The conundrum of ‘new’

Innovation: desired and feared in equal measure by senior executives in businesses round the globe. On the one hand, the school of ‘innovate or die’ – typical in fast moving consumer goods or high tech environments – the mindset, the belief, that ‘you’re only as good as your last success’.  Such is the level of competition amongst companies, many live in fear that if they don’t innovate, if they don’t slice the salami of consumer needs and understand deeper, more penetrating insights about the countless ways we live our lives, then their business will be in mortal danger.  Famously, the 3M Corporation, notable for inventing Post-It notes¹ tasked itself with ‘The 30% Challenge’ – generating 30% of worldwide sales from products launched in the last 4 years.  That’s worth a brief pause to consider.  30% of worldwide sales from products less than 4 years old.  I haven’t worked there. I don’t know if it’s a goal that is regularly achieved (but I believe they still use it as a corporate objective), but let me tell you: that is, to quote Jim Collins², a ‘big, hairy, audacious goal’.  Glance through the business pages on a weekly basis; read the Annual Reports – for most businesses, ‘innovation’ and ‘lifeblood’ are symbiotically linked.

Yet on the other hand, there’s the rather unfashionable, whisper-it-lest-you-are-heard, view.  That innovation isn’t essential. It’s a school of thought I’m increasingly persuaded by – particularly when it comes to beer.

Let’s interrogate this a little more.  Start with consumers, drinkers, customer – call your fellow human beings what you will. People who buy stuff.   In the last couple of years, I’ve done research across a dozen, more, different categories of product – bread, beer, wine, spirits, coffee, tea, paper products, banking, pizzas, weight loss, soft drinks, hotels, restaurants – you name it.  Here’s the thing – the linking thread. In 90% cases, the people working in the business are convinced that they must have new.  Innovation in product, in service, in experience, in something.  But in every case, every case, consumers don’t see the need.  The reaction by the client is never, therefore, to walk away and spend their time and money on something else, but rather to find a need.  The hunt for insights commences, driving motivations behind why we do what we do, and why we spend. And inevitably, it’s ‘slicing the salami’ – the supposed need is ever so thin, ever so see-through, ever so…false.  And of course, it’s perpetuated by consultancies and agencies – walk away from food on the table?  Best not.

But of course, we do want new. We say we don’t, but we behave ‘we do’. We love our iPads and Galaxies; we like our Tivo boxes, we like folding bikes, naïve smoothies and gooey puds. Heck, we even seem to like Irish & Belgian ciders.

IMG_0849Beer hats on sale now.  Go on, you know you want one.

And what struck me about beer is the difference between what the brewers (typically the big boys) ‘say’, and how the brewers (typically the little boys) ‘behave’.    Because I don’t think beer needs innovation. By that I mean, I don’t think in the beer market consumers want innovation. As far as I can see beer isn’t broken.  What they do want is discovery (or re discovery) of new flavours, styles, places; authenticity; connectedness to memories or good times.  On reflection, it seems no surprise that what links successes in the western markets is a perception of smallness.  The two decade explosion of North American craft beer; the rising tide of cask beer revolution in the UK from over 1000 small brewers again (cask is now back in growth in the UK); the craft movement in Australia and New Zealand; speciality brands in France, the Low Countries, Scandinavia, Italy.  And by the way – this doesn’t mean the big players are not involved – Molson in Canada owns, and has left alone both Creemore Springs and Granville Island; ABI owns stake in a number of US craft businesses – but rather it’s a ‘skunkworks’ approach outside big business that is the success formula: have idea – try in market – refine – build.    It’s an attitude about understanding what the drinker wants through, well, going out drinking, rather than relying on large amounts of market analysis and research that has the higher strike rate.    From someone who works in innovation and research it’s an uncomfortable thing to admit; but on the other, there’s something exciting about understanding intuition, about seeing beers that were clearly hunches be successful.  Now that would be worth understanding.

¹By the way, have you seen the price of Post-Its nowadays? Pant-wettingly expensive.

