Big Bullies



It should come as no surprise that the large beer companies around the world are taking notice of the craft beer revolution, even if it's still a very small percentage of beer sales. The reality is that beer sales around the world are falling but craft beer consumption is actually increasing as is its market share.

With massive economies of scale, the big conglomerates have the ability to try and weather the coming storm. In Ireland, they have traditionally done this by offering free kegs or other items in exchange for adding a line. Mostly, they did this to each other before craft beer became "a thing".

In recent years, we have heard rumours that some of the big 3 drinks companies in Ireland are offering free kegs to replace a craft tap with one of their own. It's something that's a little unfair since the small producers lack the ability to give free kegs away.

A worrying trend that occurred because of this was that publicans that were friendly to each other would call up their mates and say that a certain brewery just gave me a bunch of free kegs to take out that craft beer tap I just got in. Those publicans would then got off and have a craft beer tap put in and wait for one of the big boy reps to show up and see if they get the same deal. It got to the point that some of the craft breweries were refusing to put in single taps in certain areas because they knew it would just be taken out a month later after the publican got his freebies.

All of this just sounds like good business by the big boys. If they can afford to do it then what's the problem? It's difficult for the small breweries but the other way of looking at it is that craft beer has become so popular that they can easily put their lost taps in somewhere that will appreciate it more so it's not the end of the world.

That all seems to have changed in recent months. I'm hearing reports from brewers and some publicans that some of the big drinks companies in Ireland are solely targeting craft beer, all craft beer. They are offering 5 figure sums to pubs serving lots of craft beer to take it all out and replace it with their products and to even agree to keep out the craft for a year. They aren't requesting the same of their larger rivals products for obvious reasons.

In one case, I have even heard of one breweries taps actually being taken away. Since these taps belong to the brewery, that amounts to plain theft.

Reps from some of the big boys have apparently been telling some publicans that it's actually illegal for them to take out their taps if they want to put in something else. This is clearly a pack of lies.

One very prominent Dublin pub known for craft beer was repeatedly offered major deals over the course of 2 years and each time, they turned it down. Recently, they relented and took a deal where the Irish craft taps have been reduced to one or two, down from nearly 20. It's not like the craft beer wasn't selling, the pub was always packed and it was a destination pub for tourists interested in local beer. The annoying thing is that it always had beer from the big boys anyway so consumers could decide which they wanted to drink so now all that's happened is that choice has been taken away from customers and craft beer drinkers will go elsewhere. Since the pub is so prominent, this will not make much difference to them as they will always be busy. It's a win win situation for the pub and the big boys but not for the struggling small Irish breweries.

All of this is hearsay of course because no one will go on the record. They are terrified of retaliation with no means to defend themselves. Does this behaviour sound like something else? There's another word for this sort of behaviour. In fact, there are several that spring to mind.

As far as I'm concerned, your product should sell itself. It shouldn't be forced on people because the marketing budget is there to enable that.


COMMENTS

BLOGGER: 11
  1. I was sad to recently hear of the demise of The Norseman as a craft beer destination. I had a fantastic time in their during the European Beer Bloggers Conference last summer, necking pints of Scherlenkerla Weizen. With it being located where it is in Temple Bar I'm not surprised the big boys gave them a reported 100/200 free kegs of beer because the revenues it generates must be sky high. I do feel though that for every craft beer pub the big boys successful 'buy' two more will spring up in its place. It's too late for them to stem the tide of the craft beer movement now although their underhand tactics to try and do so still disgust me.

    ReplyDelete
    Replies
    1. Yeah, there are genuine reasons beyond that one though, it wasn't just about free stuff. Just not something I can mention at the moment.

      Delete
  2. This comment has been removed by the author.

    ReplyDelete
  3. Does Beoir have the capacity to continue to raise awareness of this issue and challenge this practice? Is it likely to be taken up by the mainstream media? I dig your positivity Matt but don't believe this should be left to "the market" to resolve.

    ReplyDelete
  4. You mean like CAMRA? Yes, I'm the Chairman of Beoir which would be their equivalent in Ireland.

    ReplyDelete
  5. Beoir has the capacity to raise awareness yes but we have to be as careful as I need to be personally by not mentioning any names and leaving it as hearsay and alleged behaviour as no one who has experienced it is willing to come forward yet.

    We do intend to contact the Competition and Consumer Protection Commission to ask them to look in to it but I would think we need some actual evidence.

    ReplyDelete
  6. Oh and regarding the media, one newspaper was about to run the story but changed their mind after taking legal advice. That says a lot!

    ReplyDelete
  7. I realised you were from Beoir after posting! I understand it's a tricky situation, legally and otherwise. Fair play to you for highlighting the issue; I was aware of the situation Matt referred to but as you stated that's a stand-alone issue. Cheers.

    ReplyDelete
  8. Irish SME's being pushed out the market by the anti-competitive practices of foreign owned multinationals. You would think people would be interested in that.

    ReplyDelete
  9. I would have thought the same and judging by the twitter comments and replies here from international folk, they are.

    ReplyDelete
  10. Adrian from Munster Brewer couldn't comment due to not having a required profile (don't allow anonymous).
    So he emailed me his thoughts and here they are:

    It seems like just competition to me. If a pub decides to reduce its
    offerings for whatever reason - well, that's the pub's choice. It's a
    crap choice in my opinion but it's their pub. It's also the customers
    choice to go elsewhere. Just as it's our choice to compete with the
    macro breweries. Nobody ever said it was gonna be fair or pretty but
    that's OK. We don't expect macro breweries to tiptoe around trying to
    put us out of business, they'll do their damndest to keep their
    earnings, but that's just business.

    The power really rests with the consumer for this type of stuff - either
    they care enough to insist their pub has an offering of great craft beer
    or they don't care enough and want pissy crap. In a way, that's up to
    us - by us I mean the craft beer community - to spread the word about
    what beer should be. For us personally, that means talking to people,
    one by one, pub by pub, beer fest by beer fest about how we brew beer,
    how we use only natural ingredients, how real beer is full of flavours -
    hundreds of them and yes, how it can be hopped to the nth degree which
    is a million miles away from what most people are used to drinking.
    Only by doing this and going through the hard slog, do we get to a point
    where a pub wouldn't dream of chucking out its craft beer because
    they'd
    know that they'd also be chucking out their customers by doing so.

    I still think in ten years time Irish craft brewers will have taken a
    leg out from under the macro brewers though :)

    Adrian
    Munster Brewery

    ReplyDelete

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The Tale Of The Ale: Big Bullies
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