Beverage Dynamics is the largest national business magazine devoted exclusively to the needs of off-premise beverage alcohol retailers, from single liquor stores to big box chains, through coverage of the latest trends in wine, beer and spirits.
Issue link: https://read.dmtmag.com/i/565520
Beer BUSINESS 10 Beverage Dynamics • September/October 2015 www.beveragedynamics.com THE ISSUE OF AUTHENTIC BEER IMPORTS recently made headlines, thanks to the settlement of a class-ac- tion lawsuit that claimed Beck's was brewed in St. Louis, rather than Germany. Anheuser-Busch may issue refunds to consum- ers who purchased Beck's believing it was a true import, rather than a domestically-brewed beer. (Source: Wall Street Journal) Beck's is far from the only beer to walk a fi ne line between import and export – Red Stripe, Foster's and Killian's Irish Red are often advertised as imports, but brewed domestically (and all indicate on the bottle that they are from the U.S.). So why would a brewer imply that its product was an im- port, when it may have been brewed a few states away? I spoke to Ray Faust, Chief Sales Offi cer at Heineken USA to fi nd out more. Heineken's products are all true imports, coming into the U.S. from Europe and Mexico. Heineken USA Imports the Heineken, Dos Equis and Tecate portfolios, as well as Amstel Light, Newcastle Brown Ale, Strongbow Hard Cider, Sol, Indio, Carta Blanca and Bohemia. Sales for the company are up 0.2% to retailers and 1.1% to wholesalers, according to the most recent earnings release. "Imported beer brands like Heineken are unique in that they embody the traditions and craftsmanship of their native country and are created with tried-and-tested techniques that lend to the distinct character of the brews," Faust says. "As such, consumers continue to perceive imported brands as premium when compared to many domestic brands." Sales for large domestic brands are down overall, as craft upstarts continue to grow market share and dominate media coverage. "We expect import share to continue to improve as more Millennial and multicultural consumers reach legal drinking age," Faust says. "These consumers are more likely to equate cost with quality, and as they trade up, they're more likely to shop the upscale import segment where quality, variety and image play a key role." WHY THE DECEPTION? Aside from the obvious savings on shipping costs, why would a brewer mislabel their beer as an import if it's brewed in the U.S.? "Domestic brewers are keenly interested in tapping into the positive perception and reputational halo many imported beers carry with them," Faust says. "We feel that companies should never appropriate that context, while deceiving customers in the process. Shopping for beer shouldn't be a guessing game. Transparency, trust and accountability must be the norm." It's too soon to tell whether there will be any backlash from consumers against the brands named in the class-action settle- ments, or whether any refunds will ultimately be issued. What is clear is that the news won't help turn around the stagnation domestic beers have experienced in recent years. "We believe consumer awareness will lead to more in- formed beer buying decisions, guided by authenticity and transparency," Faust says. "Secondly, marketers of falsely la- beled brands will take heed and adapt their labels to refl ect the truth about where their products are made. We believe these are good changes not just for brewers, but most importantly, for customers across the board." BD WHAT MAKES A BEER AN IMPORT? BY JEREMY NEDELKA All of Heineken USA's import brands are brewed outside the U.S.