PODCAST: Crafting the Revival of PBR with Neal Stewart

In the latest episode of CPG Launch Leaders, we're taken on a nostalgic trip back to the early 2000s, when Pabst Blue Ribbon (PBR) was on the brink of obscurity. Neal Stewart, a seasoned marketing leader, takes us through the incredible journey of reinvigorating a brand that was, at one point, a staple in the American beer market, only to see a decline that left it gasping for air.

Neal recounts his early days at PBR and the fragmented state of the brand. He paints a picture of a company in disarray, with no clear direction or strategy and sales trends that would make any marketer's heart sink. But as Neil delves into the brand's story, he reveals the unexpected turn of events that would lead to PBR's extraordinary resurgence.

Hear the tale of the Lutz Tavern in Portland, Oregon, where PBR found an unlikely savior in a dive bar looking for a cheap beer to sell for a dollar. This chance encounter sparked a movement that would see PBR embraced by various subcultures, from tattoo enthusiasts to indie rockers, all drawn to the beer's unpretentious and retro appeal.

Neal shares the strategies that propelled PBR to viral success, emphasizing the importance of grassroots marketing and allowing consumers to define the brand's identity. He stresses the delicate balance of growing a brand without alienating its core audience or "selling out," a challenge many up-and-coming brands face today.

The episode is not just a walk down memory lane; it's a masterclass in marketing and brand revival. It's a reminder that sometimes, the most potent marketing doesn't come from a flashy campaign but from genuine connections and understanding your audience.

This episode is a must-listen for anyone interested in brand development, consumer behavior, or the CPG industry. Neil's insights offer valuable lessons on how to navigate the complex world of branding and the power of staying true to your roots.

So pour yourself a cold one, settle in, and let the story of PBR's remarkable turnaround inspire you to think differently about marketing and brand loyalty. Tune in to CPG launch leaders for this and more tales of innovation and success in the consumer packaged goods industry.

Find us on Spotify, Apple, and anywhere you listen to your favorite podcasts, or click the player below to hear this episode now!

Transcript

Neal: Building alignment throughout the three tiers was super important. That's the unique thing about the beer business, is that it's supplier, distributor, retailer, consumer. Um, so, yeah, you can leapfrog and just focus on the consumer, but if you don't have the support of the trade, you're not going to get anywhere.

Announcer: You're listening to CPG launch leaders, the show where we interview new product trail blazers. You're ready for inspiration and secrets from the front lines of CPG innovation. Now, here are our hosts, Darcy Ramler and Alan Peretz.

Allan: Welcome to CPG launch leaders. I'm Alan Peretz, and I'm here with my co host, Darcy Rambler. Today we're talking to Neil Stewart. Neil's a seasoned brand and marketing leader who's worked for several high growth and beloved brands.

Darcy: That's right, Alan. Today, Neil will tell us about his time leading the marketing team at Paps Blue Ribbon during the fan of the brand was a big supporter and consumer in my college days. Neil.

Neal: Awesome. And, uh, Alan, I saw what you did there. Was seasoned. Since I work in the seasoning business. Yes, experienced.

Darcy: Exactly. So, Neil, ah, we're beyond excited to have you on today, um, to talk about Paps blue ribbon and turning what could have been a regional fluke into something that was really the fastest growth in the sales company history. We truly like to dive in, but before we do, we, uh, love to start each episode with one particular question. Currently, what is a product that has caught your attention in the market?

Neal: I love that question because it's so hard to answer. It's like asking, what is my favorite band? Um, so I've rehearsed this in advance for this exact occasion. I'm a big fan of what Oatley is doing right now. So they have a really well defined brand voice. They're also really bringing some creativity, not only in how they deliver the message, but the mediums that they're using to do that.

Allan: Well, your story, uh, with the company begins in 2000, uh, when you joined them.

Neal: Can you tell us a little bit.

Allan: About your background before that and why you joined PBR?

