Brew Talks Denver 2021 CBC: Panel 2: Darty Starter Marketing to Generation Z

Justin Fonte [00:17] Welcome back. We are at panel number 2 for everybody back at home or maybe you've just tuned in. I'm Justin Fonte. I'm the Brew Brown reporter, and uh we're gonna talk about Generation Z and we decided that this task was, uh, certainly far out of Justin's hands because while I'm old, I'm not Justin old. So joining me is, uh, Zoey Locata who is our new-ish editorial assistant. Hello.

Speaker 2 [00:39] Hi everybody.

Justin Fonte [00:40] How's

Speaker 2 [00:41] it going?

Justin Fonte [00:42] Good. How you doing,

Speaker 2 [00:42] bud? Good. I'm excited. I'm

Justin Fonte [00:44] good. I'm, I'm excited that you're excited because honestly I'm scared. No, don't be

Speaker 2 [00:49] scared. Gen Generation Z isn't that

Justin Fonte [00:51] scary. It's definitely a

Speaker 2 [00:53] little,

Justin Fonte [00:53] definitely not a little bit. But so yeah, we just wanna take a second to thank all our sponsors, our presenting sponsors, Dogfish Head and OI, and we also have the Ray's Beer Division, Inland Packaging, John I Haas. Orchestra G&D Chillers, Scott fabricating, and I said, right, it's so great. So thank you to all our sponsors. Really couldn't do any of this without you guys. So we are going to be talking about Gen Z and the eldest members of Generation Z are now 24, verging on 25, meaning they've been of legal drinking age for a handful of years now. And if you haven't figured out how to connect with them through your brand, there's a not insignificant chance that it might be too late, but we're here to help. So, uh, it's easy to assume that since you've been reaching millennials successfully, that maybe, you know, you don't have to change up too much, uh, and there might not be an epically long amount of time between the oldest members of the millennial generation and Gen Z's generation, but due to the, you know, the. Rapid advancements in technology while these guys were growing up, they may as well have grown up on different planets. So there's certainly a lot of different things that you gotta do when you're thinking about both of these groups.

Speaker 2 [01:55] Yeah, I mean, we Generation Z, we kind of grew up with the Internet in our pockets, and we also, as Sam mentioned on our first panel, we grew up with the beer category having this extensive array of hard seltzers and FMBs and other RTD options, um, and there hasn't really been the case for millennials or older generations, so. There definitely needs to be a new playbook for Gen Z and so we're excited to talk about that

Justin Fonte [02:20] today for sure. Our panelists today are building brands in this new era, and they bring a wealth of marketing knowledge from both inside and outside the beer industry. So, uh, please join me in welcoming TO Hunter, founder of Crowns and Hops. How you doing, Teo?

Speaker 3 [02:38] Yo, what's good. How's everybody doing? Do, do I, do I have to give a brief intro? No, I'm, I'm, I'm fucking with y'all. Nice to see you, everybody.

Justin Fonte [02:48] Uh, we also have Dave Nasby, the senior brand manager for New Belgium Brewing's Voodoo Ranger and Fruit Smash Hard Seltzer brands, two things we just talked a lot about. What's up, Dave? How are you?

Speaker 4 [02:57] Hey, I'm great. I'm great. Thanks for having me. I can't really work the crowd as well, but I'm good.

Justin Fonte [03:01] Oh, you're going to be great. Thanks for being here. Last but absolutely not least, we have Marianne Karen, the marketing director of Coop Ale Works in Oklahoma City, Oklahoma. How you doing, Marianne? I'm good, thanks for having me. Oh, thanks for being here. This is your first big beer event, right? It is

Speaker 5 [03:18] my first big beer event, um, totally new to the industry, so be gentle.

Justin Fonte [03:23] Oh, you're gonna be fine, so.

Speaker 2 [03:27] Um, yeah, so let's just start off. I mean, when you're looking at younger LDAs, it's really important to listen and see how these drinkers are engaging. So what are you guys doing to listen and engage with these Gen Z consumers, and I guess we can just start off with UTO.

Speaker 3 [03:44] Um, my name is TO Hunter. I'm the head of brewing operations and COO for Crowns and Hops Brewing Company in Inglewood, California. Uh, we are one of the only brewing companies, uh, one of the only black owned brewing companies in the nation, um, and we're extremely proud of that. Um, first and foremost, um, I think it's really important to understand what it is that we're talking about here. Um, I think the word marketing, um, advertising gets used a little bit too often, and we don't really understand that it's about reaching other human beings. Um, that said, um, when we talk about this Generation Z, um, we're also talking about the generation that really. Made Crowns and hops something that is sitting here talking to you right now. We're talking about the, the generation that was out in the streets last year fighting to make sure that their voices were heard, to make sure that Black Lives Matter was something that wasn't just a cliche statement but was something that actually people understood and did some, some self-exploration and investigation in their own. Core values and I turned it to that, um, it really is about core because after all, Gen Z will see right the fuck through you. They will see through you like the Wizard of Oz. They will see if what you're doing is full of shit or if what you're doing is worth investigation and, and has core values that they can align with. So, um, I'm sorry I went on a tangent there, but, uh, um. But yeah, um, the question again?

Speaker 2 [05:26] No, no, it kind of answers the question,

Speaker 3 [05:28] Sam.

Speaker 2 [05:31] Yeah, we're just, how are, what are you guys doing specifically as I mean you're all brands that are really connecting with these consumers in this consumer base so what is it that you're doing to connect with this generation and engage with those consumers?

