[00:00:00] Justin Kendall: Heading to CBC? Kick things off the day before at Brewbound's meetup at Love City Brewing in Philly, Sunday, April 19th from 5 to 7 p.m. Connect with beer industry leaders, grab a drink, and catch up with the Brewbound team. It's free to attend and walking distance from the convention center. Head to Brewbound.com slash lovecity.rsvp. And don't forget to catch the Brewbound team at booth 956 during CBC. Welcome to the Brewbound Podcast. This is Justin Kendall, the editor of Brewbound, and I'm in the Brewbound Podcast studios with BevNET editor-in-chief Jeffrey Klineman and Brewbound reporter Jessica Infante. Guys, welcome. Terrific to be here. And Jess, great to have you here.
[00:00:58] Jessica Infante: It's great to be here.
[00:01:02] Justin Kendall: That's so genuine.
[00:01:04] Jessica Infante: I mean that. It's been great.
[00:01:05] Justin Kendall: Jess, you joined Brewbound about a month ago now?
[00:01:09] Jessica Infante: Yeah, it's been a month.
[00:01:10] Justin Kendall: So for the listeners who aren't familiar, haven't had the chance to talk to you yet, tell them who you are.
[00:01:15] Jessica Infante: I came to Brewbound from the craft beer industry, was in marketing at a craft brewery here in Massachusetts for almost nine years. and learned a lot about the industry, both at the high national distribution level and also like really granular down at the taproom level. Prior to that, I was a newspaper reporter at the Jersey Shore. So here we are putting all those things together.
[00:01:42] Jeffrey Klineman: What's it been like shaking off the cobwebs?
[00:01:45] Jessica Infante: Not as hard as I thought. It's been a lot of fun. I know, Justin, you've said several times we need to adjust my idea of fun, but I've really enjoyed, you know, talking to people, asking them questions, getting their stories and then writing stories. So it's really great to be able to do that, covering an industry that I know really well and have a lot of affection for. It felt really normal and natural to get back into it, which, which I love.
[00:02:10] Jeffrey Klineman: Well, that's just great. And it's given Justin a lot more time to run around and do damage. And he's been putting together, as we always discuss, a terrific agenda for the Brewbound Live event in December on the 4th and 5th in Santa Monica. Absolutely. And we sent him out to do a practice panel not too long ago, and this audio, I think, is the fruit of it. Can you tell us about it a little bit?
[00:02:42] Justin Kendall: Yeah, I was invited by Neil Stewart, the VP of Marketing For Deschutes, to host a panel with Deschutes founder Gary Fish, Chris Hudson, Stacy Denbow, and Ed Maletis. Two of those guys are in sales For Deschutes. Ed Maletis is the former chairman of Columbia Distributing. And I got to chat with them at their wholesaler meeting, which is pretty much an opportunity For Deschutes to sell its new products to the wholesalers, give them a review of what happened in 2019 and where they're going in 2020. And that's pretty much it.
[00:03:19] Jeffrey Klineman: So Justin, what was it like for you to sit down in the old moderator chair for a while?
[00:03:25] Justin Kendall: I think all of the anxiety. There's nothing anyone wants more who is adverse to public speaking than to be in the moderator chair.
[00:03:33] Jeffrey Klineman: Well, we're really glad that we're going to be putting you in a position where you're going to be anxious at all times over a two-day period during Brewbound Live. But I can tell you, having heard the tape, that you only sound like 80% as angsty as we thought you would. I'm glad that I'm bringing that level down a little bit. Jess, when you were over at SAM, were these kinds of meetings regular for you?
[00:04:00] Jessica Infante: Yeah, so SAM slash Boston Beer has these wholesaler meetings, you know, this is the time, fall, coming into the new product releases of the beginning of the next calendar year. For a few years, it was my job to ship all of the POS to all these meetings, including, you know, banners and decorative items. And it's a lot like herding cats. There used to be a lot of them, and now they've really kind of cut them down and made them bigger, but fewer. But it's always really fun to hear about new products.
