IS CRAFT BEER REALLY ALL ABOUT BEER ?

Kjetil Jikiun keynote session on the 3rd SEA BREW South East Asia’s annual conference & trade fair for the brewing community which took place on August 2017 in Ho Chi Minh city, Vietnam

In my previous career, I used to be an airline pilot.  For most of the time I did long haul routes.  In the 90’s, it was not easy to find bars where you could drink lots of different beers. You could go to Belgium to have Belgian beers, England to have English beers or Bavaria to have Bavarian beers. In the US, I discovered Belgian, German, English and beers from other countries, including the US, in the same bar or restaurant. This opened my eyes to all the wonderful, diverse flavors and aromas in beers, and led to my first homebrewing experiments.

After years of homebrewing in Norway with nobody to share my passion with, I concluded that someone would have to take the responsibility of bringing the beer styles not yet available to Norwegians, to the Norwegian market.  I decided to start a brewery, and in 2002 I founded Norway’s first modern craft brewery, Nøgne Ø.  It is now the largest craft brewery in Norway.

There are many ways to define craft beer…

The American Brewers association states that what defines craft beer is traditional brewing, size and ownership. Others define it as size oriented only.  I also met a French brewer who had his own definition: «Craft brewing is when the brewer decides what beer to brew and how it tastes», he said. Common for most definitions is that most of them focus on beer and brewing related subjects. But by doing that, maybe we are missing the real essence of what craft brewing is all about.

When I started Nøgne Ø in 2002, my focus was also on beer.  In fact, it was only about the beer. This was before social media, so it was not easy to get out with news about our brewery or our beers.  But I do not think that that was much of a concern for us.  We focused on making good beer. And that was it.

A couple of years after we got started, we got a request from a company. The company, I think they were making computer software, would usually take its customers out for a dinner.  Instead of that they came to us and asked if we could receive them in our brewery, and serve beer and some finger food. Our brewery was not only really small, but the brewing system was homemade from dairy tanks and scrap metal. It was far from pretty. And we had no chairs or tables. We politely declined the offer, and suggested that they should instead arrange so that a restaurant of their choice could serve them our beers. But the person in charge of the coming event practically begged us to facilitate this. We felt very uncomfortable about this situation, but were finally persuaded, and agreed to do it.

We ended up rigging some snacks and beer on the table where we used to hand fill bottles, let’s call it our bottling line.  And with no chairs, and everybody standing, it felt really awkward. But to my surprise, the atmosphere was good and everybody enjoyed themselves thoroughly. After a while I was asked to speak about the brewery and our beers. I was caught by surprise. Who wanted to know about our rustic, not to describe it as crappy, homemade brewery? It was an embarrassing moment, but when I got started, I noticed that everybody paid attention and found my presentation really interesting and entertaining. I expected to talk for 5 minutes, but there were so many questions and interaction, so the whole ordeal took hours, and as I remember we had to work hard to make them leave late at night.

For me, this evening was a turning point in understanding the real power of craft beer. Was it the beer which made our visitors stay so long? Hopefully it was partly the beers, but what was even more important than beer was the interaction, our passion and honesty.

After this, we realized the power of interaction and our story telling power. And we had lots of people coming to visit our brewery. To illustrate the significance of these guided tours of our brewery:  In 2008 we lost a significant contract, and our volumes were down by almost 50%. For a while we contemplated to fire some employees, to cut costs. Instead we started to actively market our visits and guided tours, and this was able to generate about 20% of the revenue and 50% of the profits for the following year. But this story about how people came to our brewery – to taste our beers, talk about beer and brewing or see our brewery – is not just about how to make a business from receiving visitors.  It is a whole lot more.  It is about how people appreciate all the details behind the beer.
I guess some would say that this is typical nowadays. After decades and generations where everything, – not just beer and brewing, but all consumer goods – get more efficient while produced in larger quantities, the trend is changing.  I am thinking that these products, food or beverages we put into our bodies, products which originate from a factory owned by a multinational corporation, which share the same packaging, presentation, product line up or flavor in almost 200 countries around the world, are products whose owners nobody will ever know, nobody will ever get to know where their ingredients originate from, or where the idea behind these products originates from, or who was behind the product development,  not to mention who produced it.

My claim is that many products like these, are making people empty and poor, having no story or history to present, produced only to fill the stomach of the consumer. But the need to know and understand where things originate from and in which context or to whom they belong will never be covered. These days, a lot of consumers have had enough of mass produced and generic products. We now see a new trend in many fields: Artisan cheeses. Organic or natural wine. New local bakeries. Craft distilling. Craft coffee roasters.