Neal: I'm from the St. Louis area originally, so grew up in the shadows of the large brewery there in St. Louis, and, uh, had aspirations for working in the beer industry when I was in college. I mean, who doesn't want to work in the beer industry when they're in college? So, um, I was fortunate enough, uh, to eventually work for an agency in the St. Louis, uh, area, because pretty much every agency that was in St. Louis had some little tiny piece of anheuser bush business. And so, uh, I worked for one of those in, uh, mostly an experiential marketing capacity, and, uh, decided that, uh, one day I wanted to spread my wings a little bit and move out of the area. So I chose to move to Austin, Texas, because I had a friend who lived there. And it, uh, gave me an opportunity to sleep on a couch for a little while while I found a job. Never did find that job, uh, in Texas, except for, um, a temporary job where I was removing staples from, um. So, uh, anyway. But I did find a job in San Antonio, Texas. And that job was with Paps Brewing company. And, uh, my first role there was as a divisional marketing manager. So I had just enough beer experience from working for that agency in St. Louis to get my foot in the door.

Darcy: Well, if you were going back to report to your college and talking to college students, you could literally say, this is truly a job. I worked for Pabs blue ribbon. But when you entered in 2000, can you kind of talk about a little bit what was the state of the brand like when you entered in 2000?

Neal: Talk about the brand. But I also want to talk about the state of the company. So the state of the company was not good. The state of the brand was not good. So Papst was, uh, uh, really, uh, an amalgamation of a lot of different brewing companies, whether that was, uh, the g. Hyleman Brewing company, Schlitz Lone, uh, Star was its own brewing company at one point in time. And all of those brands lived under the Papst brewing company, uh, portfolio. And so, uh, when I first started working there, we did have one operational brewery, uh, on site in San Antonio. It was the old pearl brewery. So if anybody's been down to San Antonio lately, there's the pearl district with a really nice hotel and, uh, like an entertainment, uh, area. That's where our offices were. That's where the brewery was. Um, and I guess we did not only think of it, we did have another brewery in, uh, Lehigh Valley, Pennsylvania. So notice that we did not have a brewery in Milwaukee. And that's really where PBR's roots are. And that's where the company was based previously. So the company was, uh, being managed, uh, and really was owned by a charitable, um. So, uh, the reason it was owned by a charitable trust is because there was a guy named Paul Kalmanovitz who had previously owned Paps Brewing company. And his strategy was really just to milk all the brands, because he knew that the brands were going to outlive him. And he had no one to give the brewery to. He was an immigrant to the United States. Um, uh, he was married, but his wife was deceased. And so when he passed away, he gave the brewery to this charitable trust, which went to, um, as far as I know, hospitals in northern California where he lived, because these hospitals had helped, um, his wife prolong her life, uh, after she was diagnosed with a very, um, serious, um. And by the way, he also did, uh, the rumor was at least that he left the brewery to his pets. So he had like, a collection of dogs and birds and whatnot. So, um, dogs and birds can't own a brewery. So the charitable trust ran the brewery. Um, and obviously, in that kind of situation, is someone really managing the company in its best interest. There was a guy who was a CEO who departed, uh, right after I got there. Then we were managed by, um, kind of this, like, emergency, um, corporate management firm. Um, so, uh, in terms of sales trends, we used to celebrate being down single digits. That was a good result for us. For the most part, all of these brands were just bleeding volume down, 2030, 40% or more, or really just on a path to death. And, uh, PBR fit into that bucket. So PBR had, uh, just deteriorated in volume for many years. Um, I'll never forget this chart that I had in a lot of decks that I used in presentations. But the peak of PBR's volume was in, I think, 1978, um, at a little over 20 million barrels. Um, and a barrel of beer is, ah, 13.78 cases of beer. Okay, so a case of beer is 20 412 ounce bottles or cans. So, um, it was a massive, massive brand. And then by the time we got to 2001, it was under a million barrels of beer. So it had lost 90% of its sales.

Allan: Can you tell us a little bit about the marketing and advertising when you joined?

Neal: It was very fragmented. Um, I remember when I interviewed with the company, uh, the person who was running marketing at the time, he said, um, we're a very sales driven company. And are you okay with that? And at the time, I was like, well, yeah, sure, I like selling stuff. Um, so I didn't understand what he meant at that time. But what he really meant was that the sales team really steered the ship. And, uh, the marketing department's function was really to treat the sales team almost as, like our client or our customer. So what really happened was we had like, seven divisions, uh, seven sales divisions around the country. So whatever the team in the southeast wanted to do in terms of marketing, the brands. They did it. They asked the marketing team, hey, we're going to run a radio campaign. Can you produce some, uh, 30 and 62nd radio commercials? Sure. Yeah, let's do it. The team in the northwest, they had very different ideas. So a lot of times what would happen is, uh, the brands and how they were marketed followed the bias and the interests of those individual sales teams. There was not, uh, a brand strategy that held everything together where we said, all right, here's specifically how each brand, whether that was PBR or old Milwaukee or Lone Star Rainier or whatever, um, really, it was just like, hey, uh, we're in the southeast part of the country. We love NASCAR, so let's sponsor, like, a third tier NASCAR guys in the northwest, they were way into fishing, so we sponsored, like, this sturgeon fishing boat. So the brand messaging, uh, and marketing strategy was incredibly fragmented. Uh, when I first landed at past.

