Happy Thanksgiving BeerDownload Fans. Thank you very much for listening every week.
Chicago Beer Society (CBS) member Win Schaeffer recently posted the following message to the CBS email list:
Amazon Wine in operation – Can Amazon Beer be close behind?
Here is Steve’s perhaps somewhat lengthy response, which was discussed on episode 147:
While Amazon may well choose to sell beer too at some point, it will be problematic for the same reason that all online beer sales are: beer’s cost to weight ratio is too low, because after all, beer is mostly water.
As has been discussed on this list previously, bombers are typically a lousy value on an ounce for ounce basis compared to 12 ounce bottles, even when the exact same beer is in the bottle (Lagunitas – Little Sumpin’ Wild, Goose Island – Bourbon County Stout 2009 are two examples that jump to mind). This is odd, considering the normal model in food is larger package = less cost per unit weight, but that’s a tangential topic. Don’t get me wrong, some large bottle format beers are worth every penny, but these tend to be unusual beers with costly processes involved in their creation (read barrel aged beers and sours). If you’re paying $10 for a large bottle of standard IPA or stout, you’re almost certainly not getting a good value.
This is the core of the Amazon (and online sales of beer generally) Beer problem: the beers that would be worth ordering online will almost certainly not be available there. Beers that command a high enough price point to be worth shipping to an individual (BA and sour) are already in short supply, and there’s no reason for a brewery to give Amazon a cut of the profits on such beers, when they can keep them all for themselves, or share them with their wholesaler and retailer partners, who move the bread and butter beers for them.
Perhaps as breweries ramp up their capacity to make more and more of these high value added beers that can reasonably demand high price points, this dynamic will change. Until then, any Amazon Beer type service will be necessarily tilted towards heavily overpriced large format bottles of beer, and won’t be particularly compelling to the savvy craft beer consumer.
Program Director and Co-host of BeerDownload
P.S. It occurs to me that some new commercial brewers reading this post might take exception to my characterization of large format bottles that are not barrel aged or sour as overpriced. It may well be that to pay for the capital costs of starting a new brewery, selling large format bottles that for whatever reason command a higher price point is the only practical strategy. This is fine, I’m just not sure this is a sustainable strategy in the long term, when there are many other better established breweries out there making beer that is every bit as good and selling it for substantially cheaper. Time will tell I suppose.
These are the results of the 2012 Festival of Wood and Barrel Aged Beers competition, the 10th anniversary of the event, held on November 17th, 2012. The event is run by the Illinois Craft Brewer’s Guild and held this year at the Bridgeport art Center – Skyline Loft in Chicago. The National Wood Aged Beer Competition is judged by a panel of industry experts prior to the public sessions. Each beer is judged on the basis of how that underlying style reflects the expression of wood and/or barrel character. Gold, Silver, and Bronze medals are awarded in 10 categories as well as “best of show.”
Category 1: Classic Porter/Stout – 12 entries
Category 2: Strong porter/Stout – 21 entries
Category 3: Barleywine/Wheatwine – 16 entries
Category 4: Classic Styles (not higher than 7% abv) – 11 entries
Category 5: Strong/Double/Imperial pale Beer – 21 entries
Category 6: Strong/Double/Imperial Dark Beer – 24 entries
Category 7: Fruit Beer – 14 entries
Category 8: Experimental Beer – 18 entries
Category 9: Wild Beer – 9 entries
Category 10: Wild Acidic Beer – 27 entries
Best Of Show
Complete run down of the Beer Hoptacular. Four More Beers! Beer Auctions go big time?
5 Rabbit now at Chipotle. Half Acre tap room officially open. BCS bramble rye drinking well. River North Wine and Bourbon barrel saisons head to head.
Big beer boxes and brewery memberships. Cellar math. Trunk beers.
Special Guest: Steve Kadlec. We talk with Steve about his recent trip to Michigan, as well as GABF weekend.