Beverage Spectrum Jan-Feb 2007

JANUARY – FEBRUARY 2007

CRAFT BEER finds a home

The Brewing Giants Get Hip to Quality

ALSO THIS ISSUE: ETHNIC MARKETING BEST OF BEVNET 2006 FANCY FOODS WEST REPORT

Retailers Uncork Sales Through Wine Tastings

page 44

JANUARY – FEBRUARY 2007

23

Cover Story

34 // STALKING CRAFT

vol.

5 // no. 1

34

Features

40

19 // Best of BevNET

The Big Three pursue brewery taste.

40 // BOOK EXCERPT: Ambitious Brew: The Story of American Beer

Special Section

42 // A Drop of Common Sense:

23 // ETHNIC MARKETING:

Increasing Sales through

Best Practices

Wine Tasting 44 // NATURAL PRODUCTS EXPO WEST:

Departments

Get your show guide here

8 // BEVSCAPE Smackdown: Hulk Hogan vs.

50 // FANCY FOODS WEST:

The Blue Demon

San Francisco Wrap-Up 12 // CHANNEL CHECK New Energy Numbers 14 // NEW PRODUCTS

Columns

4 // THE FIRST DROP Don’t Patronize the Patron

Ditka Wines and Pebble Beach Scotch.

Who says sports aren’t deep?

6 // PUBLISHER’S TOAST Innovation

48 // PROMOTION PARADE Year of the Boar.

20 // GERRY’S INSIGHTS Gold in the Glass

JANUARY – FEBRUARY

2007

\\ BEVERAGE SPECTRUM

3

THE FIRST DROP

Don’t Patronize the Patron ilingual Cans. Soccer-themed (Fútbalthemed) displays. Sweet fruit flavors.

Beverage marketers love to throw these things around as the keys to attracting a multi-ethnic audience to your stores.

But that doesn’t tell the whole story. Sure, language, sports, and tastes are important characteristics to take into account when expanding your customer base to include the cultural and ethnic groups who are permanently changing the face of the country. But no amount of pandering to customers is going to replace simply knowing their buying habits when they approach your beverage cooler.

So pay attention. Because as our special Ethnic Marketing supplement indicates, when it comes to gathering ethnic consumers, retailers and marketers have to have respect. Respect means not belittling ethnic consumers with products and arrangements that speak at them, but in fact considering preferences and interests when it comes to stocking products – in other words, marketing to them. Respect means not just thinking of the Hispanic consumer as a soccer (futbal) fan, or thinking of Asians as a broad group who are only interested in whether it’s the Year of the Rat, but figuring out what mix of ethnic and mainstream products you need to have to satisfy a group’s needs. It also means that many well-traveled mainstream customers are going to want the same products you thought would only appeal to a specific ethnic group.

Run out, and you risk losing them both.

4

Truly respectful ethnic marketing, you’ll learn, ascribes to a highly American belief – that all of us are entitled to great products at good prices, and that we can vote with our feet if we think we’re getting ripped off, or made fun of, or just plain patronized.

Part of the beauty of marketing is letting people feel like they need something, and then filling that need. What you’ll find is that when it comes to mainstream marketing and ethnic marketing, the customer’s susceptibility to being sold a bill of goods is a lot lower than it used to be, regardless of the language on that bill.

One group that certainly hates to be sold a bill of goods are the dedicated beer drinkers, who are showing a greater inclination than ever to assume that if they don’t watch out, the big beer companies will slip them a watery “Mickey.” But there’s change afoot in the beer industry, regular freelancer Andy Murray discovers, as more buyers turn to craft beer – and more big brewers do so, as well.

While beer variety is of growing importance, for wines, variety is at the soul of their success.

Our story on conducting wine tastings for customers will help you teach them to appreciate (read: buy) all that you have to offer.

Until next time, drink up… respectfully.

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

PUBLISHER’S TOAST

ADVERTISING 1123 Broadway Suite 301 New York, NY 10010 ph. 212-647-0501 fax 212-647-0565

EDITORIAL 1 Mifflin Place Suite 300 Cambridge, MA 02138 ph. 617-715-9670 fax 617-715-9671

PUBLISHER

Barry J. Nathanson bnathanson@bevspectrum.com EDITORIAL DIRECTOR

John Craven craven@bevnet.com

Innovation ith the resignation of Mary Minnick from the Coca-Cola Co., the question of innovation, or the lack of same, in the beverage industry has been on my mind. I started to think of the innovation that happened at Coke under Minnick’s watch and the watch of all of those who preceded her. I started to realize that her short reign isn’t very different from the ones that others have had. It’s symptomatic of the malaise Coke is suffering from.

And it’s not just Coke.

Why is it that the big guys don’t seem to have a clue about creating exciting new products?

Too often, their own offerings have no real positioning, but when they acquire smaller boutique brands, they don’t understand their uniqueness and the consumer suffers by their neglect and demise. This has to change at the retail level.

I have been privileged to see, over the years, launches from some of the most creative organizations and brands that grace our industry.

Whenever I see the folks from Arizona, Glaceau, Hansens, Fuze, Honest Tea, Jones, Fiji and other dynamic companies, I always come away with the same reaction: They get the consumer proposition. They understand that the consumer is changing, and they have rolled with the changes.

What do they have in common? First and foremost, they have a willingness to take risks.

Second, they can take an idea from concept to the shelf faster than you can say “Mukhtar

EDITOR

Jeffrey Klineman jklineman@bevnet.com

Kent.” They forgo the researchers, analysts and consultants and go by their gut. They usually partner with a supplier that has a stake, an emotional tie-in or at least a strong understanding of their creation. They see a market segment that isn’t served and try to fill it. The real innovators don’t believe in “me too” brands. As outsiders, for the most part, in the major distribution systems, they must expend inordinate amounts of time and energy to create a hybrid route to market. So give them an extra look. Innovation should be rewarded by the industry. To my retailer, distributor and wholesaler readers, learn from these companies. Embrace their efforts.

Stock their SKU’s. You and your customers will be better-served for it.

ASSOCIATE PUBLISHER

John McKenna mckenna@bevnet.com ART DIRECTOR

Matthew Kennedy mkennedy@bevnet.com PRODUCTION MANAGER

Adam Stern astern@bevnet.com BUSINESS MANAGER

John Schinn jschinn@bevnet.com SUBSCRIPTION INQUIRIES

Adam Stern astern@bevnet.com 617-715-9679 ARTICLE REPRINTS

500 copies or more FosteReprints Kelly Ganz kganz@fostereprints.com 800-382-0808 x142 BEVERAGE SPECTRUM PUBLISHING INC. CHAIRMAN

John F. (Jack) Craven jack@bevnet.com PRESIDENT

Barry J. Nathanson, Publisher

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

John Craven craven@bevnet.com Beverage Spectrum is published 9 times a year by Beverage Spectrum Publishing, Inc. Beverage Spectrum Publishing, Inc. is a wholly owned subsidiary of BevNET.com, Inc., 1 Mifflin Place, Suite 300, Cambridge, MA 02138

BEVSCAPE

WHAT’S HAPPENING ACROSS BEVERAGES

WORLD OF SODA PEPSI PACKAGES PERMUTATE Giving former spokescelebrity Madonna a run for her money in the quick-change costume category, Pepsi Cola will feature a new package design every three or four weeks this year.

The frenzied molting will take place on bottles and cans and is expected, according to PepsiCo, to demonstrate the brand’s “fun, optimistic, and youthful spirit.”

It’s real estate that the company has realized might be a source of interest rather than consistency, according to Dawn Hudson, the president of PepsiCo’s North American division.

With advances in packaging technology, according to Hudson, sending a new graphic template is not as difficult as it might once have been; in fact, it offers the opportunity to get the company in synch with its bottlers.

SWIRL YOUR SODA? No, you’re not looking at the new tasting lab for BevNET. This is the new Dry Soda office and store in Seattle, Wash., where the new, food-friendly soda brand is trying to counter the notion that CSD’s are only for fast food by serving it up in all kinds of winery-like digs.

8

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

ZERO GROWTH It’s not even two years old, but the next couple of months will be a major coming out party for Coke Zero.

The no-calorie Coke clone – called “bloke coke” in Great Britain because of its calculatedly masculine color scheme – will be featured in a major ad push during that most masculine of events, the NCAA basketball tournament.

The Coca-Cola Co. is also pushing a slightly revised black-andsilver color scheme that plays up the darker color, as well as a real gift to the brand, an emphasis on placement next to flagship Coca-Cola Classic on shelves and displays.

The idea is to stress the brand’s closeness to Classic in terms of taste – one that the company hopes to back up by adding fountain taps for Zero in major on-premise accounts like Wendy’s restaurants.

Zero has shown steady gains: it’s sales put it in the top 25 skus nationally, according to AC Nielsen.

With most full-calorie sodas in decline, cannibalization can’t be as much of an issue for Coke as the loss of share to water and energy drinks.

BEVSCAPE EXECUTIVE MOVES

THROWDOWN: HOGAN ENERGY VS. THE BLUE DEMON Holy Captain Lou Albano! Even if mixed martial arts are displacing it on television, there’s just no stopping the progress of pro wrestlers onto the front of energy drink cans. The last year has seen a team-up between Socko Energy and barely-ambulatory former pro wrestler Hulk Hogan, while Coca-Cola has gone full throttle into ethnic marketing with the launch of sub-brand Blue Demon, which is named for Blue Demon, a famous masked Mexican wrestler and film star. Each man raised the profile of their sport in their own country, the Hulkster through a bombastic form of all-inclusive jingoism, the Blue Demon by, uh, wearing a mask. Ah, such innocent times. Anyway, here’s how the two brand mascots stack up against each other. Betcha neither one could top Hillbilly Jim or Uncle Elmer….

SOCKO HOGAN ENERGY

VS

FULL THROTTLE BLUE DEMON

Beam Wine Estates appointed Christopher Lynch as chief marketing officer.

Beam Global Spirits & Wine, Inc. named Rory Finlay as senior vice president and global chief marketing officer.

InBev named Glen Walter president of Labatt USA. David G. Burke has joined Primo Water Corporation as vice president for business development.

Brad Redenius, general manager of Judge & Dolph distributors in Peoria, IL, has been promoted to vice president and general sales manager of Griggs, Cooper & Company. Both companies are part of the Wirtz Beverage Group.

The Switch Beverage Company has named Maura Mottolese president.

Signature Wines, a specialty wine marketing company, announced it has hired Sarah Hundley Garcia as its new chief executive officer.

CONFERENCE CALENDAR FEB. 7–11 International Sweetener Colloquium Tuscon, Ariz.

Hulk Hogan

MASCOT

Blue Demon

Rocker Cindy Lauper

ODD SIDEKICK

Son, The Blue Demon Jr.

Famous for playing Thunderlips, a wrestler

FILM CAREER

Famous for playing the Blue Demon, a masked wrestler

Green

DRINK COLOR

Blue (what else?)

Fans of the song “I am a real American”

ADMIRED BY

Mexicans and Mexican-Americans

Rowdy Roddy Piper, Paul “Mr. Wonderful” Orndof, Rocky Balboa

NEMESIS

Exczema

MARCH 4–7 Nightclub & Bar Convention & Trade Show Las Vegas, Nev.

LATER YEARS

Buried in signature blue mask

MARCH 6–8 Expo West Anaheim, Calif.

Buried on television by career of famous daughter Brooke Hogan

10

The Coca-Cola Company named Muhtar Kent as president and chief operating officer.

Heineken USA announced that John Larkins has been appointed general manager of the organization’s Central Regional Business Unit. He replaced Chris Steffanci, who is now the general manager position for Heineken USA’s Northeast Regional Business Unit.

Additionally, Jim Sloan has assumed the general manager role for Heineken USA’s sister company, Star Brand Imports.

Patrick Piana has been named senior vice president, spirits marketing, at Pernod Ricard USA. Bob Koon has joined Snow Beverages in the role of COO/EVP. Other new hires for Snow Beverages include Melanie Randall, vice president of marketing & promotion and Dennis Connelly, vice president of operations.

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

FEBRUARY 2007

FEB. 18–20 Canadian International Food & Beverage Show Toronto, Canada

MARCH 24–27 Snack Food Association SNAXPO 2007 Exhibition & Conference Hollywood, Fla.

MARCH 2007

Channel Check

january – february 2007 SPOTLIGHT CATEGORY

ENERGY 52 Weeks ending 12/2/200 leading brands A look at Convenience Store numbers – believed to account for more than 2/3 the total amount of energy drink sales – shows some interesting trends in the energy drink category. First, if Red Bull and Monster continue to gain in the same way they did last year, they will be in a virtual tie for the category lead (this assumes Monster doubles its sales again, a much harder thing to pull off with its rapid growth).The Pepsi System appears to do better than Coke’s brands in convenience stores – the opposite is true in grocery – but Coke’s brands are growing much more quickly, particularly Full Throttle. Newer brands like Boo Koo, NOS, Full Throttle and Von Dutch are all showing major gains, while Lost is not doing nearly as well as Monster once hoped it would.

