WHAT is served ice-cold, on draught, and sells at a premium price to twentysomething drinkers in America’s trendiest bars? The answer will shock British drinkers of traditional beer. Newcastle Brown Ale has come a long way from the flat caps and whippets of Tyneside, where older drinkers still pour it warm from pint bottles.
The fact is that well over half the production of Newcastle Brown Ale these days crosses the Atlantic. Draught Newcastle has become the most expensive imported dark ale from the Deep South to California.
Tom Catherall knows both sides of the Newcastle revolution. His nine brothers and sisters still live within three miles of each other in his native Newcastle upon Tyne, where he was born within sight of the brewery. But Catherall, a self-made millionaire, is now selling Tyneside’s most famous brew in his string of night-spot restaurants in Atlanta, Georgia.
His restaurants — Twist, Shout and the soon to be opened Strip, to be followed by Tease — have become magnets for booming Atlanta’s young professionals. Seven in all, they all sell vast quantities of Newcastle Brown Ale, some in stubby 330cc bottles, some on draught, and always chilled to the prescribed 3C.
“Newcastle sells in amazing amounts to the clubbers here,” said Catherall, his Geordie accent still clearly identifiable beneath the Georgia drawl. “When folk come over, they can’t believe that we drink it chilled and on draught. Even the lasses like it.”
On the roof of Shout, he proudly walks round his new outdoor bar, shimmering in the humidity under the gleaming towers of Atlanta’s financial district. The place is decorated in a riot of mosaic and artfully-broken tiling, a 21st century version of Gaudi’s Parc Guell in Barcelona. “This is really a club, especially in the evenings,” he said. Sales of Newcastle Brown rank fourth here, behind the domestic Bud and Miller and imported Stella.
Catherall’s next venture may be in Las Vegas, which he recently visited to check out potential sites. When he does eventually open there, the new bar will stock chilled draught Newcastle, already available at a number of bars on The Strip.
The man responsible for bringing brown ale from Newcastle to America is Kevin Moodie, president of Scottish & Newcastle Importers, an American company that has its headquarters in San Rafael, California, and is a wholly owned subsidiary of the Edinburgh brewer.
The California connection is important. The American beer market is dominated by the big domestic brewers — Anheuser-Busch, Miller and the rest — which produce weak chilled lagers that the S&N team openly despises. “This (American industry) is a lager business — we are an ale company,” said Moodie.
California led the way in the 1980s in challenging the big brewers with the development of micro-breweries, producing dark beers and wheat beers for discerning American drinkers. This was convenient for S&N Importers, whose main product fitted in well with the micro-brewery bars.
But Moodie said Newcastle had a clear advantage over its rivals. “Brown beer is bitter — ours isn’t. Brown beer is heavy — ours isn’t.” The message carries through to the new advertising campaign: “full flavored, yet easy to drink — the best of both worlds”.
It wasn’t easy to start with, said Moodie. He remembers being told by the late Sir Alick Rankin, then S&N’s chief executive: “If you can’t make money in five years, we’ll shut you down.” In its fifth year, when Moodie left Scotland to take it over, the American business made its first profit, just $36,000. S&N Importers has been profitable ever since.
For more than a decade, Edinburgh warned the American team not to talk about Newcastle Brown on draught when they returned to Scotland, for fear of damaging the brand in Britain. So Moodie quietly got on with what he does best — selling beer. And again, the California connection gave him an advantage. Initially he avoided the ultra-competitive Manhattan market — “New York would have eaten us”. He followed what he calls the anti-Sinatra strategy. “If we can make it anywhere else, we’ll make it there rather than in New York.”
Like every S&N executive, Moodie remembers the shock when Tony Froggatt took over two years ago. He shook up the company, focusing on four core brands in Britain, consolidated the Russian Baltika brewery deal with Carlsberg, and set up joint ventures in India and China. S&N now has a marketing man driving the business.
In California, Moodie welcomed new investment coming into the American business. “We now have more support from (Edinburgh) than we’ve ever had,” he said.
The growth has been strong. “This is now a $100m turnover business, but we still view ourselves as a small company — in American beer terms, a very small company,” said Moodie.
S&N’s American marketing team is young and zany, and has an infallible test for new projects — if the boss likes it, they don’t use it. The reason? Because Moodie is at least 15 years outside their target age range.
He takes the joke in good part, admitting to never having heard of Green Day, the band that approached Newcastle to become promotional partner for their American tour this summer — because they like the taste of the beer. Bill Wetmore, the American marketing director, has also lined up partnerships with the music magazines Spin and Filter. A $4m radio and billboard campaign will push the message “full flavored, yet easy to drink”.
It is worth remembering beer is a declining market in America, and S&N is a minnow, selling about four bottles of Newcastle Brown each second, against Bud and Bud Lite’s 700 bottles a second. The dark beer made by the big American brewers is mocked by the S&N team as “Bud with food colouring”.
They have more respect for small American breweries such as Yuengling and Fat Tire, which are seeing real growth, and Mexican lagers are leading the charge of the imports. But Newcastle is the only dark beer regularly that is racking up double-digit growth or thereabouts. And the S&N team has its eyes firmly set on Bass, the main English competitor.
It seems to be working. Bass, formerly distributed by Guinness, is now owned by the Belgian giant Inbev, whose main marketing drive in America is focused on Stella. One distributor said he thought the change in ownership had damaged Bass, which is in steep decline.
Independent figures show that the S&N team appears to be achieving a tricky double — increasing sales while also being the most expensive and highest-margin brand in their niche. So they are selling it for more, and selling more of it.
Moodie has presided over 15 years of growth at S&N Importers, with little help from Edinburgh. Now that there is real corporate support, he plans to make Newcastle Brown Ale the biggest dark beer import. America is a big place, he said. “We are still scratching the surface.”
In America, Newcastle is the beer to be seen with — on draught, and chilled, of course.