Darcy: So not to date myself at all here, but early two thousand s was in college. And obviously, there was this surge of affection that came for PBR. So you've now entered in, and I'm just kind of trying to wrap my head around the story of being very sales driven. You're coming into this marketing job. What do you think? Do you attribute some of that surge? And really what started to get, like you said, sales has dropped 90%. Can you start to talk a little bit about what was that turnaround, that corner?

Neal: All right, so, first of all, I have to ask where you went to college?

Darcy: I went to college in University of Redlands, and we may or may have not had many parties where a bathtub was filled with PBR.

Neal: All right, University of Redlands, is that in California?

Darcy: California, yeah, California.

Neal: Okay. All right, cool. So, yeah, you weren't too far away from what I call the epicenter of PBR, which was. So, um, yeah, Portland, Oregon, is really where everything started in a very organic, um, you know, as there are a lot of times with brands know, become part of the fabric of society, there's some luck involved, and there definitely was luck involved here. And that luck is that there was 1 bar in Portland, Oregon, called the Lutz tavern that started carrying PBR. And the Lutz Tavern was in, uh, yeah, I think it's no longer there, unfortunately, but was, uh, in southeast Portland. And, uh, it was a classic dive bar, and it needed a brand of beer to sell for $1. And, uh, the brand of beer that they had previously sold for one dollars went out of business. It was discontinued. Uh, and I found this out. I learned this story later on from the sales rep who actually sold it into that bar. I met him by chance later on, but it was literally as simple as the Lutz tavern saying, hey, distributor sales rep, what do you got that I could sell for a dollar and make decent margin off of? And he's like, I don't know, like PBR. Okay, great, PBR. And so all of the students in this area, which was uh, Lewis and uh, liberal arts school, they started kind of like feeling the papst vibe, which was that there was no marketing around it. They were able to make it what they wanted it to be. All it was was just this kind of honest, retro, approachable type beer. And uh, so then there were other, uh, bars and restaurants in southeast Portland that started to pick it up. There was a place called the Delta Cafe that was like this uh, kind of southern themed comfort food type restaurant. And they started selling PBR in 40oz and champagne buckets. So that was very, um, uh, iconic or not iconic, ironic to them. Um, uh, our sales rep in that area, uh, he started to kind of notice that the PBR numbers are really accelerating, because when you get a few accounts like that, that are churning through a lot of volume, your numbers can turn around pretty quick when you're down like 50%. So all of a sudden, he's doing pretty well. And he's like, I don't know what's going on here. Um, so he did something that was absolutely the right move, but I think he almost did it on accident. But uh, he said, all right, well, I'm just going to make sure that I get PBR neons in as many bars around Portland as possible. And that classic blue ribbon neon that just says paps, I think they cost like $100 at the time. And um, the funny thing is that I remember that he completely overspent his budget by $50,000 or something, but it was the best thing he could have ever done. So all of a sudden, all these bars that see the Lutz tavern and the Delta cafe start picking up PBR and doing well with it and making good money off of it. They started carrying it, and all of a sudden you start seeing these PBR neons around Portland. And then it became kind of a subculture phenomenon. But it wasn't just one subculture. It was various subcultures, from people that are into the tattoo scene, people that were bike messengers, was one of the subcultures that really kind of popped in the beginning. Obviously, the music community, whether that was bluegrass or indie rock, all of them had something that they could kind of share around PBR because it hadn't been over marketed, it hadn't niched itself down to just one group. So when they were looking for a way to represent themselves through their beer, because quite honestly, when you have a beer in your hand, you're doing it. Part of, for the badging effect, as we called it in the alcabit industry. But it was a badge that they were defining. Um, this guy puts the neons all around the market, um, and the market is up like 150%. And we were starting to hear about younger people drinking PBR because it was mostly like people on a pension drinking it before that. So, uh, our marketing director is like, hey, Neil, you're like the youngest guy in the marketing department. Can you go up there and figure out what's going on? I hear there's like a bunch of young people. And, uh, that's what I did. I went up there and just kind of conducted my own research and talked to as many consumers as possible. Um, at that time, they're like, hey, let's start advertising on the local alternative rock radio station. And I was like, whoa, no, don't do that. Because then you're starting to put a label on it and you're starting to define it. And that's really what consumers didn't want us to do. So, fortunately, we decided not to do that. And what we did do is we started sponsoring events that were really connected with all those different subcultures. So whether those were like tattoo fairs or a bike messenger race is something that we sponsored. Whatever, um, bike messenger race is, um, and we mostly sponsored those with just like free product and allowed those subcultures to define what the brand meant to them and how they interacted with it.