Brand

Dollar Sales

30.3%

Red Bull

$272,648,900

20.0%

42.6%

20.5%

Monster

$91,962,880

101.1%

14.4%

16.0%

8.8%

Rockstar

$72,829,680

65.2%

11.4%

$117,079,158

35.5%

7.0%

Full Throttle

$44,401,750

89.5%

6.9%

$106,776,743

28.0%

6.4%

SoBe No Fear

$34,535,050

69.8%

5.4%

Full Throttle

$98,894,73

770.9%

5.9%

Amp

$23,070,120

15.7%

3.6%

Amp

$87,389,165

60.6%

5.2%

Diet Rockstar

$43,844,390

60.5%

2.6%

SoBe Adrenaline Rush

$18,353,770

-13.4%

2.9%

Monster Assault

$29,709,186

59.0%

1.8%

Tab

$14,486,380

N/A

2.3%

Diet Sobe

$26,760,874

38.8%

1.6%

Monster XXL

$6,044,066

621.6%

0.9%

Diet Full Throttle

$17,662,901

651.3%

1.1%

Private Label

$5,489,377

4,986.1%

0.9%

Lost

$13,020,113

-2.0%

0.8%

Rip It

$4,994,777

64.1%

0.8%

Boo Koo

$12,651,002

96.9%

0.8%

SoBe Lean

$4,621,964

44.1%

0.7%

NOS

$10,506,029

438.8%

0.6%

Boo Koo

$2,939,273

70.1%

0.5%

Tab

$10,134,326

0.0%

0.6%

SoBe Superman

$2,791,511

N/A

0.4%

Von Dutch

$2,585,963

222.5%

0.4%

Brand

Dollar Sales

Change vs. year earlier

Red Bull

$506,339,640

21.4%

Monster

$343,337,890

106.0%

Sobe

$147,695,189

Rockstar Diet Red Bull

Dollar Share

Source: AC Nielsen Convenience Track, 52 Weeks through Dec. 2, 2006

TOPLINE CATEGORY

VOLUME

52 Weeks ending 12/31/200

ENERGY DRINKS $ 40,518,300 +44.1%

BOTTLED WATER $4,585,17 ,000 +14.4%

SPORTS DRINKS $1,578,948,000 +10.7%

BEER $8,885,896,192 +2.3%

TEA/COFFEE $1,185,084,000 +25.7%

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

Dollar Share

SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart through Dec. 31, 2006

CSD’s $13,315,100,000 -1.2%

BOTTLED JUICES $3,535,208,000 +2.1% 12

Change vs. year earlier

SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

CSDs

Dollar Sales

Change vs. year earlier

RTD TEA

Dollar Sales

Change vs. year earlier

Coca-Cola Classic

$1,903,330,717

-3.2%

AriZona

$265,114,000

23.3%

Pepsi

$1,545,051,466

-3.3%

Lipton

$162,554,900

193.9%

Diet Coke

$1,190,466,616

-0.7%

Snapple

$111,799,000

14.1%

Diet Pepsi

$801,343,193

-0.6%

Diet Snapple

$84,527,000

-3.8%

Mountain Dew

$740,117,284

2.2%

Lipton Brisk

$82,757,750

5.9%

Dr Pepper

$590,975,395

0.1%

Lipton Iced Tea

$53,199,970

27.1%

Sprite

$581,417,751

-3.1%

Nestea

$46,576,750

225.3%

Caffeine Free Diet Coke

$347,565,661

-8.6%

Private Label

$30,378,470

10.1%

Diet Dr Pepper

$279,164,881

3.9%

Nestea Cool

$17,870,090

-67.8%

Diet Mountain Dew

$249,413,097

10.6%

SoBe

$14,287,110

-3.9%

Heading Up: Diet Mountain Dew

52 Weeks through 12/30/06 SOURCE: AC Nielsen/Citigroup Total U.S. food/drug/mass

Heading Up: Nestea

SPARKLING JUICE DRINKS

Dollar Sales

Change vs. year earlier

SPORTS DRINKS

Welchs

$16,330,000

5.5%

Gatorade

$686,848,300

2.6%

Martinellis Gold Medal

$12,647,480

5.7%

Powerade

$196,569,800

6.8%

$141,512,400

5.0%

52 Weeks through 12/31/06 SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

Dollar Sales

Change vs. year earlier

Izze

$8,579,900

216.8%

Gatorade Frost

Orangina

$5,901,997

9.9%

Gatorade Rain

$119,947,100

16,549.5%

Private Label

$5,095,494

-28.7%

Gatorade All Stars

$107,276,700

19.6%

Meiers

$4,685,679

-20.9%

Gatorade X-Factor

$94,769,980

-1.1%

Crystal Geyser

$2,516,080

-14.7%

Gatorade Fierce

$86,481,180

-17.9%

Kristian Regale

$2,501,675

-7.2%

Gatorade Xtremo

$16,647,260

-27.8%

$15,532,560

166.2%

$14,566,270

-24.6%

RW Knudsen

$2,423,597

21.5%

Powerade Option

Lorina

$2,323,996

53.5%

Gatorade Ice

52 Weeks through 12/31/06 SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

Heading Up: Powerade Option

CONVENIENCE/PET STILL WATER

IMPORT BEER

Heading Up: Izze

Dollar Sales

Change vs. year earlier

52 Weeks through 12/31/06 SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

Dollar Sales

Change vs. year earlier

Private Label

$500,846,500

21.2%

Corona

$480,572,864

6.2%

Aquafina

$492,977,900

15.1%

Heineken

$297,890,432

8.2%

Dasani

$424,983,100

22.1%

Corona Light

$122,099,520

10.7%

Poland Spring

$248,602,500

23.6%

Tecate

$83,593,464

6.2%

Propel

$191,062,900

3.0%

Modelo Especial

$53,852,856

30.8%

Arrowhead

$166,403,500

15.1%

Heineken Light

$50,751,208

2,973.9%

Glaceau vitaminwater

$164,156,600

134.7%

Labatt Blue

$48,339,740

-5.7%

Deer Park

$134,693,300

24.8%

Becks

$48,046,452

6.3%

Dannon

$125,402,000

-22.2%

Newcastle Brown

$46,777,432

18.6%

Ozarka

$95,760,650

18.8%

Guinness Draught

$46,557,664

8.5%

Heading Up: Glaceau vitaminwater

52 Weeks through 12/31/06 SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

Heading Up: Heineken Light

52 Weeks through 12/31/06 SOURCE: Information Resources Inc.Total food/drug/mass excluding Wal-Mart

JANUARY – FEBRUARY

2007

\\ BEVERAGE SPECTRUM

13

NEW PRODUCTS straight, chilled, on the rocks or mixed to create a “signature” cocktail, Kajmir’s unique flavor characteristics are versatile enough to create a different, yet distinctive experience very time. Kajmir is also available at major retailers across the country in 750 mL., 375 mL. and 50 mL. sizes, with a suggested retail price of $18.99 for 750 mL. For more information, call Centerra at (585) 396-7193.

Spirits From Mystique come Metropolitan Martinis, a line of ready-to-drink cocktails that come complete with the Martini glass. The added packaging is intended to take “snobbery” out of the cocktail experience without forsaking taste and sophistication. Made with all natural ingredients and premium imported vodka, Metropolitan Martinis are available in four flavors: cosmopolitan, green apple, and decadent chocolate (all 40 proof), as well as the classic vodka martini (60 proof). They are available in two packages: a cylinder with two pre-mixed 200 mL. martinis in acrylic martini glasses (retailing for $11.99-$13.99) and a party tray of 12 (for $6.99 per cocktail).

For more info, contact Mystique at (212) 279-3115. This product is currently available in Florida, California, South Carolina, New York, New Jersey, Connecticut, Massachusetts, Nevada, Minnesota and Georgia.

Further intertwining that fun couple, golf and booze, A.V. Imports has launched Pebble Beach Single Malt Scotch Whiskey. Produced by the renowned Lombard family in Speyside, Scotland, and promoted through an exclusive agreement with Pebble Beach Company, owners of America’s most famous golf resort, the product is matured for 12 years in hand-selected American White Oak, which imparts notes of cedar. Retailing at $69.99 for a 1 L. bottle, Pebble Beach is available nationwide. For more information, contact A.V. Imports at (800) 638-7720.

Long Tail Libations, Inc., a subsidiary of Anheuser Busch, has released Jekyll & Hyde premium liqueur. This liqueur combines two distinct elixirs – wild berry Jekyll and licorice-flavored Hyde – into a dichromatic shot.

Jekyll is 60 proof, while Hyde is 80 proof.

This product is available nationwide and is line-priced with other premium liqueurs. For more information, contact Anheuser Busch’s representatives at (212) 999-5585.

From Centerra Wine Company comes Kajmir, a blend of premium brandy, fine vodka and warm vanilla. Whether served

14

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

Energy Drinks This fall, Fever, the first ever libido stimulant beverage, launched in major cities. A blended ginger-vanilla flavored liquid that comes in a 14 oz. aluminum canister, Fever contains a proprietary combination of eight organic herbs that the manufacturer claims will enhance sexual performance and pleasure, and reduce recovery time between sexual intervals, including Goat Weed, Clavo Huasca, Panax Ginseng, Green Tea Caffeine, Catuaba, Daminana Leaf, Suma and Maca.This product is available for $35 for a 12-pack. For more information, call (212) 584-4286.

Function Drinks, a Los Angeles-based functional beverage company, has launched Alternative Energy, an energy drink designed to have a time-release system to ensure a smooth, consistent boost over an extended period of time. With a light tangerine taste, this product includes energy additives muira puma, catuaba, guarana and yerba mate.

Alternative Energy comes in 16.9 oz. PET bottles and is available in stores all across Southern California for approximately $2.95 per bottle. For more information, contact Function Drinks at (310) 725-9050.

Compressing a lot of caffeine into a tiny package, Zipfizz Liquid Shot is a 4 oz. serving that delivers a big energy boost. The Liquid Shot joins the growing line of Zipfizz products that includes the original Zipfizz powder form. Zipfizz Liquid Shot is available at select Costco Wholesales stores and other retailers. For more information, contact Zipfizz at (847) 267-9660.

2007

Juice Naked Juice recently launched two additions to its Superfood lines: Gold Machine, which is boosted with 11 vitamins and minerals including green tea, vitamin E, and grape seed extract for a cosmeceutical benefit to improve skin health and boost cellular renewal. Gold Machine is a blend of golden kiwi, pineapple, yellow passion fruit and banana. Purple Machine, which contains purple fruits including purple plum, concord grapes and the antioxidant-packed açai ber-

NEW DRINK REVIEWS Mr. Re Restorative Beverage Snow: New Flavors Vignette Gleukos Metromint: Orangemint and Lemonmint The Republic of Tea: Pomegranate Green Tea Steaz Energy Auna Kiwifruit Juice Bazza High Energy Tea Honest Tea Pomegranate White Tea w/Açai Mojo Energy Drink Syzmo Energy Drink Bravo Blenders Rehab Recovery Supplement Sweet Leaf Tea Half and Half Bombilla Gourd WaterPlus Damzl Fuel

ry is boosted with vitamins and minerals like vitamins A, B5, C, E and selenium, choline and grape seed extract. Also, in Naked’s Well Being Family, Black Currant, is boosted with vitamin C, echinacea, rose hips and acerola cherry for its immunity-boosting powers.

All three new flavors have a suggested retail price of $2.99 for a 16 oz. bottle, and are available nationwide. For more information, call Naked at (626) 633-8384.

Florida’s Natural Growers has launched a line of Earth’s Own Organics refrigerated juices. These blended, not-from-concentrate juices carry the USDA seal for organic products and are packed in 1 L quick-chilled bottles. The following flavors are available: Orange/Mango, Orange/Peach, Apple/Peach, Apple/Cranberry and a 15 percent juice Lemonade. The products are available nationwide at varying price points. For more information, contact Florida’s Natural Growers at (800) 237-7805.

A favorite throughout Europe, Lambda Organic Juices made their U.S. debut in late 2006. Lambda’s line of organic juices are available in 1 L. and 250 mL. sizes in five flavors: Mango/Orange, Peach/Apple, Grape, Orange and Apple. Created in the fields of the Canary Islands, the Lambda’s fruits are nurtured under strict organic guidelines.

They are offered in elegant, “blossoming” glass bottles and the juices are shelf-stabled for 18 months. They will be available nationally at health food and specialty retailers including Whole Foods and HEB. A 1 L. bottle will cost $3.99. Lambda juices are imported exclusively by Espana Brands North America and distributed through Kehe. For more information, call (866) 9ESPANA. Dairy

Regatta Ginger Beer From Odwalla, Inc., comes Odwalla Soy Smart, a new soymilk beverage to its nutritional lineup. Odwalla Soy Smart will be available to consumers in Chai, Chocolate and Vanilla varieties. Boasting a distinctive combination of soy protein, Omega-3 DHA and calcium, Odwalla Soy Smart contains nutrients essential to daily well-being and is an excellent source of calcium for bones

Lambda Organic Fruit Juices Bolthouse Farms Bom Dia G Pure Energy Sierra Mist Cranberry Splash Sambazon Purple Power From November 20 to press time.