Speaker 3 [05:43] Yeah, so I'll distill that down to um we have always been community based we've always been, um, in our opinion, um, an amplification of the community that we represent. And, um, in its truest, most authentic form, um, it was absolutely missing in craft beer. Um, I, I, I can't really say that's largely anybody's direct fault, um, because of inherently where craft beer, um, is cultivated, where it's celebrated, where, um, it, it finds traction, um, but ultimately, um, there was an. Is an audience that doesn't even know what the fuck craft beer is, and that's what Crowns and Hops represents. Um, so really it's about being, um, as, as authentic as we can be and not, um, not falling susceptible to, uh, fall, going and, and, and aligning with status quo and assimilating, um, and, and, and thereby not even showing Gen Z that we're there.

Speaker 2 [06:41] Dave, how about you? How are you guys connecting?

Speaker 4 [06:43] Yeah, so, um, I'll talk a little bit about Voodoo Ranger where To the, to the point of community, I think that's a really ripe opportunity for connecting with younger drinkers and younger generations. I think Steve mentioned it on the last panel, but the community that we've really heard from the most on voodoo is the artist community and the gaming community, the comic book community, um, that's a strategy I think you could see a lot of, of like, well, that's a lot of people, you can sell a lot of beer to those people, let's market to them. How we've connected is actually that we, we launched Foodoo Ranger in 2017. And we waited and listened to what our drinkers told us and we saw that community come to us and say, hey, can you send me the Voodoo Ranger graphic? I wanna get that tattooed on me or do you mind if we do a, a comic book ourselves with Voodoo Ranger in it? And we kind of said like, huh, there might be an opportunity here and we're actually invited into this space, this community to say like, yeah, Voodoo Ranger has a, has a place here rather than. Saying like you know we're we're gonna just try to market to these folks I think to your point of authenticity it's the same way where if we kind of went in and we're like we have an illustrated character we're gonna become an illustrated brand and you know look at us we're gonna sponsor all of your events that that doesn't fly for this generation it's waiting to be invited into their communities and then say yeah we can actually help elevate you now that we're here.

Speaker 5 [08:13] And I say similar to what both Tio and Dave have said, same, um, you know Cup is a data driven organization which I know is a very buzzy thing to say. I think every marketer in the entire world regardless of your industry says that, but it's definitely something that is true for our group. It's a cross functional, um, data analytics, so not just our analytics team which is led by a very smart. Person in our company called Derek, but it's a function of all of our jobs so whether you work in marketing or you work in sales or supply chain, we're all very data driven group and I'd say because while listening online is incredibly important actions speak louder than words and numbers do a really great job of demonstrating what they're actually doing versus what they're saying and then secondly. Um, you know, to you in particular touched on it, the idea of being inclusive. Um, my background has been the past 10 years spent in the luxury watch space, um, for a brand called IWC Scheffhausen. It's been around for 150 years, uh, so they have a lot of learnings, but they're also still learning. The watch space is still an incredibly exclusive space. It is, um. A place that can be written off as snobby and not welcoming, I think for craft beer maybe not to that extent, but for us it's constantly exploring ways that we can bring new people into the fold with understanding that not everyone's going to care about the quality of hops and all of the craftsmanship that goes into it. Sometimes people just want something that's fun.

Justin Fonte [09:30] Marianne, I'm so glad you brought up data and really quick before I hit our next question, uh, the text line is open for questions again. You can text 617-336-8560 and, uh, we will get your questions up here and, and get you some answers from the panel. But you did mention data and how important being a data-driven organization is. So how do you gauge what's working in reaching the younger demographic? What, what do you guys look for?

Speaker 5 [09:53] Well, before we do anything, we have really set KPIs now I say they're set, but they're also fluid because we don't know what we don't know, um, you know, I've been not in this industry, but I've been working in marketing for close to 20 years and I think anyone that works in marketing is well aware of the fact that within most organizations, if not all, we're the, the. Department that spends money we don't make money. I disagree with that but that is generally how it's seen on the budget sheet so I would say we try to always back things up with numbers because that's a language that everyone in most organizations speaks so again it's not necessarily the sexy answer, but it's really focusing on the numbers.

Justin Fonte [10:31] Definitely. I, as a marketing person for a tap room, I once was spoken to about ordering $600 worth of donuts for, uh, Black Friday morning, but we hit twice that in retail sales before noon, so I think I was right. But anyway,

Speaker 5 [10:42] there's nothing wrong with $600 worth of donuts.

Justin Fonte [10:44] Absolutely not. Dave, what do you guys look to to see how your efforts with Gen Z are, are working and effective?

Speaker 4 [10:52] Yeah, I, I think we, we have some tools like I, I think we have a, a nice level of like social listening and, and media mix sort of tools to tell us how to communicate with them, but ultimately the brand itself for Voodoo Rangers is built on this aspect of creativity and giving artists a chance to express themselves through our brand. So we do that in a couple of different ways. Sometimes it's serious, sometimes it's fun, sometimes it's, um, borderline inappropriate, um, but what we try to do is listen to what our, our target is telling us, you know, they, they'll let you know that's, that's the one beautiful thing about Gen Z and, and younger millennials is if you overstep you're gonna find out really quickly like there's no, there's no mystery like there may have been in, in marketing of years past, um, so we just try to listen to them and say like. You know what, what's working? What, what are we getting a lot of comments on? What are people telling us that they like? And rather than taking that and saying like, OK, well let's promote the hell out of that because that was a really good piece of content and that's, that's gonna be our strategy for the next 6 months, what we do is go, all right, cool, I'm glad they like that. Like let's, let's try to make something that's kind of similar, um, and learn from, from our success. as well as our failures I guess.

Justin Fonte [12:06] I mean that's one of the probably best and worst things about social media is that you're able to have a real time conversation with your consumer base. So TO, how do you guys know when things are working really well with with the younger drinkers? What, what do you look for?

