Amid growing competition and slowing sales in beer, Fireman Capital Partners' CANarchy Craft Brewery Collective is hoping a more public, Avengers-like team-up of its brands will offer a way to boost interest and sales.
This fall marked the second year CANarchy has released a shared variety pack featuring multiple breweries under its umbrella. Participating breweries this year include California's Three Weavers Brewing Company, Colorado's Oskar Blues Brewery, Florida's Cigar City Brewing, Michigan's Perrin Brewing Company, Texas' Deep Ellum Brewing Company, and Utah's Squatters Craft Beers and Wasatch Brewery. After "Volume 1" of the CANarchy Mixed Pack proved to be a hit in 2018, an all-IPA version rolled out at the end of September.
After all, if a brewery launches a variety pack these days, it better be special.
"To us, the CANarchy banner is always going to be secondary to the individual brands and breweries because we want them to maintain their independence and own culture," says Aaron Baker, senior marketing manager with Oskar Blues, the business that anchors the brewery collective. "But we want a common theme to tie everything together to act as a seal of quality and approval more than anything else."
Both 2018 and 2019 versions of the 12-pack boxes of 12oz cans prominently featured the CANarchy name and logo, although images of each can inside took up far more packaging real estate. Last year's "Pack of CANarchists" included flagships from Cigar City (Jai Alai IPA), Perrin (Black Ale Schwarzbier), Squatters (Hop Rising Double IPA), and Oskar Blues (Dale's Pale Ale). 2019's "Coast to Coast Craft" IPA Mixed Pack again includes Jai Alai, this time alongside Deep Ellum's IPA, Three Weavers' Expatriate IPA, and a release from Oskar Blues’ rotating Can-O-Bliss IPA series.
Last year, the 12-pack was brewed and packaged entirely in Oskar Blues’ facility in Brevard, North Carolina, just outside of Asheville. This year’s version was produced in Austin, Texas. Brewing all the included beers in one location allows them to be as fresh as possible before shipping. Baker said the company has the ability to sell the mixed pack in all 50 states in the future, but for 2019, its focus has been on home markets in California, Colorado, Florida, Michigan, Texas, and Utah.
The collection of beers also ties in with broader business trends of recent years, including the joining-up of various breweries to take advantage of mutually beneficial efficiencies in production and sales. 21st Amendment Brewery/Funkwerks/Brooklyn Brewery did it; so did Boston Beer/Dogfish Head Brewery. There’s now a new “Brewers Co-Hop” in Colorado, and Legacy Breweries, anchored by Ninkasi Brewing Company, wants to build a roster of 15 companies in the next year. The outcomes of these partnerships vary widely, but one common goal reflected in CANarchy’s move is to find additional ways to market its collection of brands.
“This ability to ‘spread the wealth’ and highlight a brewery like Three Weavers is really cool when it’s orders-of-magnitude smaller than Oskar Blues,” Baker says. “We have this platform with the Collective to share that space and straddle a line between recognition of one brand, and piquing interest with something new.”
The attitude was also on display at this year’s Great American Beer Festival, where all the CANarchy breweries shared a single, large booth area with a table for each of the seven companies. Hanging over the space was a giant, square sign with “CANarchy” on each of its four sides, as well as the brewery names and logos printed along the bottom of the display.
Baker says CANarchy isn’t worried about brand confusion by using the main company name alongside individual breweries because “the marketing ducks are in a row,” and each brewery has “its own great story.” He wouldn’t elaborate further about the potential for consumer confusion, or the inability of drinkers to see how it all fits together.
To draw a line under how integrated these companies have become, the collection of businesses was recently grouped together under the CANarchy umbrella in the sales tracking system used by IRI, a market research firm. Until late October, each brewery was tracked via its standalone portfolio. Now they're all listed under "Canarchy Craft Brewery Collective" in the system: the same setup that other teams of breweries—like Anheuser-Busch InBev's Brewers Collective, MillerCoors, Constellation Brands, Boston Beer, and more—are using. This change is symbolic more than anything, but reveals how the group is now meant to be seen together.
And to be clear, the value on a national level is high.
As a family, the CANarchy team has ratcheted up sales and volume thanks to its expanding portfolio of breweries and overall growth. From 2014-2018, the group added 64.4% in production volume (from 256,188 to 421,219 barrels). This year's IRI sales will more than double where things were five years ago. Through the end of October, CANarchy brands sold about 141,000 BBLs of product in grocery, convenience, and other chain stores, comparable to what Firestone Walker Brewing Company sold in the same kind of stores.
