Pete Coors is irritated.
Pete Coors is irritated.
MolsonCoors

Why the Brewers Association Shouldn't Pick a Fight with Pete Coors

High above Georgetown, on Guanella Pass, the snow can pile up several feet deep during the darkest months of winter. It is then, locals say, that as you listen closely to the wind rustling through the dead leaves of aspen stands, you can hear a whispering voice, a sexy voice, the voice of actor Mark Harmon. “This is the reason there is only one Coors brewery in the world,” the voice says. “When this snow melts, it’ll flow through miles of porous rock and sand. This natural filtration helps create a clarity, a purity that’s so remarkable, Coors doesn’t have to do a thing to their water. Rocky Mountain spring water. Helps give Coors a difference worth tasting.”

Harmon spoke those words for a wintry TV commercial that aired in 1985 and 1986, the same year he was judged the sexiest man alive by People magazine. He said similar things in other national TV and print ads, building on the cachet that Coors had gained a decade earlier when it was only available in eleven Western states — and highly sought after in the other 39.

“It seems to have won a reputation as the elixir of beers, the brew of Presidents, a prize to be smuggled into the East,” the New York Times wrote in 1975. That popularity confounded Brewers Digest editor Ernest Pyler, who told the Times, “I frankly can't explain it. Coors by brewing standards is a good beer, but so are many others.”

It didn’t matter. That mystique, combined with the 1977 movie Smokey and the Bandit, created a buzz that Coors couldn’t have bought.

But the Golden-based company was also setting the stage for another idea that would embed itself in the collective mind of the nation: Colorado as a place where the beer is special.

In 1979, a couple of scientists from the University of Colorado opened Boulder Beer Company (then called Boulder Brewing) in a goat shed near the town of Hygiene. Four years later, home-brewing evangelist Charlie Papazian founded the organization that would later morph into craft brewing’s major trade group, the Brewers Association. In 1988, John Hickenlooper and several partners opened the state’s first brewpub, Wynkoop Brewing, and sparked what would become explosive growth, not just in Denver’s lower downtown, but in a then-fledgling industry.

Today, Colorado is indeed that special place anticipated forty years ago. There are more than 360 breweries here, pumping $3 billion into the state economy. Beer tourists from around the globe come to Colorado to try our world-class beers, from sours and stouts to IPAs, double IPAs...and triple IPAs.

Nationwide, there are more than 6,200 craft breweries making 25.4 million barrels of beer per year. The $26 billion industry accounts for 23.4 percent of the United States beer market in sales — though just 12.7 percent  of the market share when it comes to volume. To get to this point, small and independent brewers have had to fight against “big beer” brands like Coors, Pabst, Corona, Miller and Budweiser. They’ve had to overcome what many consider to be shady sales tactics, as well as big beer’s control of distribution channels, ingredient purveyors and high-volume venues. Most recently, they've had to weather the purchase of some of their brethren as a way for big beer to push its own “craft” brands over independent brewers.

Because of that, the Brewers Association has ramped up its own public-relations campaigns in recent years. The organization has defined craft breweries, identified brands that are owned by big breweries, and even expelled members that get bought out by big beer, reminding the public that “independence matters.” Sometimes the rhetoric can be dramatic.

Eric Wallace delivers a fiery speech at the CBC in Nashville last week.EXPAND
Eric Wallace delivers a fiery speech at the CBC in Nashville last week.
Jonathan Shikes

“The many faux craft, crafty, captive, capitulated and acquired brands are weapons in the arsenal of the big breweries and used to control as much of the market as possible,” said Left Hand Brewing co-founder and Brewers Association Chairman Eric Wallace during an address at the annual Craft Brewers Conference last week in Nashville.

“Clever and deceptive packaging design, omission of ownership statements on labels, intellectual-property violations, denigrating and expensive marketing campaigns, monopolistic practices choking off raw materials and distribution channels, rampant violations of trade practices and exclusionary tactics in venues and accounts in many markets — these guys are out to eat our collective lunch and take your kids’ lunch money as well.”

