12 September 2011

Diageo with a human face

It's a rite of passage for the Irish beer drinker to be able to reminisce on a failed Guinness brand extension. You're not fit for a bar stool if you can't bore innocent people senseless about your memories of Breó, or the St James's Gate series, or the Brewhouse series, or (the holy grail of failed Guinnesses) Guinness Light.

I've tasted most of these (yawn, yeah, whatever, grandad) and in several cases they weren't bad beers: they just weren't ready for that time and place. Diageo are currently pushing out a new brand extension -- this time to the venerable Smithwick's marque -- and, in the opinion of this amateur market analyst, it's in a much better position.

Smithwick's Pale Ale is a very pale -- blonde, really -- beer being launched on keg and in half-litre bottles around the country this month. It's 4.5% ABV and has been late hopped, including dry-hopping, with Amarillo. And it shows. While light of texture to the point of wateriness and a little on the gassy side, at least from the keg, there's no mistaking the flavour of proper hops: a sweet and juicy peachiness is given an empty stage to sing its heart out.

Cleary, a lot of thought has gone into this product, and it owes its existence to more than Diageo's general revitalising of the Smithwick's brand and the flatlining of mainstream beer sales in the developed world (though I don't doubt both those things had a lot to do with it). Why, of all things, a hop-forward pale ale?

Five years ago such things didn't exist here. Microbreweries made red ales, and lagers, and stouts and wheat beers. Then Galway Hooker came along and changed the parameters, eschewing the mainstays of Irish beer and going for high doses of Saaz and Cascades. Established craft breweries followed them and the hoppy pale ale is now in the repertoire of most of the nation's micros. It's an accessible style of beer and just different enough from the other taps on the bar to make it worth investigating. But most importantly it just tastes nice. You don't need a slick brand identity to shift this stuff, nor countless centuries of brewing heritage, nor suggestions of sophistication or the exotic. It's the sort of beer grown-ups like to drink and it stands on flavour alone.

There are apparently several more to come in this Smithwick's series, but I reckon they've started in a safe and sensible place, and my perspective on the beer offerings in the Typical Irish Pub is certainly brightened by its existence.

However, I also think there's a darker lesson for Ireland's independents. Medium-strength hoppy keg ales are done. Diageo make one now, and unless you can play the local card or have some other unique selling point I imagine it's going to be a much harder thing to flog. Time to make something else.

30 comments:

  1. Yeah, yeah, it tastes nice, but the important question is: what's the advert like? Who's directing it? How much did it cost to make? Is there a link to it on YouTube? I'm not touching it if it doesn't have a good advert.

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  2. I wonder if they'll send it up here too?

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  3. http://www.smithwicks.ie/SMX-Pale-Ale.html

    I'm not sure why ester has to be inverted commas

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  4. I had a whole comment written about how Diageo must feel a bit threatened by the microbrewery industry and how this means that the microbreweries are succeeding by encroaching on Diageo's market sufficiently to have them worried and that can only be a good thing. And then I lost it (the comment).

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  5. I don't think they are necessarily encroaching on diageo's market, but diageo aren't stupid and they realise its the more flavourful beers that are holding their own in sales whilst eurolagers and nitrokeg bitters are rapidly decreasing in sales; so they're looking to tap into that market. Some of these new drinkers weren't ever diageo customers

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  6. Bailey, I did of course ask them, but I don't think they're planning any TV spots for it. I think they're doing one of them squishy launch things.

    Steve, that copy reads like a very typical example of what you get when a marketing person has been given a technical product spec sheet. "I've no idea what esters are, but they must be unique to this beer, and that's a selling point."

    Jenny, I don't think that's the case at all. I doubt Diageo would notice if all the micros disappeared tomorrow -- the business models and the numbers involved are orders-of-magnitude different. What they are threatened by is the fall-off in "normal" beer sales. Those people aren't turning to microbrewed beer in big enough numbers to threaten Diageo; mostly they're just drinking less. However, I do agree that Diageo paying attention to this end of the market is a good thing. It's a better way of winning them back than a slick TV ad (sorry Bailey).

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  7. I think he was being tongue in cheek!

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  8. Have microbreweries become the brewhouse series for Diageo? If Diageo cannot release odd beers to see if there is a market they probably just follow the micro brewers and copy them when they succeed.

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  9. It's possible. In which case it'll be very interesting to see what, if anything, they come up with next. What else do the Irish micros make that isn't already in the Diageo portfolio?

    They asked me what I'd like to see on the Irish beer market. I said, having tasted theirs, a decent dark lager. Don't think that was appreciated.