Speaker 3 [12:17] Um, I'd, I'd say I'd I'd have to agree with Mary and David. It, it, I mean, at the end of the day engagement is king. um. There's nothing like hearing directly from your community on what's working and what's not, um, you know, I have a background in advertising and marketing and creative for the entertainment industry, for Universal Pictures, Paramount, Miramax, and I've seen it all. I've seen it all from internal marketing to some of the largest marketing agencies on the planet. And um I'm telling you, we are living in a moment right now um that is so unique and so special, um, and it's been demonized ironically for so long, um, ironically until COVID, um, when people realized that their only direct communication with the consumer was through social media. Um, and that's how Crowns and Hops was born. We were literally born through social media, to take, taking that picture of that beer, uh, where some of the brewers were like, ah, you know, like, you know, how, how dare he take, you know, the lighting is not even right, the liquid isn't there, it's oxidized, the oxidized, you know, all those things, and literally we realized that there was an entire community that wasn't being spoken to, that wasn't being engaged with, that wasn't, that didn't have. Presentation, um, that was there. It was all there. It was there for not just us as crowns and hops, it was there for the entire industry. It was whether or not people were actually listening was the key. And Gen Z is all about being heard and engaged with, um, their thoughts and their opinions matter. It doesn't mean that you need to adopt them and change your entire mission statement and vision, but you do need to listen and you do need to pick up on the clues because they will give them to you. They will give it all to you.

Speaker 2 [13:58] Yeah, and we, we saw this a little bit, um, the Brewers

Speaker 3 [14:01] Association tell us what you think, Gen Z,

Speaker 2 [14:04] and I'm the unofficial spokesperson, um, but we saw the, uh, brewers Association did a survey last year of Gen Z consumers, and there seemed to be a trend that. They don't care as much about who you are, but what you're doing, the actions of your organization, your company, and locals seem to mean less to Gen Z. Is this something that you guys are seeing playing out? You can start TO if you want.

Speaker 3 [14:28] Uh, of course, um, you, you know, we, we kind of started off, um, one, we aren't the first black owned brewing company on the planet. Um, there are, there are other, obviously phenomenal, you know, Garrett, you know, Celeste, you know, um, you know, amazing brewers around the country, but we were one of the loudest, um, you know, when, when George Floyd was murdered, we were one of the first to make a statement out there. And, and to be honest, it was like one of those first moments to where it was like. Do I say something or do I stay aligned with this voice in craft beer that says you shouldn't say something? And in that moment, it was like, it was like a light bulb went off to where it was like, this is an opportunity to be 100% exactly who the fuck you are. And we did it. And we did it, and the response that we got, not only from the community, um, some of it very polarizing, some of it, you know, some of the typical shit, you know. Keep politics out of beer, keep all that, you know, whatever the case might be, um, but what we were afforded in that moment was to literally hear directly from the consumer, um, so, so it's a strategy that we, we've been doing like consistently is, is being the voice of the underrepresented, you know, I think many people in this room probably are rocking Patagonia, you know, I'm rocking Crenshaw, I'm, I'm rocking the marathon. Which is Nipsey Hussle, and if you don't know about him, look at, look, look up who he is. I'm not expecting y'all to rock a Crenshaw or slouching shirt next day, but if you do want to have an idea of what your consumer is listening to and what they're identifying with, you, you gotta break out of your shell, you know, and, and that's what we've always been about, um, not, not assimilating and not, not aligning with status quo, but rather just being authentic selves.

Speaker 2 [16:22] And Dave will pass this along to you. I mean, you guys are the only national brand up here, so what are you seeing from Gen Z about what they're caring about? I mean, are you seeing that they care less about localness?

Speaker 4 [16:33] Yeah, I don't know if, I don't know if I'd say that I'm seeing that, um, and I might just not be qualified to answer on that. I will say, you know, we have two home states, North Carolina and Colorado, and both are absolutely monster states for us and continue to be. Uh, a big part of what's driving our growth, so, um, we obviously have our taprooms there and it's been a challenging, you know, 18 months, uh, for those folks, but, uh, that's absolutely been a, a huge part of our, our marketing strategy through those rooms. So I think we still lean on it heavily, um, and I think that there's, I'd, I'd be surprised to hear that, that that was something that, um, that Gen Z didn't really care about. I guess the other part of your question of like who. Who you are and what you do and that they care more about what you do and not who you are, I think a really similar point of like if what you do isn't who you are, then you're inauthentic and you can see through that in a heartbeat like to again to your point earlier of you grew up with all your information in your pocket like these digital natives of of. People that are, let's call them 21 to 29, I'm gonna go with younger millennials in here too just to make myself feel a little bit better, um, but like those folks, they have access to all of the information so if you're trying to do something that is not who you are. You're gonna be called out in an instant. Like, I think the age of, you know, being a mega polluter and running like a, a little trash pickup campaign and running an ad about it and everyone feeling good, I think those days are over. And I think it's a good thing. We should thank Gen Z for that.

Speaker 2 [18:06] And Marianne, what are you seeing that these consumers are, are looking for?

Speaker 5 [18:10] Well, there's a stat out there that says 3/4 of Gen Z consumers are willing to boycott your brand if you don't align with their values. Um, I think we've seen that really play out over the last year and a half in particular. Um, now how long that boycott lasts is, you know, TBD, but we've seen brands and personalities and people, um, taken down for various reasons in very short amount of time, um. You know, the other part of it, I think Simon Sinek said that it's less about your brand's product, more about your brand's purpose. I think that's exactly what you guys have been saying. Then lastly, what does local even mean to this group of people to the point they've had the Internet their entire lives. Travel has been incredibly accessible if we're talking about people that live in the United States for the most part, and you know, things like study abroad programs in college have become a huge revenue generating stream for universities. So these are people, I hate to say kids, makes me sound like I'm old. I'm an older millennial, uh. But what does it, what does it mean for them when they've grown up in essentially a global world and things that are happening, whether if it's in Afghanistan or it's in Denver are really having an impact on their lives? I mean, I think that's driving a lot of it.