In the 52-week sales period ending Oct. 6, IRI volume sales were up 28.2% for CANarchy, with almost all its breweries showing strong gains across their entire footprint. But when examining a brewery’s total distribution footprint alongside sales in its home state, there are some glaring inconsistencies:
Cigar City: +43.3% total, +28.4% home state of Florida (grocery/convenience/liquor)
Three Weavers: +40.6%, +40.8% California
Squatters: +18.5%, +3.3% Utah
Deep Ellum: +10.9%, +11% Texas
Oskar Blues: +10.8%, +5.8% Colorado (grocery/convenience/liquor)
Wasatch: 0%, -2.9% Utah
Perrin: -13.6%, -14.6% Michigan
Cigar City’s increases across its entire footprint are no surprise. It’s been one of the fastest-growing breweries since being acquired by CANarchy in 2016, and has spent the last three years extending its reach, which now encompasses over 30 states. Its organic growth in Florida has been led by Guayabera Citra Pale Ale (+86.8% past 52 weeks) and the continued success of Jai Alai, which sold about 11,000 more barrels in the last 52 weeks in chain and liquor stores—a jump of almost 40% compared to the previous period.
Of particular note is Oskar Blues. It’s one of the largest breweries in the country, is sold in all 50 states, and isn’t struggling with growth like peers Sierra Nevada or Samuel Adams. At nearly 6% volume increase in Colorado, it also paces ahead of national craft beer growth, and stands to make gains from new laws in the Centennial State that have opened up all grocery and convenience stores for full-strength ABV beer.
With these two anchors underlying the collective, Baker’s point of sharing the wealth makes good sense. Cigar City and Oskar Blues are performing well; Three Weavers and Deep Ellum are smaller, but growing with ease (for now); and Squatters, Wasatch, and Perrin need some TLC. Perrin's flagship Black Ale is up 22.4% in its home state of Michigan in the last 52 weeks, but the biggest success in IRI channels for the brewery has come from its Clear Coast hard seltzer. A variety pack of mango guava, mixed berry, and watermelon lime 5% ABV seltzers is the company’s best-selling product in chain stores.
But package sales and GABF booths aren’t all for CANarchy—there’s also The Collaboratory, a beer-focused restaurant in downtown Asheville, North Carolina. It serves beer from across the CANarchy portfolio, including one-offs made in collaboration with local and national breweries specifically for the eatery, from Highland Brewing Company to Tennessee’s Blackberry Farm Brewery and Kentucky’s Against the Grain Brewery.
It opened this year in the former Lexington Avenue Brewery after ownership decided to sell to focus time elsewhere; brewing operations are led by Wayne Wambles, longtime Cigar City brewmaster. Wambles splits time between Florida and North Carolina to oversee operations and collaborations.
“There was some confusion over the name because ‘CANarchy’ doesn’t mean anything to [beer drinkers], but if you tell them it’s Oskar Blues and Cigar City, that sounds interesting,” says Edwin Arnaudin, a local journalist who covers food and beverage for Asheville’s Mountain Xpress.
Because of its reputation as a "beer city," Asheville is used to national brands—and learning about new ones all the time, Arnaudin says. Even with so many homegrown options, "we're still a hungry market and looking for good beer, regardless of where it comes from."
With around 4 million tourists visiting Asheville every year, CANarchy's restaurant also has the opportunity to make a lasting impression on people in town from all over. By serving beers from across CANarchy's multi-state footprint, the venue offers another way to connect with beer drinkers and encourage them to purchase a local brand from under the umbrella back home.
"As downtown Asheville struggles with national brands coming in—Urban Outfitters or Ben & Jerry's—some locals turn a nose up at them but they see something unique to Asheville like The Collaboratory because collaborations are coming from here and only available here," Arnaudin says. "That's why it feels like an Asheville brewery even if it's got beer from all over.”
All these aspects tie back to a core idea underlying this year’s CANarchy mixed pack. Aaron Baker, the Oskar Blues marketing manager, says the release offers another way to “build the bench” of CANarchy’s roster. The collection of breweries is clearly led by two stars—Oskar Blues and Cigar City—but the company is actively working to promote “teammates” to raise awareness.
Given the top-heavy growth of CANarchy at the moment, altogether the strategy breaks down into three simple channels: a specialty variety pack, brand awareness at events, and on-premise education in Asheville. Baker says the CANarchy banner is “secondary” to individual breweries, but it’s clearly taking on more prominence as competition increases from all over.
With all these changes, individual breweries are working both separately and collectively to build share of mind for their beers. Though the collective’s moves aren’t necessarily creating a state of disorder, they at least partially live up to the “CANarchy” name, as the company tries to create a little chaos for competitors.
Words by Bryan Roth