Allan: So, Neil, you see this happening in Portland. What did you do to get it to spread?

Neal: It did spread from there. That's why I was know, Darcy, you weren't too far away from it. So, um, I remember I kept this map, uh, that would show where the growth was happening by just like color coding states. And it literally went from Oregon to Washington. So Portland and Seattle. A lot of interaction between those markets. It went to San Francisco and northern California. Then, um, it started to happen in more kind of younger, uh, demographic markets, uh, with colleges, um, specifically markets with art schools. Uh, it really started to connect with those consumers. Um, honestly, what we tried to do was just kind of replicate the seeds that were planted in Portland. So I went to San Francisco and spent time with our sales rep there as well. And, um, uh, would go out at night and interact with consumers at the different bars. And I would usually take, like, a bag of PBR swag with me. And I tried to be super unassuming. I wouldn't barge in the door and say, hey, I'm the PBR guy. Let's do some fun stuff. I would literally just sit at the bar. Uh, and by this time, I've got my own bike messenger bag and everything. I'm totally in. Um, I had hats and t shirts and belt buckles and all kinds, keychains and whatnot. And, uh, usually I would just tell the bartender, hey, I'm with papst. Thanks for the business. Um, here's some swag. And then they would do the work for me. They'd be like, hey, the PBR guy is here, and he's got some stuff. And then I would just pass it out. And then opportunities to market would come out of that. So people would be like, oh, so, hey, you're the paps guy. I represent this event. I'm putting on this music festival. Would you be interested in sponsoring it? And then the conversation would start from there. So I spent time probably half the year on the road just doing that over and over. Eventually, we hired people to do that specifically in markets and kind of cultivate the scene individually. Um, but that was really the blueprint of how we scaled it, which I don't even know if I should use the word scale, because it was a slow scaling. And then all of a sudden, it just kind of happened. Um, and I think really the big thing, like the tipping point was maybe two things. Number one, uh, the New York Times magazine did a story on PBR's comeback. So that was huge. And then the other thing was, uh, uh, we put together this kit of promotional materials and a video of a bunch of interviews with consumers, um, and sent that out to our distributors around the country. And, you know, this is what is happening with PBR in markets like Portland, San Francisco, Savannah, Georgia, Chicago. Um, it can happen in your market, too. And when distributors saw that PBR could be a challenger brand to Budweiser, because, uh, most of our distributors did not carry Budweiser when they saw that PBR could knock Budweiser off tap and take that business, then the floodgates opened and we really started to grow.

Darcy: And your timeline is perfect because I was actually in college between 2001 and 2005. So it is exactly when you said you're entering into that younger scene of things, but being so grassroot and obviously the way that this came about. What could you say? Maybe some of the challenges a brand faces when they are able to have this type of explosive growth. But you use words that are very specific. You did use very localized, very regional strategy, very authentic. And you almost are under more scrutiny when you start to grow that way because you can be seen as a sell out very quickly if you steer away from that. So what were some of the challenges you feel like you guys encountered along the way?