[00:04:29] Justin Kendall: All right. Well, let's get to the panel. Here we go.
[00:04:37] In Episode: Please welcome Brewbound editor, Justin Kendall.
[00:04:46] Justin Kendall: Hey everyone, I'm Justin Kendall. I'm the new editor of Brewbound, and we're gonna do a little podcast here today. We need to get our guests up here, so let's get Deschutes founder Gary Fish up here. Joining Gary up here is gonna be Pacific Northwest General Manager Chris Hudson. Regional Sales Director, Stacey Denbaugh. And to give us a wholesaler's perspective, we're going to have Ed Maletis up here as well. So guys, thanks for joining the podcast. Thank you. Let's just dive in here. The industry is at an inflection point. Craft growth has slowed, and growth that is out there is being sliced up by 7,000 craft breweries. There's a lot of noise, a lot of growth is coming from hard seltzer, and we have a consumer who isn't loyal and is making more health-conscious decisions. So let's start with you, Gary. How can regional crafts such For Deschutes thrive in this competitive environment?
[00:06:18] Jeffrey Klineman: I was describing it to somebody last night, I think, as death by 1,000 cuts. And we had a conversation a couple of days ago where somebody described in typical fashion, you know, the 800-pound gorilla is Anheuser-Busch. And I said, no, that's old school. It's no longer Anheuser-Busch. The 800-pound gorilla is now 7,500 little competitors every day around us. under the assumption that the only person in this conversation who's never wrong is the consumer, how do you compete in that environment? And the way to compete from our perspective is through innovation, is getting in front of them, increasing the amount the frequency and the volume of our conversations with our consumer and listening to what they're providing to us so that we can get them the flavors, the concepts, the brands that they truly value. Understanding that may need to change, but ultimately they're the ones in charge and we have to be responsive to that.
[00:07:26] Justin Kendall: We just got a glimpse of some of that innovation for 2020. You guys have Modified Theory, an FMB that plays like a canned cocktail or a mixer, and Wowza, a low-calorie pale ale. For Deschutes is hitting on some of those big trends in the market right now. I guess, Gary, did you envision a scenario For Deschutes would morph into a beverage company?
[00:07:55] Jeffrey Klineman: People ask me, you know, did you ever think that the company was going to grow the way it did? It's like no sane person would ever think about that. You know, I spent a lot of the last 32 years paralyzed by fear. So the idea that we would morph into this, whereas, you know, I never thought negatively about it, I also never thought that we would be more than a beer company. And we make our own cider, we have our own whiskey. We have already become an adult beverage company much more than just a beer company. So whether or not it was predicted, we're already there. And so the transition to some of these more than beer products seems a very natural one at this point. Is it hard to embrace that though? For me, it's not hard to embrace anything that the consumer tells us they really want.
[00:08:55] Justin Kendall: Chris and Stacey, I'll toss this to you. When you look at sort of a morphing into a more beverage company, that seems to open up a lot more opportunity for you guys. How do you sort of sell that to your wholesaler and retailer partners?
[00:09:12] Brewbound Podcast: One thing I wanted to follow up with what Gary said was, you know, years and years ago, he always said, never say never. I said, Gary, but never this, never that. And he's like, never say never. So it's always been my experience with Gary Fish that be open to everything because you never know what tomorrow is going to bring. But as far as embracing these new things, there's a lot we're good at. There's a lot we need to learn. And we need to get back to where we were in 1988, you know, in the beginning. you know, pushing after a dark beer as being our flagship was something that people didn't do. And so it's getting back to the grassroots of talking to retailers, talking to our consumers, talking to our distributor partners, and getting back to collaborating and saying, what are you good at? We don't do hard liquor. We have never done that. We've suffered the black porter whiskey. So what hard liquor in your brands should we partner up with Modified Theory? think outside the box more and more and just figure out what kind of collaborations we can do, what kind of partnerships, but make sure that this is our plan, meaning everybody in the room's plan, For Deschutes' plan, not distributor plan, but getting back to collaborating.