To see reviews, log on to www.BevNET.com

16

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

and teeth. Packaged in 15.2 oz. grab-n-go recyclable plastic bottles at a suggested retail price of $3.29, Odwalla Soy Smart will be available beginning April 2007 in supermarkets and natural food stores throughout the country. For more information, contact Odwalla at (800) ODWALLA. Wine Mendocino Wine Company recently teamed up with football Hall of Fame player and coach Mike Ditka to produce a new line of wines. Mike Ditka Wines come in a pair of varietals. Mike Ditka Kick Ass Red is a reserve-quality bottling combining Zinfandel, Syrah and Petite Sirah, the red varieties that excel in Mendocino County’s rugged hillside vineyards. Suggested retail is $49.99. Mike Ditka Chardonnay ($17.99) and Cabernet Sauvignon ($19.99) are composed of high quality selections, while Ditka’s “Da Coach” Pinot Grigio and Merlot are styled and priced for everyday enjoyment at $11.99. All three labels feature a simple caricature of “Da Coach.” All are available through retailers in the Midwest and around the country. For more information, call the wine company at (707) 433-8484.

Beer This January, after tallying votes from beer lovers nationwide, the Boston Brewing Co. added Honey Porter to its product line.

Samuel Adams Honey Porter is a full-flavored, full-bodied English porter with a substantial roasted malt character, offering a smooth, rounded finish. This beer is brewed with traditional English Ale hops and is dry-hopped with English Goldings, known for their spicy aroma and distinctive, earthy flavor, as well as Scottish heather honey.

The new product will be part of the Samuel Adams Brewmaster’s Collection, available nationwide year-round, with a suggested retail price of $12.99-$13.99, and in 6-packs for $6.99 to $7.99.

United States Beverage, L.L.C., has begun to distribute the first Nicaraguan Beer ever widely imported into the United States,

Toña Cerveza, which is brewed in Managua, Nicaragua by Compania Cervecera De Nicaragua, S.A. Toña has an alcohol content of 4.6 percent by volume. The golden lager’s unique, authentic taste comes with the tagline, “drink exotic.” Painted bottles and yellow and black packaging give Toña a contemporary, streamlined look. Tona will be available nationwide for a suggested retail price of $6.99. For more information, contact U.S. Beverage at (212) 584-4317.

Spain’s premium leading beer, Mahou, is being launched by Eagle Brands in the U.S. this month. Mahou is making its debut in Miami, Fla., and will soon be available throughout the nation. Mahou is available in three specially designed long neck bottles, each depicting one of the celebratory icons of Spain – a flamenco dancer, a matador and a bull. Mahou is sold in 6-packs, 12-packs and 24-bottle cases. For more information about Mahou, please call (305) 567-0821.

Peak Organic Beer is now available in convenient 12-packs at retail. One of America’s very first organic beers, Peak Organic is made with the highest quality ingredients and is characterized by a distinctively refreshing taste. Peak is available in three flavors: Pale Ale, complex and hoppy; Nut Brown Ale, smooth with a nutty finish; and Amber Ale, lively with a subtle toasted character. The 12-pack features four of each flavor and is also available in the popular Pale Ale flavor. This product is being bottled in Portland, Maine, and is available in Maine and Massachusetts. For more information, call (781)648-7157.

Denver-based Flying Dog Brewery has a full lineup of new seasonal and experimental beers, which will include a new summer seasonal, two Wild Dogs and a new addition to their high gravity series, Double Dog Double Pale Ale. Double Dog will be available in four-packs hitting retail stores in April. The Flying Dog pack has also started to brew 2007’s first Wild Dog release, which will be a “whiskey barrel-aged” version of the popular Gonzo Imperial Porter, and is due to hit shelves in the early Spring. The second Wild Dog release is scheduled to be unveiled at this year’s Great American Beer Festival and

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will be available at retailers in November.

These products are available in 45 states and are as yet not priced. For more information, contact Flying Dog at (303) 717-5832.

with a numerical chill factor, from mildly cool Orangemint (-3) to super cool Peppermint (-9). These products will retail for between $1.39 and $1.69 per bottle, and are available in stores nationwide including Whole Foods Market, Wild Oats, Safeway Naturals and numerous other natural and specialty food outlets. For more information, call Soma Beverage at (415) 979-0781.

From Glaceau, the makers of Vitaminwater, comes Charge, the latest variety of the Vitaminwater line. Charge is a nutrient-enhanced lemon-lime product containing key electrolytes plus b vitamins for performance enhancement, but with no sodium. Charge will be available in 16 oz. PET bottles and is line-priced with other Vitaminwater products. For more information, contact Glaceau at (718) 746-0087.

Water Soma Beverage Company, LLC has introduced two new varieties to its Metromint line of mint-flavored waters, Orangemint and Lemonmint. These new varieties were developed with mainstream flavor profiles in mind, combining the hallmark mint taste and cooling sensation with citrus fruits. Both are made with pure water and no preservatives, sweeteners or calories. The two new flavors are available in 500 mL PET bottles.

To emphasize the company’s SKU variety, each flavor of Metromint is now designated

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BEVERAGE SPECTRUM // JANUARY – FEBRUARY

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Best Energy Drink: AriZona Pomegranate Green Tea Energy

Best New RTD Tea: Honest Tea Tangerine Green

For the second year in a row, an energy drink hybrid has taken the title; this time, AriZona combined its potent mix of packaging élan with sweet green tea know-how to create a beverage that’s viable up and down the consumer food chain. From health nuts who key in on words like green tea and pomegranate to full-on energy fiends, this is a drink that should have wide appeal.

Oh, Tangerine Green, with your delicious, low-calorie sweetener, we hardly knew ye! Why, why, didst thou tempt us with citrus-y, green tea goodness and then disappear? You know it’s great stuff when we salute a diet drink in a highly competitive field. Honest Tea might have discontinued it, but it sure did raise the bar for lo-cal sweet tea.

Readers' Choice: Snapple White Tea

Readers' Choice: Red Bull Energy Drink 12oz Best New Non-Carbonated Drink: Sambazon Organic Açaí Açaí has quickly become the popular ingredient in the beverage industry, and Sambazon’s Organic Açaí was the best of the crop for 2006. This pure blend of açaí and blue agave is exotically refreshing, but simple: only five ingredients go into the blend. It’s no wonder companies like Honest Tea and Healthy Beverage come to Sambazon for the açaí used in their drinks.

Readers' Choice: Odwalla Pomagrand

Best New Packaging: POM Tea Everyone’s talking about this stuff, and with good reason – POM took a product that was already going to draw major interest and gave it a package that’s not just re-usable, but also re-advertises itself. It’s not like it’s the most innovatively-shaped or designed product, but it has both immediate and long-range value and it sure looks nicer than the stadium “souvenir cup.”

Readers' Choice: POM Tea

Best New Oddball Product: Cocaine Energy Drink For no other reason than this product pulled perfect judo on the press, easily forcing the media to take on all the trouble of advertising it for free. P.T. Barnum couldn’t have done it any better.

Readers' Choice: Cocaine Energy Drink

his is safe to say: 2006 did not see that launch of any beverage mega-brands.

That’s not all that bad, though. Usually, the launch of a mega-brand indicates the inclusion of something mega-bad.

What we did see – and what our famous Best of BevNET voting shows – is that beverage executives are starting to understand the new playing field.

Sure, there were plenty of ham-handed line extensions and the usual cast of me-too energy drinks. But there were also plenty of companies getting on board with new tea flavors, new ingredients, and new looks. As an example, check out Pom Tea and Arizona Green Tea Energy, two products in which companies whose success is based on hot ingredients, like pomegranate juice and green tea, weren’t afraid to try to innovate in other, equally fast-moving categories, with outstanding results.

Similarly, decisions about brand purchases and licensing deals finally showed a real inclination to create partnerships that could harness the innovative reputations of both brands – Pepsi with Ben & Jerry’s, Coke and Caribou Coffee – rather just keep the lawyers busy.

BevNET user voting reflected respect for big companies, which is no surprise given their potent marketing budgets. But it’s also indicative of a positive direction in the industry that, for the most part, BevNET’s own set of “deciders” weren’t too taken aback by the amount of support the big guys received. That’s not to say our own choices weren’t a bit different. They were.

Want to see them? Look no further….

Best New Coke/Pepsi/ Cadbury-Schweppes Product: Enviga Sure, this one could fall flat in terms of its health claims. But it looks pretty good and it tastes pretty good. If nothing else, they could turn around and market it as an energy tea and not do half bad. And if people start buying the story, look out!

Readers' Choice: Ben and Jerry's Milkshakes

Best New Carbonated Drink: Sol Maté We’ve discussed this wondrous beverage enough over the past year, but here’s the recap: not too sweet, a nice kick, an edgy glass bottle package and innovative, trendy ingredients. It’s up to the marketers to really make this product a phenomenon.

Readers' Choice: Dr Pepper Berries n' Cream

Biggest News Story: Pepsi Buys Naked Juice and Izze Continuing its winning approach to locking down innovative brands, these two acquisitions give PepsiCo access for both the High-End Juice and boutique CSD segments for relatively short money.

Naked bolsters a Tropicana property that has been struck by ennui of late, while Izze is an immediate defense to the loss of school vending. Brilliant strategy from a company that really knows how to bolt on brands.

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Readers' Choice: Pepsi Buys Naked Juice and Izze

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GERRY’S INSIGHTS

t’s looking like heady times again in the craft brewing business. Maybe too heady?

Certainly the numbers are impressive, with the segment roaring into the new year up well into the double digits as consumers glom onto pale ales, porters, hefeweizens and other styles not long ago viewed as too obscure for primetime.

There’s little question that the influence of craft styles is far more pervasive than a dozen years ago, when the first craft boom crested.

Back then, only a tiny minority of taverns and restaurants offered a range of draft styles, and if you stopped into a strange place and found Sam Adams Boston Lager or Sierra Nevada Pale Ale on tap, that was enough for you to count yourself blessed. These days, multi-tap houses seem to be the rule, certainly among new openings.

That’s all testimony to the increasing culinary sophistication of Americans, and certainly suggests that the image of beer itself remains exceedingly healthy, even if the marketers of some major brands may perceive the segment to be in trouble (hint: look at your TV ads, guys).

So we’re living in this exciting period when brands are proliferating, styles are adventurous and everyone, from big Boulevard in Missouri to tiny Saint Arnold in Texas, has embarked on an expansion. It’s great for consumer choice, and if you subscribe to the trendy “long tail” theory, there seems no reason that the good-beer segment can’t continue to profitably splinter into ever-tinier and tastier niches.

Still, some of us with longer memories are haunted by the spectre of the first microboom’s unraveling a decade ago (even if, contrary to many impressions, the shakeout didn’t result in

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PHOTO COURTESY OF VisMedia

Gold in the Glass an overall decline in craft beer sales, just a flattening). Certainly, there are parallels that make me wonder whether history may be about to repeat itself: the not-quite-rational exuberance, the ratcheting up of capacity, the headlong rush into new, far-off markets. It’s reassuring to note that there are some differences from that experience.

First, we haven’t seen a proliferation of mediocre and novelty beers (anyone remember Wanker Beer?) offered by opportunists who’d gravitated to the business for its perceived cachet and get-rich-quick potential (they’re too busy making energy drinks, I suppose). Nor have we seen misguided and perhaps intentionally confusing entries from major brewers – remember “stealth” brands like Plank Road Icehouse and “fake” imports like Azteca? – or the marketing assaults on contract-brewed craft beers and “bitter beer faces.” Those trends left store shelves cluttered with brands of dubious provenance and stoked a consumer backlash that tarred the segment for years. To their credit, the major domestic players have focused on allying themselves with authentic craft brewers (AnheuserBusch), carefully nurturing their in-house craft brands (Coors, with Blue Moon) and not giving their wholesalers grief over their efforts to be represented in this thriving segment.

Still, I worry that some of the lessons learned last time around are being forgotten. The shakeout left many of the survivors swearing to put aside national expansionist ambitions and instead tenaciously defend their regional base, expanding only where they could adequately support their brands. Not everyone, they acknowledged, can be a national or super-regional

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brand like Sam Adams, Sierra Nevada or Fat Tire, nor is that necessary in order to prosper.

So when I see terrific brands like Stone and North Coast (from California) or Goose Island (from Chicago) showing up in my New York market, the consumer in me exults even as the businessman in me worries. Though I certainly believe the current resurgence is sustainable, I do wish craft brewers would take it a wee bit slower.

While I don’t expect American consumers to roll back their tastes, there is a limit to available shelf space, not to mention truck space in a wholesale segment that is consolidating, not expanding.

Nor is it out of the question that an economic correction could cause people to cut back on splurging. In that environment, with shelf space shrinking and pricing under pressure, not everyone can be a winner. Since most everyone out there today is brewing interesting beers that deserve the local loyalty they’re winning, I’d sure hate to see the land grab’s losers jeopardize their core business.

Longtime beverage-watcher Gerry Khermouch is executive editor of Beverage Business Insights, a twice-weekly e-newsletter covering the nonalcoholic beverage sector.