Neal: Selling out was definitely one of them. So we really had to, um, walk, uh, a thin line between promoting ourselves and not over promoting ourselves. So we had some guardrails in place. I don't know how well they were articulated, but, um, uh, we would often talk about allowing the consumer to really define how, uh, the brand interacted with them at these different subculture events. Um, hiring people in the individual markets. So it wasn't just me traveling around. We hired people in like six markets, and they were people who were really embedded in that culture and had a way with really just making friends with the right people. We trained them. We talked about influencer marketing a lot back then, but it wasn't influencer marketing as it is today of like, hey, work with an influencer to get 4 million TikTok views. It was one on one influencer marketing of finding the right person who could unlock some doors for additional opportunities. And that could be a bartender, that could be someone that owned a tattoo parlor, that could be someone that owned, uh, the punk rock barber shop, the record store, whatever it might be. So we really looked for those influencers that could, like I said, open doors to additional opportunities. Um, yeah. And then I think the other challenge that we had was, um, kind of figuring out, well, what is the next lever that we pull? And I remember, uh, I did not coin this term, but someone used kind, uh, of like the story of punk rock and how punk rock back in the 1970s, people were putting safety pins through their ears. Well, that trend evolved into putting safety pins into jean jackets, and that was for the next layer of people to be part of that community. But putting a safety pin through their ear, they're not going there. But safety pins in the jean jackets, it's still kind of like a, uh, link to the core of that idea. And so we would kind of think about that, like, how are we going to scale this to more consumers? It couldn't just be these influencers. It couldn't just be people that own record stores forever. So how do we kind of go the next layer out, but make sure that we're still kind of connecting with those people who got us there. And that meant kind of almost utilizing them. I guess the simple way of saying it is really just like ethnographic research, getting permission from them on how we marketed the brand.

Darcy: Yeah. With grassroots brands, there's almost an homage you have to pay to where you've started, who the people were, and make sure you don't step too far away from that.

Neal: Yeah.

Allan: So you came in and the numbers looked kind of scary, really scary, as you said. And then things started to turn around. But there had to be a magic moment, maybe you remember it, where you really realized that you were in the midst of a turnaround.

Neal: I guess there was a moment, and, um, I kind of mentioned it before, but when we got the story in the New York Times magazine, um, I happened to be in Vegas celebrating a milestone birthday. And, uh, the New York Times magazine comes. This is when newspapers were still around. Um, but I went downstairs, uh, in whatever hotel I was staying at, I can't remember, and went to the newsstand and bought the Sunday New York Times, opened it up. I'm like, wow, that's a story about me and PBR. And, um, being that it landed on my birthday was kind of weird, too. So, yeah, that was m the moment, uh, that it all really clicked.

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Darcy: That's a pretty iconic moment there, Neil. That's a good one to remember. Um, what were some of your favorite, most memorable moments? Campaign marketing that you did when you were there in your stint at know.

Neal: I mean, the one that I mentioned, uh, know, hiring the marketing reps around the country, that was the most effective campaign that we did, but that was a really slow burn. Um, so I think we launched it the first year. It had six markets. We measured it, it was working. We tripled the size of it to 20 markets the next year. And then like 25 markets the year after that. And, uh, I left the company in 2006. In a way, I think they're still executing that program. Um, the other kind of redeeming thing was that our main competitor, Miller Highlife, literally got a copy of our playbook and then launched their own campaign. And it was like exactly the same. And we were all scared about it. It was like, oh my God, Miller's coming in. They got money. We're going to get our doors blown off. Well, it didn't work. They ended up killing it like six months or a year later. And that was a really proud moment because that proved that the authenticity of our campaign is what made it successful. Another thing that we did was this one didn't work quite as well. I think it definitely added value. It just didn't drive as much value as, uh, the FMR program that I mentioned a second ago. But we kind of like started our own record label. So we worked with bands in a few different cities and then, uh, we paid to have their music pressed on, vinyl on, like, we gave them the, they sold them at their shows and they were branded with PBR. Um, that just felt very authentic to the music scene in a few, ah, markets. So I really enjoyed that. Um, and then I guess the other one that comes to mind for me is, um, so we did advertise, strangely enough, but we found a way to advertise in a way that, um, I think was relevant to our consumer. But we advertised in alternative weeklies in all of our key markets around the country. But we gave our advertising space back to a, uh, band that we highlighted as like the PBR band of the week. And, uh, we let our advertising partners kind of source those bands. And, um, then that was a great way for the band to promote themselves. And then it helped us align with literally hundreds of bands across the country that we could have, like, if we would have tried to sponsor all them, we wouldn't have had enough money. But by just giving them like a quarter page ad in an alternative weekly, again, it was kind of like influencer marketing. If Papst was helping promote them, then hopefully they're drinking PBR on stage. Hopefully people in the crowd are seeing that and hopefully they're buying it.