[00:10:17] Justin Kendall: So you guys talked a lot about innovation today. Again, wowza, Modified Theory. How do you guys ensure that you guys are not only filling a gap in your own portfolio, but also giving your wholesalers something that they can get excited to sell?
[00:10:36] Brewbound Podcast: Well, are you guys excited about what we showed you? I mean, is that exciting? Last night, that's all I drank. And looking at the packaging when I first saw it, I think it's a home run. I mean, I could see it on the shelf. So I think being more clear on our priorities and simplifying it and sticking with it, we're going to look at SKU rationale. So if there are some SKUs in your house that aren't, you know, aren't floating, let's discuss this. Let's make sure we're not, you know, all focused on 25 brands that we're locked in, we're locked and loaded on what our priorities are and focusing on those. And if there's a brand that's shifting the wrong way, rather than chasing it after that to save it, let's ramp up some of these brands like the fresh haze and a little squeezy, they're on fire. And let's get them up to 100% distribution with fresh squeezed. Same question down the line.
[00:11:24] Deschutes Brewery: You know, I think if you sometimes wait to be excited about something, and somebody needs to excite me, it's a little bit of, you're gonna maybe wait a long time, because there's a lot of noise that goes on every day in everybody's lives out there at work. But to truly be excited is, I think, starts first with being open-minded. And if you look at the industry, the breakthroughs that have occurred in the industry is not coming from the giants, OK? I remember when I was supposed to get excited about new Miller Beer. I did, painted five trucks. And if you follow, remember Coors, light red. And I mean, there's all the big big guys have all kinds of. not innovative ideas a lot of times. And the truly innovative ideas have come at least in the last 20 or 30 years from a lot of the smaller players in the industry. And sometimes the great ideas don't start out as a huge exciting idea, but you have to give them a chance and an opportunity and see what the consumer is then going to pick and choose.
[00:12:48] Justin Kendall: I'm glad you used that word noise because we hear that a lot in the industry. How do you sort of define noise at this point? Is it skew proliferation? Is it skew rationalization? What is that to you guys?
[00:13:03] Deschutes Brewery: I guess we'll kick it to Ed on that. Well, the noise, somebody put up there on the slide the four or five buzzwords. And that's noise. I mean, because if you're striving to fall under a category of those few buzzwords, then what happens is you're trying to kind of create noise. And I don't have that answer. And I don't know if anybody's really got that answer. And I also want to kind of correct everybody. I'm not a wholesaler, I'm an ex-wholesaler. So, but with a still great love for this industry.
[00:13:41] Brewbound Podcast: I mean, I think with the noise thing, if everybody's screaming, the best way to get through is to whisper. And so you just kind of got to look at the situation. All the businesses that are popular now that they're making the most money are businesses that no one knew they needed and now they can't live without. And just trying to see that business that isn't being done and be there before anybody realizes they want it.
[00:14:02] Jeffrey Klineman: I mean, admittedly, we, you know, we've have a history of being part of the problem as well. I mean, we've gone to our wholesaler networks with eight different things and asking them to get behind it. I think what the wholesalers really want is a strategic approach. Give me two things, give me three things, but go out and let's hit a home run with it.
[00:14:22] Justin Kendall: So you guys have evolved your strategy as far as going to your wholesalers on these things now?