²Jim Collins, Jerry Porras ‘Built to Last’ (1994)

© David Preston, Beer Tinted Spectacles, October 2012

The Session #67: How many breweries?

the session beer blogging fridayI’m late.  A summer break that was well overdue, led to relaxation of body, mind and fingers to keyboard. My first missed deadline and I think serendipitously so as it turns out as the topic of this month’s ‘Big Session’ is about the future of the US craft market – where will it go and specifically how many breweries will there be a few years from now?  Fortune favours the procrastinator. Just as I experienced my first writers block – unable to find an interesting angle into the topic without covering old ground, so our good friends at CAMRA’s PR team spring into action to announce that in the UK, we have just passed the 1,000 brewery mark for the first time in donkey’s years*.

An interesting juxtaposition. The night before I heard this, I had attended leaving drinks with a former colleague at the large brewer we had both worked for.  She was skating through the room with delight and expectation to the new challenges ahead.  Lovely though this was to see, less so were the cold, grey faces on others left behind (apparently this all changed later on when Shots got involved). They seemed battle scarred and weary through years of long hours trying to turn round a business sailing towards a maelstrom whilst fending off all the non value added dross that goes with working in big businesses.  Declining beer consumption; much-hyped strategic initiatives around such glossy topics as promoting beer for women, grand trumpetings for major relaunches… all broken and scattered like the flotsam and jetsom washed up on the rocks from a shipwreck, tempted by the wreckers’ false lights to the shore.

Yet British brewing – ale brewing, small-scale, round the back of the pub, in the garage, an industrial unit brewing…well that’s something else.  Since I lifted my head back above water and began to see the beer category as a drinker again, it’s shocked me how it feels in rude health. New breweries opening, a mad new name for a beer to conjure with every week, an amazing range on sale in a supermarket – both domestic and foreign beers.  The big boys and ‘craft’ boys are like gypsies with daggers; tied at the hip, reticent to reach into the others’ fight space ifor fear it will be the last thing they do.

Brewery numbers here and across the pond is rather like the Olympics medal table:  despite our geographical compactness and rather miserly 60 million inhabitants the UK now has 1,000 breweries. The U.S., for all of its 360 million good folk, has only 1,989.  So whilst we can enjoy the moral highground on this particular score, the reality is we should enjoy the fruits of our brewers and our brewsters while we can.

This may sound heretical, but history suggest cycles, and economic reality tends to support it too.  Here’s my thinking:

1) Despite the growth in breweries, the hard reality is that people in both countries are drinking considerably less than they did 5, 10 years ago.  And within this, the mix is changing. Both markets are still seeing the growth of wine (albeit this isn’t as inexorable as it seemed a few years back), mass produced ciders, particularly over here, but even now in the US and a spirits market that is fighting back after a torrid couple of decades.

2) The real competition, the reason why CAMRA are now slowly but certainly moving their focus to saving our pubs, is the rise of the coffee shop.  Drawing in consumers from dawn until dusk for the inexpensive treat that used to be the sole realm of alcohol.  With a decreasing amount of disposable income in our pockets nowadays it’s going to continue to have implications.

3) Supply and demand.  There is excess brewing capacity in the UK yet new starters are building new breweries, and to a lesser degree new packaging lines at a rate of knots.  The rate of craft brewery failure is less publicised but look carefully and there they are.  Small companies, launched on such optimism and belief yet over-stretching themselves by building assets wanted but not needed.

4)  The big boys will take note and they will act.  What’s the biggest ‘craft’ beer in the US?  Boston Lager?  Sierra Nevada Pale Ale?  Brooklyn Lager?  Nope – Blue Moon from Miller Coors.  You may argue it doesn’t count – it’s not a ‘craft’ beer.  But the drinker isn’t bothered.  Blue Moon looks like a craft; and it smells like one. By God, it must be one. And frankly, Keith Villa is a lovely chap and we know where his heart is really, so it’s all OK. Isn’t it?  Well Molson Coors are small fry when it comes to the real boys in town: take Anheuser Busch Inbev not only developing their own brands but investing in crafts. I know: I bought some Goose Island only today from a Waitrose.

Don’t get me wrong. I’m not a doom-monger.  I’m loving what’s going on in beer at the moment – and I’d probably re-mortage the house to start a brewery if I thought Mrs P wouldn’t butcher off my dangly bits and feed them to her mother’s Jack Russell, but those who are pro beer, pro taste, pro the individual taking on the behemoth…well let’s be prepared and make sure we build great beer brands, not just great breweries.