Darcy: You basically were, I say, you were the first in beer that were doing now what all energy drinks do in UFC or anything else that was going on. But you talk a lot about alternative markets, right? Just even talking about messengers or tattoo or going into the music scene. Did you guys ever at one point say, hey, these are underserved markets. These are markets that, uh, other beer companies are looking over, or did it just kind of organically fall into those markets? How did you identify those consumers in those markets?

Neal: I think I was partially marketing to myself. I think I was part of that culture, um, which, quite honestly, is not a great credit to me, because everyone marketing to themselves. But, um, I had a gut feeling that there were consumers out there that just were rejecting mainstream light beer and were rejecting, uh, this was in the age of when Bud Light was still putting up, like, girls in bikini posters, and that that doesn't happen. Uh, um, yeah, with a race. Um, so just kind of going the opposite direction of that, I guess, simply put, was a zig versus zag strategy. Um, I think we went in that direction and then validated it by talking to consumers. And it was amazing how proactive consumers were. I use the example being in the bar and people coming to me with all these opportunities, but people would come to us and say, oh, you're the paps guy. Let me tell you about my experience with PBR. And we would hear the same stories over and over across the entire country. And one story that always emerged was, I'm drinking this beer as a tribute to my grandfather. So this is a beer that my dad would not know. My dad is a miller light, Bud light drinker. Um, but my grandfather, I remember being young and him drinking a PBR. My dad's lame. My grandfather was cool, so I'm drinking it as a tribute to him. And everyone could kind of wrap their head around that very simple idea.

Allan: So you've got this authentic brand. Uh, the authenticity is really driving your success. Did you do anything to change the look of the brand, uh, during this time, or did you kind of maintain it as it had been for PBR?

Neal: No, but there were line extensions within the Papst family. So one of the things that we did try to figure out was PBR light. Uh, but the feedback that we would always get is that, well, PBR is light enough. Why do you need a PBR light? And it's still the case. Domestic premium light beer is still, like, 50% of the beer category. Uh, so when we looked at it and said, well, PBR light is like 3% of the PBR business, there's got to be an idea there. We could never get that one right. Um, they even tried it after I left, and I think they probably did a better job of designing the packaging after I left than I did. Um, but there was just something about the proposition that didn't connect with consumers. Not sure why. Um, but yeah, in terms of core PBR, no, we didn't mess with the packaging at all. Um, we did bring back some icons of the past, so we did bring back some of the very retro 1970s, maybe even 1960s era advertising. We brought back a character called Cool Blue, which was this cartoon character that was, uh, like kind of a superhero, um, probably late 60s, early seventy s. Is the era that cool blue was, uh, maybe, uh, uh, a spokesperson for the brand. Uh, so we brought back some of that, but there wasn't a concerted campaign around it. Uh, but because mostly our advertising and promotional efforts, anything we were designing was trying to kind of put the consumer at the center of the messaging.

Darcy: And as all this is happening, obviously going on after new alternative demographics, a younger demographic. We spoke earlier that when you joined, the traditional demographic was definitely a different age range. Did you find as all of this sales growth started, did it alienate that original demographic or did they stay brand loyal to you guys?

Neal: That's a great question. PBR was not the only brand in the portfolio that we were trying to kind of resurge. Um, there was a brand, actually, from where I'm from in the St. Louis area called stag that had very divergent consumers. Um, and we would often know if the consumers see each other drinking the beer, that maybe they wouldn't like it. But that didn't happen with Papst. Um, I think mostly because the older consumer, um, was really living off of what they knew the brand to be back when they were in kind of that core drinking era of their life. They were older. And there's this long standing belief in the beer industry. I think it's probably changing more recently as there's just more choices within Alkbev. But, um, a lot of people would say once you're in the brand set, when that person turns like 30 years old, they're not changing, you're in for good. And I think for that generation of consumers, that probably was true. Uh, they drank PBR back when they were in their, they're in their, that's their brand. It fit their budget. So. Okay, we're good. Um, and then if they saw younger people drinking PBR in a bar, we would often talk about how dive bars kind of change demographics around like, 06:00. So from noon until 06:00 it's the old timers in there.

Darcy: You got the norms of cheers sitting in there. Yeah, for sure.

Neal: Yeah, you got those guys. And then around 06:00 on a Friday night, the younger people start coming in, but there's this maybe two hour period where they overlap. And honestly, what we saw is that if the older demographics saw, ah, younger people drinking PBR, they would actually bond over it.

