Side Launch Brewing Company Continuing Case

Balancing a Beer Portfolio

"I think Coors Light is a very refreshing beverage." Not exactly the admission one might expect to hear from one of Canada's craft beer pioneers. But brewer Michael Hancock, who did his time in macro beer prior to launching his own Denison's brand of craft beer in the 1980s, has an instinct to see the upside of any kind of beer rather than possess a blind craft elitism often associated with craft beer producers. "People always think that's the kind of beer that no craft brewer would be seen dead with, but I don't fit that stereotype. Generally speaking though, for session drinking, as we call it, for people who know anything about beer, it just doesn't have enough substance," he concludes.

As discussed in Chapter 3, the Ansoff Growth Opportunity Matrix demonstrates four general growth strategies for firms, two of whichproduct development and diversificationinvolve creating new products to add to a firm's line-up. In the craft brewery space, there are always external pressures to refine existing beers or expand the product portfolio by offering something new, conforming to one beer trend or another. The Side Launch mindset, however, is a little bit different. "As craft brewers, admittedly we gravitate to trying new things for so many reasons," offers Dave Sands, VP Operations. "It's a great opportunity to learn about the infinite number of beers we can create and, at the end of the day, make something ourselves we're interested in tasting." The opportunity cost, he then concludes, is obvious. "The worst thing you can do, for the sake of making one brew's worth of new beer, is to upset or impact your breadwinners."

Those breadwinners, the ones that Side Launch is committed to producing year-round, the ones they base their entire operations on from procurement of raw materials to the preprinted packaging bearing that increasingly familiar Side Launch logo, are not merely "made" as much as they are "coddled" by Michael, Dave, and everyone involved in the operation. "So many craft breweries are cranking out minor variations on the same style, particularly IPAs," observes Michael, "but I think if we were to become obsessed with creating the next big thing, or following trends, then we would have missed the opportunity to make the best of these four. That's a very personal thing."

The conviction in his tone reflects a common mantra heard, seen, and felt from within the brewery itself as well as on the streets in the story told to customers by Side Launch sales reps: "True to style, honest, and authentic." Products aren't managed only at the production level. The way they are positioned and sold through the market requires patience and critical thinking as well, and constant open communication must occur between sales and production.

To VP Sales and Marketing Chuck Galea, overseeing the front end of the Side Launch operation, the understanding of the delicate balance of remaining true to style, even if it means marketing a product that may not perform as well as another, is vital to be seen as a complete craft beer brand. "The Dark Lager and the Pale haven't kept up to the pace of Wheat and Mountain in terms of rate of sale," he explains. "We have more distribution of our Dark Lager, with less volume, whereas we have lower distribution with Mountain Lager, but higher volume."

The easy business decision would be to crank up production of what's selling the best, while curtailing production of what's with selling less, and yet to do so would be to dismiss the importance of having strong representation across the four flavour profiles Side Launch produces year-round. Thus, from a brand perspective, the whole, as Side Launch sees it, is much greater than the sum of its parts.

1.VP Sales and Marketing Chuck Galea observes in this chapter that two of his core brands sell more, despite being less widely distributed than the other two. Does this automatically indicate that the two faster sellers are in the growth stage of the product life cycle and that the other two are in maturity?