{"id":130,"date":"2013-03-05T08:16:58","date_gmt":"2013-03-05T13:16:58","guid":{"rendered":"http:\/\/www.beerbusinessunplugged.com\/?p=130"},"modified":"2013-03-05T08:16:58","modified_gmt":"2013-03-05T13:16:58","slug":"details-of-your-incompetence-do-not-interest-me","status":"publish","type":"post","link":"http:\/\/www.beerbusinessunplugged.com\/?p=130","title":{"rendered":"Details of your incompetence do not interest me"},"content":{"rendered":"

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Just recently, Maker’s Mark Whiskey became the latest beverage company to misjudge its customers, or its product, and backpedal to protect its brand.\u00a0 Thousands of customers told Maker’s Mark that the company had made a huge mistake when it reduced the alcohol content in its signature whiskey from 90 proof to 84 proof.\u00a0 The company originally stated that their reason for lowering the proof was that the demand for the product outstripped supply, and that by reducing the alcohol content, the company could “stretch” its bourbon supply by six percent.\u00a0 Within a week, the outpouring elicited a promise to return the alcohol content to 90 proof.\u00a0 The consumers spoke.\u00a0 The company listened.<\/p>\n

Consumers skewered Coca-Cola in 1985 when Coke introduced a new recipe.\u00a0 Within three months, the company revived the old formula as Coca-Cola Classic.\u00a0 “New Coke” eventually disappeared in the US, except as a worst-case marketing study.<\/p>\n

Cynics suggest that such moves could be clever marketing ploys to keep product names in the news and foremost in customers’ minds.\u00a0 Really?<\/p>\n

At Harvard, the MBA program has a case study on how to kill a billion dollar company.\u00a0 It\u2019s called the demise of the Jos. Schlitz Brewing Co.\u00a0 By the early 1970’s, Schlitz was trying to reduce costs and looked at building new, state-of-the art breweries. The Schlitz shareholders, however, refused to approve the change.\u00a0 The production department was then forced to create a new cost-cutting scheme: “accelerated-batch fermentation.\u201d\u00a0 The process added air to stimulate the yeast’s growth, and reduced fermentation from twelve days, to less than four days, and allowed the brewmaster to cut the brewing cycle from 25 days, to two weeks.\u00a0 Corn syrup replaced corn grits; hop extract replaced hop pellets.\u00a0 Then the finance department raised prices in a high inflation market.\u00a0 By the mid 70’s, with sales in a decline, an accountant took charge of running the brewery, and the marketing\/sales executive, Fred Haviland, cleaned out his office and left.\u00a0 Finally, Schlitz ordered their brewmasters to put Chill-garde into the beer.\u00a0 Chill-garde is a stabilizer and was added to improve shelf-life, but it interfered with the beer’s foam stabilizer.\u00a0 The chemical reaction spawned a flake-laden haze.\u00a0 Not dangerous to the taste of the product, but it gave the beer an unattractive look.\u00a0 Six months elapsed before the brewmasters stopped using Chill-garde, but the damage was done.<\/p>\n

Bob Uihlein, who ran the brewery, died in 1976, with no clear leader named.\u00a0 Schlitz drifted for years.\u00a0 In the late 70’s, a Coke executive, Alan Proudfoot, was hired to over-see the sales department.\u00a0 He wasn’t able to make the transition to beer, and was gone in a short time.\u00a0 Then Frank Sellinger, a brewer from AB, was hired to run the brewery.\u00a0 Sellinger changed the packaging, cans, bottles, and all the advertising.\u00a0 Then he went on TV and announced he had come to Schlitz “to make the best,” giving the consumer cause to wonder why the beer had changed!\u00a0 Almost overnight sales dropped like a rock.<\/p>\n

Interestingly, even with all the quality problems across the country, the Longview, Texas brewery never changed its brewing process. Consequently, the beer in Texas and Louisiana never suffered the problems of the other Schlitz breweries in the US.\u00a0 Sales in these two states, slid slightly, but still remained high.<\/p>\n

Unlike Maker’s Mark or Coke, Schlitz didn’t\u00a0acknowledge\u00a0the damage it had done causing the iconic brand’s demise.\u00a0 Nothing changed, so by 1981, the brewery was sold to the Stroh Brewing Co. The rest is history. During this 5-year period, I went from selling 2 million cases of Schlitz to a mere 100K cases of Schlitz.<\/p>\n

The CEO’s of Coke and Marker’s Mark should have studied what happened to Schlitz.\u00a0 Had they done so, they probably would not have made the changes they did.\u00a0 \u00a0Until then, the details of their incompetence do not interest me.<\/p>\n

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    Just recently, Maker’s Mark Whiskey became the latest beverage company to misjudge its customers, or its product, and backpedal to protect its brand.\u00a0 Thousands of customers told Maker’s Mark that the company had made a huge mistake when it reduced the alcohol content in its signature whiskey from 90 proof to 84 proof.\u00a0 […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_s2mail":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_newsletter_tier_id":0,"jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[1],"tags":[],"jetpack_publicize_connections":[],"aioseo_notices":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p2xRTi-26","jetpack_sharing_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/130"}],"collection":[{"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=130"}],"version-history":[{"count":14,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/130\/revisions"}],"predecessor-version":[{"id":668,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=\/wp\/v2\/posts\/130\/revisions\/668"}],"wp:attachment":[{"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=130"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=130"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.beerbusinessunplugged.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=130"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}