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A SPECIAL SECTION FROM

JANUARY – FEBRUARY 2007

Courting Ethnic Customers

By Lisa Terry

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H

ispanic beverages at Texas’ Car- VP of Latino Merchandising at Minyard Food nival stores used to be stocked alongside foods Stores/Carnival Super Market, Coppell, Texas, popular among Hispanics. But recognizing which serves the chain’s largely Mexican consumthe changing demographics of many of ers. “There is a group of items any store must its stores, merchandisers relocated them to have” he says, to satisfy the Hispanic consumer the chain targets, including juices, nectars, minthe beverage section.

“Beverages meant so much that we pulled eral water and authentic soft drinks.

Generally speaking, mainstream retailers tend them out of the ethnic-Mexican aisle and put to be lower on the learning curve in figuring them with regular soft drinks in 24-foot to 36out how to win ethnic customers. Those failing foot sections,” says Bob Highsmith, Senior Vice President of Merchandising at Minyard Food Stores/Carnival Supermarkets. “Sales have mushroomed,” leading the retailer to expand the strategy.

Such success stories are mounting as retailers respond to the increasing diversity of the US population. By 2040, half the US population will be Hispanic, Asian-American or African-American; some markets are already there. Stocking the right assortment of beverage brands, flavors and sizes is key to both atActive sampling is something that all customers appreciate. tracting ethnic shopper and satisfying the broadening palates of the mainstream to fully embrace these groups, however, risk losing sales to those who those who do. consumers they influence.

Many retailers are thriving by creating environments that make ethnic customers feel comfortable by catering to their tastes and lifestyles and offering authentic products and assortments. Beverages are critical to that formula.

Among Hispanics, for example, beverages “are a category the Latino consumer buys every time they come into the store,” says Mario Chavez,

Diversity Wake-Up Call

Manufacturers devote significant resources to learning about customers, using syndicated data to shape ethnic marketing programs with point-of-purchase materials, promotion and ad dollars, and events sponsorship to create excitement around their products.

Many retailers have been less comprehensive.

According to the Coca-Cola Research Council’s 2002 report, Grow with America, Best Practices in Ethnic Marketing and Merchandising, retailers’ ethnic marketing is driven at the local level rather than by the entire organization, and programs lack continuity and are based on short-term promotions and events. Their investment in ethnic marketing tends to be limited and typically focuses on advertising and promotions, rather than on understanding cultures. Yet it’s only from a true understanding of the customer that retailers' courting of ethnic customers comes off as truly authentic.

That’s starting to change, however, as retailers realize the potential upside of courting ethnic consumers more comprehensively. According to the Coca-Cola report, market baskets of ethnic customers are 20 percent larger than those of non-ethnic consumers, and they shop more often—two to three times per week.

“Manufacturers used to come in with programs that were Hispanic-oriented and retailers would look and listen,” says Paul Castillo, executive vice president of ViVA Partnership, a Miami consultancy. “Now retailers go to manufacturers and say, ‘here is what I want in my Hispanic plan, how do you fit in?’”

Walgreens, for example, customizes stores to match the demographics of the neighborhood, creating a program that has won widespread admiration. It includes bilingual associates

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BEVERAGE SPECTRUM // JANUARY – FEBRUARY

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Frequently referred to as the “healing plant,” Aloe vera is one of the oldest medicinal plants in recorded history. In Hispanic, Asian and African cultures, ingesting Aloe vera as a beverage has a long tradition of folk remedy use handed down from one generation to the next.

In numerous Hispanic surveys, the use of Aloe was consistent across all Hispanic sub-cultures, age groups, acculturation stage, educational and income levels. In Asian countries, especially Japan and South Korea, Aloe vera is already a popular ingredient in juice drinks and yogurts. For retailers creating a “destination” in their stores for Hispanic and Asian consumers, beverages developed with authentic ingredients such as Aloe vera would serve as a reminder of culture, tradition, history and family—establishing a strong emotional connection between the consumer and the retailer

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and the stocking of stores with products that index highly to African-American or Hispanic consumers, focusing on the value of those products in its ads.

Data is fueling such efforts. “We’re getting more and more requests from retailers to subscribe or buy data,” says Thomas Neal, Nielsen product manager for ACNielsen’s Target Track. “It’s always been a financial issue, but now they see a cost/benefit.”

Target Track decomposes sales transactions into non-ethnic and ethnic sales. A sister service, Spectra Marketing Systems’ HispanIQ, breaks down this data by brand. Syndicated data, for example, detected the successful entry of Grupo Industrial Lala SA’s LaLa milk products from Mexico into U.S. regions with large Mexican populations, likely displacing domestic brand purchases in favor of a long-familiar name from south of the border.

A Rising Tide

Ethnic customers aren’t the only ones at stake.

Mainstream Americans are drawn to new flavors, natural and healthy ingredients and energy drinks – all of which can be sated by crossmarketing ethnic beverages.

Japanese green tea maker Ito En, for example, entered the U.S. market in 2001 the way many non-U.S. beverages do, in ethnic groceries, but with an eye to the mainstream. “We felt with changing lifestyles, there was more interest in wellness, health, and Pacific cuisine,” says Rona Tison, Ito En's Vice President of Corporate Relations. Ito En next penetrated natural foods chains, and today its unsweetened Teas’ Tea is sold everywhere from supermarkets to Target. The takeaway: just because a beverage

is ethnic doesn’t mean that’s the only quality to emphasize in promotions.

Similarly, with retailers’ help, Americans are discovering coconut water as a natural sports drink and aloe vera water as a digestive health aide, says Richard Ross, vice president of marketing at Tampico Beverages.

Another US trend is the desire to “trade up” to high-end brands. Chinese brewer Tsingtao is tapping this to extend beyond Chinese buyers, aiming at the 35-and-over crowd with new packaging and a line extension. Retail-level strategies include promotions pairing the beer with highend authentic Chinese foods.

Sampling events are a key strategy to introduce mainstream customers to ethnic beverages.

Asian grocer H-Mart, a 22-unit chain operated by the Hanahreum Group in Lyndhurst, NJ, uses samplings heavily to promote Asian juices and bottled teas, boosting purchases

by Asian and non-Asian shoppers alike, says Jimmy Kim, manager.

Pairing beverages with complementary foods not only drives sales, but enhances the retailer’s reputation as a source of new tastes. At a Whole Foods in Las Vegas, for example, chilled Teas’ Teas were paired with equally subtle Belgian wafer cookies for a tasting. Integrating ethnic goods with mainstream – such as bottled ethnic drinks in the regular beverage aisle – supports the cross-over effort.

1. Know and use demographics. Step one to any ethnic marketing program is understanding customers. Beyond gut feel, data can clarify who is shopping in a trading area and how a neighborhood is trending. Detail is essential; knowing there are a high percentage of Asian customers, for example, isn’t enough. Are they primarily from China? Korea? Another key is acculturation; first-generation immigrants may have very different purchase patterns than second or third.

For example, least acculturated Hispanics prefer Modelo Especial, Carta Blanca and Corona beer, according to ACNielsen, while more acculturated prefer Sam Adams, Budweiser and micro-brews.

Anheuser-Busch is addressing acculturation by marketing to more Latinos in English in 2007, says Henry Dominguez, vice president of Latino marketing, as well as creating advertising aimed at the diverse countries of origin in East coast urban areas. “Relevance is critical as you get into different cultures and countries,”

Ethnic Marketing Best Practices

Retailers seeking to truly capitalize on the potential sales boost of ethnic beverages can tap these best practices honed by ethnic and mainstream retailers alike:

Anheuser-Busch markets to Latinos in Spanish, but does plenty of marketing to them in English, as well.

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2007

Big Red, already highly regarded throughout Texas, is a growing favorite among Mexican-Americans moving throughout the US. Big Red’s unique flavor and red color transcends three generations, appealing to even the most acculturated consumer. Big Red, LTD. borrowed equity from its recognizable core translating it into line extensions including Big Red Vanilla Float and Big Pineapple. Both brands, appealing in color and flavor to the Hispanic consumer, launched successfully and delivered double-digit increases in markets where retailers are clamoring for Hispanic shopping dollars, such as Los Angeles, Chicago and Denver.

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Dominguez notes. “You need to be respectful,” and make an emotional and cultural connection.

Ongoing analysis is key to picking up on trends. For example, “many areas in which African Americans live tend to be transitional,” with growing Hispanic and Asian populations, says Sam Chisholm, veteran marketer and president of Chisholm Consulting. Tastes change, too; whereas once African Americans preferred sweeter, grape and red beverages, “we’re tending to become closer in style to our mainstream counterparts,” Chisholm says.

Syndicated data may not be enough, however; many ethnic markets don’t participate, so results are skewed toward ethnic purchases in mainstream stores. Another strategy is buying data about beverages in customers’ countries of origin.

2. Observe. Ethnic market executives have their reasons for not sharing this data; they thrive by understanding their customer and creating an authentic experience, from the advertising to the in-store design to the music to the assortments. Retailers need to shop ethnic markets and urban, multicultural stores and note the beverage brands, presentation, signage and in-store feel.

“There is a significant variety of canned and bottled juices made from fruits one never sees in this country imported from Latin America or manufactured in the U.S.,” says Soto. “You could fill up a 23-foot aisle,” and ethnic markets often do. “Go to independent supermarkets, look at the space that is dedicated to ethnic beverages, and you’ll quickly have a sense of the potential volume movement these products have that you’ll never see in the syndicated scanner data.”

Store visits can teach other lessons. For example, “often the shopper is not who they expect,” says Chisholm. In African American communities, for example, “It’s not necessarily the mother – it could be the daughter or someone else doing the shopping,” whose brand and taste preferences may be quite different.

Equally key is listening to customers and accommodating their expressed needs, adds Poul Heilmann, Senior Vice President of MarketFEATURED PRODUCT

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Our success with the culturally diverse Hispanic community is due to the true and authentic taste of our products. Unlike other brands, our nectars are not made from concentrate and they are not blended with any other fruit juices. Our 1 L. packaging is bilingual, allowing retailers to cater to multi-ethnic customers.

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ing and Strategic Planning for Minyard Food Stores/Carnival Super Market.

3. Collaborate. The best ethnic marketing combines the efforts of manufacturers and retailers for better-funded, more impactful campaigns.

“We have a good pulse on what our customers find exciting and interesting, and manufacturers are interested in understanding and working with us,” says Carnival’s Heilmann. “We work with them under their objectives and our objectives, and tailor programs to fit.” A campaign with DelValle, for example, boosted the juice’s sales among Latino and non-Latino consumers.

When retailers are more invested, “there’s still an event, but you’ve also got the four weeks leading up to it in the store, with TPRs [temporary price reductions], displays. There is an authenticity when it’s retailer driven,” says ViVA’s Castillo. He urges retailers to create a playbook for the year, creating in-store programs and sponsorships around pertinent ethnic events.

Ethnic events successfully used by Tampico include a mobile bus tour that visits retailer lots, playing music and offering samples, giveaways, and in-store displays and promotions. Hispanic- or African-American “ambassadors” and bilingual signage helped convey the message, boosting Tampico sales. Multipacks with bilingual coloring books and sales contests have also worked, Ross adds.

Wholesalers and distributors can also recommend shelf sets and facilitate events. UK Imports, in Orlando, Fla., helps retailers shape

A fresh juice bar shows this store's strong commitment to marketing to Hispanic-Americans.

ethnic sections according to local demographics. For example, the company has incorporated mainstay Scottish soda Irn-Bru into ethnic sets where there are ex-pats and high British tourism. A recent tweaking moved Irn-Bru, famous for its unique orange color, to the top shelf.

“It gets a little more attention for the product; the light hits the bottle and it brings the item out so customers notice it,” says Mike Darbyshire, president.

4. Define and commit. There is no clear formula matching level of penetration of a particular ethnic group to the amount of play a store should devote to ethnic beverages. But what is clear is that whatever level is determined appropriate requires 100 percent commitment from management on down.

Carnival’s relocation of ethnic beverages is one successful example of commitment throughout the chain. Resetting a store to integrate ethnic

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In addition to the flavor, the product is packaged in a can that symbolizes tradi-

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tional Hispanic values. The Black Horse represents masculinity and strength. The colors of the flag say, “I’m proud to be Hispanic.” The silver characterizes the Hispanic heritage and the items frequently found in their current traditional marketplaces.

For retailers attempting to appeal to their ever growing Hispanic consumer base, Caballo Negro is a must-have product. In addition, the flavor and performance appeal to all consumers.

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and mainstream products is a hallmark of a more complete commitment to embrace ethnic clientele. The move also addresses acculturation by accommodating the range of beverage tastes in one place.

In the chain’s Minyard and Sackn’ Save banners, particularly those in primarily African-American neighborhoods, Latino brands remain in an ethnic aisle and assortments of Dr. Pepper, Coca-Cola and Pepsi are larger.

In three Carnival stores the retailer offers Fruterias mixing custom blends of fresh fruits – an approach that complements, rather than cannibalizes, bottled sales. “We would put them in every Carnival if we could,” says Chavez.