Darcy: Yeah, I was going to say there's a cheers moment there of like an eye contact. We're both drinking it cool and a little bit of a respect moment there. I love that. And I think some of it you talk about that older customer that's been so loyal, the one area where you guys didn't depart from. And I think this is key probably to the success of how you don't alienate that consumer, is changing that packaging, changing that iconic. Because I do think it's like having a coke change what coke looks like immediately. Once you start to change what they visually see, um, there can be an association. Are they changing the taste? What are they doing with my brand? So probably keeping majority of that intact for those consumers was extremely helpful of keeping them loyal too.

Neal: There's usually someone within the organization that when something gets hot, it's like, all right, let's try to fuel it by changing the packaging. That's always, um, the hot topic within the marketing department. What can we do to optimize packaging? Uh, but yeah, uh, we fortunately stayed away from that. I think we heard it from consumers enough that it was good as is. Honestly, there were a lot of things in the packaging design that were just like weird. Like weird choices of colors. Um, the outer wrap of the twelve packs was like, the color was completely washed out and not very vibrant on shelf. Those are things that we did want to change with just our marketer hat on. But yeah, we always had to put the consumer first and say, all right, what kind of impact will this have on the consumer? Even the most subtle of change. Um, what perception does that drive with the consumer?

Allan: So we talked a lot about bars. Can you tell me a bit about what was happening at retail? Uh, during this time?

Neal: We'd always kind of consider on premise bars, restaurants, nightclubs, whatever. Um, we consider that's where the brand was being built, but on premise is where most of the volume came from. I'm not really recalling what our percent mix was. Um, I'm going to take a guess and say it was probably like 75% off premise to on premise. Um, but I don't recall that number. Um, but anyway, um, yeah, we did have to kind of find a way to rebuild distribution off premise. And getting back into chain grocery stores was a pretty big chore. So, um, we kind of approached it from the standpoint of focusing on independent, uh, liquor stores first and building a success story there. And then, um, we did see a direct correlation between, um, the on premise distribution and on premise strength. So certain neighborhoods would perform extremely well in Chicago, like Wicker park was kind of a stronghold for PBR. And then we'd look at the jewel Osco in that neighborhood. How are we performing there? And we saw a direct correlation. So, uh, we tried to convert that into a selling story for the national account retailers to give us more distribution, but that's a longer selling cycle. So it didn't happen quite as fast. But when I was quoting that number earlier of being the fastest growing brand within the top 50, that was a data point from syndicated off premise data. So, um, yeah, there were times when we were growing over 20%, uh, in the off premise, and that was in an era when, if you recall, there were all those, um, smearing off ice knockoffs out there. Uh, and so I think probably part of the other story here is that a lot of the bigger breweries got distracted with innovation and not focusing on their core business. And that allowed PBR to kind of sneak in the side door.

Darcy: Absolutely. So you're growing at, uh, retail. We've discussed that not only from the bar side of it, now you're growing in retail. With growing in retail comes the pressure of national campaigns. Um, was there anything. And then balancing what's a national campaign? How do we keep grassroots? We've talked about this is a very delicate balance. Were there any hard no's that you guys said, we're not going to do. From a marketing standpoint, when it came to national campaigns or levers to be.

Neal: Pulled, honestly, we didn't have enough money for national campaigns, so that was a.

Darcy: Little bit out of that made it easy.

Neal: Yeah, I'm trying to recall our marketing budget. I'm going to say our marketing budget around this time was m. Uh, probably about six or $7 million, enough to.

Darcy: Buy a few messenger bags and get on the road.

Neal: A third of that was spent on those field marketing reps. Uh, a lot of it was probably spent on just price promotion at retail. So getting tprs at the right point in time, um, but we really didn't get much pushback from national retailers or even distributors when we got to that point. Now, in the building up to it, when people were just kind of reaching to say, all right, hey, we got to try something. The brand's in decline. I need advertising. Uh, that was a tougher battle for me to fight. But once we demonstrated that the grassroots campaigns were working, and as I said earlier, sending out that kit and this video that had all these interviews, when people saw it in action, they were like, uh, okay, I got it. Now I'm on board. So, yeah, building alignment throughout the three tiers was super important. That's the unique thing about the beer business, is that it's supplier, distributor, retailer, consumer. Um, so, yeah, you can leapfrog and just focus on the consumer, but if you don't have the support of the trade, you're not going to get anywhere. So getting to that point, getting the support of our distributors and helping them realize that there was an opportunity for them to, uh, realize some incrementality was extremely important.