Wallace's words were fiery and inspiring. And while such rousing speeches are nothing new for the Brewers Association, this one apparently hit home with Pete Coors, the 72-year-old great-grandson of Adolph Coors and chairman of the board of the Molson Coors Brewing Company. This week, he wrote an open letter to the Brewers Association, which was published in Beer Business Daily and on the Coors website.

“The leadership of the Brewers Association does a great disservice to the entire beer value chain by attempting to pit one part of the industry against another,” Coors wrote.

“You must know that it is insulting to those of us who don’t meet the clever criteria of your self-proclaimed definition of ‘craft brewer.’ This approach prioritizes insults and division over unity for a beverage that has been used to unify and celebrate together for generations.

“Should the highly educated and trained brewers who work for large brewers or the breweries that have been purchased by them be included in the disdain you seem to have for them? Should the quality of beers produced by them, including hundreds of quality medals, be insulted...simply because the parent company isn’t part of your ever-changing ‘club?’ Didn’t all large brewers start as craft brewers? Don’t all craft brewers wish to grow and be prosperous?”

Coors also took aim at Wallace’s “cheap shots and insults," adding, “That is a slippery slope that does not end well for our industry. We have enough competition inside the beer business and outside it with wine, spirits and, increasingly, marijuana.”

It’s an interesting letter — one that encapsulates a knack for public relations with the gentleman’s-handshake style of doing business that Coors has espoused since its beginnings in 1873...but it also shows a lack of understanding of the competition that craft breweries face. Even so, the BA would be smart to take some time to absorb and understand the missive. (See the full letter below.)

Coors is far from a victim. It’s one of the biggest beer companies in the world, and it has no problem flexing those muscles. If you’ve been to a Colorado Rockies game this year, you may have noticed a kiosk featuring beers from Hop Valley Brewing. Don’t recognize the name? That’s because Hop Valley isn’t a Colorado brewery. Rather, it is an Oregon brewery that sold out to MillerCoors in September 2016 and is now using its connection with the giant company to leverage itself across the country. In a blog post on the Coors website, Hop Valley brags that it is “expanding its innovative ‘hop boxes,’ concession stands carved out of bright green shipping containers that pour Hop Valley beers. The program started at AT&T Park in San Francisco and Safeco Field in Seattle and is slated to expand to Angels Stadium of Anaheim in Southern California, Chase Field in Phoenix and Coors Field in Denver.”

Then there’s Blue Moon. The Coors brand was created in 1995 and first brewed inside the Sandlot, the Coors-owned brewery at Coors Field. Blue Moon is now the top-selling full-flavored beer nationwide, but nowhere on the label does it mention its corporate ownership. Nor do the breweries that have been purchased by Coors.

Closer to home, in 2016 Blue Moon opened a 30,000-square-foot brewery and pub in the River North Art District, which is also home to a dozen independent breweries. It was a savvy move — the place is beautiful — but clearly poses some major competition in the neighborhood.

Despite its power, though, Coors has managed to avoid the all-out hatred that many craft brewers and fans direct toward Anheuser-Busch InBev, which has purchased twelve formerly independent breweries in recent years and now uses them to absorb tap handles and shelf space everywhere. There are several reasons for this. For starters, Coors was quick to help the young microbrewers in the early days. The company let Boulder Beer’s founders rummage around in their junk yard for equipment. It has dispatched its quality-control team to breweries around the country to help them with everything from science to recipes. It has collaborated with local breweries and hasn’t engaged in the same tactics at AB InBev.

“There is a different feel to it — at least in Colorado — between ABI and Molson Coors,” says Dave Thomas, who retired from Coors in 2005 after thirty years there and now brews for Dostal Alley, a tiny craft brewery in Central City. Thomas, who is also a beer author and historian, says that when craft breweries first began to pop up in the early 1980s, Pete’s uncle, Bill Coors, told his employees “that if you get a call from a startup brewery, get on a plane and go. He said don’t worry about the competition. We will compete on the shelves.”

Bill Coors figured that small breweries would end up helping the large ones because they would provide more voices in Washington, D.C., when it came to opposing new beer taxes or neo-prohibitionists or anyone else who wanted to harm the overall industry.

