. Getting back to CBC, I think one of the things obviously attached to it is the World Beer Cup. When you're relying on some international attendance and you have an international event, makes things a little difficult in the current climate. For sure.
[00:09:29] Jessica Infante: And the World Beer Cup, I mean, we, I scanned through the press release. I can't think of any surprises. Everything seemed pretty copacetic. 132 international judges from 37 countries, which is cool.
[00:09:45] Zoe Licata: Yeah. I think my gauge of the event was Part of it was positive where it felt more positive than Vegas, I think, where Vegas felt very chaotic. A lot because of the environment, but it seemed like people were a little bit more like, okay, we're here and we're here to be here for this conference. It felt like a lot of folks were going to sessions, wanted to learn, wanted to hear, all right, we now have accepted this environment that we're in. What can we do about it? But I think it also made it feel a little bit quieter than past CVCs. It was a bit more calm. Some of the events that I feel like normally happen didn't happen. Like the women's arm wrestling event is on hiatus right now. That did not happen this year. So yeah, it was just a little bit more subdued, I think, than previous CBCs.
[00:10:34] Justin Kendall: I would even say some of the parties were a little more subdued, or at least some of the ones that we attended. I know that there was still some pretty outrageous ones, but I did not see those outrageous ones.
[00:10:46] Zoe Licata: No, I mean, the most lively thing that I went to, I think was Sun King and that kind of ended up being one of the main spots that everyone ended up at. And that's just because they had lots of music. There was a basketball game on. It was just kind of a big, loud environment.
[00:11:01] Jessica Infante: Nothing too crazy. We went to Sun King for one beer, Justin and I, and my Apple Watch was like, hello, ma'am, you're in a very high decibel environment.
[00:11:11] Justin Kendall: Sun King is the best. Yeah, there's a band playing. Over and over. Singer-songwriter guy.
[00:11:17] Jessica Infante: I have many questions about that band. Like, are any of the members workers of Sun King? Because they spelled out Sun King was like a whole song. Like, are they fans? Did Sun King commission this? It was interesting. Great questions.
[00:11:33] Justin Kendall: Well, you can read all of our coverage of CBC. You can be on the lookout too for several podcasts that we recorded on the trade show floor there. We want to thank everyone who stopped by the booth and had nice things to say, or I don't think anybody said anything mean. No. Also a huge thank you to our teammates for holding it down and doing all the work there. We couldn't have done it without them because certainly couldn't have recorded all these podcasts and we certainly couldn't have just met everyone that we met because they were working.
[00:12:04] Jessica Infante: It was so nice to meet pod fans. It was really great. I loved it.
[00:12:09] Justin Kendall: Including the salted nut roll. Including the salted nut roll.
[00:12:14] Zoe Licata: Yeah. Such a good photo. Yeah. I mean, I had to man our cameras for one interview and I was stressed out. So shout out to Josh and Joe and all of our AV crew who make that possible all the time.
[00:12:26] Justin Kendall: Yeah and big thanks to Tom and Jon Landis for working it. Let's talk about one thing that was pouring on the floor and that's Rheingeis' new non-alcoholic beer brand and that's Ghost. SBT was pouring Ghost Haze on the floor. They've done work for Deschutes before. But this is a new non-alcoholic affiliated brand. So think Ciena Vada Trail Pass, very similar to that in how this operates. And SBT is going to be producing Ghost Haze and Ghost Pills for Rheingeist. Going to be out in 12-ounce cans, six packs across Rheingeist, full nine-state footprint. And I got to say, I'm very impressed with the SBT non-alcoholic beers. They're very flavorful, very juicy. they can really do the hazy IPA as well, I feel like. Yeah. The beer was great. I enjoyed it. And I got a chance to talk to Rheingau's CEO, Adam Pankovich. He told me all about it. You all can read about it on Brewbound.com. But the one thing he said was, we didn't have space for a pasteurizer and food safety is so important. And we wanted to be comfortable with a partner making a beer that we put our name on or the ghost name for that matter, and they feel like they've nailed it. So I'm excited to see this hit the market. Obviously, one of those nine markets is not Iowa, so I would be a lot happier if it were, but... You could move to Cincinnati. I could move to Cincinnati or just... Nice little city. Yeah. Unfortunately, direct-to-consumer sales, probably not going to happen for them. They said they're not really looking to get into that game. This will go through traditional distribution. And the other thing that they're launching right now is Synthelight Lime. It's out on draft and package is going to follow in June.
[00:14:26] Zoe Licata: That makes a lot of sense. Yeah. I feel like, I mean, Synthelight has been massive for them and The Syncylite lime fits well with that target demographic of folks.
[00:14:37] Jessica Infante: I think Adam even told you like, hey, we know lime is not earth shattering, but people like it.
