Is Boston Beer Doomed?

Old-timey.

I’ve got my nose deep into a long-form piece today, and so I’m outsourcing content to The Motley Fool, which paints a grim picture of the country’s largest craft brewery.

The bulk of Boston Beer’s sales come from the Samuel Adams line of beer, and those have been declining. The company’s Angry Orchard cider and Traveler beer brands were also down in the quarter, only partially offset by sales increases in Twisted Tea, Coney Island beer, and Truly Spiked and Sparkling….

Still clinging to its craft tradition, the company has chosen to primarily develop new offerings in-house through its Science and Alchemy division. Its most recent launch was a spiked sparkling water-flavored beverage. Sam Adams also recently released its Rebel IPA and Nitro projects, but none has been enough to restore the company to growth….

The company’s internal efforts to generate growth aren’t keeping up. I can understand the desire to stay true to the craft roots, but the company opted to play the perpetual growth game and went public. Shareholders demand profitable growth. It might be time to purchase a small rival brewer or two and plug them into the existing Sam Adams family.

Of all the larger craft breweries, Boston Beer seems to be in the weakest position. A decade ago and more it was lauded for innovation, but that era has long passed. Crappy, brand-eroding flavored malt beverages have distracted the company from its core competency (beer), and owner Jim Koch’s commitment to amber lager in an IPA era does not inspire confidence that it will be relevant again anytime soon. I disagree with the Motley Fool on the direction it should take, though. Boston Beer doesn’t have the money to compete in the acquisitions game with ABI and MillerCoors. It needs to rehabilitate and extend its own brand and figure out a way to freshen up Boston Lager. And it should definitely quit trying to come up with crappy side products.

Boston Beer looked like a titan as recently as a couple years ago, but it’s in real trouble now. It never developed a strategy to compete against smaller, boutique breweries in terms of innovation and quality, nor does it appear prepared to battle the new wave of ABI- and MillerCoors-owned “craft” brands, which are going to be making extremely aggressive efforts to establish their national presence. If I were on team Sam Adams, I’d be hitting the panic button, stat.

from Beervana http://beervana.blogspot.com/2016/08/is-boston-beer-doomed.html

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