© David Preston, Beer Tinted Spectacles 2012

*It’s over 70 years apparently, which by my crude maths takes me to 1942…the War…you know, know the best time for breweries you’d think?  In fact, weren’t some nationalised??

**And here’s an interesting fact, courtesy of the American Brewers Association…

US craft beer image

Reassuringly bollocks free.

There’s a general murmuring in marketing communities that the latest Stella work from ABI for it’s ‘Cidre’ brand is the dogs bollocks. Taking the basics of a drinks experience and adding a premium feel to every touchpoint., hence ‘Cidre’ not ‘cider’; ‘From the continent’ not ‘…the country’; and of course, served, not in a pint glass, but in a ‘chalice’ (“Chalisssse”). Perhaps it is the DBs, or perhaps Newcastle Brown, ever-so cheekily, have really read it right?


The Shamen of the Namin’

At different points in my career I have had responsibility for naming new beers.  This is one of the jobs that should be joyous: right brained, creative, all bean bags and Swizzells-Matlow ‘Refreshers’.  Alas, the truth, my truth, is far from this.  In a big business this task, this bitter task, is one of nightmarish proportions.  For the job of naming isn’t a simple blue blob on a Gantt chart; it isn’t just something to do between weeks 27 and 31, oh no.  This one is emotional.  And everyone wants in. Everyone wants to lay claim to delivering the nomenclatorial coup de grace. Because whether the beer turns out to be the Golden Goose or the Turkey of Despair does not matter:  The prize of naming the brand is the medal. It’s the bit that the consumer sees – hang on, scratch that, it’s the bit that your Mum sees. She might not understand the intricacies of your job, but by Jingo, she’ll understand this, and as the coffee morning circuit word of mouth builds, so the chances of your heroic ‘local-boy-made-good’ reputation become increasingly assured.

Beyond the physical sensations of a racing heart beat and stress-induced palpitations though, naming things is big business.  There are Companies dedicated to this one act alone and they have many stripes on their arm, in the alcohol world, the most famous of which is Diageo. The ‘geo’ bit was rationalised as demonstrating the global potential and reach of the business, and the ‘Dia’ is from the Uzbekistani for ‘Nonsense’.  Oh, hang on, that might not be right. Honestly, poor old Arthur Guinness.  Do you think he would have authorised half a mill being spent on that?

It’s no use levelling the cannons at others though. I too have form, albeit fortunately rather tangentially.  Many moons ago I was working on Carling Black Label as a general oik and hod carrier, and Bass (as was) were very keen to ‘stretch the equity of the brand to reach new consumers, on new occasions representing the way we drink today’ – or something like that.  We actually had a cracking new lagered beer, full flavoured but very smooth as we triple filtered it through diatomous filters (essentially ‘diatoms’ are fossilised insect thingies, who, unbeknown to them during their timeon Earth were destined to find a second life as fine particulate industrial drink filters. Thanks chaps. German reader* – this is kieselgur). The project codename:  Rock.  I recollect that the project team, which included me, invested an eye watering three figure sum with a naming agency.  We considered everything. We did research (uh-oooooh).  We did, in short, the works.  We scoured the literary world; we did word association exercises; ancient languages were mined for potential links.  Specialist naming Consultants & Social Anthropologists delved into the black bag of their respective arts.  Mystic Meg even had a hand in it. In the end, our launch name was…….Carling Rock.  Yay.

Anyhoo, this particular topic dawned on me as I have been re-acquainting myself recently with cask beers after a number of years in self-imposed exile (well, not exile exactly, I’ve just been experimenting more with craft beers, some of which are served from (sharp intake of breath)…kegs). On pushing the boundaries to find new beers of any sort in the UK that might light up my taste buds, I was surprised by just how many beers have odd names. My ‘comprehensive’ study notes have determined a number of distinct, distinctive and daft naming categories:

Let’s start with the grandiose… ‘the provenance school’.  This could be creative laziness or perhaps jaw dropping scenery that the brewer wants to celebrate – or more likely, neither, but this category is pretty popular, and one of the first.  Whether it is Burton Bridge Bitter just up the road from me, or London Pride just up the road from everyone, St Austell (who go the whole hog and double up, like in St Austell Dartmoor Ale (and I thought you couldn’t be in two places at once – that’s beer for you), or even outside cask of course, Pilsner Urquell, Dortmunder Actien Brauerei, Boston Lager, Hoegaarden, Quilmes … you get the picture, ad nauseam.  When I make my millions, I shall buy an industrial unit on Anglesey and start the ‘Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch Brewery’. Now THAT’S a bar call.  And I’ve got the advertising sorted:  “Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch….. ask for it by name’. (Naming brands was my plan to make the millions. On this evidence, I might just have to re-think. And anyway, perhaps it would be better to open a distillery – everyone would order a long short. Geddit?  No? Whatever.)

Then there’s the ‘Stuff where the brewery is from, it’s all about me, Me, ME!’ approach.  A despicable and highly uncreative naming method which is designed to massage the ego of the owner.  Countless examples here, and one or two of my favourites as well, but I refuse to give any of these scallywags publicity when they refuse to advertise on my blog site.  Whilst I’m here though, if you are in the Burton area, look out for ‘Pilsner Prestonski’. It’s a Burton top fermented beer, that’s then lagered for 49 days, maaarvellous¹.

National Institutions, Regional Peculiarities & Local Yarns’ come next.  It’s amazing what people choose to talk about here from the grand and nationally important, to the innocuous.   In the UK we have beers featuring castles (Windsor), landscapes (Exmoor, Dartmoor – it’s a west country thing clearly),  whilst at other end of the spectrum you have one of my personal favourites (and a darn fine beer too), Jenning’s ‘Snecklifter’ referring to the north country name for a thumb latch on an old fashioned door handle.

Finally, there’s the “Sh**ts and Giggles” bucket. A profuse and remarkably (subjectively) amusing category of names, over which I don’t know if I should laugh or cry.  On the one hand, I think “A pint of The Dogs Bollocks” gives our beloved beer an air of self deprecation & wry amusement which signals: “Get us. We’re beer and we’re not up ourselves like wine”. I like that.  On the other, when you pause ever so briefly, and rationalise what you’re actually ordering, it’s a “…pint of sweaty, hairy, dangly, sexual reproductive organs from Man’s Best Friend” please.  I’m not sure about the appetite appeal of that one².

Big brands from multinational brewers deserve a section for themselves.  I’m particularly intrigued by colours. A selection to the witness box if you please:  Beck’s Blue (low / no alcohol); Foster’s Gold; Stella Black; Guinness Red; Bud Silver.  I don’t necessarily dislike these names, hell I know how difficult it is naming brand extensions (you don’t want to fight with the ‘mother brand’ name, but equally you need to be distinctive), but really. Is this the best they can do?  And it goes for mock production processes too. I have already mentioned Carling Rock; but there’s Carlsberg (et al) Ice, Dry beers (Asahi et al – where are they now?), Strong, Dark, Filtered, Fast, Slow.  Funny that the real creative energy lies with smaller guys, the ones for whom risk seems less of an issue – it could lead to fame, it could lead to failure, it may lead to notoriety, or even the vets, but they’re having a go.  Half term report for the big boys: must try harder.

Yet the real common denominator in all of this seems the lack of science. Naming brands is, I feel, where the art comes in; where you have to get off the pot and put your idea front and centre to your customer.  That’s brave and exciting.  But I think I could still make my millions here after all – despite past shames, at least I’m confident that the mystical approach to naming could allow me to be the shamen of the namin’  after all.

*Hopefully this will move into the plural if you would care to pass on the link or retweet me? Danke schőn.

¹Actually this was made up, but you wouldn’t guess would you? Seamless, just seamless.

²For completeness let me share a small selection of other names: Arrogant Bastard, ButtFace, Top Totty, Granny Wouldn’t Like It, Dirty Tackle (it’s a rugby allusion, OK), Village Idiot, Haggis Hunter.  All quite amusing, yet all trumped by a beer for those considering a holiday in the Balkans. Look out for Macedonia’s ‘Vergina’ beer.

© David Preston, Beer Tinted Spectacles. Originally posted on Posterous, April 2012