Craft Brewers versus Industrial Brewers

Friday I spent on Miller’s brewery tour, what with their 11,000 kegs of beer made daily. Saturday, I spent at Lakefront Brewery, who make approximately 11k kegs a years. The differences between the two brands could not have been more stark.

While Miller’s seemed polished and straight laced, Lakefront’s approach to their tour was rough and direct, and a little bawdy. Miller’s had us walk around several buildings, each with their own tiled floors. Lakefront was only in one building and their floor looked more like a cross between a warehouse and basement.

Miller’s threw the crowd large numbers, bragging about how many cases of beer they sell a year, and how many bushels of hops they go through in a day. Lakefront talked more of the history of beer and how much the liked to party.

Miller’s tasting was a bit sedate and most of the folks whispered to one another as they reviewed the past hour. Lakefront tour participants drank the entire tour, and found themselves shoulder to shoulder with hundreds of other folks who had yet to be on the tour.

There were far more people at the Lakefront tour. Granted, they run fewer tours per week than the folks at Miller’s. But the scene they create gave an appearance of a party atmosphere rather than a tourist destination. Where else in Milwaukee could someone get four glasses of craft beer for only $6?

Throughout the Lakefront tour, it was implied that the profit margins were thin. At Miller’s, the cost of the recent Miller’s/Coor’s deal literally was plastered on the wall. But for all of their money, all of their size, MillersCoors (or is it CoorsMillers?) couldn’t reproduce what Lakefront showed me on a rainy Saturday in April.

What Lakefront had could best be described as soul. The people who ran the tours seemed less like employees of Lakefront and more akin to partners. They didn’t have twenty-one year old women running the tours, they had a forty-something school teacher from the Milwaukee school district who worked at the brewery part time running the show. This somehow made the operation seemed more down to earth, and less of a scripted production.

All of these thoughts went through my head as I compared the two operations. But there was one that seemed more of an epiphany than the rest. Namely, Lakefront doesn’t compete with Millers and Millers certainly doesn’t worry about Lakefront. They are going after two different markets with two different outlooks on beer drinking and brewing. When one company is struggling to get their product into the state of Washington and the other is trying to figure out how to compete with InBev Anheuser-Busch in Belgium, I think it’s safe to say that the two companies rarely cross path in the markets.

So while it makes for great marketing when craft brewers put down the practices of the industrial brewers, the reality seems a little different to me. The market the craft brewers are looking at are not the brand loyal consumers of Bud, Miller’s, or Coor’s. They’re looking instead to the one beer drinker out of twenty who looks for something different, OR they look for the new beer drinker who hasn’t established any brand loyalty. In other words, they’re looking beyond the established beer market.

I’m not sure how accurate of an assessment this is. Had I the numbers, I could probably find a report somewhere that either confirms or denies my hypothesis. I don’t know enough about the beer industry to get a handle on this.

What I do know is this: Miller’s is to Lakefront as an oil tanker is to a speed boat. One is slow to turn, the other is quick and nimble. One is built to weather rough storms, the other can barely handle heavy chop.

Oh, and one is far more fun to ride in than the other.