[00:14:28] Deschutes Brewery: Absolutely. But one of the things that I stress, at least in my conversations with the brewery and in a bit of an advisory role is, Think about it from the other side. Think about it from the brewery side if you can. It's a tightrope. So I came from the wholesale side, involved on the brewery side, but today's environment, and it's been this way for a while, is a tightrope. You don't want to sit here and be confronted with a lot of me-too ideas that are thrown your way. You also don't want to sit here and be confronted with 10 different out-of-the-park ideas, but there's a fine line of a few ideas that you believe have a pretty good chance of succeeding in the marketplace, yet not afraid if one or two don't work. Can't be afraid to try things. And it's what I like to term affordable mistakes. If it's a mistake, is it affordable for the brewer? Is it an affordable mistake for the wholesaler? I.e., not so much product that's going down the drain, not over packaging. You can have something where the package materials that you have to toss is in the hundreds of thousands of dollars, if not more. But you want people taking affordable risks there. And if four items come out and two of them do really, really well, one does so-so, the other one's a dud, that's a pretty great batting average in today's climate.
[00:16:15] Justin Kendall: So we talk a lot about focus and mindshare and gaining that with your wholesalers. I'll kick it to Gary on this. You know, brewers want both, but there are 7,500 other breweries right now who want the same thing. Let's break that down. When you say focus and mindshare, how do you define that?
[00:16:37] Jeffrey Klineman: Well, that's a great question. And I've used this analogy. The consumer is screaming for variety right now. The market is screaming for focus. And we're walking the tightrope in between. So we need to be able to create new brands that get people excited without ignoring the brands that brought us here in the first place. But also, you guys, with your portfolio of suppliers, have a challenging time being able to truly focus on the brands that are going to be profitable within your system. We're trying to figure out how to get you those brands that are going to make you successful, those brands that are gonna make the retailers successful, and ultimately excite the consumer so that all our online friends write about us all the time.
[00:17:35] Justin Kendall: Is this the hardest time that you've seen to get that mind share and that focus?
[00:17:41] Jeffrey Klineman: It's the weirdest time. Why? Because, you know, honestly, I mean, I've been in this long enough. I've ridden this roller coaster, the ups and downs, and been through, I think, three full recessions in my time in the industry. And each one, I was able to look forward and say, okay, here's where we're gonna get out of this. Keep your head down, keep working, do good work, and we'll get through this. This time is different. We tried that two years ago. It was like, okay, we don't know what's going on. We don't know why the consumer is behaving the way they are. Keep your head down, keep doing good work, keep plowing forward, and eventually the consumer will behave rationally again. Well, clearly that didn't work. So, trying to figure out where the consumer's going, and now you've got things like online purchasing, on-premise overall is suffering, not just in the beer industry, the wine industry, the spirits industry, but in the food industry. Overall, restaurants are challenged because people are eating at home. The millennials' consumption pattern is not like the consumption pattern that we had when we were that age. Where are they going next? What's the next generation going to want or need? I mean, these are the things we're trying to think through, but there are no clear answers from our perspective.
[00:19:10] Justin Kendall: When you look at how difficult it is to get that share of mine, then you add on top of that the shift to local, and we have a proliferation of breweries with their own premise tap rooms. That would seem to add another layer of complexity, but it would also seem to give you a competitive advantage as far as you can work with everybody in this room. You've got wholesalers, you've got an advantage that other smaller breweries don't. So can you sort of speak to how that evolution to a taproom focus has sort of changed for regional players?
[00:19:51] Deschutes Brewery: Well, we describe the craft brewing business as 7,500 strong, but let's not kid anybody. You're looking here at a company For Deschutes Brewery that is really one of 10, maybe 20 really great craft brewers that have pedigree, history, resonance with the consumer. And it's a relationship that you have had together as a wholesaler and as a brewer for 10, 20, or 30 years. So there's no mistake that you out there are survivors in the shakeout industry of wholesaling. There's no mistake that these people at the chutes are survivors. What we don't know is we don't know, does 7,500 go to 8,000 before it goes back to 7,000, before it goes to 6,000? I'm going to make a projection that I don't think is too out of line to say I don't think there's going to be 7,500 craft brewers five years from now. I think the number is probably going to be less than that. The definition of a craft brewer to encompass 7,500 is it's not an accurate, you can't put an umbrella over 7,500 different companies recognizing how different they are. But I think the first thing and the understanding is you've got to have trust in each other. And you've got to take that longevity and understand that what it really is is trust. And how can we take that trust and make it work for everybody?
