What is BrewDog’s position in the beer world?

By Nikkie Sutton

- Last updated on GMT

BrewDog spotlight: the Scottish brewer and operator is clearly no longer a pup
BrewDog spotlight: the Scottish brewer and operator is clearly no longer a pup
From day one, BrewDog has always intended its ‘Punk’ mission to blaze a trail in the industry. Here, we reveal how the brewer and operator stands up next to other ‘craft’ brewers.

Love them or loathe them, there’s no denying BrewDog has certainly made a huge impact on the beer and pub industry over the past decade.

From its humble beginnings in 2007 in co-founder Martin Dickie’s mum’s garage, BrewDog now exports to more than 60 countries and runs in excess of 70 bars across the globe. Also in the past 11 years, the Scottish brewer and operator’s overall revenue has soared to £112m.

It acquired multiple-site operator Draft House in a £15m deal earlier this year (March), taking control of 14 bars across London and the south-east.

All 213 Draft House employees joined BrewDog and the brewer also offered all Draft House staff Cicerone training, as well as support if they wanted to apply to the Institute of Brewing and Distilling and the Beer Judge Certification Programme.

Number one craft beer

In the 11 years of its existence, BrewDog has brewed 1.2m hectolitres (HL) and its flagship beer Punk IPA is now the number one on-trade craft beer in the UK (according to CGA data).

In BrewDog’s accounts, filed at the end of 2017, its UK sales grew by 78%, and it raised £10m in the UK and $7m in the US for its Equity for Punks crowdfunding scheme.

When it comes to other global brewers, AB InBev sold about 612m HL worldwide (according to Statista) in 2017. During the same period, Heineken sold about 218m HL, Molson Coors 94m HL and Carlsberg, 112.4m HL.

When comparing these numbers to BrewDog’s annual volume sales in 2017 of 344,387 HL, the craft brewer is still on the small side of things. However, when delving into brewers who launched around the same time as BrewDog, the scale shifts.

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Following leader’s footsteps

Looking at other breweries that have followed in BrewDog’s footsteps when it comes to crowdfunding, Berkshire based Siren Craft Brew, recently launched a crowdfunding campaign in order to expand its business.

Founder Darron Anley says: “The primary thing we want to do is put Siren into cans, which we haven’t done since we started (in 2013).

“While cans are hugely popular, I wouldn’t put anything in them until we could have the highest level of quality.

“For the canning line, we are looking at a capital spend of anywhere between £750,000 and £1m, which is a pretty big investment.

“We have got a tapyard (tasting room and bottle shop) at the brewery [in Wokingham, Berkshire] and we are doing really well with it, so if we get to £1.5m, we want to take that concept to a couple of city centres.”

Similarly, Signature Brew launched a crowdfunding campaign to raise £400,000 in October, which the northeast London brewer will use to triple its production capacity and refine some essential back-of-house functions.

The campaign ran for a short time before it went public on 15 October after more than £80,000 was raised. A total of £50,000 was raised within three days of launching.

Tom Bott, founder of Signature Brew – which was named the Society of Independent Brewers’ Brewery Business of the Year this year – reveals the campaign details exclusively to The Morning Advertiser.

“We’re crowdfunding for the next step in our business,” he says. “We’re moving site and installing a new brewhouse that is going to help us meet demand and future-proof the brewery.”

Currently, Signature Brew is running at full capacity, double brewing most days on a 10-barrel kit, and needs to increase production capabilities to keep up with demand, he explains.

Breaking the mould

When it comes to BrewDog, there’s no doubt the Scottish brewer and operator broke the mould of making the public aware of ‘craft’ beer, despite its current growth and size.

Founder and CEO of marketing company We Are Spectacular, Mark McCulloch, says: “BrewDog started an entire marketplace.

“People have two perceptions of the business. The people in the industry may sneer at BrewDog. If I do a speech about it, it splits the audience.

“It has managed to keep the craft and independent feel because it is doing constant things to shock the market, stay relevant and innovate all the time.”

Leeds-based brewery Northern Monk started just a year after BrewDog in 2008 and has also taken the brewing world by storm, selling to 22 countries and predicting it will brew a total of 3m pints this year.

It also has ambitions to open taprooms in London and Manchester, triple its capacity and invest in a new canning line.

However, McCulloch outlines how BrewDog has continued to stand the test of time, retaining its craft credentials even at its current size.

He adds: “Having two leaders (James Watt and Martin Dickie) at the helm makes BrewDog like a club. It brings a consistency of the brand conscience, which disseminates among everyone further down too.

“Everyone learns and it filtrates into the middle management of the company and means another generation that is coming through believes in that brand conscience.”

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Bad Beer Amnesty

In September this year, BrewDog told its customers to get rid of the ‘generic’ beers in their fridges in exchange for a pint of the brewer’s Lost Lager as part of its Bad Beer Amnesty.

On this, McCulloch says: “If you are against the mainstream and you still become pretty mainstream, while constantly attacking the status quo then you will be the people’s champion and hero. From its very early bottles, it said it was alternative.”

­The marketing guru also hails the way BrewDog has continued to ensure it stands out from the crowd with its innovations and PR – when it works and when it doesn’t.

McCulloch says: “Now it’s hard to come up with something that Brew- Dog hasn’t done. If a craft brewer says it is going to do crowdfunding, it’s nothing new.

“If another craft brewer says it is going to open a hotel, an airline, or a TV channel, it’s nothing new. BrewDog is the ‑ rest to do everything.

“It spends an enormous amount of time having fun and being provocative in lots of things it does and while it gets it wrong sometimes, it does get it right more often.”

An online backlash

One example when things went a little wrong for BrewDog was when it faced an online backlash over its ‘Pink IPA’ – launched as a ‘beer for girls’ to celebrate International Women’s Day (6 March).

­The beer was unveiled with the aim of highlighting gender pay inequality and supporting women looking for a career – particularly in science, technology, engineering and maths.

To highlight the gender pay cap, the beer was served in BrewDog bars 20% cheaper to those who identify as women, while the brewery said it would donate 20% of its proceeds from bottled Pink IPA and Punk IPA to causes that ‑ fight against gender inequality.

However, the beer received a mixed reaction online, with Twitter users commenting on its bright pink label, and tagline ‘beer for girls’.

Commenting on this, McCulloch says: “It seemed a bit misjudged and you would have to be almost psychotic to [deliberately] do something like that.

“Genuinely, there were good intentions with it, but it was just the execution which was poor. No one is perfect but if you look at the hit rate of BrewDog’s marketing, they are doing pretty good.”

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Misjudged marketing

While somewhat misjudged marketing created a bit of a storm, this hasn’t stopped fans or competitors liking what BrewDog does.

McCulloch says: “I see a lot of people in the industry butting against BrewDog but my take on it is that they have outdone everything everyone else has done.

“It’s jealousy, because Watt and Dickie have started a business in modern times, which is hard to do. ­ they have done classic challenging brand marketing, hit all the taboo points and got themselves into a bit of bother.

“Sharing its information is also such a powerful thing BrewDog does, because even if one of the big brewers took a leaf out of its playbook, they couldn’t execute it like BrewDog does.

“­There’s a precision to it. One example is when it stated cask was back. I have had a few conversations with different people who have said they have done cask for years, who does BrewDog think it is, but it’s like Spotify saying vinyl is back.

“If HMV said vinyl was back everyone would think ‘who cares?’ Relating it back to beer, if [BrewDog] says cask will be back then it will be.

“BrewDog will transform an entire marketplace and cask brewers should be thanking them because more people will be drinking cask and BrewDog will get  to Millennials and Centennials like no other beer brand will.”

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