Unfortunately, commitment has been a problem for many mainstream grocers. “Ethnic budgets are still the first to get cut on an annual basis,” says Kylee Hall, Nielsen product manager for Spectra’s HispanIQ. It’s not uncommon for retailers to hire ethnic specialists without giving them the power to implement changes or to integrate ethnic products into category management. For example, “Bashas went in the direction of creating their own division, Food City Stores, in order to bypass the potential bureaucracy which might have limited their ability to implement a true Hispanic strategy. That requires customization at a time when the industry’s direction was achieving greater efficiencies through centralization and deploying strategies on a mass level,” says Terry Soto, president of About Marketing Solutions, a Burbank, Cal.-based Hispanic strategy consultancy. For instance, smaller, minority vendors have limited capabilities and it can be difficult for buyers and category managers to incorporate them into day-to-day business processes. “For example, ethnic buyers and merchandisers and large retailers don’t often see eye to eye on volume measurement systems so it is difficult for these vendors to make the case for product authorizations,” Soto adds. Successful ethnic marketing means finding a way to overcome these barriers.

Aloe’s roots run deep in many emerging markets.

What’s the most overlooked beverage ingredient that enjoys a strong heritage and cultural appeal with Hispanic, Asian, African-American and other diverse ethnic markets?

In a word, it’s Aloe.

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5. Source authentically. While major U.S. manufacturers have deeper pockets and more sophisticated information technology, it’s important to source authentic brands from customers’ countries of origin as well.

Specialty and ethnic distributors can offer expertise here.

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“In the past, retailers have welcomed with open arms the big brands, and still do,” says ViVA’s Castillo. “But now they’re talking also to little brands to make a big impact.”

While it’s tempting to dabble in ethnic beverages at first, that’s not always the best approach, warns Ross. “We’ve faced a lot of retailers who were skeptical at first, and wanted one or two flavors, not ten. But as they add flavors, we’ve never seen a decrease in the rest of the brand.

Flavors tend to be incremental,” tapping into their target customers’ desire for variety.

In addition to ethnic brands, ethnic consumers often prefer the flavor of international formulations of some global brands. Carnival, for example, has long stocked Mexican Coke, a sweeter formulation.

6. Price correctly. Some retailers make the mistake of pricing ethnic goods as specialty products, failing to understand the role some play as a staple of the diet. According to the Coca-Cola study, for example, Hispanics typically have larger families and often drink significant amounts of juice in a day, so selling a wide variety of tropical flavors in gallon sizes and pricing them for purchase in large quantities is essential to winning that customer’s loyalty.

“Chains need to understand that when it comes to the perimeter of the store, the Hispanic opportunity is in volume, not margin – that’s one thing independents understand well,” says Soto.

come their reticence to extend ethnic marketing past ethnic aisles and the occasional holiday and commit at the level dictated by their customer base.

“If your supermarket is in a trading area where the ethnic population is at least twenty percent higher than in the total market,” then it’s probably time to step up efforts, says About’s Soto.

Retailers often start with ethnic sections and specific events, but as the program grows and ethnic traffic picks up, these strategies help take them to the next level: • integrating products with mainstream categories • bilingual signage • hiring ethnic workers • extended programs/events/tie-ins • ethnic advertising, promotions • resetting the store to emphasize qualities the dominant ethnic group favors • sponsoring community events and supporting local ethnic organizations Changing the feel of the store can be a hurdle for many retailers. “This is where they shy off because they don’t want to offend” mainstream

Stepping Up

Knowing best practices is one thing; reaching them can be quite another. Retailers must over-

Retailers have demanded that their manufacturers and distributors get on board with ethnic marketing programs.

customers, notes Linda Gonzalez, CEO and president at ViVA Partnership.

Retailers who “get it” and make broad changes, such as HEB, Carnival and Food City, are winning business from those who do not.

Embracing Ethnic Opportunity

The need for ethnic marketing can no longer be ignored. The good news is, many of the changes retailers make to accommodate the preferences of ethnic consumers will please the gamut of customers, from broader assortments to fresh juice bars to increased customer service. Some beverages can help span the range; when Bookoo Beverages created Jugo with 99 percent juice, for example, they knew energy drinks were trending well across most ethnic groups, and formulated and named the drink accordingly.

“Jugo means juice, but it appeals to a number of people,” says Paul Herrera, advertising manager. “Even if you don’t know Spanish, it seems like a word you should know.” Separate English and Spanish advertising and promotional programs are driving both groups to Jugo. Similarly, Pepsi first introduced its Manzanita Sol in Mexico, then brought it into the U.S..

Do ethnic marketing right, and it can boost ethnic sales while pleasing mainstream customers as well. “Retailers who compete effectively for these customers will be in a position to profit from this growth,” according to the Coca-Cola report. “Those who ignore the changing makeup of the marketplace—or make only token efforts—will not find success.”

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Now, Tampico Beverages is strengthening our bond with the Hispanic consumer by adding even more irresistible products and packages to our beverage portfolio. Recent introductions include: Tampico Flavored Water Beverage a refreshing line of waters with a tropical fruit twist, Tampico Plus, a reduced-sugar, vitamin and calcium fortified fruit drink, and Tampico Energy a powerful Hispanic targeted beverage that is El Mas Bravo. Plus, we've added a line of 20-ounce PET beverages for consumers on the go!

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Stalking Craft Better and smaller beers are cruising. But the Big Three have crafty plans of their own.

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PHOTO COURTESY OF VisMedia

By Andy Murray

Craft brew has a stalker.

Usually, Anheuser-Busch – the nation’s largest brewer – isn’t one found to be slinking around in the shadows. But these aren’t usual times, Beer, that staple of Friday frat parties and Saturday tailgates, is flatlining. According to Information Resources Inc., a market researcher, total beer sales grew by just 0.7 percent for the 52-week period ending Dec. 3, 2006. That followed similarly lackluster expansion in each of the previous two years.

Beer’s slump has come, ironically, at a time of near-record consumer spending.

While shoppers have shown an almost insatiable appetite for $5 lattes, $500 shoes and $5000 televisions, brewers have somehow failed to connect with the nation’s unholy passion for consumption.

Or have they? One segment of the beer market that has been cruising along is “microcraft,” or specialty brewing market. Usually sold at a 25 percent premium over most mass produced brews, micro-craft beers grew by 17.2 percent over the same 52-week period, to $453 million, according to IRI. In fact, for many craft brewers, 2006 may go down as the year their sales broke through the copper ceiling: at year’s end, it made up more than 5 percent of the United States’ $8.7 billion in annual beer sales.

“Overall, the beer market is having its challenges, but people are going for high-end products that offer a more substantial flavor profile,” said Steve Harrison, vice president of the Sierra Nevada Brewing Co. Founded in 1980 by Ken Grossman and Paul Camusi, Sierra Nevada is the nation’s top-selling micro-craft beer, at about $53 million.

As trailblazers like Sierra Nevada know well, this isn’t the first craft beer surge.

In 1996, U.S. craft brewers increased output by 26 percent. That year brought the end to a half-decade of growth that peaked in 1995 at 51 percent, but things ended poorly, with the industry awash in product and extra brewing equipment, a classic case of too much to soon.

But this time, brewers agree, something feels different. Not only are survivors like Sierra Nevada, Boston Beer Co., and Colorado’s New Belgium Brewing Co. more seasoned and battle-tested, but independent brewers have the sneaking suspicion they aren’t alone. The big brewers are looking over their shoulder, studying their moves, looking for a way into the game.

Somebody’s Watching You Ken Hehir, 42, works for Molson/Coors, not that the company has any interest in letting you know that. He oversees the brand and marketing promotion of two lines: Blue Moon Belgian White and Killian’s Irish Red. Neither one is marketed strongly as a Coors brand, as today’s picky beer drinker doesn’t necessarily associate mass production with high quality.

In fact, many off-premise and on-premise retailers mistakenly sell Blue Moon and Killian’s as imports, despite the fact that they have been Coors products for years (in Blue Moon’s case, from the start).

It’s a legacy of the first microbrew boom: during the mid-1990s the nation’s Big Three brewers launched a bevy of high-concept specialty beers, many of which were revealed to be poor imitations of the burgeoning craft scene. One of the only ones that survived was Blue Moon. It was launched in 1995 by a Coors master brewer who had earned his PhD in Belgium and wanted to recreate the country’s fruity, almost-sweet wheat beers.

Since 1995, Blue Moon has steadily gained momentum and market share, but it’s really taken off lately, growing by 115 percent in the first 10 months of 2006 alone, according to the Rocky Mountain News. According to industry estimates, the company was on track to sell between 400,000 and 500,000 barrels of Blue Moon in 2006, which would have made it the equivalent of the third- or fourth-largest craft brewer in the U.S., behind Boston Beer; Sierra Nevada and New Belgium. But it's never been promoted as a Coors product.

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“We’ve had a lot of success with word-of-mouth for Blue Moon without havNow, kids are used ing to beat people over the to going into the head with it,” Hehir said. grocery store and “I think it’s because people seeing 35 different like to reward themselves by kinds of beer from trading up a little bit. But 34 different brewwhile they do want to trade ers. I don’t see that up, they don’t want to trade going away. up too far in terms of flavor.

They don’t want a beer they can’t cope with.”

The other major breweries are also trying to find the sweet spot held by unique but familiar-tasting beers like Blue Moon. Global brewing giant SABMiller, which bought the Miller Brewing Co. in 2002, recently scored a hit with its Fredrick Miller Chocolate Lager, which one reviewer called one of the “best new beers of 2006.” Miller also owns Henry Weinhard's, which recently launched an organic offshoot. A-B has put out regional brews, developed by its brew masters in St. Louis and New Hampshire, distributing them across the Northeast and the Midwest.

Not only are major brewers encouraging their own employees to get crafty, they are also lapping up smaller, independent brewers at a rapid pace. In May, Anheuser-Busch announced it was buying Latrobe, Penn.-based brewer Rolling Rock from the InBev, but it also owns large shares in regional craft brews such as Chicago’s Goose Island Beer Co., Seattle’s Redhook Ale Brewery Inc., and Portland, Ore.-based Widmer Brothers Brewing Co.

”

St. Louis Craft Fair To hear that Anheuser-Busch is focusing on high-end products is to invite snickers, but Pat McGauley, vice president of innovation at AnheuserBusch, doesn’t let it worry him. To craft loyalists who openly question whether a beer can be considered micro-anything if it is brewed by A-B, McGauley long ago came up with a counter-argument.

“We tell them to taste our beer and tell us it’s not meeting their standards. Anheuser-Busch has some of the best brewers in the world and we are winning the skeptics over,” said McGauley, 43.

But winning the skeptics over, no matter how well qualified its brewers are, means that the St. Louis behemoth has to take the micro-craft boom seriously.

In many respects, it has.

In addition to backing Redhook and Widmer, last year, Anheuser-Busch launched two organic beers, Stone Mill Pale Ale and Wild Hop Lager. The giant brewer also came out with a line of four seasonal specialty InBev ®

brews in bars, including Spring Heat Spiced Wheat, Beach Bum Blonde Ale, Jack’s Pumpkin Spice Ale and Winter’s Bourbon Cask Ale. “This is a building-block type approach,” McGauley said. “We don’t expect these beers to pay off right away, but the news we are generating in the market is very, very positive. These beers are all about creating excitement in the beer category,” he said.

Anheuser-Busch is also looking to reinvigorate its organizational structure by giving its network of breweries the authority to make and distribute regional beers to a limited area. Last year, those companies brewed beers like Mule Kick Oatmeal Stout in St. Louis and the Demon Hop Yard Ale in Merrimac, NH. These items, while only available in restaurants and bars, were a way of giving brewmasters throughout the organization the flexibility to work with more specific flavor profiles and recipes, while creating a sort of local pride of ownership. Next year, the program will expand to all 12 of the company’s regional breweries.

“Beer is absolutely an emotional purchase so we are always trying to make sure there is an emotional tie between our products and customers,” McGauley said. “This is all about giving some control and brand ownership back to the consumer.’

Backlash The big-beer ownership behind these brands has led some independent brewers and their supporters to deride them as “stealth beers” or “pseudo crafts.”

Jim Koch, president and founder of Boston Beer, the nation’s largest craft brewery (and a company that is derided on occasion as having gotten too big itself ), argues that the definition of a craft brewery is small, independent and authentic, meaning it can’t produce more than 2 million barrels, and can’t be owned by a larger brewer.

But Coors’ Hehir argues this definition ignores the care and steps a brewer takes in brewing his or her beer.

“It’s carefully-crafted, it’s a complex recipe and it takes a lot of time to brew,” Hehir said of Blue Moon.

Whatever words get used to paint the picture, it’s clear the brewing landscape is changing.

Mark Selner, beer buyer for Surdyk’s Wine and Cheese Shop in the Twin Cities, sees the end result of that every day.

Even though Surdyk’s is just a few short miles from the University of Minnesota’s campus, an increasing portion of the store’s beer sales are driven by craft or specialty beers. Selner, who started at the store in 1973, said there were maybe a few dozen beers in the early days, mostly old regional favorites like Augsberger. Today, Selner estimates the store carries close to 300 different kinds of beer, largely to accommodate the never-ending search to try something new.

