Friday, April 22, 2016

Greg Hall Speaks

Correction: in an earlier version of this post, I wrote "John" Hall rather than "Greg." John Hall founded Goose Island, and Greg, his son, founded Virtue Cider. I have no idea what caused the mental hiccup that caused me to transpose the names in my brain. 

For those of you who follow cider closely, the curious case of Greg Hall's adventures with Virtue Cider have been a source of endless fascination. Hall launched cider with a showman's flair, a ton of bravado, and bottle prices that were at least 50% above the competition. He knew beer and he was confident he understood cider as well--a view some long-time cidermakers rightly chafed at. So, when Virtue ran into a host of troubles a few years ago, there was more than a little schadenfreude. Well, today Jason Notte has an interview with Hall that's well worth a read.  A few of the highlights, with my commentary sprinkled throughout.
Then, all of a sudden, boom, [cider] was everywhere, and everybody wanted it. We felt like pioneers and missionaries again in 2011 and 2012, but by 2013 we had markets all over the country looking for cider...
Pioneers in 2011? Steve Wood is really going to love that comment.

We were in Costco by Year 2, which is unbelievable. We just didn’t plan that there would be that much demand early on. We had to kind of restructure the way we were doing things and figure out what was the best way to do this and which markets we could support.
I doubt this very much. I interviewed Hall in Portland in 2011 or '12, and he was there to do an all-out launch. He wanted his cider to be national immediately. I think what he didn't understand is that scaling cider looks very, very different than scaling beer.
We overreached a little bit, and we couldn’t support some of the markets that we went into. It’s always hard for a brand to say no to new markets when they want you, so we maybe overreached a little bit and were unable to support some of the markets, and [so] we regrouped back to the Great Lakes. We continued to do well in Chicago and some of the surrounding areas, and now, with additional resources and the High End team and the Goose Island team, we’re able to do a better job supporting the brand in the marketplace while still making all the cider at our farm up in Fennville and doing all of the brand work and all of that. 
It's a good thing ABI infused the cidery with the money to hang on, because the "bit" of overreaching would have ended Virtue without it.
The other great advantage is that we get to send all of our cider down to Chicago and they bottle it for us and they keg it for us. We don’t have to make the big capital investments in a bottle line. We can use the bottle line that I put in in 1995 for Goose Island and that’s been upgraded since then. We get that wonderful capital asset, and that probably puts us at an advantage over a lot of our brethren in the cider business who are still hand bottling like we were 10 months ago. That’s the way it started out, but we were fortunate that we were able to ramp things up quickly.
Virtue was originally intended to be a farm-based cidery making artisanal European-style products. That model can work, but it's very difficult to make it work in the mass market. Now that Virtue is an ABI line, will the focus be on those same high-end products, or a slightly higher end portion of the mass market currently owned by Angry Orchard? I know where I'd place my bets.

There was some talk of Goose's consideration of doing a cider back in 2000, but scrapping the idea. We pick it up from there.
Now, I look at it and I see all these cideries popping up, and the ones that I think are the ones that are leading things — if not on the sales side, on respect in the market — are the guys on the farms. That’s the way it’s always been done back in England, France and Spain. The timing allowed me to do it that way, which, for me, is the right way to do it: Make cider on a farm, and really focus on cider above all.
This is an accurate description of the market, but it perverts the timeline. Cider predated Hall's consideration of it. He has a weird instinct--as he did with Goose Island--to place it at the beginning of the narrative. But Virtue Cider came decades after cider reemerged in the US, and Goose Island was founded well into the craft brewery movement (1988). The one place he's happy not to take credit? Being the first brewery to sell out to AB InBev.
I think that whole “Goose was the first ...,” well, if it wasn’t Goose, it would have been somebody else. It was just a matter of time. 
Aw shucks. He concludes this way, and I'll let you draw your own conclusions.
And then the timing on the cider thing. It couldn’t have been better. If we had opened five years earlier, it would have been too early, but if we opened five years later, we would have been a me-too cidery. I’d love to say I planned all this timing, but I’m glad that for me it’s worked as well as it has.
There's more there, so go have a look.

1 comment:

  1. Greg Hall, not John, w/r/t the bulk of the cider talk (Notte interviewed both John and Greg for the article), and I think Steve Wood understands what Hall means by "feeling like a pioneer" -- there were folks who came before the launch of Virtue, but farm-to-bottle cider was by no means a well-understood thing when Hall launched Virtue. He certainly didn't have the numerous models that, say, a new brewery would have today.

    The placing of Goose Island at the "beginning of the narrative" is also within a Chicago-specific context: yes, there were craft breweries predating Goose in the US, but Goose was Chicago's first in terms of gaining any traction whatsoever, and was the only one in the city limits for years. For the longest time, when you talked about Chicago's craft breweries, you were talking about Goose, Two Brothers (in the western burbs) and Three Floyds (in Munster, IN). Everything in the article places things in a Chicago context for Goose's early years -- neither Hall is claiming they predated Sierra Nevada, say.

    You are spot on, however, in saying Virtue would have been toast without AB InBev $$$. I doubt another variant of the Angry Orchard type is needed, though -- I'd guess they'll keep it as is, and if it doesn't turn a profit, ax it as a brand.