[00:14:44] Justin Kendall: Yeah. Exactly. They did consumer tests. So they give people a flight and they had an amber on it and a wheat and obviously lime. And they did the original as well. And they gave these consumers a token. So they wanted to see what they would pick when it was all over. So they could redeem the token for a full beer. And what they found was they think that there's an occasion for lime and that it's not going to cannibalize the original very much. There may be some trading, but they've still got some runway with the original that they think that they've got some grace.
[00:15:18] Jessica Infante: Was it like super decisive in favor of lime? It sounded like it was. Yeah. Wheat is an interesting proposal for a lighter lager. Yeah, it is. And Amber too, I mean, that's very similar to, and you'll hear this interview in the coming weeks, COO of New Trail Brewing, Michael Rosa came and chatted at our booth for a little bit and their crisp lager family, similar situation. They've got the flagship, the lime and amber. They don't have any crossover in their markets with Rheingeist.
[00:15:50] Justin Kendall: Well, you can read that story. And if you're a Brewbound Newsletter subscriber, you can read about Erwin Simon of Tilray and his thoughts on his stock price, which is at risk of being delisted by NASDAQ. He had a much longer quote, but the thing everybody's sort of pulling out is, I got a shitty stock price.
[00:16:15] Jessica Infante: Which he does. Yeah. On Monday, yesterday, closed at 44 cents. Not great. Not what you want.
[00:16:23] Justin Kendall: I appreciate that amount of honesty, but I don't know that that's going to help on the street.
[00:16:30] Jessica Infante: And that fortune story that he. you know, was quoted saying that and he, they have a plan to execute a reverse stock split. Can't we come up with a better term for this? Like a combining of the stocks, a reuniting of stocks. I don't know, man, but basically they, they need the shareholders to approve this maneuver. It needs to be completed by July and he's pretty confident it's going to happen. But woof, 44 cents. Look, as a graduate of Syracuse University, that number is special to us for many athletic reasons. So I appreciate, but. It's not what you want to stop, Royce, Jesus.
[00:17:04] Zoe Licata: No, Erwin has always been pretty transparent when he's been disappointed in something or just acquiring something. Well, like what did he say to you guys in that first interview when I was out? Right. That's what I was thinking of is when we wrote about that, all of those AB acquisitions, we did a big, deep data dive into how all of those craft brands were performing. he mentioned looking at it and being like basically saying he was unaware of how bad some of those numbers were.
[00:17:34] Justin Kendall: I got all these declining brands.
[00:17:37] Zoe Licata: Yeah.
[00:17:38] Justin Kendall: What did I buy? It was something like that.
[00:17:40] Jessica Infante: Yeah. I wasn't even there and it lives rent-free in my head. Yeah.
[00:17:45] Justin Kendall: Yeah, it haunts me as well.
[00:17:47] Zoe Licata: Yeah. Yeah, so he doesn't hold back when he's feeling his thanks.
[00:17:51] Jessica Infante: Which like I appreciate, you know, like we cover all these publicly traded companies and often their leaders are not walking quote machines. They don't say a whole lot cause they can or don't want to. So it's refreshing to have Irwin who will tell you exactly what he thinks all the time. I don't know if Tilray shareholders agree with that, but personally I appreciate it.
[00:18:13] Justin Kendall: Yeah. Well, you can read all about that in our insider newsletter and I think we should hop on to another round of tabbing out and then get out of here to the BART interview. Zoe, you brought one up, and that is Big Sips has jugs. J-U-G-E-Z, which is essentially a borg, except not a gallon. It's one liter. A borl. No, it is a gallon jug, it says. This one gallon jug delivers bold flavors at one liter. Am I wrong in my measurements? I think somebody is confused.
[00:18:50] Zoe Licata: I think someone's just calling a large plastic container with a lid a gallon, but it is one liter.
[00:18:57] Justin Kendall: I'm getting confused here. The metric system is hard.
[00:19:01] Zoe Licata: These are plastic containers with colorful liquid inside. that look very much like slightly smaller versions of Borgs. I found out about them because I just had a friend sent me a photo of them being like, oh, cool. Look at this. This is a friend that you should never take alcohol purchasing advice from. So don't make that be a reference for how consumers are excited or not about this. But yeah, the Borg has been commercialized.
[00:19:32] Justin Kendall: So three flavors, America, no A, which my assumption is it's a Rocket Pop, Fruit Punch, and Purple Punch, which I think has an affiliation with Waka Flocka Flame. I feel so uncool right now. And these are 16% ABV.
[00:19:53] Zoe Licata: Yes, 16%. I feel like we knew this was going to happen, like someone's going to see Borgs and be like, all right, how can we make money off of that? But this kind of defeats the purpose of a lot of the reasons why I think people have Borgs. One of those main reasons being so they can make what they want and know exactly what is inside of their beverage.
