NE IPA and the GTM Problem

Tree House Brewing Can Line
The now-famous Tree House Brewing Co. can line.

Go-to-market (GTM) is NE IPAs lingering problem and not only has it not been properly solved, it is now causing a narrative problem for the rest of craft beer.

Paraphrasing Wikipedia and other sources: GTM is a strategy for a company utilizing inside and outside resources to deliver a unique value proposition to customers to achieve competitive advantages.

Thus far NE IPAs GTM strategy has brought us direct sales of cans, almost exclusively pounders. Right around when everyone started to wake up to the fact that cans actually were the right container for beers, the one style that needed it most was nascent.

These fragile beers were brewed by small breweries in small quantities that needed to be sold and consumer “fresh.” Their turbid appearance and the bold yet ephemeral flavors of the style meant they needed to be stored cold, only briefly, and sold quickly to a consumer. Self-distribution as GTM answered all these issues. It was a natural result.

The GTM of NE IPAs is clear in hindsight. Limited runs of cans that are stored cold (if they don’t sell out within hours) and sold on location. Limited releases to thirsty bros that would either drink them up fresh or flip them into a fast-paced social media driven market that moved them to interested buyers quickly.

This has resulted in people drinking beer that is incredibly fresh, measured in weeks or even days, which is great. Really fresh NE IPAs are amazing. But the concept of freshness for NE IPAs is now being stretched into the broader market.

A West Coast IPA may remain fresh for three months without significant alteration in flavor. There is no reason why anyone should turn their nose up to a two-month-old Sierra Nevada Torpedo, but recently I saw just that. “Nah, I don’t drink anything older than a month” responded one craft beer drinker.

The rightful insistence on beer being exceedingly fresh for NE IPAs exists due to the nature of the beer and the methodology for the distribution. Small brewers needed to flip beers quickly. The Veil Brewing Co. seems to hardly make the same beer twice because it has a GTM self-distribution strategy for getting their beer out the door. But those rules do not apply to the broader craft beer market which is widely predicated on the three-tier system. Don’t @ me about the three-tier system, that is another post entirely.

This is not a defense of stale beer. I hate the off-putting flavor of a seemingly wet cardboard infused shelf turd as much as the next guy. The issue here is: Do we want to see a scenario where many breweries have logistical nightmares because what applies to NE IPAs suddenly is demanded of Brown Ales?

Tilting away from the broader impact on Craft Beer… What are NE IPAs producers going to do about their distribution problem?

Their GTM strategy does not scale.

Tree House Brewing Co has an amazing facility that I was lucky enough to witness first hand, but hour-long lines for six packs and cases have a ceiling. Lots of people will tolerate the wait and effort that but even more people will refuse to so much as make the drive. Tree House has a ceiling and they will reach it.

Tree House is not alone. Veil, Dancing Gnome, Trillium, Monkish… the list goes on. None of these guys distribute. Their product cannot or should not go into the distribution chain as they currently exist.

How long will can lines sustain these brewers? People, many of them brewers, dismiss NE IPA as a fad and in some ways, it looks like one. Watch this short video about Ty Beanie Babies and try to tell me you don’t see parallels. (Tip o’ the hat to Ed for finding this connection.) The standing in line for what is an endless stream of different labels on beers that are harder and harder to differentiate is going to burn some people out. Saturation of the thirstybros’ FOMO is not just possible it will be a reality. Waiting in line for two hours outside Dancing Gnome will not be a thing at some point.

I am not saying the GTM of self-distribution is unworkable. It is a great business plan as long as you can live under your ceiling. Maybe that is the long-term business plan.

But… If a major brewer can find a new GTM strategy for truly great NE IPAs, that would really be disruptive. But who can find it? So far, no one. Not Sam Adams. Not Blue Point. Not Sierra Nevada. We have hazy and juicy IPAs, but the true NE IPAs have evaded the big guys. Therefore we are seemingly left with but one method into the market, and that places a ceiling on the style and the businesses that trade in them.  

Post Script:

Easy Pretzel jumping in to offer his comments: Few breweries are putting out quality NE IPAs like Treehouse. Treehouse is the exception rather than the rule for breweries to even scale to the size that Treehouse is now. Treehouse recently said they are cranking out 1,000 bbls per week and growing, that is a ceiling that many breweries would love to approach. But does this style need to scale? Small quality NE IPA breweries can crank out some wonderful beer, self-distribute in the can game, and make a ton of cash (If they don’t load up on debt and try to scale too fast). The biggest competition (other than an economic recession with higher taxes and less disposable income) in this space is other local breweries because I don’t think this style can handle the current distribution chain. Not everything needs to be scalable. Thomas Keller can have great restaurants all over the world without worrying what Applebee’s is doing in their distribution chain.

Bearcat here again: Did you watch that video I linked above? Tell me it is not really on point in so many ways with what we are seeing in craft beer as it relates to NE IPAs and Pastry Stouts.

The self-distribution GTM is not just for NE IPAs. Lots of brewers are using this strategy and not brewing NE IPAs.

Personally, I think self-distribution is a brilliant method of selling beer, but it is far from perfect.

The more I consider it, the more impressed I am with Brew Gentlemen and the fact that they do not can their beers. I think it is a bit of a differentiator and a good one.

Mobile canning has had an amazing impact on Craft Beer. Someone should write about this. It should definitely be Bryan D. Roth. BTW — Bryan has been killing it over GBH.

I was drinking weak ass coffee while writing this but I wish it was a Doubleganger.

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