Speaker 3 [19:20] I, I will say that too on a local standpoint, um, for, for me and my partner Benny Ashburn, what we're building in, in Inglewood, um, off of Crenshaw in Manchester, um, it, it, it has been up for grabs, you know, and, and, you know, take, take that how you will, but in black and brown communities, there have been. No local concepts that really were enriching, that really served the community, that really served the people that already lived there, and, and that element of local is something that, that myself, um, Craig Bowers, you know, um, in South Central is doing as well, um, and, and, and it's something that, you know, one, I think really speaks to the true pillars of craft. Beer, um, I think all the things that we originally fell in love with, um, but we're, we're introducing them to our community, you know, you know, from us, by us, you know, so there still is a huge element of local to it, you know, I don't think that people need to all of a sudden be everything to everybody. I, I think that's a recipe for disaster, um, but, but that said, I, I do think there's an opportunity to. Support other breweries that might need it um that are are are doing their version of

Justin Fonte [20:33] local yeah I mean and one of the issues of the past decade I'd say is we see lots of breweries opening up in those neighborhoods and then they don't hire local residents and then they wonder why their local community isn't supporting them but you know you have people Ubering in from God knows where and it's really been kind of a struggle so I love what you guys are doing in LA. Uh, one of the things that all of you bring that's, I think, really important is you're coming to this industry with relatively fresh eyes, and Marianne, you're what, 6 months into, beer, just

Speaker 5 [21:01] barely,

Justin Fonte [21:02] I mean. But like that's so important. So when you look at this industry because we're at a very, you know, we've been at like a very pivotal moment for a while now. I don't know how long a pivotal moment can last, because this one's kind of exhausting, but how can beer do a better job of speaking to younger consumers?

Speaker 5 [21:22] Well, the luxury industry isn't all that different from the craft beer and seltzer industry, um, you know, people are buying goods for a lot of reasons, um, but there, there's a lot of similarities. What I would say is I think it's having a firm understanding of the baggage that this generation is bringing to the table. Um, I feel like I'm talking a lot about downer subjects, but this is a group of people who their entire life have had school shootings in the background, global and economic crises, and. Now for the past year where they're starting their working careers perhaps even families um it's been marred by COVID and the long term implications of that and how they interact with brands and just society I think are really TBD so it's hard to know um you know I there's a study that came out in North Carolina State University that talks about the three things that that can. Find Gen Z and it's um a constant need for innovation which makes sense again when you think about the time they were growing up and entering adulthood um convenience we see that with things like the rise of drizzly and GoPuff and then lastly escapism and I think that goes back to my original point I mean I think all of us feel this way. I think we all need a little escapism at a certain point.

Justin Fonte [22:34] For sure, Dave, you're what, a few years in, right? Couple years, yeah, a couple of years. What like what have you seen as comparing to your earlier parts of your career that beer could do a little bit better talking to the youth,

Speaker 4 [22:46] the youth, the

Justin Fonte [22:47] youths,

Speaker 4 [22:47] the youth, um, still really old. So I, I didn't come from movie studios or luxury brands. I came from this is better dog food, which is a pretty sexy

Speaker 3 [23:02] horrible start to your answer, Dave.

Speaker 4 [23:05] Let me tell you a thing or two about Doug Kibble. Um, no, no, but I think the, the point remains is, is there's a lot of similarities and a lot of differences, um, and the one thing that I, I've really taken away from, from joining the industry is that we've segmented in an incredibly. Short mannered way like we, we've looked at, it's not, you're not a beer drinker, you're not a craft drinker, you're not an IPA drinker. I'm a hazy drinker and you have got kind of got people down to these like very specific uh occasions that define them. As a consumer, well, really they're a person and they enjoy drinking beer and yeah when they're on, you know, when they're at a bar and there's a hazy they might be like yeah I'll choose that over maybe a West Coast style because I kind of, I like the hazy profile but that's not a hazy consumer um I think that's the big thing I've taken away since I've come in and like pull it back a little bit and think of like who are these people and what are their motivations outside of beer and I think you can talk to them in a much different way, um, that might resonate a bit better.

Speaker 5 [24:11] Dave and I were talking about this, sorry, before the panel and about how, um, you know, at some point, you know, millennials would've been the thing we were talking about on the stage and at another point it would've been Gen X and maybe baby boomers um at some point Gen Z is going to have very similar shopping habits to their 30-year-old plus counterparts, um, when you think about the life changes that happen. So a lot of this too is looking at best in class examples from I hate to say like time gone by because there's always a need for innovation and things change both technologically and culturally, but it's, it makes me giggle a little bit that we talk about them in a way that they're just this unicorn that never existed. Yes, they are different and they've had loads of different life experiences than perhaps someone like myself has had at my age, but it's, it's not exactly rocket science.