[00:20:16] Jessica Infante: Yeah, there's that. There's, I can't believe what I'm about to say here, but the public safety element of Borgs. which is that you mix it, it's in your control at all times. I honestly, like, I kind of forgot that borgs existed until all those pictures surfaced from Boston St. Patrick's Day. I have not seen, but we've also been busy. I wonder what Marathon Monday was like on the borg front. Good question. Very good question. I mean, look, as a busy mom, I appreciate this pre-made borg. I don't have the time. the desire. You're going to add these to your drinking regimen? Maybe, my non-existent drinking regimen. Jess, you don't drink anything anymore except for Borg's.
[00:21:05] Justin Kendall: To your point though, at least this, you know that it's 16%. Yes. There's not a lot of margin for error there. If I'm mixing this, I don't know what we're going to get.
[00:21:17] Zoe Licata: That's true. I feel like another big aspect of the Borg is the, in full quotation marks, hydration aspect of it. A lot of people add some sort of like electrolytes powder or something. So you were in theory making it better for you than just drinking the alcohol. And it doesn't seem like they're promoting any of that type of benefit on these ones. So I don't think they have them. I think we should also note that Big Sips has these basically the same exact liquid in different formats. They have the Purple Punch and Fruit Punch and other things in their more traditional little circular containers. Ones that I believe are in contention for trademark infringement with buzz balls. The liquid itself isn't necessarily new. It's just this new format that looks just like a mini Borg. They're cute.
[00:22:14] Jessica Infante: I mean, I think we would have reached peak capitalism ripping off creative consumers if there's like a space for you to write a name for your little big drugs.
[00:22:23] Justin Kendall: Yeah. That seems like the thing that is missing.
[00:22:26] Jessica Infante: Yeah. That's the thing that I most appreciate about Borgs. Lots of great puns. Again, as a busy working mom, I don't have time to make one and I don't have the brain capacity to think of anything cute and clever, but I salute everybody who does. There's gotta be like a, Like the handshake emoji meme here between water talk and borgs.
[00:22:48] Zoe Licata: I was going to say, I feel like the mom version of a borg is just water talk. It's the same thing essentially, but without the alcohol. You don't know that. That's true. There could be sneaking some stuff in there that I'm totally unaware of. I have just seen syrups and glitter and various Starburst packet things. Who knows?
[00:23:10] Justin Kendall: Well, What's the verdict here?
[00:23:13] Zoe Licata: I'm tabbing out. It defeats the purpose of a Borg. I want to be able to make it myself. Half of a Borg is water and it has electrolytes in it. If that is a placebo to make me feel like I'm doing better things, sure. And I want to come up with a cool punny name. I really don't want to say Jugs. So I'm tabbing out. Have you named a Borg? No. A Borg sounds great in theory, but there's never been an incident where I'm like, yes, I'm actually going to make a Borg. Bilbo Borgins has been one of my favorites that I've seen so far.
[00:23:48] Jessica Infante: You know what I think we need to do? And I'm not saying that big drugs will be part of this, but I think summer outing Borgs.
[00:23:55] Zoe Licata: Summer outing Borgs.
[00:23:56] Jessica Infante: Yeah. We can just like ride the Eastie ferry a couple of different times and you and me will drink Borgs.
[00:24:02] Zoe Licata: Great.
[00:24:04] Jessica Infante: Hopefully BPD doesn't mind.
[00:24:06] Justin Kendall: I'm glad I'm safely in Iowa.
[00:24:09] Jessica Infante: My verdict, I think, you know what, Zoe, I'm going to take the opposite tack here and say, yeah, I appreciate it out of convenience sake, but I also appreciate your points. Fair.
[00:24:18] Justin Kendall: The dad in me is like, oh, well, you know, it's 16%. You know, you at least know that it's 16%. You're not going to get more than that. Right. Right. Hopefully. But given that my bones would turn to dust, I mean, it's never going to be about me. This isn't about me. This is about somebody else. So I'll let the kids have their convenience.
[00:24:39] Zoe Licata: How kind.
[00:24:40] Justin Kendall: Yeah. Well, let's get to our featured interview now with Bart Watson.
[00:24:50] Jessica Infante: We are back in the Brewbound podcast on Location Studio here at the Craft Brewers Conference Brew Expo America with arguably the guest of honor, Brewers Association President and CEO Bart Watson. How are you doing?
[00:25:04] Bart Watson: Good. Apparently we need to get some better guests in here. It's your party, man.
[00:25:07] Jessica Infante: Yeah. I don't know that you're the guest of honor so much as...
[00:25:10] Bart Watson: Host of honor? Yeah. All right. I'll take it.
[00:25:12] Jessica Infante: Yeah. But it is your first CBC as the host of honor. How has it been so far?
[00:25:17] Bart Watson: It's definitely a different perspective, but it's going great. I mean, this is one of my favorite weeks of the year. So many people that you know in the industry here in one place. So really excited. And it's fun being on a different, getting a different perspective on it.