The CBC will be in Denver in 2019.EXPAND
The CBC will be in Denver in 2019.
Jonathan Shikes

Back then, Coors was still a regional brewery. It didn’t cross the Mississippi River until the early 1980s and didn’t enter New England until the middle of that decade. In fact, in the early ’90s, Coors was distributed in fewer states than products from Colorado’s two largest craft breweries, New Belgium and Oskar Blues, are today. (Both distribute to all fifty states.)

These days, that Coors mystique, that Mark Harmon sexiness, is gone. The craft breweries enjoy the cult-like following now. But affection for Coors still runs deep, even among craft brewers, some of whom are known for posting pictures of themselves drinking Banquets after work.

Like the Brewers Association, the company is a Colorado native. And despite the power Coors wields, it helped and continues to help make Colorado a special place for beer.

Governor John Hickenlooper on his way to his first inaugural party.
Governor John Hickenlooper on his way to his first inaugural party.
Jonathan Shikes

In a response to Pete Coors's letter, BA president Bob Pease wrote: “The BA has the utmost respect for Pete and the Coors family, and we would look forward to sitting down with Pete over a beer and discussing his concerns. We look forward to doing so in a thoughtful and respectful fashion. That said, the BA will continue to work to differentiate and promote and protect small and independent craft brewers in the marketplace, and we look forward to working with all of our members, voting and non-voting alike, on building the beverage of beer in the United States.”

I hope Coors and BA really do sit down — perhaps brewer/governor Hickenlooper can arrange it (and invite me, please) — ideally before the next Craft Brewers Conference, which takes place in April 2019 in Denver, because “when the snow melts,” there is only one Colorado, and it’s “worth tasting.”

Here is the full text of the Pete Coors letter:

As a paying member of the Brewers Association I enjoy my subscription to The New Brewer. It is the reason I have taken the time to write a point of view concerning the ongoing vitriol expressed in its pages and most recently reaffirmed by BA Chairman Eric Wallace and President Bob Pease toward the large, non-independent brewers. Congratulations on the remarkable attendance at this year’s Craft Brewers Conference in Nashville. The high turnout speaks to the interest and passion that brewers, suppliers, and the general public have for beer and the brewing industry.

The brewing industry is not exclusively made up of “large, multinational brewers” or “big brewers” or “faux craft brewers.” It is not exclusively made up of “mass produced” beer, craft brewers or home brewers. Rather, the beer industry is a combination of large and small brewers, retailers, distributors and suppliers who are passionate about their craft and committed to their businesses. And, they are passionate about competing for the millions of American consumers who love beer.

The leadership of the Brewers Association does a great disservice to the entire beer value chain by attempting to pit one part of the industry against another.

You must know that it is insulting to those of us who don’t meet the clever criteria of your self-proclaimed definition of “craft brewer.” This approach prioritizes insults and division over unity for a beverage that has been used to unify and celebrate together for generations.

Should the highly educated and trained brewers who work for large brewers or the breweries that have been purchased by them be included in the disdain you seem to have for them? Should the quality of beers produced by them, including hundreds of quality medals be insulted by the Brewers Association simply because the parent company isn’t part of your ever-changing “club?” Didn’t all large brewers start as craft brewers? Don’t all craft brewers wish to grow and be prosperous?

We share distributors, many of whom would not be able to distribute Brewers Association beers without the scale provided by the large brewers. You claim that your members are precluded from distribution at retail, while I visit account after account that do not carry any “big brewer” products.

Competition in our industry should be honored and cherished. I agree with you that craft brewers are “exemplars of the American Dream, of entrepreneurial spirit”. However, you must realize that big brewers are as well. There should be no room for cheap shots and insults (“faux”, “crafty”, “capitulated” beers) for each other.

That is a slippery slope that does not end well for our industry. We have enough competition inside the beer business and outside it with wine, spirits and, increasingly, marijuana.

You undermine your credibility by pitting us against one another to the ultimate detriment of the entire beer industry.

Keep your independent seal, your pride and your zeal for brewing, but let’s be united as an industry. There are other enemies we all must fight together.

— Pete Coors

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