And craft beer.
I think that craft beer is a little different than the products I ‘ve just mentioned. You just don’t start discussing yeast fermentation temperatures with your local baker or what type of rennet was used in a specific cheese, with a cheese maker. It is quite amazing though how a normal craft beer drinker – after all we are not talking about a geeky home brewer – would want to know about hops and yeast from a brewer. What could be the reason of this difference? My theory is that it is not only about people that love beer. No, this is because of us, who are in the craft beer industry. I believe that people in the craft beer industry are different than in most other industries. Many would claim that this is because of enthusiasm and energy. There are so many other industries where there are lots of enthusiastic people.  Like among wine makers. Or people working with craft coffee. But this is how we, who work with craft beer, are different:

  • We share
    Craft brewers interact. Not only with consumers, but with other craft brewers. In these interactions, there is a lot of information being passed on. Most craft brewers have no secrets. The whole community is like an open source. This is very unique.
  • We do not talk about competition
    Competition is a word which almost does not exist in the vocabulary of a craft brewer. Craft brewers are focused on the industry as a whole. They are all aware that they cannot build a market alone, but need to work together with others to expand craft beer market shares.
  • We love to be with our customers
    Craft beer is far more than production and distribution. It is about reaching out people. This takes place in person, in tap rooms, brew pubs and regular bars.  Where the beer is being served, you very often also find the brewer or someone else from the brewery.
  • We are dynamic and make new products, seasonal and creative
    Unlike many other industries, where a producer would define a product or a static product portfolio, craft brewing is constantly dynamic. Not only is it trend-oriented, but brewers also love to use new ingredients or brew for specific seasons and events.
  • We work with a pull factor from the markets. Regular breweries and businesses try to push their products.  Most craft brewers are different by responding to what the consumers want, in interactive ways.

All these qualities, combined with the unsnobbish and down to earth culture among craft beer drinkers and producers make craft beer sympathetic and approachable. It is easy to like, and easy to make it part of your life and social structure.

But what about the beer?  What role does the beer play?

I usually say that craft beer is not about beer, it is about people. But we must not forget that it all starts with a product which can be sold and enjoyed. Actually, I would expect that most craft beer drinkers are aware of the beer, and not much else. They go to a bar and drink product X because they like it. Well, this is what they think. But behind product X there is a whole lot more. Many, if not the majority, of craft beer drinkers know a lot about the beers and the breweries behind the beers they drink. But consumers are very often unaware of the psycological factors which make them choose a specific product, and I think that craft beer drinkers are not much different. The general craft beer drinker would drink product X and be convinced that he or she does so because of the product and its qualities. It is however likely that there are several other factors which are just as important as the beer itself. These factors can be referred to as meta values. These are values which are not really about the product itself, but which offer added value in the eyes of the consumer or customer, giving the product an increased perceived value.

And what could those factors be:
–  The brewery and its story.  Usually there is more than a business plan behind a brewery. It usually started because of someone who wanted to make better beer.
–  The brewer’s philosophy and personality. People are all different. So are brewers.
–  The story behind a specific beer. Perhaps it was brewed first time for a specific purpose or event. Maybe there is a special ingredient in it or it has won an award.
–  The brand. Some breweries are tightly connected with a certain lifestyle, which their brand communicates very strongly.
–  The location of the brewery. A lot of people like to drink local beer but some are drawn to beers from certain countries or regions. This is a very powerful factor.
I think we, who work with craft beer should consider these factors as a list of what our brewery really is. And this can make us understand the real depth of how we are perceived.

But what about the beer ? While taking about values, experiences and interactions, did I forget the beer?

No. We must not forget that the beer is the foundation. It all starts with the beer and is the glue between us. I guess we have all heard the expression that beer is liquid friendship, but even more important is the fact that the beer is what gives our message credibility. To be able to build the higher perceived value of our beer, we also need to prove that our beer has high value and this can only be done by focusing on quality.
And what do I mean by quality? First of all, absence of technical flaws. Our beer must be well brewed. Then it must be in the right balance, the right balance for its intended market. Some markets are sensitive to bitterness, while others do not appreciate high alcohol beers or markets where dark beers are not popular.
But quality is the foundation of what we do. The beer is the communicator. Good beer communicates well. Lack of quality undermines the credibility of the brewery.
If you are going to build your brand, the perceived value of the beer and its popularity, you need to first focus on the quality of your products.
There are countless examples of popular breweries, which lost their «stardom» because of deteriorating quality.

So, given that our beer is OK from a quality perspective, meeitng the market’s expectations and requirements with regards to beer style and profile, what can we as craft brewers do to build, create and enhance the perceived value of our beers, brewery and brand?
There are a lot of tools to do exactly that.

  • Social media. Remember that social media is interactive. If you use it as a one-way communicator, then you have missed the goal of using it.
  • Make sure that your website is updated, and has real and interesting information.
  • We humans are very visual and emotional. Invest on this.
  • Personal interaction (events, festivals). Make sure that the beer drinker gets to meet the person who actually created the beer they are drinking.

These tools are essential. But it is not enough just to be aware of them to use them. They must be used in the right way.