[00:25:31] Justin Kendall: Do you feel like you're getting to hear from a lot more brewers while you're here, or are you just doing everything all the time now and you don't have as much time to sort of interact like you used to?
[00:25:43] Bart Watson: It's a little bit, you know, it's different interactions, right? You've got different constituency to serve now, but yeah, I'm still getting a lot of time to see Brewer friends, to hear how it's going. I always try to, when I do things like state of the industry that I did this morning, you know, see how that resonated. What did that capture for you? What did I miss? What are the pieces that you don't think captured your business? So I'm still getting a chance to do that. And I think it's just a little less downtime and a little more scheduled than it used to be, which is fine. It's good to have an energy rush for a week.
[00:26:13] Jessica Infante: you did just deliver the State of the Industry, we were there, and that negative 4% volume year over year is a tough one. I know now, obviously, the BA has a really big tent. You've got nationally distributed brewers, you've got taproom brewers, you've got microbreweries, brewpubs. That negative 4%, is that felt in any one sector of the membership more than others?
[00:26:36] Bart Watson: I mean, we tried to break that apart and give some of that context and show that, you know, first, I would say the 4% isn't everybody's experience. And, you know, there's a distribution. So one of the positives we highlight along with that 4% is that 43% of companies were up last year. And so you can have a number where, yes, the middle of it is negative, but there's still lots of people on the positive side. So I think that's one thing for listeners to keep in mind. Where we saw the hardest-hit groups, though, were typically, I think, in two places. One at the very smallest end. I think there's a combination of factors there, a lot of them around resources and the ability to invest, to pivot. And then secondarily, smaller distributing breweries, microbreweries. less than 500 barrels down 9.5% as we shared, and then microbreweries down 7%, kind of two places where I think that pain is being felt a little bit more for different reasons. You know, one around resources, one around how distribution and retail are changing. And then those are counterbalanced again by, you know, places that the number's a little bit better and a little bit more positive.
[00:27:36] Justin Kendall: You mentioned the 500-barrel breweries, and this was the first time I think I've ever heard somebody verbalize that in those opening and closing numbers, the closings are heavily weighted to 500-barrel breweries. And I think that's always been an assumption that I've had, but I think that's the first time I've heard it out loud.
[00:27:54] Bart Watson: Yeah, I mean, there's two pieces to that. One, that's most of the breweries, you know, 64 percent of breweries fall under 500 barrels. So it's going to be most of the openings and most of the closings. I think the second is, you know, that those are the companies, right, that running a small business is hard. And those are the companies that are the smallest business. And so they're just on the smallest line of, OK, the landlord changes the rent when our lease is up. This one thing happens. Main Street gets torn up because the city's doing construction and disrupts our traffic that, you know, 2,000 barrel brewery typically is going to have resources and options to whether that 500 barrel brewery might not. So yeah, that's, you know, I mean, those are members we're trying to think about how we help, how we drive foot traffic and, you know, what we can do to improve their conditions.
[00:28:36] Jessica Infante: You mentioned that you are spending a lot of time in D.C. and there's a lot of stuff coming out of D.C. that is making what would be a difficult time without it happening even more difficult. So what is the organization doing to help support even the smallest breweries who are probably going to face, you know, impacts and tariffs?
[00:28:52] Bart Watson: Yeah, so tariffs is the number one thing we're talking about in D.C. right now. Also talking about taxes and many of the other kind of issues du jour. But, you know, we're we're really trying to just to educate, you know, lobbying at its base is telling the story of your members, educating the right people about it. And one of the places we've been communicating with the administration is they want to help American manufacturing. We have American manufacturers as members. And so trying to educate them on places where we think they can do that in ways that fall with their larger policy goals. You know, they want things to be onshore. Great. We can appreciate and understand that. Again, American manufacturers, we can also educate them about the places in our industry where that's unlikely to happen, right? The climate may be better for growing barley other places. You have proprietary hops that are grown in Australia or New Zealand that are going to be grown there because they're proprietary. So where are places they can make smart exemptions to ensure that the American manufacturers they want to support keep growing the jobs, keep doing all the things? And, you know, we're hopeful that they're going to start to develop that process more over time. And that message is going to get through.
[00:29:53] Justin Kendall: Do you feel like it's resonating with them yet?
[00:29:56] Bart Watson: I think it's too early to tell. I mean, you know, one thing that becomes very apparent when you get up there is how many groups are doing exactly what we're doing right now. This is a new administration. There's new people. You've got to build those relationships. It takes time. I do think they're open to it. You know, we've heard directly from people in the administration that they want to differentiate between those products which are choosing not to be onshore and those products that can't be offshore for whatever reason. So we think that we keep hammering that message, working with the right people, finding connections, you know, more in the administration, but also with our legislative champions that that can make a difference over time. And you're starting to see that they are responding in some ways, right? We are seeing exemptions in certain products. We are seeing them show flexibility. And some of this will also just be base information as they think about how they structure trade deals. So making sure that products, you know, right now, Barley is not paying a tariff because under USMCA, it is USMCA compliant. So if there's a new trade deal with Canada, we want to make sure they understand that's an important thing to be covered without tariffs under that trade deal.