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  10. I agree with you there, on the dark lager. Didn't guinness technically make one of those recently? What happened to that? I mean, I gave them my full support when they were dishing them out for nothing in the bar, like.

    So, Smithwicks' making something nice, eh? Maybe there's no need to home-brew after all...

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  11. >What else do the Irish micros make that isn't already in the Diageo portfolio?

    Seasonal beers? Puca alike for Halloween. Special drink for Arthurs day etc.

    A porter like Clothworthy or Dark Arts?

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  12. Tom, yes it's still about and, as they tell it, a roaring success. It launched in Norn Iron last year and they've just started sending it to the States in the last couple of weeks. My review is here.

    I'd keep going with the homebrew, mind, just to be on the safe side.

    Dave, I would say that anything in the porter-stout spectrum is off-limits to the Smithwick's brand for fear of diluting the Guinness one. It's a relationship that has existed since Guinness bailed Smithwick's out during a strike in the 1920s when they were still separate companies. There ain't no Smithwick's Porter and there never was, capiche? Good boy.

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  13. Having one hoppy pale ale on the market doesn't mean there isn't room for any more, surely. There are (several) small brewers in the Northwest of England who brew nothing but, and they seem to do all right.

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  14. True, it doesn't mean there isn't room for more, just the same as the existence of Guinness and Murphy's doesn't preclude micros from making nitrokeg stout. However, it does make it bloody difficult to get a craft nitrostout onto a bar counter.

    IMO there isn't enough to distinguish most of the Irish hoppy keg ales from this new one. The drinker's interest is not served by their proliferation, nor the proliferation of nitrostout, nor of 1.038 brown bitter.

    I'd like to see more variety, and I know I'm not going to get that from the macrobrewers.

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  15. When's it coming to an Irish themed pub in Blackpool?

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  16. Look, I just took two free pints off them. I did not volunteer to be their international spokesperson.

    If you want it, get over here and do your bit to bail out our excuse for an economy. We also offer cooking lager and cooking stout for around €3 a pint in some boozers.

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  17. We have fond memories of Breó from our first trip to Ireland in 1998. We fell in love with the Emerald Isle after the first sip.

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  18. Anonymous4:06 p.m.

    Interesting post BN - I had my first bottle of this last night and, I'm happy to say, it won't be my last. It's certainly not the boldest tasting brew I've ever had but it's a proper beer with a discernible hop profile and it'll have much wider distribution than even the most succesful of the micros. Supporing Diageo does leave a slightly bad taste in my mouth, but a reasonably flavoursome new Irish beer is definitely welcome, regardless of who produces it.

    Madigan

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  19. No reason to get shirty pal. You should be chuffed your blog gets comments.

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  20. Professor Pie-Tin12:11 p.m.

    Anything - and I mean ANYTHING - which produces even a tiny bit more selection other than all the usual bleeding suspects on offer at most Irish pubs has got to be welcomed.
    I live in a town with more than 30 licensed premises and only one - a large hotel - offers anything other the chain beers.
    And that's a bottle of Paulaner well hidden from public view just in case a pesky tourist should have the temerity to order one of them there foreign beers.
    But I'm nothing if not optimistic - perhaps the latest diaspora of young people who've left looking for work will acquire a taste for the unusual and bring it home with them in 10 years time.

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  21. We're in the midst of a Guinness Black Lager launch 'round these parts. Thus far I've seen it in bottles, but not on tap anywhere.

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  22. It was bottle-only in NI. They're after the barbecue and nightclub market (think Corona) so I wouldn't be surprised if they didn't bother with draught.

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  23. I don't have high expectations for it. But who knows, I might be wrong. I'll probably grab a few this week.

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  24. Just stumbled on this blog today... fantastic. Interesting piece on Pale Ale, I personally think it will be another failure. The key is trying to target the younger consumer ie students. Have Diegeo done anything to promote this..simple answer no!

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  25. They tell me they're going for a 30+ audience for it. Besides, they've only just launched. The marketing has barely started.

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  26. Yes fair point... I feel the market is slightly saturated with beers targeting the 30-50 bracket.. Ireland needs someone or something to revolutionize the market... perhaps a micro-brewery to get backing from one of the coprporate giants.. theres alot of talent in Ireland

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  27. Ireland has 19 independent microbreweries fronted by talented professional brewers. They don't, to my knowledge, segment their market into age brackets. I doubt they can afford to.

    And they don't need foreign companies backing them. The beer is there for whomever wants to drink it.

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