Scarcity? On purpose? Why would anyone do that and what the hell does scarcity mean exactly?
Nice job. That is exactly the right question to ask, because it means something vastly different for every brewery. Scarcity for one brewery might mean a hundred thousand cases (or more). To another, it means two or three pallets of beer, pulsed in to a market a few times a year. Ridiculous? Nonsense, you say? Let’s peel back a couple of real-world examples to illustrate just how broad a term scarcity can be through two polar opposite examples.
Lagunitas landed in Chicago in the summer of 2006. Relatively unknown outside the usual circle of accounts like the Hopleaf and Map Room, it was a solid start to their business in Chicago, but no records were being broken. Yet. Fast forward through a lot of blood, sweat, and tears to Anno Domini 2012, and Lagunitas was approaching volumes as the top craft brewery in Chicago. Hundreds of thousands of cases being sold, an enviable development from zero to a hundred MPH that many breweries can only dream about. Painfully, at the same time, there were out of stocks all over the place. Draft, package, IPA, Pils, Little Sumpin’… One or the other missing from orders for weeks at a time. An interminable game of Whack-A-Mole with empty shelf space and plastic cups on tap handles. Then came an announcement from the owner on Twitter they’d be opening a brewery in Chicago, adding a boost of jet fuel to an already unstoppable rocket ship. Scarcity.
A couple years after that brewery from California made it to Chicago, there came another one. This time hailing from Minnesota and calling themselves Surly Brewing Company. A vastly different relationship began, with a mutual understanding out of the gate that there’d be minimal supply, and only draft available. Immediately when they arrived in the market, it forced a process that used to send shivers down the spines of sales people and customers alike: allocations. The demand was high. The supply was low. The customers in Chicago & Minnesota alike became more and more impatient. In 2010, the brewery eventually had to leave the Chicago market entirely. Scarcity.
Obviously, these examples reflect scarcity as a matter of necessity, with production constraints holding back retail and consumer demand. The difference between these scenarios and the perfect model for scarcity-as-marketing? It boils down to everyone involved simply running a smart business. Making sure there is solid communication, understanding, and expectations between Supplier, the Off-Trail management team, the distributor, and the input of key retail(ers) wherever possible. One simple thing that’s been said for many years, if we want a healthy market we should all be looking to place “the right beer in the right accounts with the right quantities.” As illustrated previously, that can mean executing a 50 case display program across multiple Chain stores or sending just one keg each to the “A” accounts in a territory.
“Yeah, but does it work?” Yes. Scarcity-as-marketing is the driving force for every line of people showing up for a beer release. The secret ingredient is balance. The amount that makes a beer scarce depends on the beer, the brewery, where they’re at in the life cycle, and how patient but bold they’re willing to be. Three Floyds has been doing Dark Lord Day for a long time. From that first event with a few hundred people and a few hundred bottles to the spectacle of more than 6000 people showing up in Munster purchasing thousands of bottles of multiple varieties. That didn’t happen overnight. It took years of development, planning, additional production capacity, and a sprinkle of pixie dust for good measure.
Becoming Part of the Collective.
We’re accessing distributors who have their finger on the pulse of the taste makers, sending appropriate quantities of beer in to the market and engaging the right audience with your beer and your message. Dissecting the results and calculating the best, next move. Carefully navigate the perfect timing for another pulse in that market. Who’s next?
There’s no guaranteed formula for that perfect amount of beer being pulsed in to a market. We also can’t control what everyone else is doing out there. We function in the market alongside MANY other players, with more coming along every day. Many are just trying to survive, and there’s nothing more dangerous than desperation when trying to make good decisions. However, we CAN control how we play in the market and the positive disruption we bring to a sometimes volatile and always unpredictable industry. There are many in the business that are simply trying to jam as much beer in to the market as possible; desperate for more sales in a challenging time, with no consideration for what the consequences might bring.
One guarantee for the Members of Off-Trail Collective is that we’re not one of those businesses. We’re not looking to facilitate that kind of activity for ourselves or for others. Scarcity as marketing is just one approach to developing new breweries in new markets, but it’s one that’s incredibly valuable in such a crowded landscape.
Wes Phillips, Managing Partner