[00:30:56] Jessica Infante: And the BA just made a really key hire last week. You announced that Sam Beaver, who is coming to the BA to handle federal government affairs, recently joined you from the National Association of Manufacturers. So what a great find. I'm sure Sam is already off the ground and running.
[00:31:13] Bart Watson: Great find, worked on the hill, so worked in congressional offices, was actually one of the first people to work on small brew acts many years back in the day. National Association of Manufacturers, so that experience there, and just a great cultural fit too. He's a home brewer, he loves beer, so we think we really found a diamond here. We're excited and he's got big shoes to fill. Katie Marisik did a great job for many years, but we think he's going to do a great job telling our member story up on the hill.
[00:31:42] Justin Kendall: part of communicating that message seems to be playing out here at the Craft Brewers conference. You've got sort of a tagline going on. You brew. We've got your back. Is that something that you're officially running with here?
[00:31:53] Bart Watson: I mean, you know, that's more kind of our marketing to the beer industry. You know, we we want them to know what we do. And I think one of the things I'm trying to think of everything we do in the association. But I think one thing we took our eyes off on in the good years was telling our own story, right? And we need those members to be participating in our association to be successful then to reinvest back in those members. So we're going to try to do that in the coming years too, let them know what we're doing. You see that, you know, the marketing campaign or kind of that tagline that our creative folks thought up, which is awesome. There's one piece of that. You're going to see that in social media. I've been trying to take a much more active role and just, hey, I'm going to see the USDA today. I'm going to see TTB. I'm in with representative Newhouse. and letting them know kind of on a day-to-day basis that we do have their back and what that means in kind of tangible ways. We've noticed. That's great. That's the goal of marketing. So I'm glad it's working.
[00:32:42] Jessica Infante: And I know like the fact that gets brought out a lot that really helps tell your story better is that every congressional district has a Craft Brewers in it.
[00:32:49] Bart Watson: Yeah.
[00:32:49] Jessica Infante: Your representatives can visit these places and meet the owners and hear their problems. Like it really works.
[00:32:55] Bart Watson: Yeah. And you know, I think we have an opportunity in the next couple of years because government affairs is so elevated in everybody's mind, right? You can take government affairs for granted in a good time when everything's in smooth sailing and then something comes along and it disrupts an industry, which I think as we're seeing, it has a lot of points where it can be disrupted, not just supply chain, but regulatory, et cetera. So we're hopeful that that gives us an opportunity to communicate with members how important what we do is, but also important how it is for them to engage. There's nothing like getting a legislator to come into a brewery, seeing it, seeing all the shiny tanks, seeing the manufacturing, seeing all the jobs that light bulb goes on. And that's how we create supporters who are going to help work with our industry.
[00:33:33] Jessica Infante: Yeah. We cover all of the major trade groups that interact with the beer industry. And one thing that has always struck me about the BA is that you guys have a different role than everybody else because you do a lot of consumer facing work. Specifically, I'm thinking of the Great American Beer Festival, which has a lot of changes coming up that you've detailed. And I know a lot of changes got enacted last year and this year, even more spirits are coming. I'm excited to get to Denver and see it. What do you think events like that do for your members?
[00:33:59] Bart Watson: You know, that's one of the questions we're asking ourselves is what do they do? What can they do? How can we improve what they do? You know, I think at its heyday, right, it did a lot of things. It was the place where distributors came to experience brands as well. And obviously that's different than it used to be. I think it is a place where consumers can be introduced to new products, new flavors, new ideas. And that's one of the reasons we shifted what we're offering, because Craft Brewers are making these things, we want to make sure that they're finding them from our members. So, you know, if they're going to come into, you know, hard whatever, let's make sure that they're connecting with a small and independent producer to discover that and find a product that they like. So I think you can have that promote. I think it could also be just another community gathering event, an opportunity to celebrate. You know, one of the things we're trying to think is what value do the brewers get out of this? Not even the consumer facing value, but in education, in networking, in some of the things that CBC does, and it's not going to be CBC, right? CBC is its own unique, special thing. It has education. It has this expo that we're sitting in, but trying to think of GABF in that vein, too, of, okay, it's a different group who's going to come to GABF. Maybe it's more the sales heavy. Maybe it's the taproom folks. How can we make sure that they have an experience, they learn from the industry, and bring that back to their breweries?
[00:35:12] Justin Kendall: In shaping that too, you mentioned featuring products that your members are making. You mentioned on stage that Full Strength Spirits, the door is open to them this year for the first time. Are there guardrails, guideposts that you're going with on which spirits get in? Obviously we saw Jameson in the past, but how are you approaching it?
