Tenth and Blake, the MillerCoors craft and import arm behind such brands as Peroni, Saint Archer and Terrapin, has brought on two new leaders over the past two months, each of whom brings extensive experience in craft and the alcohol industry overall.
Mara Schaefer, who came over from packaged food giant Kellogg Co., spent three years working at Goose Island Beer Company, and before that, more than a decade at spirits company Beam Suntory. She joined Tenth and Blake this spring as a senior director of brand marketing.
Michaela Roberts, who is coming off three years on sales leadership teams at Lagunitas Brewing Company and 11 years at parent company Heineken USA, took over as the craft and import director for the MillerCoors central region this week.
Together, the two leaders are being charged with helping Tenth and Blake accelerate growth amid booming demand and a heightened industrywide focus on above-premium beer. Each sat down to share their insights on where they view the beer industry heading, particularly with regard to the trend of premiumization.
Q: Mara, you helped Goose Island develop new positioning, a communications platform and consumer engagement strategy for its flagship brand, Goose IPA. Can you talk about the importance of brand-building, particularly as it relates to craft?
Schaefer: It all starts with really great beer. From there, you have to have an authentic story that connects with consumers in a way that’s meaningful and relevant. And, it’s important to have a strong long-term innovation strategy to keep drinkers coming back to your brewery and brands as they are searching for what’s new.
Brand-building is so much more important in craft than it was just a couple of years ago. Craft is mainstream now, and everyone is drinking craft beer. But if the beer is good, the quality is there and the story is there, I think you can still build a national craft brand, just like you can build a national food brand.
Q: What does that look like for MillerCoors craft brands?
Schaefer: It all goes back to making that emotional connection. Saint Archer, for instance, is all about active lifestyle. You see it in their creative work, you see it in the brewery. Everything they do reinforces that positioning, and that helps make the brand relevant to the people who live in its home market of San Diego as well as people who live in places like Chicago, but wish they were surfing in Southern California.
That’s why Saint Archer Gold makes so much sense. It’s relevant because it’s hitting on a macro trend of ‘better-for-you’ that’s spread across mainstream America. To make that brand connect in new markets, you’ve got to be consistent with your message and make an authentic connection with consumers, and that means getting one-on-one interaction with them through experiential marketing.
Q: Speaking of better-for-you trends, Michaela, you think the trend of premiumization in beer has more to do with brand attributes than price. Can you explain that?
Roberts: Many in the industry talk about premiumization because of the growth in segments where prices are higher than premium lights. I like to look at the reasons driving that growth, so that we can make sure we are positioned to sell the most beer. We’ve seen craft growth explode, the rise of Mexican imports and Michelob Ultra, and more recently, the rise of hard seltzers.
But this is about more than price: It’s more about segments of the beer category delivering what consumers are looking for. And we’ve found they are willing to pay a bit more to get what they want. People are going to continue to care about things that are good for them, and that extends to alcohol beverages. And they’re also willing to pay more for things they feel good about buying. Whether that’s lower-calorie beer, hard sparkling waters or sparkling cocktails like Cape Line, the better-for-you trend is here to stay.
As someone who has been selling beer her entire career, it’s been exciting to see brewers large and small innovating to meet consumers where they’re moving.
Q: That seems to bode well, not only for brands like Cape Line and Henry’s Hard Sparkling Water, but also Saint Archer Gold in the Tenth and Blake portfolio. What’s your view on how that brand can compete nationally?
Roberts: What’s really impressed me is that it’s being approached so thoughtfully. Tenth and Blake is taking its time here to make sure our approach for Saint Archer Gold is right.
It’s become really hard to make a national craft play today. Craft has become more of a regional game, and how to get beyond that is challenging. You have to be very, very thoughtful about how you go beyond your home market, because you start to see the rate of sales drop significantly the farther away from your home market you get.
Q: So how do you compete beyond your home market?
Roberts: It’s all about the team you have in each market — your people and your distributors. As Mara said, you need to make connections with consumers. They need to know how great the beer is, where it comes from and why they should care. On top of that, you have to prove that the beer will stay great — stay consistently good on draft and in package — all the time. This business is still a very high-touch business, where you need people connecting with consumers in the on-premise, telling these stories. If you don’t do that, you will not succeed.
Q: Mara, with all this in mind, what can MillerCoors do to grow its craft business, or more broadly, its entire above-premium portfolio?
Schaefer: We have to continue to put our foot on the gas when it comes to above premium, to think more about the brands of the future in addition to today’s. We’re already doing a great job putting more focus on imports, including with brands like Peroni that project an aspirational lifestyle to consumers. This all takes time, but sticking with it will only benefit us over the long-term.
There’s a big lifestyle shift underway, and consumers are making different choices with how they spend their money. They’ve proven they’re willing to spend more of their money on quality food and beverage as this is a part of mainstream luxury that is becoming more important to them.
Our (larger) brands will always be important. They’re the names on the door and we’ll never walk away from them. They’re go-to brands for millions of consumers and they will play a major role in this company’s future. But in order to make ourselves relevant for today’s consumers, we need to be really smart about our investments. That means driving more return from our craft partners who have lots of opportunity and runway. And we need to continue to focus on imports and other above-premium brands that will help generate more revenue to invest back in the brands that might need our help.