“People are into the unusual. Highest this, most that; the beer with the sharpest hops, the most alcohol,” he said.

And small liquor stores aren’t the only ones taking notice. Greg Maurer, executive vice president for the Heidelberg Distributing Co., points to large grocers and discount clubs such as Pittsburgh’s Giant Eagle Supermarkets that are restocking their coolers in states that allow beer and wines sales to reflect a more diverse offering.

“If nothing else it is a statement they are making that they are willing to service their customers’ needs and wants,” Maurer said.

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Building a bigger ring Brewers and wholesalers often point to one of two factors to explain the recent surge in craft brews and imports. One is a growing wealth of upper-middle class professionals who often work hard and spend even harder. The other is the so-called identity factor. With more disposable income, consumers are looking for brands or products that set them apart, that communicate their likes and dislikes, their social status. Maurer sees both factors at play.

“It’s that high-discretionary-income, young consumer. They’re doing it partly for the identity factor, partly because of high income, and partly because of flavor. It becomes ‘Who am I?’ and ‘Can I define who I am by what I drink?’” Maurer said.

Convenience stores and other off-premise retailers can benefit greatly from this kind of soul-searching. While a six-pack of 12 oz. Budweiser or Miller bottles may cost retailers $4 and retail for $5.49 plus deposits, the same six-pack of Sam Adams or Flying Dog may cost $5.25 and sell for anywhere from $7 to $7.50. That’s roughly the same profit as import beers, and is at least 16 percent better profit than most mass domestics.

“It’s a good volume and it’s a really good ring, so it’s a high margin item that moves pretty well,” Harrison said.

Like many, Coors’ Hehir sees Starbucks as an example worth emulating.

While Starbucks redefined coffee as a luxury item at $5 per cup, it has also created a luxury lifestyle: customers who stop in for a latte often leave with a cookie, a compact disc, or a book. Beer drinkers who spend more per bottle also will make impulse buys, something that retailers appreciate.

“I think people let the situation guide them. Sometimes it’s a craft brew. If they are mowing the lawn and just want something that’s easy-todrink and refreshing, it might be a Coors. The ideal is for them to walk out with both,” Hehir said.

Loud footsteps In 1990, Jim Koch predicted “better beers,” crafts and imports, would account for 20 to 30 percent of domestic beer sales and craft beers would account for “at least a third of that” by 2010.

With three years to go craft brewing still has a way to go, but it has pushed its head above the 5 percent mark for the first time.

“To me great beer is a great beverage,” Koch said in January. “I think people are thirsty for quality, flavor, variety and authenticity in their beverages and that is where I think the growth is.”

But there’s something different in this craft boom than the one Koch rose to prominence in during the1990s. For one thing, he said, the brewers are a lot more professional.

“In some ways crafts grew so fast in the beginning of the 1990s that I just think there was an adjustment to a more modest growth spurt,” he said.

While specialty and craft brewers may be the toast of the town now, they have reason to be looking over their shoulder, said Maureen Ogle, author of Ambitious Brew: The Story of American Beer.

Ogle notes that for all their growth, craft brews still account for only

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6 percent of the nation’s beer. The other 94 percent comes from Big Brewers. Anheuser-Busch alone accounts for half the beer sold in the U.S. Budweiser, 18 percent.

The reason big brewers seemed to fail during the first craft revolution during the nineties was partly because they didn’t take it seriously, Ogle said. Brewers like Anheuser-Busch seemed to think they could find any pre-Prohibition beer recipe, slap an old-timey label on it and it would sell regardless of what it tasted like.

Fifteen years later, Ogle thinks they’ve smartened up. Gone is the haphazard approach to brands; back is massive influx of investment that characterized the post-World War II era, when brewers like AnheuserBusch, Coors and Miller survived a sustained drop in beer consumption by adding capacity, exploiting every possible niche or fad imaginable and innovating until the Baby Boom reached legal drinking age.

Ogle sees gluten-free beers, like Budweiser’s RedBridge, as an example of the sound, long-term investment big brewers are making.

“They are just getting a lot smarter,” Ogle said.

Consolidation is also helping reinvigorate the brewing industry, Ogle said. South African Breweries 2002 purchase of the Miller Brewing Co. from Philip Morris started that company on a track to rediscovering its brewing roots. Successes like the company’s chocolate lager show, in a limited way, how much the Milwaukee brewing company is refocusing itself on beer. So does A-B’s regional beer program.

If major brewers were to get organized, independent brewers and retailers would have plenty of reason to be worried. With their vast distribution networks, big brewers can exert tremendous control over retailers and the beer they stock, even pulling their major brands if a retailer isn’t cooperating. That, combined with acquisition and advertising budgets that would make most European countries quaver, mean things could get a lot nastier before they improve.

“Anheuser-Busch and Miller could be way more aggressive exploiting their marketing advantage and throwing their advertising dollars around. I think a lot of those small brewers are going to go away,” Ogle said.

Like any small business, independent craft breweries also face questions about succession. Many of the nation’s craft brewing pioneers are graying. Grossman, Koch, and Anchor Steam’s Fritz Maytag are all nearing retirement age.

How long can craft brewing’s growth last? Like Koch and other craft brewers, Ogle can’t say for certain, but she doesn’t see beer drinker’s thirst for the unusual drying up any time soon.

“Now, kids are used to going into the grocery store and seeing 35 different kinds of beer from 34 different brewers. I don’t see that going away.

I think there is always going to be a segment, a small segment of the market that always gravitates to choice, just like they want 500 channels on cable,” she said.

What might change, though, is that the big brewers seem to be pretty interested in making some off-beat programs of their own.

´ AMIGOS. ADIOS,

On December 31, the Corona brewer y in Mexico and its impor ter par ted ways. As the adver tising agency for the impor ter, we had no choice but to say adiós as well. It feels like only yesterday that we created the campaign inviting beer drinkers to escape to a Corona state of mind, b u t re m a r k a b l y, i t’s b e e n more than ten years.

Ten years of working with a client who believed in consistency as much as we do. Ten years of helping C o ro n a b e c o m e t h e #1 selling impor t in the U.S. and the four th-largest brand in the world. Ten years.

Gracias, Corona, for making ever y one of them feel like a day at the beach.

THE RICHARDS GROUP

Excerpted from: Ambitious Brew: The Story of American Beer

M

aureen Ogle’s Ambitious Brew: The Story of American Beer is more than just a tale of the development of an American brewing style, it’s also an enlightening primer on U.S. immigration patterns, family business and mainstream taste. But for retailers, it holds lessons on the beer companies themselves, and what kind of factors influence them to provide the products you stock. In this excerpt – late in the book, after Ogle has retold the story of brewing from the perspective of many of its leading families – she takes stock of the crew comprising the top ten domestic brewers in the year 2000.

While a few changes have been made – most notably the sale of Rolling Rock to Anheuser Busch – there is a key takeaway for retailers: be it production values or stylistic imperatives, buying from companies who are dedicated to what they do is very important, because those are the companies that last.

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As it turned out,

these were growing pains, not death throes, and they were good for the industry. The encounters with the Big Boys toughened the survivors, who either fashioned new, and better, strategies for growth, or reeled in their ambitions and stayed close to home. Customers came back. The number of breweries and brewpubs soared, reaching well over one thousand by century’s end. By the late 1990s, Ken Grossman’s annual output inched toward a half million barrels and he was out-producing Leinenkugel and F. X. Matt. Jim Koch shot past the million mark.

The late-twentieth-century reinvention of American brewing laid bare the industry’s bone structure, and revealed a fundamental truth about brewing: almost alone among commercial enterprises, it is one in which, regardless of the brewery’s size, success depends less on number-crunching, share value, and MBA management than on basic entrepreneurship and a personal passion for the product.

Consider the sad story at Schlitz, which, already bleeding from the carnage of the 1970s, did not survive the century. In June 1981, striking brewery workers walked out of the Milwaukee plant. Company officials, most of them accountants rather than men with beer in their veins, announced that they planned to shut the brewery for good in September, even as Pabst and Heilemen battled for ownership of the tattered remnants of what had been one of Milwaukee’s finest. Schlitz’s board of directors approved a sale to Heileman, but the Justice Department nixed the deal as a violation of anti-trust laws. In the spring of 1982, Schlitz finally found a home, with Stroh of Detroit.

Stroh was one of the family-owned survivors, having been in business for 149 years under five generations of Strohs. But the family made its bid for grandeur at the wrong moment, demonstrating that brewing heritage and passion alone do not make great breweries. Had they maintained their “small” mystique and cachet, they might have survived. But in an industry hobbled by fragmentation, fickle consumers, and dwindling demand, no one wanted beer from an ordinary Big Brewer wannabe, and it was im-

possible for Stroh to catch up with giants A-B and Miller. Add the new burden of debt and stagnant demand, and the pressure proved fatal. In 1998, the company’s board sold its Tampa plant to Dick Yuengling; a year later they disposed of the rest of the assets, including the cornucopia of brand names Stroh had acquired over the years: Schlitz, Old Milwaukee, Old Style, Schmidt’s, Lone Star, and Special Export.

In 2000, the nation’s tenth-ranked brewer was Minnesota Brewing Co. of St. Paul, but the company was nearing the end of its short-lived run for glory. Management would file for bankruptcy in 2002, selling its Grain Belt label to August Schell Brewing in nearby New Ulm, Minnesota (the second-oldest family-owned brewery in the country).

The number-nine spot belonged to Ken Grossman, now sole owner of Sierra Nevada Brewing Co. and as passionate about his beer and his future as he had been back in 1978.

At number eight sat the nation’s oldest beermaker: D. G. Yuengling & Son. Dick Yuengling, Jr., had devoted the 1990s to making the kinds of careful business decisions that only a hands-on entrepreneur could: he used secondhand equipment when possible and saved on stamps by having his drivers deliver necessary mail to the brewery’s wholesalers. But when Yuengling did spend money, he did so dramatically and effectively: In 1998 he announced plans to build a new brewery from ground up in Pottsville; a year later, he bought Stroh’s Tampa plant. In 2001, Yuengling would break the one-million-barrel mark.

Number seven, Latrobe, was an oddity: The Pennsylvania maker of Rolling Rock, which had become the favorite of collegians in the 1980s, was owned by Labatt, which was itself owned

by Belgian giant Interbev.

Jim Koch’s Boston Beer Company claimed the number-six spot. He still brewed some beer on contract, but in 1996 he’d bought the old Hudepohl-Schoenling brewery in Cincinnati, the town where he’d grown up. Few brewers had been as personally battered by the late-century beer wars as Koch; but few proved more tenacious and passionate than he when it came to making fine beer.

Genesee of Rochester, New York, in the number-five spot, had been around western New York for more than a century, owned and run by the Wehle family since repeal. But in 2000, the Wehle at the top, dying of cancer, decided to sell what had become an ailing company. A group of investors, nearly all of them Rochester locals, bought it, intent on saving some local history and the brewery’s five hundred jobs. The owners immediately aligned themselves with the microbrewing end of the industry, hiring a brewmaster with a craft brewing background and launching a new line of full-bodied brews.

At number four was an entity named Pabst, but which had nothing to do with the Pabst Brewing that had once been the world’s largest beermaker. Pabst officials, uncertain how to navigate a stagnant market and changing tastes, spent the early 1980s leaning into a whirlwind of mostly hostile takeover bids. In the end, Paul Kalmanovitz, a California investor, won. He acquired Pabst in 1985 and proceeded to strip its management,

its advertising, its employees, and its sales. When Kalmanovitz died in early 1987, his successor vowed to save the brewery.

It was too late. In 1996, Phillip Best and Frederick Pabst’s proud factory--the acres of soft red brick, the wrought iron lamps with their ornate “P,” the once-bustling shipping yard--fell silent, locked behind an ugly chain-link, barb-wired-topped fence, its only companions a growing community of weeds, rats, and birds. Captain Pabst’s beloved Blue Ribbon brand survived--in name only and as one of an array of beer labels owned by the Kalmanovitz Charitable Foundation, a San Antonio, Texas, holding company. Blue Ribbon became the darling of the bike messenger and retro-chic crowd in the early 2000s--but it was brewed at the Miller plant out on State Street.

In 2000, the Coors family still clung to their number-three spot, but Pete Coors’s plans to topple the two leaders had never panned out. Indeed, the brewery’s share of the market slipped in the 1990s, perhaps because for the first time in company history, the family turned the wheel over to an outsider, a man who had once run Frito-Lay. As for the top two, they were the same pair who had held the spots since the late 1970s. But in 2000, Miller produced less than half of A-B’s 96 million barrels, and its market share dwindled slightly each year. In 2002, Philip Morris conceded defeat and sold Miller to a South African outfit. Would things have turned out differently if Fred C. Miller had not boarded that plane in December 1955? Perhaps.

And then there was the leader: Anheuser-Busch.