[00:35:33] Bart Watson: Yeah. So, you know, again, I think we talked about this when I first started. You know, what I'm trying to be laser focused on is how do we improve our member experience? What can we do for them that they can't do for themselves? And, you know, JVF is a great platform. It's still tens of thousands of people come in. There's still incredible amount of media. So, you know, there and This is still going to be the Greater American Beer Festival. It's not going to be the, you know, suddenly this huge spirits festival. This is going to be limited. We're going to kind of step our toe in the water, see how it's received by our members too, and get that feedback. But where we're going to start is with our members and small and local producers. So this is going to go out to our members first. We know there are hundreds of our members who are making full strength spirits, and we're going to have the requirement for licensee reasons. You've got to be distributing Colorado. So they either need to be doing that or be willing to get that licensing, which isn't that hard, but maybe a barrier some people don't want to go through. So it's going to start with member breweries. If you're making spirits, we want to promote those. If you want us to, bring them. And I think that next ring out, we're going to look, we're talking already with the Colorado Distillers Guild about, you know, bringing other small and local producers if we need to fill out more spots. But members first, we're going to start with the members and then we're going to broaden from there in ways that we think reflect our community and what we want JABF to be.
[00:36:42] Jessica Infante: I have a wild question. Yeah. Would you ever consider moving JABF?
[00:36:46] Bart Watson: It's not a wild question. You know, I think all things are on the table, right? GABF has to be something that serves our members, that promotes what we're trying to do as an association, and works for the association. And, you know, if we could do that better, there's a lot of built-in advantages to GABF where it is. We have a great relationship with the Colorado Convention Center, with the City of Denver. We have a great volunteer pool in Colorado. But yeah, I mean, all options are on the table. Really excited for our new VP of Events, Lacey Gauthier, to be looking at this and for her to think of some of these ideas and where she could imagine it going within the confines of what the role it plays and what it does for our members.
[00:37:22] Justin Kendall: Speaking of on the move, next year's Philly, then after that, San Antonio? That's correct. And then where are we going from there?
[00:37:30] Bart Watson: After that, we haven't signed anything after that. We've got some exciting destinations. I'm an opportunity and challenge guy, so this show is a little smaller than it used to be. that creates huge opportunities and suddenly there's a whole range of cities that we couldn't bring CBC to that we can now look at. So excited to see Lacey's eyes on this show too from a new perspective and hopefully we'll get 28 locked in and start building out that cycle further on in the future.
[00:37:58] Justin Kendall: These are the ones that I really enjoy. It's like Indianapolis, Milwaukee, Minneapolis. I feel like those are the ones where you get to a market that you don't really get to very often.
[00:38:09] Bart Watson: Yeah, Justin said it. People, if we do come back to Indy, you should check it out. It's been a great city to be in. Super walkable. There's lots of breweries within walking distance. You can walk to the football stadium where we did our welcome reception. You can walk. I walked down to the basketball game last night. So I think Indy's been a city that a lot of people have been discovering and realizing, like, yeah, this is a great fit for us. It's a beer city. So I think this is the kind of size that we're probably going to be looking at and a little bit less of, you know, Las Vegas was great in its own way, too. But I think this is more kind of our speed going forward.
[00:38:39] Jessica Infante: I think Justin was very close to just asking for CBC Des Moines.
[00:38:43] Bart Watson: I don't know if I was asking for that. I'm an Iowa boy, so we'll wait that in somewhere in the future.
[00:38:48] Jessica Infante: The beer industry is full of Iowans.
[00:38:50] Bart Watson: Yeah. Nothing against Iowa. There's a lot of ex-Iowans that helps.
[00:38:53] Jessica Infante: Yeah. And I feel like you're all very adept at finding each other. New Jerseyans are the same. I really enjoyed going to Homebrew Con in Baltimore, so I thought that was a great city.
[00:39:02] Bart Watson: Yeah, Baltimore's been a great city for us as well, so that's a fun one just down the road. And, you know, D.C., we haven't been back to D.C. in a while. That's not on the current plan, but that's always one we're thinking about and how we can increase our presence there.
[00:39:13] Jessica Infante: Makes sense, especially now that you don't have Savor anymore. That was a good way to make sure that members were in town and meeting with their reps. Yeah, R.I.P.
[00:39:20] Justin Kendall: Savor.
[00:39:21] Jessica Infante: R.I.P. What a great party. It was beautiful.
[00:39:23] Justin Kendall: So as you're walking around here and getting some time with members, what's the vibe you're getting?
[00:39:29] Bart Watson: I'm getting a positive vibe. I'd be interested in the two of you giving your perspective too, but this is a biased take, right? The people who have the money to come to CBC are doing a little bit better, but everything I'm hearing is very positive. I think we have seen a lot of companies put in hard work in the last couple of years to get their business in a more stable position. The vendors are seeing that too, that people who showed up tend to be looking to buy, that they're still looking to do business. I think we're seeing more people who recognize you can't just wait this out, you gotta invest through it. So I'm getting a pretty positive vibe. It's not all, you know, it's not sunshine and roses this, but I think there's a lot of things are going better than we expected. We're starting to see more beams of light appearing through the clouds. And overall, I've been getting a really positive vibe from attendees. What about you two? What are you hearing?
