Yuengling's Success Story
January 20, 2012
AdAge has a headline that reads: D.G. Yuengling & Son Becomes America's Largest Brewer. Of course, once you get into the meat of the article you see that it's technically true because all the major beer conglomerates have now all been acquired by even bigger foreign conglomerates, not because of some ridiculous growth trend in Central Pennsylvania.
Still, I was struck by this quote:
Yuengling has a unique market position. When you go into a bar, it's often lumped into the "domestics" category, along with Bud Light, Miller Light, Coors Light, etc. So when a bar runs a happy hour special, like $2 domestic bottles, you essentially have your choice of Yuengling or light beer; and plenty of people feel that Yuengling is a superior quality beer.
Craft beer snobs may still be the minority of beer consumers, but there are enough of them to matter, and their numbers are growing. For all the talk about how the beer market has been shrinking in recent years, the numbers clearly show that it's at the expense of the conglomerates, not the small craft brewers.
(from stevegarfield on Flickr)
Still, I was struck by this quote:
Yuengling's growth -- which was fueled by a huge launch in Ohio last year -- is remarkable considering that the overall beer industry remains in a funk. Total beer shipments fell by 1.4%, according to Beer Marketer's Insights, continuing a multi-year slump.I don't find Yuengling's growth especially remarkable at all, and unless you're only judging the company from it's income statement and balance sheet, I think many people who enjoy anything other than light beer feel similarly.
Yuengling has a unique market position. When you go into a bar, it's often lumped into the "domestics" category, along with Bud Light, Miller Light, Coors Light, etc. So when a bar runs a happy hour special, like $2 domestic bottles, you essentially have your choice of Yuengling or light beer; and plenty of people feel that Yuengling is a superior quality beer.
Craft beer snobs may still be the minority of beer consumers, but there are enough of them to matter, and their numbers are growing. For all the talk about how the beer market has been shrinking in recent years, the numbers clearly show that it's at the expense of the conglomerates, not the small craft brewers.
Yuengling is a great compromise beer in this respect. People who wouldn't be caught dead holding a Coors Light might be perfectly willing to have a Yuengling if it's part of a happy hour special or it's what their friends have in the fridge.
I think the ratings over at Beer Advocate cement my case. As of today, Yuengling comes in at 79 out of 100. In school, that would be a high C - not a score worth hanging on the fridge, but not an unacceptable failure either. Bud Light, Coors Light and Miller Light score 49, 51 and 56 respectively - all of which would earn a big fat F.
As long as Yuengling can continue to hang around in the "domestics" category, I think it will continue to do well. If it ever gets bumped anywhere near the "craft" category and starts getting priced as such, I think that momentum will grind to a halt.
I think the ratings over at Beer Advocate cement my case. As of today, Yuengling comes in at 79 out of 100. In school, that would be a high C - not a score worth hanging on the fridge, but not an unacceptable failure either. Bud Light, Coors Light and Miller Light score 49, 51 and 56 respectively - all of which would earn a big fat F.
As long as Yuengling can continue to hang around in the "domestics" category, I think it will continue to do well. If it ever gets bumped anywhere near the "craft" category and starts getting priced as such, I think that momentum will grind to a halt.