At the beginning of the new century, half the beer consumed by Americans sported the AnheuserBusch eagle, and just one of those brands, Budweiser, accounted for a staggering 18 percent of all the beer sold in the United States--proof that microbreweries notwithstanding, many Americans still favored a light-bodied, effervescent beer of the kind created by Carl Conrad and Adolphus Busch more than a century earlier. In 2002, August Busch IV, the great-great-grandson of Adolphus Busch, took over as president of Anheuser-Busch, the fifth Busch to serve in that post.

That as much as anything else explains why Anheuser-Busch is the world’s largest brewery: For more than 150 years, the family has nurtured and built and fought, trusting almost no one but themselves to care as much about the company’s name and its beer as they did. The craft brewers, the brewpub owners, the contract brewers, and everyone in between could take a lesson from the Busch family: Stick to the basics, in this case uncompromised quality and consistency. And if anyone needed proof beyond the sales figures, they need only visit the St. Louis brewery. There, in its immaculate grounds, in Adolphus’s still-pristine stables, in the perfectly maintained 1893 brewhouse, stands evidence of the family’s constant vigilance and its justifiable pride in its history, products, image, and reputation. Evidence, in short, of the entrepreneurial passion--and ambition-that had served the company for a century and a half.

Adolphus would be proud--but then again, he would have ex-pected nothing less.

JANUARY – FEBRUARY

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aster’s

Wine tastings that work

A

s an increasing number of Americans pop the cork, retailers are looking to wine tastings – either as separate events or ongoing programs – as a way to attract clients to the store and, eventually, the cash register.

At retail, the art of product sampling as an enticement to buy is an old one. But wine tastings, where a few bottles are set out as samples for customers to try, have the potential to be much more effective than sausage on a stick. These events aren’t just a way to make a fast buck on whatever you’re pushing that week: they can produce more knowledgeable, loyal customers, the kind who will regard your store as a gathering place and a resource as much as they will rely on it as a retail establishment.

Depending on your store type, wine tasting programs can be either a stylistic necessity or a nice bonus for ordinary shoppers.

At Hi-Time Wine Cellars in Costa Mesa, California – a family-owned store with 24,000 square feet of retail space and a 3,000 square-foot temperature controlled wine cellar – it’s the former.

Tastings take place three times a

42

week in the store’s wine bar, featuring up to a dozen different wines.

“There is more of a hands-on mentality, where people really want to decide for themselves what they like and what they want to taste,” observes Dan Rhodes, Hi-Time’s French wine buyer.

“There is also a growing awareness of wine matching, and that’s really good, because it gets people off the main path. A wine bar can help to introduce people to new things.”

Rhodes creates specific themes for each tasting, often by region, grape variety, or wine type.

“There are a lot of different things that you can do, and the more creative you are, the more your clients appreciate it,” he advises. Tastings at Hi-Times are also seasonal: Rhodes won’t, for example, conduct a Sauvignon Blanc tasting during the middle of winter.

BLM Wine + Spirits in Boston, Massachusetts, holds tastings every Saturday. Usually featuring about nine wines, a table is arranged so that the tasting glasses are placed in front of the bottle, enabling the customer to look at and smell the wine. Roger Ormon, BLM’s wine manager, provides a sheet with a two-to-three paragraph blurb on each wine, listing grape varieties, facts about the region, how the wine is made and interesting highlights about the winemaker. A tasting coordinator behind the table focuses on how the wine tastes, but also pushes for incremental sales by talking about its relationship to food.

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

hoice

By Carolyn Heinze

“They will draw people out so that they can express what they think about the wine, and what they would serve it with,” he says, adding that customers will also talk amongst themselves. “It’s very informal. Some people go through all the wines in a hurry, while other will taste one or two. Some will talk for half an hour to 45 minutes to leisurely go through all of the wines.”

Servers don’t necessarily need to possess the in-depth knowledge of a master sommelier, but they should be equipped with a number of basic facts on grape varieties, regions and background on the wineries themselves.

“The real critical component, as far as the in-store operations go, is to make sure that there are wine-knowledgeable people out there selling the product,” emphasizes Scott D. Kamp, corporate wine buyer for grocery chain Meijer, Inc, headquartered in Grand Rapids, Michigan. “If someone is selling wine and they don’t understand it the way they should, you can get into trouble quickly because you lose credibility. People who really like wine will quickly pick up on it when someone doesn’t know what they are talking about.”

Meijer works closely with its suppliers in organizing their tastings, which usually take place on Friday evenings

and Saturday afternoons, to make the most of high-traffic times. Those conducting the tastings are usually supplied by the winery, but Kamp underlines that, even if a tasting coordinator is from outside your establishment, they should be familiar with your store before they hit the floor.

“They are the face of the retailer to the customer,” he says. “It’s important that they are knowledgeable about that entire department, and they really should have some level of familiarity with the store as a whole. If you are sampling wine in the wine department, there will always be someone who asks you where the cheese is. That’s going to happen – especially with a supercenter format like Meijer.”

K

Tips for Tastings ·Ambiance is a must: create an informal, celebratory environment where clients are comfortable and receptive · Be creative: develop interesting themes · Serve wines from lightest to heaviest · Servers must be neutral: let the customer decide what they like and dislike

Secondary Benefits

amp points out that tastings in a grocery store environment not only boost wine sales, but, when executed properly, provide an opportunity to increase sales in other departments as well.

“There are tremendous cross-merchandising benefits,” he says. “We will pair a nice wine, a cheese, a chocolate, or even something from the deli area.” And, he adds, the hands-on nature of wine tasting demonstrates to customers that the store is committed to providing good service.

But what happens when in-store wine tastings are illegal in your state, or require an expensive license that you may not be willing to invest in right now? Meijer, which has stores in Michigan, Ohio, Indiana, Illinois and Kentucky, may only conduct tastings in Illinois; it’s illegal to pop a cork in the rest of the states except for Indiana, which requires retailers to purchase a license.

To get around this restriction, Meijer provides specially-trained “hand-sellers” who circulate throughout the department, offering customers advice and recounting various details about each wine. If you can put a bottle into a client’s hand, Kamp reasons, it’s 80 percent sold.

“People don’t want to, if they are going to someone’s house, buy a bottle of wine and look like they don’t know what they’re doing,” he says. “If you have someone who is wine-knowledgeable, and who can give them food pairings, information about the winery or the history of the wine, now you personalize that product for them. Then, when the customer goes to somebody’s house with that bottle of wine, they are not only confident that they have the right bottle, but they also have a little story to tell.”

In conjunction with tastings or hand-sellers, special events are another good way to drive traffic through your wine department. Kamp recounts that, during tastings, some Meijer locations charge several cents a glass to donate to a local organization – solidifying the retailer’s involvement in the community. Meijer will also invite some of the country’s better-known winemakers to come into a store to speak and sign bottles. Every effort is made to have wines bolster the store and to help the store to sell more wine.

To encourage purchases, Ormon notes that BLM offers a 20 percent discount on the wines that are being tasted with a minimum purchase of three bottles. Kamp believes that pricing should be very aggressive during a tasting so that customers are encouraged to try the wine at home – and hopefully, come back to buy more at the regular price. “My philosophy has always been that you pretty much need to give the product away,” he says. “I almost look at it as a loss leader. I will sell wine at cost during a wine tasting just to get the product into people’s hands. If even 10 percent of the people that tasted it come back the following week and they buy it at full margin because they like it, or they tell a friend or neighbor about it, it can be an extremely powerful way to market product.”

A Bit About Beer When it’s not staging wine tastings, Hi-Time Wine Cellars in Costa Mesa, California – which also sells North American micro-brews and world-class beers – holds monthly beer tastings based on various themes. Dan Rhodes, the store’s French wine buyer, notes that these events differ greatly from those dedicated to wine, although both can be powerful sales boosters if they cater to the consumer in the right way.

“It’s two different crowds,” Rhodes says. “There is a definite beer aficionado that appreciates the subtle differences in beer, but it’s a little bit different in that it’s a little bit more about a camaraderie between beer drinkers. There is more social interaction going on and it’s more of a pub atmosphere. We provide snacks, such as chips, pretzels and pizza rolls.”

During wine tastings, the store offers bread, but the focus on snacks is minimal in order to keep the palette neutral.

Rhodes believes that this difference between the two beverages is rooted in our social conditioning. “We are conditioned to think of wine as a more artistic beverage and beer as a more commercial, industrial beverage,” he said. “I don’t necessarily agree with that; I think there are some really artistic beers that are really well done and produced in small quantities, and a lot of industrial plonk that calls itself wine. I don’t necessarily agree with the perception, but it is the perception.”

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NATURAL PRODUCTS EXPO WEST

Anaheim Convention Center Anaheim, CA Education: March 8-11, 2007 Trade Show: March 9-11, 2007

PREVIEW EVENT SCHEDULE Thursday, 3/8/2007 8:00 A.M. – 1:00 P.M.: Retail Store Tour 11: 30 A.M. – 1:30 P.M.: 10th Annual OFRF Meet & Greet Benefit Luncheon 12: 30 P.M. – 5:30 P.M.: Fresh Ideas Organic Marketplace 6:0 0 P.M. – 8:00 P.M.: International Welcome Reception 7:3 0P.M. – 10:30P.M.: OTA's Organic Industry Reception Friday, 3/9/2007 8:0 0A.M. – 10:00A.M.: A Better Breakfast with Silk, Horizon Organic & Kashi 9:3 0A.M. – 6:30 P.M.: New Ingredient & Technology Showcase; New Products Showcase 10: 00 A.M. – 6:00 P.M.: Business Information and Technology Exchange; Global Supply Marketplace 6:3 0 P.M. – 9:30 P.M.: LUNAFEST: In Support of The Breast Cancer Fund 9:0 0 P.M. – 12:00 A.M.: Live Music Party featuring the Dirty Dozen Brass Band Saturday, 3/10/2007 8:00 A.M. – 9:00 A.M.: Run for the Health of It 9:3 0 A.M. – 6:30 P.M.: New Ingredient & Technology Showcase 10: 00 A.M. – 6:00 P.M.: Business Information and Technology Exchange; Global Supply Marketplace 12:00 P.M. – 5:00 P.M.: Organic Farm Tour 4:0 0 P.M. – 6:00 P.M.: Global Supply Marketplace Client Appreciation Event 5:30 P.M. – 5:45 P.M.: NutrAward Announcement 6:0 0 P.M. – 7:30 P.M.: Women In Naturals Networking Event 7:0 0 P.M. -10:00 P.M.: The Organic Wine and Beer Festival Sunday, 3/11/2007 9:3 0 A.M. – 4:00 P.M.: New Ingredient & Technology Showcase 9:3 0 A.M. – 4:00 P.M.: New Products Showcase 10: 00 A.M. – 4:00 P.M.: Business Information and Technology Exchange

44

EDUCATION/SEMINAR SCHEDULE Thursday, 3/8/2007 9:0 0 A.M. – 10:30 A.M.: The Fresh Revolution: How It's Changing Customer Perceptions in Your Store Speakers: Byron Freney, Jay Jacobowitz 10: 30 A.M. -12:00 P.M. Japan—Market Opportunities and Regulatory Issues 11: 00 A.M. -12:45 P.M. From Here to Sustainability: Greening Your Business and Bottom Line Speaker: Joel Makower 1:0 0 P.M. – 2:15 P.M. The Global Health and Wellness Opportunity: Consumer Research 1:3 0 P.M. – 2:30 P.M. Alice Waters on Organics and Sustainability Speaker: Alice Waters 2:0 0 P.M. – 3:30 P.M. Educating Your Customers: Practical Guidance on Supplements and Integrative Medicine Speaker: Elson Haas, MD 2:4 5 P.M. – 4:00 P.M. Introduction to the North American Market 4:0 0 P.M. – 5:30 P.M. Roundtables with the Experts: Nuts, Bolts and Nuance for Successfully Managing Your Business 4:3 0 P.M. – 5:45 P.M. The Organic Opportunity in Latin A.M.erica Friday, 3/9/2007 8:3 0 A.M. -10:00 A.M. Making Meaningful Health Claims in Risky Regulatory Waters Speakers: Ivan Wasserman, Michelle Rusk 8:3 0 A.M. – 9:30 A.M. Featured Speaker Andrew Zolli 10: 30 A.M. -12:00 P.M. A Close Look at EU Standards for Personal Care Speaker: Stacy Malkan Global Ingredient Sourcing: Pricing, Shortages and Quality Organic Basics: Core Values and Fundamental Principles Speakers: Jamie Brent, Jesse Singerman, Lisa Bell 1:0 0 P.M. – 2:15 P.M. Fine Tuning Your Marketing Campaign

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

1:0 0 P.M. – 2:30 P.M. Hot New Consumer and Retail Trends Speakers: Linda Povey, Maryellen Molyneaux 1:0 0 P.M. – 2:00 P.M. Seminar Presented by Natural Factors (Exhibitor-Presented) 1:3 0 P.M. – 2:30 P.M. Cosmetics, Health Risks, and Solutions for Safer Products 2:4 5P.M. – 4:00P.M. Organic Issues Forum: Hot Topics Saturday 3/10/2007 9:0 0 A.M. -10:00 A.M.: Keynote Address Speaker: Eric Schlosser 10: 30 A.M. -12:00 P.M.: Contract Manufacturing Primer: Focus on Supplements Got Organic Certification Questions? Ask the Experts Speakers: Jake Lewin, Marty Mesh 10: 30 A.M. -11:30 A.M.: The Hormone Triangle: What's the Adrenals, Thyroid and Liver to do with Balanced Hormones?

