Great Lakes Brewing, the 35-year-old Ohio craft brewery, recently underwent a self-reflection: “How do we continue to attract new consumers, when many of today’s drinkers were in diapers at our brewery’s founding?”
The issue is not unique to Great Lakes. Every craft brewery is competing for new consumers, not just with each other but also with hard seltzer and ready-to-drink, spirits-based cocktail makers. With the appointment of industry veteran Mark King as CEO in 2019, Great Lakes sought to refresh its brand and escape years of declining volumes.
Production at Great Lakes peaked at 149,948 barrels of beer in 2014 and has not reached that level in the years since, according to data published in the Brewers Association’s New Brewer magazine. In 2019, the company produced 124,819 barrels of beer, and amidst the pandemic in 2020, the company produced 105,841 barrels.
“The big challenge was, how do you take a company that, as great as it has been, had been in decline for about seven years?” King told Brewbound. “Looking at how consumer tastes changed, we had to start creating those brands that attracted the younger [audience], we had to get back in the conversation, and we had to get to recruiting new consumers. And that’s what we did.”
Great Lakes created a three-step plan to reinvigorate itself: stabilize its core brands, transition to cans, and expand its range of offerings.
When Pat and Dan Conway founded Great Lakes in 1986, they set out to create beers inspired by their European travels, while also paying homage to their local roots, according to the Great Lakes website. Over the past 35 years, they’ve grown a core lineup of “legacy brands,” including Dortmunder Gold Lager, Eliot Ness Amber Lager, Edmund Fitzgerald Porter, and Great Lakes Pale Ale.
“Great Lakes is in a perfect position, given its legacy brands [and] its history,” King said. “It’s well respected. If it looks good, it tastes good, and it’s priced right, you’re halfway there. But it’s also got to be an exciting brand that people really fall in love with.”
While the brewery created a dedicated consumer base with those legacy products, sales have declined as consumers shifted their purchasing to newer styles and beyond beer offerings. King, who brought more than 30 years of industry experience, including 20 years with Anheuser-Busch InBev (A-B), saw an opportunity to improve the legacy brands’ numbers by refreshing their product images and marketing.
The company re-designed the look of those brands from flat black and subdued to bright, colorful imagery, while maintaining the designs dedicated to local history. The Dortmunder pays homage to the city of Cleveland and features a bright yellow gold medal, referencing the gold medal it won at the Great American Beer Festival in 1990, which King said put Great Lakes on the map. Commodore Perry features the battleships of the 1813 Battle of Lake Erie, with bright blue skies and blazing yellow fire.
“The fear is, if you do things that are too far out of the box for your legacy consumers, that you could turn them off,” King said. “The brands that built this company were all rooted in Cleveland heritage, and we kept that when we put together our new packaging.”
The re-design came as consumers were forced to shift their purchasing from on-premise bars and restaurants to off-premise retailers during the COVID-19 pandemic.
“They come alive at retail,” King said of the packaging. “And we really made an effort to create the best in class with point of sale and display pieces. … Our marketing team really brought our point of sale alive last year, and wholesalers executed it.”
Although Great Lakes had begun canning beer in 2017 through a partnership with Boston’s Harpoon Brewery, the company didn’t have a dedicated canning line until October 2020 when its 67,000 sq. ft. Strongsville production facility came online.
The canning line was part of a nearly $7 million innovation and expansion project that began in late 2019 but was delayed due to the pandemic. In the meantime, the brewery began canning Dortmunder and Great Lakes IPA through a partnership with contract brewer Brew Detroit.
The final step of the brewery’s refresh was to expand its portfolio of brands. Lagers and porters had helped build the brewery, but those styles make up only a small fraction of craft consumption, King said.
“We’re fighting for less than 10% of the pie,” he added.
Year-to-date through mid-May, craft lagers (pale lager, bock, amber lager, pilsner) accounted for 8.75% of dollar sales at off-premise multi-outlet food and convenience stores according to IRI. Of those, only pilsner (+4.5%) has increased dollar sales compared to the same period last year. Craft porters accounted for 0.9% of craft dollars and sales were in decline (-2%) year-to-date through May 16, according to IRI.
In the past year, Great Lakes has released several new brands, including Crushworthy, a low-calorie citrus wheat; Lemon Hefeweizen; and two hazy IPAs, Hazecraft and Tidal Fury. Three more IPA variations are set to release later this year. All new brands are sold in cans and draft, not bottles.
Great Lakes also released a Gimme Five variety 15-pack, featuring 12 oz. cans of Dortmunder, Burning River, IPA, Hazecraft, and Crushworthy. The variety pack, released in March and has been selling three times faster than wholesalers forecasted, according to King.
“Our innovation is absolutely crushing it,” King said. “Everything that we put in motion is actually happening as good or better than we had planned.”
Sales data backs him up. Against competition in the so-called “better-for-you” space, Crushworthy is the No. 1 low-calorie craft option in Ohio, and No. 2 in the Midwest, King said, citing IRI 52-week food data through June 6. King added that the wheat ale is set to outgrow its main competitor, Blue Moon Light Sky, which it already outsells in Cleveland.
Overall, Great Lake’s dollar sales are up more than 18% year-to date in food stores, according to IRI. Despite cycling the stock-up period comps from 2020, Great Lakes’ off-premise dollar sales between March 15 and June 6, 2021, increased +20.69% compared to the same period last year. Great Lakes ranked as the 22nd largest BA-defined craft brewery by volume in 2020, the largest craft brewery in Ohio, and the seventh largest craft brewery in the north central region of the U.S.
As on-premise establishments re-open, Great Lakes is exploring getting draft placements for its new products. In 2019, the on-premise compromised 35% of the company’s sales, according to King. Even with the renewed focus on draft, King said the company will continue its focus on retail sales, which increased from 40,000 to 53,000 points of distribution last year.
Great Lakes’ innovation drive will also continue, however that may not include a foray into hard seltzer.
“The pure side of me as I’ve been doing this for so long says, ‘No, we got to stick to our core,’” King said. “But I think it can be tastefully done to jump into additional categories as long as there is similarity or a halo effect to the mother brand.
“There’s a big romance with craft beer. I don’t see that there’s a big romance with seltzer, with the seltzer category. It’s a wonderful category. It’s been great for our beer wholesalers. It’s been great for our retailers. But there’s still a romance and a history with craft beer.”