category-iconHaving a Beer with

Having a Beer with...Josh Noel

May 23, 2018

By Will Robertson, May 23, 2018

Approaching Tribune Tower in Chicago, rock fragments can be seen embedded within the facade. These pieces of history come from the Alamo, Tomb of Abraham Lincoln, and Omaha Beach in Normandy, France. There's even a steel shard from the World Trade Center. Their presence whets the appetite for what lays ahead. Inside, the lobby is adorned with quotes carved in granite; quotes about the First Amendment, in support of a free press and reflections of the values of our free society.

Up a few steps is the Chicago Tribune newsroom. While the physical has a patina, the spiritual is as bright as ever. Since the newspaper is about to from the building, I jumped at the chance to meet with Josh Noel within these hallowed halls. Josh has worked at the "World's Greatest Newspaper" since 2005 and currently serves as its beer and travel writer.

‘Barrel-Aged Stout and Selling Out: Goose Island, Anheuser-Busch, and how Craft Beer Became Big Business’ is your book, which drops June 1st. You serial tweeted the first chapter, is that correct?

I started on January 1st. I tweeted one or two lines a day. I'm really excited to start being able to share it. Sharing it on Twitter just seemed to be a novel way to try to engage people. People have a lot of things coming at them now. Getting people to buy books in 2018 is not so easy.

Said chapter has since been published by the Chicago Tribune. You are a fantastic storyteller. The imagery just drew me in.

Craft beer has such an incredibly passionate and knowledgeable audience. I want to engage with those people and talk to them about beer and tell the Goose Island story, which is also the Anheuser-Busch story, which is also the Anheuser-Busch InBev story, and all that reflects the craft beer story. I’m trying to tell the story of craft beer through the lens of Goose Island and Anheuser-Busch. Goose Island is one of the most creative and innovative breweries in the history of craft beer. I'm talking presale. Then they were at the epicenter of the earthquake that shook the foundation of craft beer with that sale. They were the first to go in a meaningful way. It gets crazy. It starts small and it gets huge.

There was a story of innovation, struggle, success, big business, small business, what it means to 'sell out and, for good measure, a father-and-son story.”

What compelled you to tell this story?

Soon after Goose Island's sale to Anheuser-Busch in 2011, I knew there was a fascinating story on two levels: Goose Island's role in the rise of craft beer, and Anheuser-Busch's need to get involved in a segment of the industry where it had long struggled. There was a story of innovation, struggle, success, big business, small business, what it means to 'sell out' and, for good measure, a father-and-son story. Every good book needs compelling characters, and a father-son dynamic helped provide that. When I started reporting the book, I did not know the end of the story. It could well have been Goose Island's sale to Anheuser-Busch. Instead, that wound up being the midway point. I had no idea that the Goose Island sale would launch a complicated new era in craft beer, driven mostly by Anheuser-Busch's need to become involved in the industry. But it did, and it only made the story better.

Having tracked most of Goose Island's history with an emphasis on the acquisition, what about that has gone well and not well for Goose?

The sale certainly solved the needs Goose Island had at the time of the sale. It gave founder John Hall, who was approaching 70 years old at the time, an exit strategy and a well-deserved payday. It relieved the brewery of the burden of making so much beer. The sale allowed Goose Island's core portfolio to be made in far larger batches at Anheuser-Busch breweries, which freed up the Chicago brewery for more innovation and specialty brewing, such as Bourbon County Stout. However, offloading much of the brewing to Anheuser-Busch also came at a price: Those beers just aren't as good these days. So the things that have gone well as a result of the sale—the ability to grow—have also had a hand in what hasn't gone so well—spotty quality and a fair bit of beer in the market older than it should be.

It can't be overstated how little a craft brewery owned by Anheuser-Busch and a brewery making a few thousand barrels of beer per year have in common.”

How does what happened with Goose Island translate to other breweries acquired by AB?

Goose Island was the first of Anheuser-Busch's ten craft brewery acquisitions, and, as a result, it suffered the most. Anheuser-Busch dearly needed a national craft brand, and Goose Island was it simply by being the first acquisition. It therefore had to grow faster than it should have. The brand has sustained some damage along the way, as we see in the 2017 sales figures. It's no coincidence that every other brand bought since Goose Island has seen far slower expansion. Anheuser-Busch has learned that craft beer and ‘Big Beer’ brands can't be treated the same.

Has Big Beer learned enough from recent past to suggest another buying spree is in the near future?

I think we'll see some targeted acquisitions here and there, but the era marked by brewery sales probably peaked in 2015. Anheuser-Busch bought ten breweries between 2011 and 2017. That seems to be about the limit of what they need to accomplish their goal of being the nation's dominant producer of craft beer across every style of beer and region of the United States.

What are your thoughts on Big Beer vs craft or ‘Little,’ as it were, beer?

Big Beer and Little Beer are just playing vastly different games. It can't be overstated how little a craft brewery owned by Anheuser-Busch and a brewery making a few thousand barrels of beer per year have in common. Yes, both make IPAs that look ‘authentic’ on a cooler shelf or a tap list, but they're radically different propositions once you get past the liquid. That's why the big beer companies are so invested in the ‘all that matters is the beer’ narrative. It's imperative to Big Beer that it blend in with the little guys. The small breweries have the ‘small, local, authentic’ credibility that is so prized right now and lifts the entire industry. Anheuser-Busch has acknowledged that it depends on the little guys to lend credibility to big guys such as itself. But Anheuser-Busch is also invested in making sure that the smaller guys can grow to become only so large—while it becomes the largest of them all.

The thought that you could get IPA on a major airline or in an airport bar or at a baseball game 15 years ago was ludicrous. Now, it's commonplace.”

How is your relationship with the beer industry and Goose Island since writing the book? Has it changed?

The thing that has changed over the last few years is the industry itself. This era of mergers and acquisitions and Big Beer's leap into craft has been fascinating to watch, with many interesting and compelling players. It has also been interesting to watch the Brewers Association try to grapple with it. The Brewers Association has had some successes, but also seems to have turned people off with its messaging about Big Beer's entry into craft.

It's amazing to me how many people still don't know Blue Moon is owned and made by MillerCoors and Goose Island is owned and largely made by Anheuser-Busch. And that's the way Anheuser-Busch and MillerCoors want it. The way they need it. And it makes sense why. They want those brands to stand for themselves, far from their massive corporate parents. But when the Brewers Association, or whoever, complains about a lack of transparency, there's a fair point there. Say what you want about Big Beer, but it had to get involved in craft and it did. Can't blame them. Are they being honest with the consumer? That's debatable.

I know you've addressed it via Twitter and also in the book: Who won? Is Big Beer bending to what defines craft a victory? Does being the number one producer of craft outweigh craft's independent gains?

This is ultimately the question that runs throughout the book. John Hall argues that craft beer won. It forced Big Beer to change. And who can argue with him? The thought that you could get IPA on a major airline or in an airport bar or at a baseball game 15 years ago was ludicrous. Now, it's commonplace. Craft beer made that happen, but mostly because Big Beer got involved. Big Beer controls so much access, that its decision to mainstream craft beer contributed heavily to craft beer's success. And that's why some people say that Big Beer has won—it commandeered craft beer and took it into the mainstream on its own terms. I think both sides make a compelling case.

ZX Ventures, a division within AB InBev, is an investor in October
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