THE GIST
On Dec. 22, Sufferfest Beer Co. announced it would pause production and not release any new beers in 2021 in order to “explore what’s next for Sufferfest Beer Company.” Sufferfest was founded in San Francisco in 2016 by Caitlin Landesberg as a gluten-removed beer brand for athletes; Sierra Nevada acquired Sufferfest in February 2019 for an undisclosed amount—to date its only purchase of another beverage alcohol company.
Landesberg referred all questions about the Dec. 22 announcement to Sierra Nevada, which declined to comment beyond what was posted on Sufferfest’s website. That statement reads, in part: “As athletes know, the path to success is rarely a straight line, and it is time to find our bearing. Whatever comes next on our journey, we will keep on sweating and celebrating, just as we always have.”
Sufferfest’s portfolio of gluten-removed, low-calorie beers included Repeat Kolsch, Flyby Pilsner, FKT Pale Ale, and a variety pack. Since acquiring the start-up last year, Sierra Nevada expanded Sufferfest’s distribution across the country. Sales in chain retail stores for the entire Sufferfest portfolio, as tracked by market research company IRI, are on track to grow more than 60% in 2020 to top $514,000. The amount puts it on par with IRI-tracked sales for MadTree Brewing's Happy Amber Ale and Troegs Independent Brewing's seasonal Nimble Giant Double IPA.
But Sufferfest’s 2020 earnings in retail are a drop in the bucket for a brewery the size of Sierra Nevada, which is on pace to sell more than $345 million of beer this year in IRI-tracked retailers. (Sierra Nevada will sell almost 200 times as much Hazy Little Thing IPA as all Sufferfest beer in 2020.) Omission Brewing Co., a Portland, Oregon brewery of gluten-free beer, will see chain retail sales top $13 million in 2020. Stone Brewing’s gluten-reduced IPA, Delicious, will top $17.2 million in sales in 2020.
Despite a proliferation of other low-calorie, low-ABV, and “better-for-you” beers, Sierra Nevada is, for now, pulling the plug on one of the most celebrated beer brands in that space. Michelob Ultra, the beer that provided proof of concept for the category, continues to gain steam. Now the second best-selling beer in America behind Bud Light, Michelob Ultra will likely add $500 million in IRI-tracked sales this year versus its 2019 total. But the fate of Sufferfest, despite financial backing from the country’s 10th largest brewery, suggests Michelob Ultra will continue to be the lone leader of the “active lifestyle beer” pack.
WHY IT MATTERS
Celebrated as a beer brand produced by athletes for athletes, Sufferfest’s uncertain future illustrates the difficulties craft breweries face in competing with the Michelob Ultra phenom. In promoting Sufferfest, Landesberg touted her athletic bona fides while admitting to her outside status in craft beer; she’d previously worked for fitness app Strava before launching Sufferfest with employees who mostly shared her fitness and sports background.
Appearing on the GBH podcast in 2019, Landesberg referred to Sufferfest as “an outdoor lifestyle business” rather than a beer company. She’d built Sufferfest through self-distributed sales and word-of-mouth, making inroads in the running and outdoor recreation communities in the three years before the Sierra Nevada acquisition. Once the deal with Sierra Nevada closed, the brand sponsored marathons and partnered with Strava and other Bay Area businesses.
“They really honor our brand-building tactics. They let us do our thing, which is lovely,” she told GBH of Sierra Nevada after the acquisition in 2019. “But they have those [distributor and retailer] relationships. So it is really putting muscles on the mouse.”
But Sierra Nevada doesn’t appear to have the interest in continuing to build Sufferfest, at least not in 2021. The parent brewery may feel it has other products that will serve the same “active lifestyle” target as Sufferfest, including Strainge Beast hard kombucha and an upcoming hard seltzer called Agua Azul. If Sierra Nevada didn’t feel it adequately understood Sufferfest’s ethos, it’s easier to pull the plug on that brand than its homegrown products. (The Strainge Beast line of kombuchas will sell more than $1.3 million in IRI-tracked sales this year, nearly three times what Sufferfest sold.)
Landesberg previously outlined a belief that Sufferfest’s authentic athletic roots would translate to active lifestyle drinkers, making it a “word-of-mouth success” toward which customers feel a great deal of loyalty. Other beers had previously failed to match Michelob Ultra’s popularity among those drinkers. Molson Coors launched Saint Archer Gold in 2019 as a direct competitor to Michelob Ultra, but Molson Coors nixed it after less than two years—but not before spending $20 million on a marketing campaign.
Sufferfest intended to appeal to both craft beer drinkers and active lifestyle drinkers, but both presented challenges. The typical craft beer drinker is inherently promiscuous in their purchasing habits, switching between brands and breweries to try what’s new. That’s in contrast to Sufferfest’s “loyalty” presupposition, and it perhaps fails to recognize how niche an audience there is for gluten-reduced, low-carb beer among all craft beer drinkers.
Meanwhile, non-craft, “active lifestyle” drinkers are already served by the ubiquitous Michelob Ultra—also a frequent road race and competition sponsor—which practically owns that entire category. Then add to the mix low-carb, low-calorie hard seltzers and ready-to-drink cocktails that are among some of the fastest growing segments of the alcohol market, and which also appeal to similar demographics. Perhaps the health-conscious, loyal drinker that Landesberg imagined just wasn’t as broad a market as she anticipated.
“I’m being self-referential,” Landesberg told the GBH podcast, referring to deliberately building her company inside the athlete-culture bubble. “This is the number one thing you’re told not to do … But I’m going at this completely selfishly based on my experiences in high tech, in a start-up, jiu-jitsu-ing the convention and really understanding what I want as a ‘sweaty consumer.’”
The issue, it seems, is that neither Sufferfest or Sierra Nevada has ever had to face such a formidable champion on its home turf. And once again, Michelob Ultra proved its juggernaut status.
Sufferfest’s uncertain future, despite the support of a large brewing company with national distribution, raises questions of how big the niche is for low-calorie, low-carb, “better-for-you” beers. Sufferfest proved this was a fast-growing niche, but as runners know, races are won not just with speed, but endurance.
Words by Kate Bernot