Speaker 3 [25:02] Alright, so, so all the people in Inglewood would be pissed if I didn't do this, cause I try and do it. So I'm gonna ask the entire crowd to wake the fuck up for two seconds and pronounce Inglewood the way that you actually say it, and that is Inglewood. So on the count of 3, I need a strong ass, thunderous Englewood from the crowd. Ready? 123. That was sexy. I love that. Um, I, I, I would, I would also, um, say that it's not rocket science, you know, um, I think one of the things that a lot of people. Get stuck in um and all the head trash starts to develop around is how do I market this brand rather than focus on the core of who they are. If you truly want change and you truly want something different, then you need to invite change and different to the table trying to develop these solutions and all. All these, these ideas and these cool concepts and shit that you know, and you're, you're, you're, you're saying and you're, you're swearing that you need something different, then you need to make sure that different is right in front of you and that you're getting answers from different. Again, it's online, it's on social, and I equate it to working out, which I know that from the looks of it, all of you do, quite often. Um, you know, it, it, you, you could, you, you could, um, work on your arms and your legs all day, but if your core is whack, if your core is weak, then you could pick up a marble and twist your whole shit up. So if your core in your company and your staff and your employees aren't on the same path of what it means to unfold and to be something different in order to preserve the longevity of whatever core attributes and core principles that you have, then fuck marketing and branding and advertising it doesn't matter because. If the experience of Gen Z is gonna be something that doesn't reflect and says, hey, I wanna build with you Gen Z, or this is for you, this is your space, which is ultimately the freedom and the beauty of craft beer is that once you give that pint away, it ain't yours anymore, it's theirs, and, and we should think about that the same way that we market and that we present our products and our brands to them as well.

Speaker 2 [27:19] And going off of that, I mean beyond just younger legal drinking age consumers, the craft industry has really struggled with bringing in young black drinkers is, uh, I'll start, I'm gonna ask all of you, I'll start with UTO, what can craft brewers do to bring in consumers and not appear to be pandering to them, like bring them in in an authentic way that they're going to appreciate.

Speaker 3 [27:42] Um, I, I, I think it, it latters in what I just said. Um, be true to your own principles and stop looking at the black community as a monolithic community. Um, there are black people that love to ride bikes, that love to hike, that love to surf, um, that love to do what they do. You don't need to pander, just be true and just talk about the shit that you love, um, because the reality is, our community is just as diverse as your community. You know, um, just because I wear a Crenshaw shirt doesn't mean that I'm not gonna rock out to some paramore when I get in an Uber. You know what I'm saying? Um. You, you don't know that, you know, so I think what we have is an opportunity to, to dive deeper into who we are and to present that, and to present that we're, we're open to listening and opening to understanding even new facets of the shit that you love. You know, it's just like taking a hike up in the Rockies, you know, you, you may be stuck to one fucking trail, missing all the 30 other trails, you know, so, so really it's less about what you do and what you say, um, but more about being. True to your core values, um, and the last thing I'll say is if you have black people in your community, make sure that they know that that brew pub that that public house is theirs as well, uh, make sure that there's programming, make sure that there's community leaders that know that that's a place, a public space for them to gather to conspire to, to, to do great things for the community that's also yours.

Speaker 2 [29:09] And Dave, we touched on this too of like how Gen Z will call you out if they see that you are doing something that isn't real or that's fake. So what can you do to, to bring in that community still and to bring in these young drinkers without being that

Speaker 4 [29:23] I think the first thing is to acknowledge that someone that looks like me probably shouldn't be commenting on exactly what's right and rather. Listen to the people who are experts in this space and can create those more inclusive environments that's something that at New Belgium we take extremely seriously. We've made strategic hires internally and we've brought in outside councils to to help and continue to evolve in that space. I think the big takeaway that I've heard from them is, is one that we've already touched on which is, you know, don't look at other communities as a way to sell more of your beer. Think of ways to help support those communities like it and the answer to that question can't be by bringing your magical beer to them like they have their beer, they have their ability, and this, this is any community that I'm talking about right now of they have the ability to, to make their own. So if you're gonna get into that space, you need to do it the right way. You need to first listen and then, um, think of ways to elevate.

Speaker 3 [30:27] And one thing I will say too, I'm sorry to chime in real quick, is appropriation is a real thing. Um, that is not the answer. Um, I don't know if you guys have seen it, but Budweiser just put out a beer with Biggie Smalls on it. That is not the answer. Um, using cultural monikers and, and phrases and, and culture, um, without any attribute or any invitation to the community from where it was derived is wrong. And there are several articles I'm not gonna go into and get on the soapbox about it now, um, but any. Community that has not had the ability to utilize and leverage their own culture um and for an industry that has struggled with diversity and inclusion for generations to all of a sudden with resources be able to leverage that culture for their benefit is not the answer so

Justin Fonte [31:17] I'm glad you said that to you.

Speaker 5 [31:20] I'd say part of it too is like we had talked about inclusiveness earlier it's, you know, the luxury industry is, is sort of have coming to terms with this as well, but it's about bringing in diverse voices in your organization and diverse decision makers and you know, making that part of your corporate culture. I mean, I think we also remember, you know, I apologize because it feels like time is just blended into one never ending stream. So was it this past summer, the summer before, summer before when everyone had their black square on Instagram? What did that mean? And to the point of calling people out on their shit, we saw that. I remember a really classic example with Nike was, well, how about you share about how many people of color are on your board of directors because Nike's going and all of the athletes they use and they posted that square with not a lot to say about it. So I think, you know, the point of people calling out industries and companies, I think that's a good thing if that's gonna be at least for now what it takes to hold people accountable, um, to move in this direction that I think for the most part everyone is agreeing that we all need to be moving towards, um. I think we're all on board with that

Justin Fonte [32:21] for sure. Uh, one more plug for the text line if you have questions for these guys, send them to 617-336-8560. I wanna move on to something that we, uh, I guess we try to talk about, but it ends up with a lot of like, oh, how do we do this, uh, brand loyalty. And Marianne, I know you probably know a lot about this from your, your career in luxury goods, but brand loyalty seemingly always been an issue within craft beer, given rotation nation. We see it crop up in hard seltzer. New brands are cannibalizing older ones. Marianne, you've worked on this from your time in luxury watches. What challenges do you see in building brand loyalty with this current generation?

