Crafting Generations of Beer
May 1, 2006
Crafting Generations of Beer
By SARAH THEODORE
It’s probably safe to say that when the Leinenkugel brothers get together for a beer, it’s a little different than most sibling gatherings. For starters, their family name looks back at them from every bottle, and carries with it almost 140 years of brewing history, as well as an image that has become synonymous with the Midwest region in which their brewery was founded. It might sound like a lot of pressure, but Jake, Dick and John Leinenkugel say they look at it as “incentive,” and while their approach to sales and distribution is all business, they have infused their products with a sense of relaxation and an irreverent sense of humor that keeps their brand as relevant to today’s consumers as it was in their great, great grandfather’s time.
The Jacob Leinenkugel Brewing Co. traces its beginnings in Chippewa Falls, Wis., to 1867, when the area was a leading lumbering region in need of a beer for its thirsty laborers. Today the Northwoods is more of a vacation destination, and the company tries to incorporate both ideas into the brand.
“They were a huge risk-taking lot in those days,” says company President Jake Leinenkugel. “They established a neat little business with our last name on it … I want to make sure it not only maintains the history and prestige that our great, great grandfather and his partner started, but also make it better.”
The careful balance of the traditional and the contemporary is one of Leinenkugel Brewing’s strongest characteristics. The company is a leading craft brewer, with a portfolio of year-round and seasonal offerings. It became part of Miller Brewing Co. in 1988, but has remained family run and maintained its headquarters and the majority of its production in Chippewa Falls, which proved even more beneficial to the brand than it anticipated.
“Chippewa Falls and the meaning it has with our customers and consumers is much more powerful than we probably realized 10 years ago,” Jake says. “It really shapes a lot of our brand positioning and who we are as brewers.”
To that end, the company has based much of its messaging on being “The Flavor of the Northwoods,” and many of its offices are housed in the “Leinie Lodge,” a large welcoming center that is a tourist destination in itself, hosting 42,000 visitors a year and celebrating anything related to hunting, fishing, camping — and, of course, beer.
A strong partnership
While Miller Brewing took a hands-off approach to running the Leinenkugel business, it has offered valuable consumer insight that has helped in both marketing and product development, says Dick Leinenkugel, vice president of sales and marketing.
“We’re very blessed by being part of Miller Brewing Co. where we have access to the latest research and some terrific marketing minds,” he says. “Having access to that has certainly made the three of us better marketers and better brewers.”
“They have made a commitment to make sure we have the resources, we have the up-to-date knowledge of what’s happening in the beer industry today, and they are more than willing to provide us with those resources,” Jake adds. “They have helped us develop very good brand positioning. We knew the guts of who we were, but they helped bring the discipline to establish tighter brand positioning and helped us develop tighter brand strategies.”
The Leinenkugel year-round lineup begins with Original Lager, which is brewed from a traditional family recipe. Leinie’s Light is a similar style, with fewer calories, and Red Lager is a Vienna style red lager. Creamy Dark is a dark lager reminiscent of a stout, but with a less bitter flavor. Wheat beers round out the full-year portfolio, with the company’s top-seller, Honey Weiss, and new Sunset Wheat. With the addition of several seasonal products, the portfolio offers a little something for everyone, which suits today’s market well, Dick says.
“Today’s beer consumer isn’t just drinking the same beer; he may not even drink beer all the time,” he says. “It’s really about the occasion, and I think one of the advantages we have at Leinenkugel is we have this breadth in our portfolio where we have a beer for every occasion.”
The family brewing tradition is in German lagers, but a willingness to experiment with different “craft” styles of beer was apparent, even before craft beer was a legitimate beverage category. “Our great grandfather was making porters, and was making pale malt extract products back in the early 1900s, before Prohibition,” Jake says. “After World War II, we already had a brand [in a seasonal bock beer], we just didn’t know it was that special or crafty.
“The new consumer start for us was a select group of consumers who said, ‘This beer is special.’ It only came out once a year for a couple of months, and they were willing to pay, at that time, a quarter a case more for it, which was considerable. It started us thinking that maybe this was something we needed to explore with other styles of beer.”
The company rotates a number of seasonal brands throughout the year, including Big Butt Dopplebock, a dark bock beer allegedly named for the head-butting goats on the label, from January to March; Berry Weiss from April to September; Oktoberfest, a traditional Märzen-style beer, in September and October; and Apple Spice in November and December.
Leinenkugel’s leading brand, Honey Weiss, started out as a seasonal product in 1995 and was so successful it quickly became a year-round offering. On-premise the product was served with a lemon, making it one of the first Leinenkugel products to embrace “occasion-based” selling opportunities. It also was one of the first to bring a female audience into the fold.
According to Jake, that wasn’t the reason the company developed the product, but it quickly saw an opportunity in Honey Weiss’s appeal.
“When you look at Honey Weiss and what that brand represented at the time, it was a summer seasonal beer that we knew was going to be a very good, clean, drinkable, Kristal style of German lager, with a very prominent wheat base — different than anything in the industry at that time. The garnish of lemon trademarked that style,” he says.
“We found that a lot of women, all of sudden, were seen with a pint glass with a lemon on it, and I remember asking so many of them ‘why?’ No. 1 was they liked the taste of the beer and they thought it was a little crisper, lighter and sweeter. The second thing was that the garnish was something that attracted them to the beer for the first time.”
