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Craft Beer CEO Keeps Clear Head On Sales

Your company is one of the few that stakes itself to the craft brewing industry right in its name. At a time when craft brewers are producing not only hundreds of thousands, but millions of barrels a year, what does the term "craft brewing" mean to your company in the greater context?

Michaelson: There are lots of different definitions out there for craft, but for us it really has to do with how the customer experiences the beer and brand.

The customer is becoming more demanding, and we think it has to do with how they perceive the quality, variety and authenticity of the whole brand experience and how they relate to it. They want all of that, and it really has more to do with that relationship than it does to the size of brewer. From the consumer standpoint, they're calling nanobreweries and gypsy breweries craft ... for a lot of consumers, [MolsonCoors (TAP) witbier] Blue Moon and [Anheuser-Busch InBev witbier] Shock Top are craft. It's only people in the industry who start applying ownership tags and volume tags which, to the consumer at this point, really aren't meaningful.

What is it about the craft industry's growth that has made the Alliance's business decisions necessary, especially decisions to adapt its brands for survival?

Michaelson: There's a fundamental change in the beer category as there have been in categories like coffee, where the consumer is looking for a new kind of experience than they have in the past. Brands are still important, but they're looking for quality, looking for variety and looking to be kind of surprised both by the beer and the brand experience, so it becomes paramount to provide that to the consumer if you're going to be successful.

The second thing on the beer side is that there's a lot of consolidation at retail, especially on the off-premise side, with major chains consolidating, so it's important that brewers are delivering to the consumer, but that they're doing it with people who have enough gross margin, who bring enough business support, who are able to support them with both distribution and analysis and discussions of how to build that business together.

What makes us unique is that we have these unique beers and brands and that craft brewing richness of history in terms of creating new and great beers. But on the business side we have more resources and an organization that can deliver to the retail channels what they're looking for.

-- Written by Jason Notte in Boston.



>To contact the writer of this article, click here: Jason Notte.

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Jason Notte is a reporter for TheStreet. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, the Boston Herald, the Boston Phoenix, the Metro newspaper and the Colorado Springs Independent. He previously served as the political and global affairs editor for Metro U.S., layout editor for Boston Now, assistant news editor for the Herald News of West Paterson, N.J., editor of Go Out! Magazine in Hoboken, N.J., and copy editor and lifestyle editor at the Jersey Journal in Jersey City, N.J.
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