Allan: So we've talked a little bit about merchandise, uh, hats, t shirts, belt buckles. Did that become part of the business too, or was that strictly promotional?

Neal: We had a tiny Ecom business. ECOM was really just starting back then. Um, I remember when we launched, uh, selling merchandise on our website. It took like two years to do it. And, you know, finding a vendor to provide that, it was, it was an ordeal. Um, which, you know, I kind of look back on it and I think maybe that helped us as well because it wasn't so easy to get a PBR belt buckle. You had to kind of know someone, you had to be in the right place at the right time to get one. So it made all of that stuff very collectible and sought after. We utilized a lot of that to hook up, um, bartenders first and foremost. Obviously, we want them pushing and promoting our brand. So, uh, yeah, we spent a lot of money on merch, um, those field marketing reps that were sprinkled around the country. That was one of their big buckets of budget of like, here's your budget. Spend x percent, at least 30% or so on merchandise. Hats, belt buckles, t shirts, red, white and blue sweatbands were popular, all that stuff.

Darcy: Absolutely. So you left, you said PBR in 2006. What was your next step from there?

Neal: I stayed in the beer business for most of my time. After that, I had an interest in craft beer, so I went to a brewery called flying Dog. Um, that was based in Denver, Colorado. Ah, my wife was from Colorado, and I had an interest in craft beer at this time. And, uh, so, yeah, went to flying dog for a bit. And then, uh, since then I've worked at a few other craft breweries, probably, um, most notably dogfish head, um, out in, uh, Milton, Delaware. So, um, yeah, spent quite a bit of time in the beer industry. But, uh, yeah, I've left the beer industry now and, uh, I work in the seasoning business. Um, and I work for a brand called Dano's seasoning. And the interesting thing is that we really market our brand like a beer brand. It's a lifestyle brand. And there aren't too many lifestyle branded, well, not too many seasoning brands that can say that they're a lifestyle brand.

Darcy: Absolutely. And you've kind of found yourself back to a brand that started from a very grassroots type of way, which is full circle for you, Neil.

Neal: I mean, that's my specialty, I think. And, um, I like to build things. Um, and we have a great team at Danos and we're growing quickly and growing distribution all across the country. So it's been a really fun ride. But, yeah, uh, I've always said I'm not the kind of person that's going to take a job that has the instruction manual and tells you exactly ten steps that you need to take. I prefer the blank piece of paper and try to figure it out on my own.

Allan: So what's happening in the seasoning market today? What's the big trend?

Neal: The big trend? Well, I kind of think that we're, uh, one of the front runners in defining what the trends are. Um, seasoning has been kind of a commoditized, sleepy category for many years. And, um, at Danos, we have just a massive social media following. We have over 4 million followers on TikTok, uh, over 2 million on Facebook. So we have a really big organic social media following. And for us, ah, it's a lot about content marketing. Our founder has a passion for creating, uh, content and creating recipes. Um, in a way, um, this is kind of a widely used phrase, but we're almost more of a media company than a seasoning company, although we're very proud of our product. So, yeah, from a marketing standpoint, it's a lot about content development, but from a functional standpoint, um, I think better for you, just like many other categories, is an emerging trend for us. And we're very proud to have significantly lower sodium than a lot of our other competitors. No MSG, uh, no sugar in our seasoning. So, yeah, that allows us to have fun in the category, but also have something functional to talk about with consumers.

Darcy: Amazing. Well, Neil, thank you for joining us and sharing your story and really your experience as you helped build PBR in 2000. It is truly stories like yours that remind us to keep innovating, stay inspired, and let's continue to redefine the world of CPG innovation. Thanks, Neil.

Neal: Great. Thank you.

Allan: Thank you.

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Keywords

Cpg Launch Leaders, Neil Stewart, Pabst Blue Ribbon (Pbr), Brand Marketing, Consumer Packaged Goods (Cpg), Beer Industry, Trade Support, Experiential Marketing, Oatly Brand, Sales Growth, Brand Strategy, Subcultures In Marketing, Grassroots Marketing, Influencer Marketing, Product Turnaround, Viral Marketing Campaigns, Niche Marketing, Dive Bars And Beer, Field Marketing, Seasoning Industry Trends