With that in mind, the company developed Berry Weiss the following year, blending a wheat beer base with loganberries, elderberries and blackberries, and it became a seasonal hit. “We really were one of the first brewers that we’re aware of in the United States that did a product like that from a malt base,” Jake says. “Berry Weiss compounded and sped up the process of attracting women that we never had in the franchise before.”
The move was ahead of its time, as any look at today’s beer category will indicate. A number of beer companies, such as Anheuser-Busch with its new Peels product, are turning their attention to female consumers these days, and Jake says, “I give all of us a little bit of credit, either by plan or by mistake, for entering that early and taking a risk.”
New tastes for new consumers
But the products didn’t just attract women; the new flavor profiles have proved equally appealing to the new generation of male consumers. In fact, Leinenkugel says a “mix it up” campaign was based on an idea that came from men mixing Honey Weiss and Berry Weiss to create a new, customized flavor.
“There is that new-entry beer drinker who is finding new ways to enjoy their beer, either by mixing them up or trying some of our new styles,” Jake says.
With a nod to the Belgian beer style, the company this spring rolled out Sunset Wheat, which has citrus characteristics as well as a bit of coriander spice, and is served with an orange slice on-premise.
But one of its biggest flavor gambles was Apple Spice, which the company introduced as a seasonal last winter and readily admits is a love-it-or-hate-it proposition — fortunately a lot of people loved it. An apple product was first considered a decade ago, during the development of Berry Weiss, but stayed on the back burner until last year. The product featured an apple flavor as well as cinnamon spice, and could be served hot or cold.
“You look at ‘Does it make sense to the consumer group and to our brand positioning?’ and with the Northwoods and our location in Wisconsin, apple and apple orchards are a big thing,” Jake says. “We floated it out there and we did some sampling … and we were completely blown away. Dick made a very gutsy move and said ‘I think we’re going to sell twice as much of this; let’s brew twice as much.’ And I didn’t say ‘You’re nuts,’ but I was thinking it for a minute. The outcome was phenomenal, a great success story.”
The Leinenkugels say they are less concerned with brewing specific types of products than they are with creating fun, drinkable styles of beer.
“It’s all about making beer fun,” says Sales Representative John Leinenkugel. “That’s a key point here at Leinenkugel’s. We want to make beer fun, and we want to make it interesting.
“You look at these young consumers … they’re not looking for a standard lager or just an ale beer. They want sweeter, more interesting flavors, and we at Leinenkugel, and the beer industry in general, have to start making our products more fun, more innovative, more interesting to these young, legal drinking age consumers.”
“There is a fragmentation that is happening in the beer business, and that is really all about customizing your beer to make it your own,” Dick adds. “The garnishing of Honey Weiss with a lemon wedge, the mixing of Honey Weiss and Berry Weiss together to create your own beer, the orange slice serving suggestion with Sunset Wheat make them distinctive, differentiated and fun.”
The lighthearted attitude carries over into the brand marketing, which often reflects the vacation atmosphere of the Northwoods, and in many cases reflects a tongue-in-cheek sense of humor. The company, in the past, has created bicycles out of kegs for promotional purposes, and this summer, will promote the introduction of Sunset Wheat with each of the brothers sitting in 10-foot “Leinie Loungers” — think Lily Tomlin — in retail locations.
The family aspect of the business is an important marketing element, and the three brothers are featured in radio advertisements as well.
“We’ve gotten much better at defining who we are from a brand essence and brand positioning,” Jake says. “Where it all came together was putting all three brothers together and having some very strong message points about the product — why our product is different, why it is drinkable. At the same time, we talk about experiences of the Northwoods — the lakes, the streams, all the different things you can do while enjoying a Leinenkugel’s beer with family and friends. I think the message points we have are some of the strongest in the industry.”
Beyond the Midwest
The resurgence of craft beers during the past several years has brought a number of new distribution opportunities to Leinenkugel. The brand is available in 28 states altogether, and sources the majority of its business in 10 Midwestern states. But Miller distributors in regions outside the Midwest have expressed interest in the brand, Jake says.
“It’s sort of an exciting time for us, but we must be deliberate and make sure we’re not rushing out to all of these markets,” he says. Some markets that have a large Midwest transplant or seasonal population make sense for the company, and some markets offer other similarities that work with the brand.
“We’re looking at all possibilities, but it has to be relevant to our brand and our positioning,” Jake says. “I don’t want us to go into a market where we don’t have a chance of sustaining growth for the long term.”
But craft beer itself definitely has long-term possibilities, he says, pointing out that it’s not just newly legal consumers who are attracted to craft beer, but baby boomers as well.
“What I’m noticing is that segment likes and prefers beer, but differently … that’s the group that is willing to trade up,” Jake says. ”I call it drinking a little less, but drinking better. I think that group is going to be there for, not just a few years, but decades.”
And John adds that he believes the combination of family and history will keep Leinenkugel Brewing in a great place to capture that audience.
“Authenticity is very important,” he says. “Leinenkugel is very authentic in the name, the history and everything we do. We have a real story to tell. Our consumers are interested in it; they light up when you tell them the history.” BI