The rise of Goose Island to global brand: book review
I suspect that the somewhat sneering title of Josh Noel’s book “Barrel Aged Stout and Selling Out” (Chicago Review Press, 2018), which charts the rise of Chicago’s famous brewpub Goose Island to AB-InBev’s global craft beer brand, was chosen to make the book more sellable. Going for a rhyme – stout and out – might help too.
However, the book is anything but racy. It is very level and fair, considering that the final sale of Goose Island to AB-InBev in 2011 for USD 38.8 million (the old Anheuser-Busch had already acquired a 42 percent stake for USD 3.5 million in 2006) shocked the craft beer industry. Not the price – in view of later craft brewer valuations Goose Island, which sold 150,000 barrels beer that year, went for a song – but the sale itself.
Little did craft brewers know at the time that Goose Island was only AB-InBev’s test lab for what to do with its future craft beer acquisitions. It will be remembered that AB-InBev went on to buy nine more US craft brewers between 2014 and 2017, the last one to date being Asheville’s Wicked Weed in May 2017.
Mr Noel cleverly intertwines two narrative strands: Goose Island’s, or more precisely the story of the father-and-son team, John and Greg Hall, who founded the brewpub in 1988 and later a production brewery, and Anheuser-Busch’s. His narrative gathers speed in the 1990s when Goose Island was struggling to make ends meet. At the time, Anheuser-Busch thought that, by launching their own crafty offerings under the Michelob label (later to become Shock Top and others), they could keep the threat posed by craft beer at bay. This tactic proved so futile that Anheuser-Busch resorted to a “if you cannot beat them, buy them” approach, snapping up stakes in the Redhook and Widmer craft breweries.
Being a journalist with the Chicago Tribune, Mr Noel obviously benefitted from lengthy interviews with the Halls and their employees, in which they shared hitherto unknown insights. I am not sure that the Halls will find their portraits flattering. John Hall is described as a jovial but shrewd businessman, who always sought to grow his company to achieve a profitable exit. His son, on the other hand, comes across as a gregarious and tireless beer promoter, whose ingenuity at devising new beers styles (like barrel-aged beers in 1995) is beyond doubt, but who still likes his beer a bit too much and shows no business sense. His own cider venture, Virtue, flounders.
What makes the book imminently readable is that Mr Noel combines an interest in gripping personal stories with astute business analysis. Moreover, he provides his readers with perceptive descriptions of craft beer’s culture: the dope smoking, the leisurely and congenial ways, the flip-flops and short trousers. Goose Island was no exception. Hence the changes in practices at the brewery instigated by AB-InBev after the takeover – drugs tests, safety regulations etc – serve as powerful examples of the far bigger changes Goose Island underwent after it became corporate.
In Mr Noel’s analysis, AB-InBev messed up the national roll out of Goose Island big time. They took the brand national far too quickly. The taste of the beers, many of which were now produced at AB-InBev’s plants, suffered. They began to taste ordinary. In Mr Noel’s words: “They tasted exactly like what they were: Big Beer imitations of craft beer.” Goose Island’s spirit, revolving around innovation, intimacy, storytelling, nuance, relationships, relevance, authenticity, was gone. As were the Halls and plenty of Goose Island’s long-time employees.
Nevertheless, the takeover of Goose Island put AB-InBev on a steep learning curve. They saw that they could not stop change. Craft beer continued to barrel ahead. Therefore, they would embrace it. Mr Noel devotes the final sections of his book to AB-InBev’s subsequent takeovers of US craft brewers and explains how they have honed their practices in order not to repeat the mistakes they made with Goose Island. Although he mentions that in 2017 Goose Island’s US sales declined for the first time he does not delve into the possible reasons for this: was Goose Island becoming the victim of the backlash against national brands as craft beer consumers increasingly went for a truly local beer? Or did consumers finally turn against its bland beers?
Still, Goose Island has led AB-InBev’s global craft strategy. They are opening brewpubs and bars dedicated to Goose Island all around the globe. The book ends by saying that John Hall does not regret the sale. After all, AB-InBev has taken his dream global.
If you plan to take a book with you on your summer vacations, make it this one. You will be gripped.
On a final note: I have to declare a personal interest in Goose Island because for over 20 years on my annual visits to Chicago friends would take me to the brewpub for drinks and dinners. When I last visited in April this year I wanted to see what it looked like after the major refurbishment which lasted for almost all of last year. John Hall had sold the brewpub to AB-InBev in 2016. Gone was its snug appeal which in John Hall’s vision compared with “a comfy pair of jeans you’ve had for 30 years”. The new Goose Island brewpub had been given a sleek and modern makeover and the old wooden horseshoe bar, a Chicago staple, had been ripped out. I was also saddened to see that the restaurant was nearly empty. It was Friday evening and our waiter appeared a bit depressed. His take-home in tips would be slim indeed. Seeing that the brewpub is not doing a brisk business, I wonder when AB-InBev will pull the plug?