Speakers: Lorna Vanderhaeghe BSc 11: 00 A.M. -12:00 P.M. Vulnerable Blood – A Common Denominator Preventing Cardiovascular Health 1:0 0 P.M. – 2:15 P.M. Contract Manufacturing Primer: Focus on Food Cultural Convergence: The Place Where Healthy and Ethnic Meet Speakers: Kimberly Egan, Thomas Tseng Top Ten Reasons To Go Organic: Revisited for the 21st Century Speakers: Alan Greene MD, FAAP, Bob Scowcroft, Sylvia Tawse 2:4 5 P.M. – 4:00 P.M. Making The Hard Choices at Work Without Losing Your Self-Respect Speakers: Jim Autry, Peter Roy Tackling Organic Ingredient and Supply Chain Challenges Speaker: Mary Mulry PhD Sunday, 3/11/2007 9:0 0 A.M. -10:00 A.M. Featured Speaker: Neil Howe

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3. What is your primary business type?

(check only one) A—N Convenience Store B—N Supermarket/Grocery C—N Club/Warehouse Store D—N Mass Merchandiser/Dollar E—N Drug Store F—N Liquor Store G—N Wine Store H—N Wholesaler/Distributor/Broker I —N Beverage Only/Beverage Specialty Store X—N Other (please describe):

4. What is your title? (check only one) A—N B—N C—N D—N E—N X—N

Owner/President/CEO/COO/VP/Director Buyer Merchandising Manager Regional/District Manager Store Manager/Supervisor Other (please describe):

5. Do the locations that you are responsible for sell: (check all that apply) A—N Carbonated soft drinks B—N Non-carbonated soft drinks C—N Bottled water D—N Beer E—N Wine F—N Liquor

BS0506 BS03O6 BS0406

EXHIBITORS 4266 1384 4489 2362 4038 5500 4677 3460 2884 4354 4469 5206 1672 511 916 1895 2379 2596 3584 1315 5554 3239 2387 4388 4259 1944 5506 2278 1650 1986 3149 3984 3338 2462 2223 4089 4090 2991 5850 1274 4814 2340 4387 4292 3723 3873 4250 4054 5404 3538 2748 4815 3658 2846 4262

46

Adagio Teas Adina World Beat Beverages AJY International Inc. Aloe Breeze Apple & Eve Appletiser/Genesis NA Aquamantra, Inc. Blue Diamond Growers Bolthouse Farms Bossa Nova Beverage Group, Inc. Boylan Bottling Co. Brazil Gourmet BSN Canandaigua Concentrates, Div. of Constellation Wines U.S. Century Foods International Ceres Organics Clement Pappas & Co., Inc. Crayons, Inc CurrantC CytoSport, Inc. EarthTrade Water Eden Foods, Inc Elite Natural/Organic Juice USA Espana Brands N.A. Evamor Products, Inc. Frutzzo Natural Juice, LLC Fuze Beverage LLC Good Karma Foods Green Mountain Coffee Roasters Guayakí Yerba Maté GURU Energy GuS – Grown-up Soda Hain Celestial Group, The Hansen Beverage Company Health Support, Inc. Hiball Inc. Hint, Inc. Honest Tea Hydrate 2 O Icelandic Water Holdings, EHF Inko's White Tea ITO EN, LTD. IZZE Beverage Company Jones Soda Co. Juice Beauty Kagome USA Kamauoha Farms Kombucha Wonder Drink Kooz Beverage Company, LLC Kraft Foods Lakewood Organic and Premium Juices Langer Juice Company Liberty Richter Lifeway Foods, Inc. Lightfull Foods

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

1270 4374 2575 4170 3247 3979 2495 1862 3791 2429 2391 1422 5540 2652 3352 3593 3804 1790 2891 4481 3648 4808 3666 3792 3742 1991 2787 2436 4819 5701 2796 1736 3958 1978 3358 2284 5601 5700 2776 4348 3538 4574 1984 2536 1266 1997 3852 5838 5504 2466 3967 3268 4472 2785

Logic Nutrition Maddie's Beverage Company, Inc Metromint – Soma Beverage Mountain Valley Spring Company Naked Juice New Attitude Beverage Corp New Belgium Brewing Co. Newman's Own Organics Noble Juice/Blue Lake Citrus Products Nordic Naturals Numi Tea NVE Pharmaceutical O Beverages, LLC Odwalla Pacific Natural Foods Pacific Resources Penta Water/Bio-Hydration Research Lab, Inc. Pixie Maté POM Wonderful Purity Foods Quaker Tropicana Naturals Reed's, Inc. Republic of Tea, The Royal Pacific Foods/The Ginger People Rush Beverage Company Sambazon Sanfaustino/CCW Holdings Inc. SILK/Horizon Organic Simply Orange/Minute Maid Bus. Unit Skylar Haley SodaLixir Herbal Beverages Sol Maté Beverages Source Atlantique Steaz Green Tea Soda Stonyfield Farm Sweet Leaf Tea Company Switch Beverage Co., The TalkingRain Beverage Co. Tart is Smart (TPG) Taste Nirvana International Inc. Tazo Tempest Tea Tonic Scene Tree of Life, Inc. TRIMSPA-Goen Technologies Vita Coco – All Market Vitasoy USA VPX Sports, Inc. WaterPlus WholeSoy & Co. Wild Waters Inc Wyman's Zico, LLC Zola Açaí

PROMO PARADE Daily’s Makes Mojitos Easy Daily’s is running the Perfect Mojitos Made Easy promotion through through March. The program offers consumers and on-premise operators the perfect way to take the hassle of muddling and mixing great-tasting mojitos every time through Daily’s Mojito Mix. Eye-catching point of sale materials including case cards, shelf talkers and pre-packed neckers with recipes support ing today’s hottest flavors and encouraging consumer trial.

“Mojitos are popular and in great demand these days,” says Tim Barr, Marketing Director for Daily’s, “but they are not the easiest cocktails to prepare, either at the bar or at home. Daily’s Mojito Mix is the perfect solution. It is easy to use and minimizes waste but more importantly it makes consistently great tasting mojitos time after time.

Daily’s authentic mojito formula was developed by in-house mixologists using only the finest all natural flavors. It is delicious mixed with rum as a classic mojito or combined with other Daily’s mixers such as Daily’s Cosmopolitan Mix and Daily’s new Pomegranate Mix to add new dimension to this fashionable cocktail.

Fuze Sparks Student Creativity Students from 11 of the most prestigious design schools across the Country will vie for the chance to best creatively capture brand FUZE through the innovative use of multimedia this spring.

The competition will challenge advertising, design and communication students to construct a media plan that best integrates new media with traditional media. Multiple teams will compete from each university, with the school itself determining its winning campaign to position against the other schools in a national competition.

FUZE is awarding an $8000 scholarship to the winning team from each school. The team with the best overall campaign will be flown to Manhattan to personally present their campaign to FUZE executives.

The schools competing are: The Art Institute of New York, Michigan State University, Minneapolis College of Art and Design, Academy of Art University, Cal State Fullerton, University of Oregon, University of Texas at Austin, School of the Art Institute of Chicago, Portfolio Center, Creative Circus and Savannah College of Art and Design.

Winter Essentials include Miller Genuine Draft and Miller Genuine Draft Light Through the end of March, Miller Genuine Draft is presenting a one-of-a-kind cinema program that will bring the Red Carpet to off-premise accounts. Custom-designed Miller Genuine Draft packaging will communicate the in-pack offer. Program support also includes a partnership with IMDB. com, print-ads, impactful POS and special online content.

Supermarkets will have a "Build-a-Movie-Premier" display with display cards with take-one box and GQ minimagazines, red carpet floor decals, spectaculars, case cards and basewrap.

In C-stores, consumers will embrace opening night excitement with take-one posters, horizontal display cards, case cards, tatic stickers, basewrap, red carpet floor decals and cooler door clings. In liquor stores, command floor space with a display featuring display cards with a take-one box and GQ mini-magazines, red carpet floor decals, take-one posters, static stickers, a cooler door cling, case cards, basewrap and shelf cards. Spanish language versions will also be available to activate Hispanic accounts. See your local distributor for details and to request merchandising materials.

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BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

BOAR-ING:

Year of the Boar According to Chinese tradition, the “Year of the Boar”, starting on February 18, 2007, will be a year of plenty. Signifying freedom, ease of life and abundance, the “Year of the Boar” will be a year where one can live life to the hilt, socialize more and make numerous friends.

Chinese New Year is also an excellent time to promote authentic Tsingtao Lager, the number one imported Chinese beer in the United States, and smooth, light-tasting Tsingtao Pure Draft, with an array of promotional materials designed to capture attention and increase sales during this festive holiday.

For off-premise accounts, Tsingtao has produced P.O.S. items sure to generate consumer excitement at retail, including bright red hanging lanterns, two-sided satin banners, basewrap, easel cards and tuck-in price cards. And in markets where legal, Tsingtao and Annie Chun’s All Natural Asian Cuisine, a leading producer of Asian meal kits, noodles and sauces, are teaming up with a chain grocery coupon program that offers IRC’s on Annie Chun food products.

Tsingtao’s alliance with Annie Chun’s creates the perfect opportunity for out-of-department displays in the Asian food, meat and produce sections.

Consumers interested in the Chinese New Year can surf the Tsingtao website at www.tsingtaobeer.com to pick up fun facts about the holiday and the Chinese zodiac. The website includes background on the holiday, a listing of Chinese New Year celebrations and it enables people to type in their birth date to determine their Chinese zodiac sign. Consumers can also learn which personal characteristics are attributed to their zodiac sign and which celebrities share their sign. Well-known people born in the Year of the Boar include: Henry Kissinger, David Letterman, Hillary Rodham Clinton, Elton John, Lucille Ball, Lance Armstrong, Marie Osmond and the Dalai Lama.

More Bawlsy Sports BAWLS Guarana has entered BMX racing as the “Official Energy Drink” of the National Bicycle League (NBL). Tens of thousands of BMX racers across North America will now rely on the refreshing taste and caffeinated kick of BAWLS Guarana to keep them bouncing down the track this season.

Set to be an official sport for the first time at the 2008 Olympics in Beijing, BMX racing is the latest niche to join BAWLS Guarana’s portfolio of targeted industries which include video gaming, paintball and fashion.

As the Official Energy Drink of the NBL, BAWLS Guarana will enjoy exclusive sampling and on-track signage rights at all NBL-sanctioned national races, set to take place in more than 20 cities across the US. BAWLS will launch an aggressive sampling effort to introduce tens of thousands of BMX enthusiasts to the refreshing, caffeine-packed taste of BAWLS Guarana. The brand also plans to launch a cooperative marketing effort with the NBL through a limited edition run of BAWLS Guarana packaging dedicated to BMX racing, as well as a nationwide contest.

Through their partnership with the NBL, BAWLS Guarana will also have a presence at several Olympic qualifier events.

Olympic hopefuls will have opportunities to gather qualifying points at nine NBL National races this year. The NBL is the only BMX organization affiliated with the UCI (Union Cycliste Internationale) - the international governing body of cycling that is qualifying riders from around the world to participate in the 2008 Olympics.

JANUARY – FEBRUARY

2007

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CONVENTION SCRAPBOOK

As the first national beverage tradeshow of the year, the Fancy Foods West Show is a great place to spot new beverage launches and line extensions. It’s also a great place to watch out for our booth cam, there to grab the best product shots and smiles.

fancy food show

Ira Liran and Leigh Robertson: drink Vita Coco, win a yellow T-shirt!

Hey, Pat Galvi

y, Althea Caroline Parker, Jeanene Bentle ity.

Pur of the faces

Dunn:

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Hey, Moriba Ouendeno from Moriba, Bissssaaaaap?!?

n, mind if we g

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Krissy Miller from Skylar Haley

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ut a visit to th ho it w te le p om ld be c What Expo cou Honest Tea booth?

50

Kara Goldin and Peter Moritz of

Young Jo Jin from T’Best Aloe Vera Juice.

David Louie and Jeffrey Barhhart from Sugar Bowl Bakery – A spirited group. Ha. Ha.

BEVERAGE SPECTRUM // JANUARY – FEBRUARY

2007

P U T T H E P R O F I T T O T H E M E T A L.

With the huge success of the aluminum bottle, Anheuser-Busch is now putting more of your customers’ favorite brands in the upscale packaging. Beer consumers want innovation. They want sophistication. And they want it cold. Only Anheuser-Busch delivers all that in the 16 oz. aluminum bottle. Everybody’s buying it, make sure they’re buying it from you. Call your Anheuser-Busch sales representative for everything you need to know. Or go to www.beerprofitguide.com.

©2006 Anheuser-Busch, Inc., St. Louis, MO