Speaker 5 [32:58] Well, I'll address the point of cannibalization first because I was working in luxury watches when the Apple Watch came on the scene and every single headline and story was it's the death of analog watches. No one's gonna want an analog watch anymore. It's the death of the Swiss watch industry. Well, you know what? No, it wasn't. They're still around, you know, the brand I worked for had been around for 150 years. Other luxury brands such as Cartier have been around a lot longer. Um, there was space for both, um, and I won't go into the weeds about how that's worked out and luxury watches people can certainly afford their Apple Watch and their analog watch, but there was space. I think that applies to most industries, so to the point of cannibalization, I think it goes back to more adapt or die more than anything. To the point of loyalty, it's a pretty easy question. Gen Z isn't loyal. I mean, not to oversimplify it, they're just not. But a lot of that seems to come with age. Um, they're at a point again, they're at the start of their careers, they may be more price conscious because they're not in a higher income bracket yet because again they're 21, 22, 23, 24, 25. I mean how much are any of us making unless we work in finance at that age? Um, I think part of it that the luxury industry has done really well is they understand it's a long game. Um, you know, brands such as Cartier and Louis Vuitton have done an excellent job of product diversification because while it's gonna be hard to hear, there are some 21-year-olds that can afford a $12,000 watch and bespoke handbags from Louis Vuitton. Most can't, so how do you get them in the door? Again, it's that portfolio diversification. A lot of people can afford a Cartier key chain. They can afford a small leather good from Louis Vuitton, and so those brands have understood that it's a slow burn and it's a long game. So to get them in early in an attainable price point is the way to go. Now listen, they also don't have any restrictions around age. If a 13-year-old wanted to come in. And buy a Cartier love bracelet, no one's gonna tell them no, um, so whereas this industry there's obviously age limitations, but I think you know when you have the opportunity for portfolio diversification, that's one way to look at it. But again, I came from a brand, it was an analog watch brand other than straps there's not a whole lot else you can do. So I think to the question of loyalty it's getting creative. It's again the idea of innovation and to the point of diversification as well it's your marketing channel strategy. It doesn't have to mean that you're adding a ton of new SKUs to whatever you're doing. Um, it's just making sure that what you're doing is right and hitting the mark with realistic expectations of how long this may take.

Justin Fonte [35:23] So I'm glad you brought up, you know, a portfolio strategy because Dave, that's certainly something that New Belgium really has, especially right now. So what path are you seeing newer, uh, LDA drinkers take as they enter the portfolio? Are there certain products that bring them in? How do you, how do you keep them in, and how do you see them move back and forth between all your different offerings?

Speaker 4 [35:42] Yeah, I think the answer to that is probably different than it was maybe 5 years ago. Like, so within New Belgium, you know, you may have thought like, OK, you enter in through Fat Tire, you explore the Voodoo Ranger portfolio, you graduate to our sour program. I don't think that's really the case anymore. I think what we've done, especially with Voodoo Rangers, is try to make as many accessible entry points into craft within voodoo as we could. Um, and whether that's, you know, our IPA or Juicy Hayes or one of our rotational beers, um, once you're in, there's a lot to sample within the portfolio, um, but we don't actually see like a really clear path like maybe we used to, um, to enter into Voodoo Ranger.

Speaker 2 [36:21] And Teo, you guys, you're building a new brand, so what are you guys doing and what have you learned that helps create a drinker base that is loyal to Crown and Hops?

Speaker 3 [36:30] Um, well, again, we started with a community, um, we started with a community that didn't see themselves in the industry. Um, so it was always about trust, um, not only with the consumers and drinkers, but also with this industry. Um, there were a lot of people when I was walking around with a Black People Love beer shirt in the craft breweries, just thought I was full of shit, or thought I was gimmicky, or thought, didn't understand the crux of what it was that I was doing. Um, but, you know, 7 years later, um, you know, it goes to what my answer is, consistency. Um, consistency in my opinion, is what is going to be the thing that is really gonna make sure that consumers have any sense of affinity and loyalty to you. Um, you know, it doesn't mind, it doesn't matter if your logo changes from a bike to a, a ranger with skeletons and all that good shit, you know. What, what, what, what matters is what matters is that New Belgium have programs for giving bikes to the kids, you know, that were underserved in the community, um, before it was even cliche to start talking about diversity, you know, with, with, you know, what we did with our atrial pills. to where we saw that it was very difficult for uh people in the alcohol industry to get grants initially in craft beer. So we created an initiative to help preserve and help the less than 1% of black owned breweries that were there. Wasn't no one gonna do that shit. But, but, but, you know, it's about what are you doing that's aligned with your core values, your mission, and are you consistent with it? Because just to go to the social media element, that's how you drive your social media. That's how you get your numbers and your likes up. Post consistently. Engage consistently. It is about consistently, and in my opinion, that's what Gen Z, um, is looking for, uh, to build any sense of loyalty to.

Speaker 5 [38:23] Can I add one thing too, just about the point of loyalty? You know, one thing Coop Ale Works has done, we have a new brand extension. It's Sonic Hard Seltzer, so part of that exercise too is borrowing some brand equity, which I think is also an interesting take on how this could potentially be achieved. For Coop Ale Works, we've dominated the Oklahoma craft beer space, but outside of Oklahoma, not a ton of brand awareness. With Sonic Hard-Seltzer, it's a totally different ballgame for us. Because we have Sonic on our cans. Sonic means a lot to a lot of people. I mean, in the state of Texas there's almost 1000 Sonic drive-ins. The state of Tennessee has close to 600. Connecticut has 4, but there's still plenty of people in Connecticut that love Sonic, um, but again I think that's another way, um, when we talk about, um, the roads to loyalty, um, if it's not about, um, you know, adding a new beer to your collection, you know, the idea of partnerships is also something interesting to explore.