[00:21:49] Jeffrey Klineman: I'll offer the counterpoint to that. I think there's going to be 10,000 breweries in two years, and I think it's going to grow from there. And the reason I say that, and one of the things that makes it challenging for me to look forward and see where this thing works itself out, is that the barriers to entry in the industry have basically come down to zero. You know, you can, as a home brewer, you can go fill out a form, write a check for 50 bucks, and you're a professional brewer. Some of these guys aren't even filling out the form. But you can make beer in your garage, put it in a keg, and wheel it down to your buddy's tavern on the corner, and he'll put it on tap because he knows you. That's one slice of the pie that we don't get to compete for. Each new tasting room, 7,500 breweries, how many have multiple tasting rooms or pubs? How many do we already effectively have? Heck, we have two brewpubs. We have five brewing systems. How many breweries are we? I think that's where the challenge really comes is that basically you can go pro as a home brewer and live a part of this fantastic lifestyle industry, which it is, and all your buddies who you've been giving free beer to as a home brewer, all of a sudden, maybe they're not like and paying for it, but they still like you. So, you know, for every brewery that goes out of business, there are two or three ready to take their place and come back in. And that's where I think the challenge really comes. I cannot afford as a businessman to sit here and assume that this thing's going to shake out and the weak players are going to go away and the overall numbers are going to drop. I have to assume that this is going to continue to explode and we're going to have to figure out ways to succeed on into the future. And that's exactly the task we've set ourselves to. And what you saw today is only a part of what you will see next year at this time, the year after and so forth, because we can't afford to think about it any other way.
[00:23:58] Justin Kendall: Do you ever look to, I guess, pull back to your core markets and focus on those as opposed to outside markets?
[00:24:09] Jeffrey Klineman: Well, I can tell you in the last couple of years, we've had a lot of conversations on a lot of different subjects. And what should we be doing? I mean, should we be pulling back to our core markets? Well, our core markets in the Northwest are some of the markets we're struggling with the most. We're the number one craft brewer in the Northwest. And that's where we're having some of our toughest challenges. We have to be able to win in our home markets. And we're taking the steps that we need to take to do just that.
[00:24:40] Justin Kendall: Chris and Stacey, when you look at those sort of core markets, what do you see as sort of the biggest issues for the brand at the moment? Or the biggest challenges, I should say?
[00:24:52] Jeffrey Klineman: Well, we can't be local everywhere, and that's a struggle. So how do you combat that has been the question over the last three years. Some of those answers come from what we've already described as being us. We have to believe that we have the best beer. We have to believe that we have the best brewers, that we have an uncompromising commitment to quality. We have a great marketing team. We have an epic sales team. What are some of the other words? awesome, we have an awesome production team, we have great upper management, ownership, we're co-owners, and we have all those tools. We need to do a better job of telling the story. I think the consumers, you know, for us, are starting to grasp the idea that local doesn't always mean good. And so we have, if you've ever been to our brewery with our lab and gone through our lab and seen the amount of money and time we invest in quality control, it's unparalleled out there. And so those are the kind of stories that make us proud to co-own and be able to work For Deschutes Brewery because it's always been that way and it always will be that way.