I think the following are essential for communicating well:

  • Have a message. It is not enough to just have some good beers. There must be something you, your brewery and your beers want to communicate. In my Nøgne Ø days we communicated Quality, Brew to style and Balance/drinkability. In our Greek Σόλο project we say, «Good beer is a human right» meaning that we try to make quality beers affordable for most people. Τhe key is to have a message, and you must be able to present and communicate it.
  • Have a story. Where do you and your brewery come from? What is your inspiration? What do you want to achieve? People must understand that your motivation for brewing craft beer is about more than the business transaction of money changing hands.
  • Be personal. Remember that you and your staff are people and you reach out to people. Make your people be like real people. This is what makes your customers care.
  • Be friendly. Surely some brewers try to build their image as tough and “bad ass”, but most people like friendliness. For that reason, try always to be positive and caring.
  • Be honest. Allow people to see the real you and your brewery. Not just a facade. Then your customers will feel that they know you, and they will be more loyal.
  • Be available. Respond to people who contact you. Whether in social media, emails or telephone calls. This will show that you and your brand take people seriously.

It is quite ironic that when all these abilities and traits are addressed well, then it is not so much about the beer anymore. As a Canadian craft brewer told me: It is not about the beer at all. On tap take overs or launch parties for new beers we never talk about beer or brewing … we talk about sports or cars or the weather.  Because craft beer and craft brewing is about people and life.

One detail which is quite important with regards to meta values or the perceived value of craft beer is size. Size matters. But the opposite of how the term is usually applied. Generally, craft beer drinkers like small breweries. Maybe this is one of the physical laws of nature, which applies to the craft beer industry, and this phenomenon makes it easier for new breweries to get established. Being small is no guarantee though for success, but it makes it easier.

And why should it be easier for a smaller brewery ? For starters, in a small organization it is easier to be personal. The persons behind the beer can be visible. All of them. Like all 5 or 15. But this is not so easy when there are 150 employees in a craft brewery. When a craft brewery is small, it also has small capacity and there is not better marketing than being sold out and being unable to deliver enough. Besides, when a craft brewery is small, then it reaches out to a smaller segment of the market, enabling targeted communication, promoting its products to a very narrow niche. If this is done well, then it can be perceived as very charming, and it can hit its niche with better accuracy and force.

But what could be the dilemma when a brewery is growing and the growth demands larger market shares? Then it is not so easy to target a narrow segment. Like a brewery in Scotland: They used to write «Beer for punks» on their labels. A couple of years later they changed it to «Craft beer for the people». There is no doubt that the term people fathoms a much larger market than punks. But surely it is a more difficult task to communicate with good accuracy to «the people» meaning everyone.

When I started Nøgne Ø in Norway back in 2002, we called it not only Nøgne Ø, but also The Uncompromising Brewery. At the start, it was about uncompromising beers, both in qualities and flavour profiles., and while understanding more about communication, meta values and our followers, we were also quite uncompromising in how to interact and communicate as well. As the company grew, and we had an increase in the numbers of partners, while in need for capital expansions, we had a hard time being loyal to the idea of being uncompromising. With more and more people working for the brewery and the whole organization becoming more and more as a corporation, it became increasingly difficult to stay uncompromising. Our first challenge was quality. We had always been focused on making the best beer possible, but all of a sudden, a new terminology was launched: Good enough. Most of our customers do not notice the fine nuances in a beer anyway. «Why bother to make perfect beers, when the big majority are happy with something a bit less perfect? » my partners said.

Then it was about design, brand, packaging and brand building. Some people in our organization were afraid that too energetic label texts and not enough helpful information about how the beer tastes was a risk, as to lose market shares. Slowly, the company’s image changed from dynamic and innovative to slow and predictable. And then people started to think that we should not allow brewers to present the beers in social media and on events. That would make us look unprofessional. Instead this should be done by the marketing people and sales staff.

My response to all this, was to try to make some strategies on how our brewery could act and present itself. About values. About design. About social media. But to my surprise, my partners considered strategy documents as a limiting factor more than a structuring tool to make the brewery more cohesive in its appearance and communication.

I am convinced that this is the key to staying loyal to the real craft beer spirit and culture while growing: Define your identity, brand personality and ways of communication, and put this into a strategy document, in order to communicate the culture of your brewery across everybody in your organization.

Experiencing that this was never going to happen in my own brewery was for me a very sad thing, because I had so much love and passion for the human aspect, interaction with people and sharing of our passion. I concluded to leave the company I had founded.

This does not mean that I think it is impossible to grow and stay true and loyal to the human aspects of craft brewing. But I have learned that it is difficult. There are many big craft breweries which have had phenomenal growth the last decade. Perhaps most of those are based in the US, but looking at those with a critical eye, it is quite evident that many of these craft breweries have very different focus on how to deal with these matters. It would be unfair to mention anyone in detail in this presentation, but my recommendation is to study their approach to it, and also see how they are developing in being popular brands and also whether they are respected as true craft breweries.

Since I left Nøgne Ø, I have started a new brewery on the island of Crete in Greece.  After about a year and a half with contract brewing, we will later this year have our own production unit. We take communication and people seriously. In our small company with 6 employees, we have one person dedicated to social media and communication. And this time I have taken the decision that it is better to be small and have full control of both quality and meta values.

Because true craft brewing is not so much about making beer, it is about people, communication, feelings and emotions.

And this we are 100% committed to.