Spirits marketers, winery branch out into brews

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What do the makers of Jack Daniel's, Gallo and Bacardi market? If you didn't answer "beer," you're behind the times.

These days you can get Brown-Forman Corp.'s Jack Daniel's as a whiskey and also as a lager beer; an alcoholic cider called Hornsby's from E&J Gallo Winery; and a beer once famous in Cuba, called Hatuey (pronounced At-too-ey), from Bacardi Imports. Seagram Beverage Co. has been testing a beer called Coyote in several markets, and a Chicago restaurant recently got help from Jim Beam Brands in creating Bourbon County Stout, aged in Jim Beam bourbon barrels.

"There is definitely a craft beer segment that looks like it is approaching 2% of the industry and it was a natural for us," said Kevin Janiga, senior brand manager for the Jack Daniel Brewery. "The equities fit well. Jack Daniel's is a whiskey with old-fashion values, and we are [marketing] an old-fashion beer."

The most extensively distributed and marketed of the new brews, Jack Daniel's 1866 Classic Amber Lager, has been in Baltimore; Nashville, Tenn.; and Raleigh-Durham, N.C., since March and now is adding Washington and Atlanta with plans for additional rollout sites.

At a recent beer show, Brown-Forman offered examples of several possible brand extensions including an oak-aged ale and a pilsner. Brown-Forman supports Jack Daniel's with radio and outdoor ads from Simmons Durham & Associates, St. Louis, using a "Way behind the times" tagline and promotions using a "Pair of Jacks" theme.

The cachet of the Jack Daniel's Tennessee whiskey brand name has helped the marketer quickly hurdle barriers to getting a new beer into bars, restaurants and stores and speeded consumer trial of the specialty-price brew.

"We are getting a lot of repeat business," said Art Brzostowski, director of beer sales for Churchill Distributing in Baltimore. Gallo, due to roll Hornsby's cider national in January, seems to have limited aims for its brew. "This is a cider, not a beer," said Steve Swasey, public relations director. "It's a growth opportunity." He declined comment on any plans Gallo may have to enter the beer market more directly. Free standing inserts, created in-house, support.

Bacardi sees Hatuey, now only marketed in Miami, as the renewal of a tradition. Before fleeing Cuba in 1959, the Bacardi family's Hatuey was Cuba's No. 1 beer with more than a 50% market share.

A version of the brew is still marketed in Cuba. "We think the timing is right" to reintroduce the beer [in the U.S.]," said John Gomez, senior marketing manager. "With the growth in the specialty beer market, we think there is an opportunity to compete."

Bacardi has so far marketed the beer to Hispanics with Spanish-language print, radio and outdoor boards in Miami from Zubi Advertising, Miami, but the brew's early success and the recent revival of Cuban restaurants around the country is prompting plans to expand distribution and rethinking of Hispanic-only targeting. English-language ads could break next year.

Industry consultants say the past separation of the U.S. alcohol industry into two spirits makers and brewers is an abberation compared with other countries.

"It's almost an unnatural split," said Tom Pirko, president of New York-based BevMark, a consultancy. "The big companies tend not to respond competitively [to smaller brews], and [the specialty arena] is where all the action is. The consumer is just beginning to realize what a specialty brew is; and it's image driven, and [spirits makers] are experienced at providing images."

Copyright November 1995 Crain Communications Inc.

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