[00:26:08] Brewbound Podcast: Yeah, we had a number of years of just growth, growth, growth, growth, growth. And then, you know, two or three years ago, we started to see the decline in the market changing. And the good, you know, I always feel like in every bad, there's a good. And the good in that, you don't learn a lot from your success. You learn from your challenges. You know, like Gary was saying, we can't do anything about the competition. We can compete with them, but we can't sit around and hope that, you know, they get the flu and they're no longer in business or they go out of business or whatever. We just have to focus on being a better us. And that's what we gotta do. And we gotta also realize that the days of it being easy are over. It's not, I mean, I don't see it being easy anytime in the near future, every single month. Two and a half years ago, we had a great month. I'm like, we're back. Next month was that, and the next two months, and another month, we're back. And then in July, we had a great month. And then up until August 30th, we had a great month in August. And then that one day was a 5.8% swing of just having that one day. to bring us back to not positive. It's just not going to be easy. It's going to be like dragging a rock down the beach, but we just got to get together. We can't do it without you. Hopefully, we're a major part in your thing. If you're here, that means that we're important to you as well. It's not going to be easy. So anybody who thinks that we're going to come up with one beer and that's just going to get us out of the heyday for the next 10 years, that's not true. It's going to have to be three home runs every year. We have to work every single day, can't take anything for granted. And if we have a good month, we can't think that all of a sudden the rest of the year is going to be good. Every day we got to work, Saturday, Sunday, whether it's, you know, digging the yard and thinking about strategy or whatever, but it's not going to be easy. We got to keep pushing.
[00:27:46] Justin Kendall: The big topic out there right now is hard seltzers. In your 31 years running this, in Ed's time, you know, as a former wholesaler, have either of you seen any type of product with this sort of upward trajectory?
[00:28:01] Deschutes Brewery: When things hit that hard, that strong, Everybody said, well, you know, remember wine coolers? Well, you know, wine coolers are still around. So when anything hits that big, that strong, it might be off the radar screen in terms of headlines. But when you get to a peak volume, those products stay around for a long, long time. But I don't think I've ever seen anything like this.
[00:28:28] Justin Kendall: Do you guys think it has legs? Like, in a year from now, are we gonna still be talking about, you know, White Claw Summer and, you know, White Claw shortages or, you know, truly ad campaigns? Or are we gonna be talking about Modified Theory and how it's, you know, revolutionized the F&B category?
[00:28:48] Brewbound Podcast: The latter, of course. That's probably the softest ball question I think I've ever thrown. You know, historically, I've always said anything goes up fast goes down fast. But I was on a strategic call last week and a lot of wholesalers that sell a lot of the seltzers see this as being because the whole market is so different with Millennials and the younger drinker, seeing this as being the what was said a couple times was seltzers are the Millennials light beer. And a lot of speculation is it's not going to go away anytime soon and it's continued to grow. So, you know, for me, I'm not involved in selling that, but that's, that's what I heard some people who've been in industry for a long time.
[00:29:27] Deschutes Brewery: I know we're reaching the end here, but I am not going to have a microphone in my hand in front of all these people without saying something that I want to talk about. So put up your little sign of whatever, five minutes, but I'm, you know, one minute. Well, I'm going to do my best, but I'm not making any promise. And it's really this. This is a special company, and I think all of you out there know that. And my advice to you guys is, these are people that have been at it for 30 years. They can trust you, and you can trust them. What I urge everybody to do is take full advantage of that special opportunity. These are people that have experience, and they care. You don't have to be perfect to be great. I'm looking at a sea of great wholesalers out there, but you're not perfect. I'm looking at a great craft brewer, but they're not perfect. But I will tell you what I would urge you to do. Gary's going to maybe shoot me, but they have earned your respect, and you have earned their respect. But take the opportunity of this. great company of size that's important to you, that really makes up the heart of a craft category. And be honest and open with one another. And that means more effective communication. And what I would urge you all to do, whether you are an owner, a sales manager, an operations manager, a branch manager, a CFO, pick up the phone twice a year. and call Gary, call Michael, and just have a conversation. 15 minutes, just an update. You're not selling each other anything. You're not asking each other, I want you to spend more money in my market, or I want you to add people, but you're having a conversation about the market. Gary's cell phone number, get your pen and paper out. Michael's cell phone number. But honest to God, if you get back to that basic, talk to each other a couple of times a year. And the amount of honest interaction that you'll have will be a hell of a good improvement in each of your bottom lines. Because it's a fast moving world out there. So don't just rely on the field sales individual to communicate everything to your wholesalership and vice versa. Those are important relationships to have, but the other honest conversation at the top is also important so you both can get through these tough and trying times with the most amount of success possible.
