Remember the last time you had a Stone IPA? I don't either. This is at the heart of Stone Brewing's problems. This article from Good Beer Hunting, posted yesterday, presents a bleak outlook for Stone and makes a case that Stone's slide started with its filing of a lawsuit against MillerCoors. The article confuses the lawsuit filing date, with the text stating that the lawsuit was filed in February 2019, but it has a timeline graph showing the lawsuit starting in February 2018. Whatever date the lawsuit was filed, people were no longer talking about Stone's beer.
The story should start in July 2016 when Stone received $90 million of private equity financing. One month later Stone hired a new CEO, Dominic Engels, who resigned last month. New private equity investors, new CEO, and the founders still involved. What could go wrong? As part of my day job I get to analyze and see private equity's impact on companies. The cash is great for companies, but this cash comes with a price. From my experience, and I have no idea if this is the case with Stone's investors, private equity focuses on asset extraction for carried interest payments. Stated another way: private equity only cares about paydays for its principals.
The article states that Stone is actively seeking to sell itself, and that is being driven by the private equity investors. This is news, but it is no shock. Stone's new CEO, Maria Stipp, comes from Lagunitas where 50% of the brewery was sold to Heineken three months after she began, and then Heineken purchased the remaining 50% of Lagunitas less than two years later. Stone denies any plans to sell, which I hope is true.
Going back to Stone IPA, Stone needs to focus on beer. I checked Stone's website, and outside of Delicious IPA it is rare to see any of its other year-round beers at restaurants I frequent. Tropic of Thunder - nope; Fear. Movie. Lions - nope; Tangerine Express - nope; Ripper - nope; Scorpion Bowl IPA - nope; Ruination - nope; Buenaveza - nope; and even Stone IPA - nope. For a brewery, beer must be foremost, but beer is not the first thought that comes to mind when you think of Stone. It is ironic that the most brand and image conscience craft brewery lost sight of marketing and the market, which diminished the brand.
On a personal level, I am pulling for Stone. I like its beers, I like its bistros and tasting rooms, and I like its brand. Cans of Buenaveza have been a household favorite this summer, and in writing this post I learned that Stone IPA now is brewed with several varieties of New Zealand hops, which makes me want to get reacquainted with this classic.
2 comments:
There have been so many head-scratcher moves that this should not be a surprise. Unfortunately.
Berlin had the end result most probably expected.
Several brands (Smoked Porter, Levitation, Pale Ale) were canceled a few years ago. Poor sales was the reason given, which certainly would justify removing those brands from year-round production. The problem is that those brands helped Stone get big and still had strong followings in the beer geek world. Why not throw the long-time customers a bone and offer those seasonally? Who would not want a 6-pack of Levitation in the summer and Smoked Porter around the holidays? And what replaced those beers? Mexican lagers, fruit-infused IPAs, and poor attempts at haze.
The packaging has become schizophrenic. I understand and applaud the move to cans, but there isn't much consistency. Stone IPA is available in 12 oz. cans and bottles, 19.2 oz cans, and bombers. How about Ruination (er, Ruination 2.0, wait, no, Ruination 2.0 sans filtre)? Bombers. Others are available in 16 oz. can 6-packs. I am neither a businessman nor a beer industry expert, but I am an economist. Maybe the market demands that much variety in SKUs, but it seems like there might be some inefficiencies there.
I am a long-time Stone fan. A homer, even. My growler has the Mata Way address on it. I am hoping for the best, but I fear the worst.
Thanks for the comment. The fruit beer (Tangerine Express) was late and not good, and now it's the haze offering, too. Like it or not, hazy IPAs are popular. I agree with your comment on Stone's confusing packaging. I seldom buy 12 oz cans of any beers. Four packs of 16 oz cans allow my to try a number of different beers.
A couple of other points I excluded from my post:
Why doesn't Stone make special can releases for some of the beers coming out of Liberty Station? Modern Times and Pizza Port have great special releases, and Kris Ketchum makes some good beer that would get snapped up. Does every release have to be a national project?
Why has Arrogant Bastard beer been allowed to languish? Spun off into its own brand, Arrogant Consortia, in 2015, before private equity, its website only lists Enter the Night pilsner as the only other regular beer under the brand. Port Brewing has four distinct brands that it manages, and none seem dormant. The same can be said about Stone's Mission Warehouse Sour project. I have not heard about it in a while, either.
Like you, I consider myself a Stone homer. I am really pulling for Stone's long-term success.
Post a Comment