[00:40:13] Justin Kendall: It's kind of a mix in some of the conversations I'm hearing. It's really tough. Yeah. A lot of people are saying, you know, things that weren't on the table for us before are things that we have to look at now.
[00:40:25] Bart Watson: Yeah, that makes sense. And, you know, I mean, that's one of the reasons you come to something like this, too, is you see that range of options and you start talking them through with people who are doing them.
[00:40:32] Jessica Infante: I mean, like you said, if you are able to come to CBC, you obviously have the means to do it. But I think with a lot of people that have come out, they are making like the emotional investment to feel more positive. It's like I'm here. We're all here. We're doing it together. We're going to get through it. Kraft has been through really hard times before. this shouldn't really be all that different. But the one unknown that I would say, and I would be interested in your take here, is that the demographics of the consumer pool are different than they've been before. Yeah. So I think while we've got all of these other, you know, pressures that are coming externally, the one question mark is what will Gen Z do? And I know you read Burkhardt's report and so did I. And I think he laid out that there's not as much reason to panic about Gen Z as people think.
[00:41:17] Bart Watson: Yeah, I would describe it as you need to be aware, you need to be thinking, you need to be evolving, but you don't need to panic. And that's always been true. You know, the demographics of our country change on a day-to-day basis. And that's been true for as long as all of us have been alive. So with Gen Z, you know, one of the things we're going to try to do for members is give more resources there on, OK, it is going to be different to connect with this next generation. And, you know, I touched on some of that stuff in state of the industry today. I think they want to support local. They want to support values based businesses, but they're not going to do it. the automatic way the millennials did there at show me generation there are you know they want to know what your values are and you you put them up there and you tell them why sporting local is good for the things that they believe in you know similarly in beverage alcohol i think they're gonna come in but they're gonna be different and it's gonna be different without one of the things the card laid out really well is It is a different consumer, that this generation just looks differently in terms of who's drinking. Female drinkers, much higher percentage of the overall mix, and that's going to be different, right? And it's different in terms of levels, because even if women are drinking more, they tend to drink less than men overall on average. So I love that report because it aligned with what I have believed in, which is this isn't a huge shift, but it's an ongoing shift that you have to be paying attention to.
[00:42:29] Jessica Infante: Yeah. And one thing I think he did call out was that white men in the younger generation, they are drinking less. And if you have not really reoriented your business to not be so laser focused on that one demographic, this could be tough for you. But the good news is that so many more of them are starting to age up that you've got time. You know, you've got time to figure out a way to welcome in the other groups that maybe you weren't speaking to. And there's plenty of ways to do that. And there are plenty of resources that I know the BA offers. You can find really so much advice on how to make sure that you are speaking authentically.
[00:43:04] Bart Watson: Yeah. One of the pieces of advice I tried to offer today too is just, I think a lot Craft Brewers, it's big to think about how we take this on kind of overall. And, you know, I think they can find inspiration from their communities. Who is your community? who is immediately around you, and how can you authentically reach out and connect with them. And, you know, most communities are about half men, half women. You know, the demographics on race, ethnicity is going to vary by place. But if you're doing that in a true way, there's lots of opportunities to grow new fans. So.
[00:43:31] Jessica Infante: I watched Matt Gaciac's presentation yesterday, BA Staff Economist. He did a great job. It was really interesting the way he presented the information was he found four breweries to really present his case studies and highlight and somebody that he really spent a lot of time talking about was Lady Justice, who's right in your neck of the woods. He pointed out that they've really figured out that their audience is four different groups. It's their immediate neighbors. It's people who travel to the Denver area for beer. Then they've got people who really find that the brewery's social justice mission resonates with them. And then they've also started showing women's sports. And so they have people coming in for that. It can be done. Figure out, like you said, who your community is and what they like and figure out a way to give that to them in a way that feels authentic to your brand.
[00:44:14] Bart Watson: Yeah, and those are, I mean, those are four great examples of reasons for a particular community to get off their couch and come into a tap room. They've thought about it, they've got a strategy, and I'm sure then they're activating on each of those four. So, great example, and I'm glad you highlighted it. Matt's doing great work, and we're excited for whatever else he's digging up in his insights.
[00:44:30] Jessica Infante: He did an awesome job. Great.
[00:44:32] Justin Kendall: I thought another great point that you brought up, though, today was the flavor hurdle. And it's the perception versus reality in some regards, too, that this is all hoppy or everything is IPA. And I think I was talking to Zoe about it earlier, and she had brought up Jack's Abbey and how they even faced that, where somebody was like, oh, you know, it's Kraft, it's hoppy. And it's like, it's a lager house. Yeah. So it seems like that there's a marketing issue at hand here Craft Brewers are going to have to tackle going forward.