Justin Fonte [39:11] I'm glad you brought that up, Marianne. What have you noticed about what excites Gen Z when you do partner with a brand like Sonic, something that they've known their whole lives? How has that been, been working?

Speaker 5 [39:21] Well, we're still fairly new, um, the product only launched in May of this year, so I would say it's, it's early days and we've been available in the state of Oklahoma since May. We're launching in 5 other states in mid October, so I think it's a little TBD on what we're gonna take away from it, but again, to the point of borrowing brand equity. Um, you know, in the Sun Belt in particular, people are very passionate about Sonic. Um, for a lot of people it's the in and out that's not in California. Um, they deeply care about it. A lot of people have a lot of great attachment to it. They either, you know, they worked there in high school or they worked there in college or even into adulthood. Um, it's been a fixture of their community, you know, especially because of the fact they're franchise owned. A lot of people have ties to them, um, so, so far we've seen great feedback. People are really excited about it more than anything to the point of listening. We listen a lot and we hear a lot of when are you coming to Kentucky? When are you coming to Alaska? When are you coming? So, it's a good problem to have. Um I'll just be really excited when we can, when we're going to the states so I can tell them sit tight, it's coming.

Justin Fonte [40:21] The, the first Sonic in New Jersey opened on my first day at work at a newspaper and we actually sent someone to cover it, so

Speaker 5 [40:28] it's a big deal. My best friend was a car hop there and this was in the late 90s and they still roller skated. We still talk about it. You can't pull out of my parents' neighborhood in Oklahoma City without hitting a Sonic. In any direction. I mean, you're gonna come across one, so it is a really beloved brand

Justin Fonte [40:42] for sure. So Sonic Hard Seltzer and Fruit Smash have both taken really different approaches to the Hard seltzer segment and I know we talked a little bit about this on our prep call, but you know, Dave, one thing that we've discussed is that Fruit Smash doesn't speak to consumers in the same way that the established segment brands do. It's a little bit sardonic, a little crass, maybe, but mostly really fun, uh, so that might be a risk, but how do you feel like that's playing out?

Speaker 4 [41:03] Oh yeah, it, it's absolutely a risk, a calculated one, but um. I think to the point, uh, there's an earlier question, the first panel around what are retailers and distributors looking for now, and it's the answer's incrementality as we looked at how we're gonna enter into the seltzer space, we knew we had to do something that was distinctly different, and that's. That had to be something that was at the core of that brand as we built it. So whether that was the liquid was going to be different, it was gonna be made with real juice. We're gonna use a normal can instead of a slim can. We're gonna put color on our can. We're gonna make it a bunch of designs. We, we gave that can to a tattoo artist and had them help design it. That's a lot different than what you kind of associate with the seltzer category as a whole, which is, you know, tall slim cans of seltzer, white packaging. Uh, very minimalist, but we knew if we put out an offering like that, we would just get shot right back down because that's not gonna help a retailer, that's not gonna help a distributor, and it's not really gonna help us because it's not gonna work, uh, so as we, we built Fruit Smash, we just knew we had to talk a little bit differently and look a little bit differently. Um, in order for it to be a success, um, results have been good so far. It's already a top 20 seltzer brand, um, which is that's exceeded our expectations, I'll say, um, and we're really excited about next year, um, launching new innovations with it as well.

Speaker 2 [42:22] So as you guys are looking into this next year and with everything that's still happening with COVID and Delta variant, how big are experiential spaces and tap rooms and stuff for you guys to connect to these consumers? Um, do you wanna start, Dave?

Speaker 4 [42:36] Yeah, sure. So yeah, I, I can't imagine working in a tapro 20 months ago and just, you know, we're gonna go home for 2 weeks and we'll be right back, um. One thing that's been really cool about uh New Belgium is, is we, we did go home for 2 weeks and then when it was clear that we were not coming back after 2 we found roles for everyone that was in our tap room, uh, within the company to help expand their career, uh, which was awesome so there were opportunities for them to go out. Try new jobs if they like them, they could stay. If they didn't like them, they were welcomed back to to the tap room. Um, the folks that did come back to the tap room came back with an energy that was, uh, I, I don't know, a Gen Z energy. I don't know, not an energy I don't have, um,

Speaker 3 [43:23] also known as Teo energy, yeah, yeah.

Speaker 4 [43:27] I'll take that. But yeah, I mean, it's, it's been amazing because they've, they've really helped us launch Fruit Smash. So every weekend we've had seltzer Saturdays at the brewery where you can get a bucket of Fruit Smash or they've, they've got a slushie machine that they created Fruit Smash slushies out of, uh, and it's been a really, really important touch. Point, especially for, uh, Fort Collins and Nashville for people to come and experience the brand and taste the liquid in an environment where we can help deliver some of the personality that we talked to earlier and our, our taprooms have been just a huge, huge part of that and a big reason why the brand's been successful.

Speaker 2 [44:01] Mary Ann, how are you seeing that CO is working in these places?

Speaker 5 [44:05] Sure, well, I think on the coop side of our business we did have a tap room. It closed during COVID and it remains closed. Our business was not built around a taproom experience. Um, it was, it was built around everything else, um, so it has. Hasn't been a business implication for us whatsoever, um, you know, you'll see it, you know, some point in the somewhat near future that we'll be transitioning to a larger space that's more of a hospitality play and that's really what we're hedging our bets on in a very, you know, calculated decision. On the Sonic side of the business again it's still new it launched, you know, well into the pandemic it's also not being sold at Sonic drive-ins for obvious reasons. It's an alcoholic beverage it doesn't really message that well, um, even though I think we all have the experience in high school of going and getting Sonic and, you know, adding additions to it if you needed to, um, but I think for Sonic in particular we've really leaned into the message of celebrating moments at home and with family and friends, which is something the Sonic. And really leans into as well it's about creating those moments with the people closest to you so we focused on that and you'll see that rolling out in a tailgating campaign we're trying to be safe and responsible. I mean, is the short answer um you know we want to do what's right for our company but also what's right for our community so it's been asking ourselves the hard questions about just sort of experiential marketing in general and, and what's the for us what's the right thing to do.

