Coors Light Takes a Page From the Craft Beer Playbook

MillerCoors is rolling out a seasonal beer for its Coors Light brand. It's a smart move, given the success craft beer has with seasonal offerings.

May 3, 2014 at 9:00AM

When the industry rags reported on MillerCoors' new summer offering, they referred to it as a new "citrus Coors Light variant." Let's not mince words: This is a seasonal beer, and MillerCoors got the idea from the craft beer movement.

Coorslight Summer Brew

Source: MillerCoors.

Before we get into how amazing Coors Light Summer Brew probably tastes, lets take a look at a few telling statements from our publicly traded craft brewers to get a sense of how important seasonal offerings are to their industry.

From the most recent annual filing by Boston Beer (NYSE:SAM): "Shipment volume for the core brands increased by 10.4% to 2,727,000 barrels, due primarily to increases in Angry Orchard, Twisted Tea and Samuel Adams Seasonals."

Right there you've got the telling proof of how important variety is to a brewer's portfolio. The only actual beer even mentioned by this craft king are its seasonal offerings; the other growth drivers at the company are hard ciders and teas. The trend continued for Boston Beer through the first quarter of this year. This past Wednesday the company reported its depletions (or sales from wholesaler to retailer) grew 34% year over year, again driven by its seasonal offerings. It introduced Samuel Adams Cold Snap as its spring seasonal for the first time, which sold well before giving way to its powerhouse Summer Ale. The one-two seasonal punch combined with the strength of the company's existing portfolio and the introduction of an India Pale Ale drove quarterly revenue up 35%. Results like that really demonstrate the power of variety.

Let's move on to the 10-K filing from Craft Brew Alliance (NASDAQ:BREW): "During 2013, we added a Summer Variety Pack to complement our Winter Variety Pack released in 2012. Both Variety Packs include beers from Kona, Widmer Brothers and Redhook to satisfy consumers' thirst for two popular trends in craft beer: seasonal beers and variety packs."

It's not easy to be a craft beer drinker, awash in thousands of potential choices for what to imbibe next. Variety packs are the obvious answer when your consumer wants to try everything but doesn't necessarily want to risk buying 12 of any one kind of beer they might not like. Craft Brew Alliance knows this, and now MillerCoors knows it, too.

MillerCoors has some practice with seasonal implementation, and I'm not surprised it will be the first macrobrewer to launch a true summer beer. The company's craft shop, Tenth and Blake, puts out numerous varieties of Blue Moon every year, to the delight of its rabid fan base. In fact, Blue Moon and the company's other craft beers are carrying the weight for MillerCoors in recent years, as sales flag for its bigger brands like Miller Lite and Coors Light.

Of course, craft brewers have a little bit more flexibility when it comes to brewing new beers on a whim. Here's more from the Craft Brew 10-K:

Each of our breweries is modern, has flexible production capabilities, and is designed to produce beer in smaller batches relative to the national domestic brewers, thereby allowing us to brew a wide variety of brand offerings. We believe that our investment in brewing and logistics technologies enables us to minimize brewery operating costs and consistently produce innovative beer styles.

Management goes on to comment about not one but two special beers it rolled out in promotion with the Super Bowl and Buffalo Wild Wings, respectively. And therein lies the power of the smaller brewer. Anheuser-Busch InBev can put Bud Light in a different can for the Super Bowl or the World Cup, but it's still Bud Light. These smaller, more dynamic brewers can capitalize on unique opportunities to create entirely original beers that boost their bottom lines, even if it's only for a month or two.

In that sense, Coors Light Summer Brew is less of a gimmick and more of a wholehearted attempt to step outside of the Big Beer box and take a page from the craft beer playbook. The beer launches in select markets Memorial Day weekend, and it will be an extremely interesting story to watch. Can it compete with craft beer seasonals? Probably not, but it's not necessarily meant to. It's meant to drive sales at a flagging brand, the way Sam Adams' seasonals drive sales at Boston Beer. Only time will tell if the initiative is successful, but I like the effort here. 

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Aimee Duffy has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Boston Beer and Buffalo Wild Wings. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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