[00:45:04] Bart Watson: Yeah. I mean, it's a there's there's sort of a collective action problem here, too. I mean, so many brewers, their brand is IPA. That's what, you know, particularly in white distribution. But this isn't something new. I mean, I've already talked to several brewers today after that speech who, you know, that resonated with. And then they shared their stories of, you know, somebody coming in and being like, I don't like beer. Well, do you like white wine? Like, here's a Berliner Weiss for you. Oh, do you like chocolate? Do you like, you know, here's something with roasted malt for you. So, I think brewers know how to do this. It's just a muscle. Maybe we need to reflex. We need to put more emphasis on and it doesn't mean we need to go away from IPA. IPA has been hugely successful and is going to be key brands for a lot of companies. But can we do yes and? Can we do IPA and then say, hey, we're IPA and this and show people that there's a place for them and And, you know, we're doing that with other beverages right now. I think, you know, we can increasingly do that with other beverages and beer that, you know, we don't have to say you need to go to a seltzer or you need to go to an RTD cocktail. But, you know, we have beer options that maybe you should try along with those.
[00:46:07] Jessica Infante: Yeah. I mean, an IPA is not a monolith. There's plenty of things in there that you can use to appeal to different demographics. One thing that Kraft has been really great at is sharing the nitty gritty of beer with consumers, like with passion. But consumers are busy and there's a lot to learn about beer. So they didn't really always grasp onto everything. So I think maybe the community as a whole needs to remember what they did in the 90s. How you educated people on the very, very basics and get back to that in a way that feels right.
[00:46:36] Bart Watson: Yeah, that's a great reminder. We've done this before. I mean, there was an era when people, uh, I mean, you hear some of the like original stories of craft and it's like, that beer's dark. Is it bad? Like, you know, so we've done this before. We've probably faced bigger challenges in consumer education than this one in the history of, uh, recent history of beer. And our job, right, is not to tell brewers how to do that. You know, and we can create some campaigns that can share in and we can do that stuff, but it's to get them thinking. And we've got enough smart entrepreneurs out here that, they get their marketing folks turning on this, they're gonna come up with smart stuff like, yeah, it's hopping better and, or what are the kind of few things you can put out to your customers so that they understand like, there's a beer for you.
[00:47:15] Jessica Infante: Zoe and I parted with our coworker, Martín Caballero, who's the editor of BevNET. And he was like, you know, there's really a functional beverage now for every 20 minutes of the day. You could say that for Craft Brewers, too. There's a beer for literally any occasion you could possibly think of.
[00:47:30] Bart Watson: Yeah, we'll have some maybe beer moses tomorrow at Breakfast Apart.
[00:47:33] Jessica Infante: I love this idea.
[00:47:35] Bart Watson: Yeah, beer and a flavor for for any time and occasion. And I mean, that's one of the most common podcast questions I get is something around like, what's your favorite style? And maybe I'm going to steal this. There's a beer for every 20 minutes in the day. You know, I mean, there's a different style that I'm going to want to be drinking, you know, when I'm at a basketball game versus sitting on my couch at home versus, you know, anyway, you get it.
[00:47:57] Jessica Infante: I get it.
[00:47:58] Justin Kendall: Another thing you brought up on stage is basically a call to action, because you pretty much laid out, if you think you can ride this out, you can't. You have to reconsider your business strategy. And I think that that's a powerful message that a lot of folks need to hear.
[00:48:13] Bart Watson: That is really motivated by what I have heard coming in, which is, you know, I think there have been a lot Craft Brewers who've kind of been waiting on the shakeout or waiting on this to clear, and maybe that'll even work for some of them in the short term. I think in the long run, Craft Brewers aren't thinking about what their strategy is, their points of differentiation, where in the words of Fred Matt, they delight the customer. Where do you do that? That we're going to have bigger long-term problems. We're going to be in this again. So I try not to use the bully pulpit too much. Our role is not to tell members what to do, it's to arm them with stuff. So whatever they do, they can do it excellently. But that's a place where I do want to push brewers to not be passive observers of all this, but to get active, to think about a strategy, and then know that we've got resources that can help them do that.
[00:48:54] Justin Kendall: I think that's a great way to end it.
[00:48:56] Bart Watson: I think that was perfect. Yeah. Wonderful. Well, I always appreciate being on the two. Super fun.
[00:49:03] Justin Kendall: And that's our show for this week. Thanks to Bart Watson for joining us on the trade show floor at the Craft Brewers conference. Thanks to Josh and Joe for running audio and video during the show. Thanks to Jess for hanging out for the interview. And thanks to Zoe for joining us for this episode and filling us in on all the motor sports adventures that she had over the last week. And thanks to all of you for listening. We'll be back next week.