Speaker 2 [45:27] The, how about you guys?

Speaker 3 [45:28] Yeah, I, I think we have the benefit, um, we're, we're still about 78 months, um, from being able to open our doors, um, but we have the benefit of looking at best practices, um, you know, I think what New Belgium does, uh, in terms of programs with their employment with their employees, um, immediately and directly impacts the consumer. Experience, um, so that, that is extraordinarily valuable for, for you all to take notes from what that Gen Z, that millennial group is doing in order to make sure that it is, is digested by that Gen Z consumer is, is important and, um, you know, to have a COVID-safe space, um, you know, in the construction plans of our, our, um. Our, uh, our space, you know, obviously indoor outdoor space is critical, um, so that we can, you know, fortunately, um, consider what the worst case scenarios might be presented to where we can still keep our doors open and keep people employed because ultimately the, the brew pub is an extension of our homes and that is something that we have not had in the black. Black and brown community, um, we have not had off of Crenshaw Boulevard is something that is safe, something that, um, you can enjoy beverages, a meal with your family, um, and fantastic craft beer. So it, it is absolutely pivotal for us to have these spaces, um, it's key to our, our business model.

Justin Fonte [46:55] It's gonna be huge for you guys. I'm really excited to see, see it finally open come visit. Um, Marianne, I'm glad you brought up tailgate because we actually do have a sports related question. Um, so within sports, college sports, state laws and NCAA rule changes have opened the door for athletes to earn money from their name, image, and likeness. Uh, Coupe is in a state where college sports are extremely popular. How do you view the NIL change as an opportunity?

Speaker 5 [47:20] Um, it's definitely a hot topic within our organization. Um, I think it's early days, you know, we've been talking for the past however many minutes about how savvy Gen Z is, and they'll call us all out on our bullshit. Well, you know, you've seen the rise of the micro influencer because peer influence is incredibly important amongst this group of people. I mean, it's important a lot amongst a lot of groups of people, but with the. This one in particular and what's the value of bringing on a college ambassador when you could very easily describe them as them being a corporate shill um how is that gonna resonate? We don't know yet it just started so it's something that we're keeping a sharp eye on and we've had partnerships with older college athletes that have gone on to. For instance, the NFL, we have a great relationship with Creed Humphries, who plays for, um, the Kansas City Chiefs, and during the draft he had Coop at home. There were Coop ice buckets, um, etc. so we've been like dabbling in the space but just, you know, not officially in the way that the NIL is changes have impacted us. So for us it's a little TBD.

Justin Fonte [48:25] Makes a lot of sense. Dave. I know New Belgium already partners with Colorado State. Do you guys see any opportunities there?

Speaker 4 [48:31] Yeah, we, we, so we have, um, Old Aggie, which is our Colorado State University beer, uh, we also have Old Tuffy in North Carolina, Old NC State, a lot of NC State references, uh, today, but, um, yeah, we. I think the answer is that it's early days still too like there, there's certainly a potential for an opportunity, but our agreements with uh NC State and with Colorado State, they're built on. Trying to elevate the university and elevate our breweries, um, so as we look at what NIL could mean and honestly it, it's so new that I don't think a lot of us really understand what it means, we just have to take a really hard look and make sure that like the core of our agreement with those universities is being upheld and we are continuing to not only elevate the athlete but elevate our brewery and um those universities as well and ensure that like the core there is, you know. It's not really in sports, it's about fermentation science, and we wanna make sure that's, that's really kept intact.

Justin Fonte [49:27] For sure. is this something that's on your radar?

Speaker 3 [49:29] Um, in a way, um, and, and I, I can speak of it, um, you know, from the perspective of being a black man in an industry where there are very few black men, um, especially in brewery ownership. Um, there is obviously a huge conversation on how to get a more diverse and inclusive taproom, how to reach Gen Z. Um, I think right now the model of hiring agencies to, to help you get these answers is few and far between. So what people are doing is they're going to influencers, they're going to talent, they're going to individuals, and they are not being paid for the same thing that they would. Give an agency for the exact same information so it it it isn't maybe a a apples to apples comparison, but when it comes down to getting information that will immediately impact your your bottom line that that's something that should be paid for um these are people, um, whether it be influencers, whether it be individuals from organizations that that specify or that that. That are specific to reaching a market that you don't currently have, they should be compensated for it um they they they should be um individuals that should be valued because the information has the ability to change things drastically for your organizations.

Justin Fonte [50:44] Definitely that's we have time for. I wanna thank you guys. I'm sorry

Speaker 4 [50:51] we can talk afterwards we went over to we could just get a beer at the bar.

Speaker 2 [50:53] Well, just the 5 of us will just stay on stage for the rest of the day.

Justin Fonte [50:57] Uh, we did have a TikTok question and Zoey is our, uh, in-house TikTok expert. TikTok. I know I didn't get to give my

Speaker 3 [51:02] TikTok. I'm sorry. That's

Justin Fonte [51:04] awesome. Well, Mary Ann, Dave, Teo, can't thank you enough. Zoey, great job. Thank you guys for all showing up. We hope to see you in Santa Monica, California for Brewbound Live November 30th, December 1st. Let's go drink some

Speaker 4 [51:15] beers. Thank you all.