[00:32:37] Justin Kendall: Guys, thank you for joining the podcast. I'm sure our listeners cannot wait to have Gary's cell phone number. Thanks for having me, Deschutes.
[00:32:59] Jeffrey Klineman: It says here that one takeaway was that Gary was paralyzed by fear.
[00:33:06] Justin Kendall: Not during the meeting. He said that he spent the last 32 years paralyzed by fear, which I took away as sort of an honest assessment of, you know, an entrepreneur's journey through growing a business to the size For Deschutes.
[00:33:21] Jeffrey Klineman: Would you say we can thank Gary's fear for many of the Deschutes high gravity offerings? I would think so.
[00:33:28] Justin Kendall: The Abyss. Yes, aptly named.
[00:33:33] Jeffrey Klineman: Shifting gears a little bit, how well prepared do you think many of these regional breweries are to slide over into the broader beverage company platform? Or are they better off sticking to their knitting?
[00:33:51] Justin Kendall: I think that's something I'm still trying to figure out myself because you hear a brewery say that they're a beverage company now, and it's kind of jarring to hear that because you know these businesses didn't start as, I'm going to get into a beverage company, and they sort of morphed into this over time as a way to sort of bolster the core business.
[00:34:18] Jeffrey Klineman: Yeah, I mean I think they recognize that there's share out there for the taking and they also want to avoid going backwards as companies and the ones that are big enough probably have the capacity and have the connections to get it done. I'm just thinking back a few years ago when one of the early local craft brewers who I knew showed up here with what was essentially an Izzy Soda knockoff, you know, it was carbonated water and juice. And he was saying, this is what I'm into right now. Now he's still making beer, but I haven't seen that product on the market for a long time. I wonder if saying we're a total beverage company now might feel a little premature and trend chasing. Not to say that Deschutes is doing so, but if there's too many people running to take this still relatively small chunk of market space, how are you going to build brand distinctiveness?
[00:35:29] Justin Kendall: I think that's a question that still, I keep coming back to this, it's a question that still hasn't played out. And I do get concerned about companies when they step away from the core competencies to move into these other directions. And it can feel like they're turning attention away from a core business that while might be losing some volume, isn't outright bleeding, you know?
[00:36:01] Jeffrey Klineman: Yeah, and in fact, it's the blood that runs through their veins as a company. Yeah. On the other hand, it's easy to innovate when you're a brewer, right? I mean, a lot of these folks are able to do runs of stuff because they don't have to call up their co-packer and say, you know, well, can you get me line time for this or that beverage? They're their own producers. But there are probably other things that make it more expensive, like coming up with marketing and merchandising programs for these kinds of things, right?
[00:36:35] Justin Kendall: Right. And I don't know if it played out within this conversation, but Deschutes is doing bilingual marketing for Modified Theory because they believe, and their research has proven out, that there are multicultural consumers who want this product or who have at least have purchase intent for it. So this is going to play in stores, in markets where they currently aren't selling beer. I think there is a whole other opportunity here too that, you know, we talk about core competencies and this and that, but there's also this opportunity that exists to get in other parts of a store or new stores, you know, that they're not in before. All right, that's our show for this week. Thanks for tuning in. We are available on every platform you can imagine. iTunes, Stitcher, Spotify, Google Play, Libsyn, and SoundCloud. If you like the show, give us a rating and a review. Share the podcast with your friends and colleagues. Drop us a note at podcast at Brewbound.com if you'd like to be featured on the pod or share your thoughts. Thank you to our audio team, our guests, Gary, Chris, Stacy, and Ed. Thank you For Deschutes Brewery. Thank you to Neil Stewart, Deschutes VP of Marketing, for inviting me to host the panel. And thank you to all our listeners out there. Catch us next week for episode four. Until then, cheers. Cheers.
