How Hipsters Saved PBR

August 28, 2018

In 2000 Pabst Blue Ribbon was in a 20-year sales decline. The brand was in trouble, so the Senior Brand Manager went to the one place where the beer was selling ー Portland, Ore., the home of the hipsters.

FULL TRANSCRIPT

FEMALE_1: [MUSIC] What do you

FEMALE_1: picture when you hear the word hipster?

FEMALE_1: They are probably wearing a tight jeans, a flannel,

FEMALE_1: beanie, black framed glasses, maybe a beard.

FEMALE_1: And of course, the stereotypical hipster

FEMALE_1: is holding a can of PBR.

FEMALE_1: But wait, why PBR?

FEMALE_1: There is no real definition of a contemporary hipster,

FEMALE_1: but some generally agreed upon descriptive terms

FEMALE_1: include anti [NOISE] mainstream and anti consumerism.

MALE_1: Oh come on! A guy like that hanging

MALE_1: around here?The bar is over

FEMALE_1: In his 2011 book, Hipstermatic,

FEMALE_1: author Matt Greenfield summed up

FEMALE_1: hipster culture by writing, [NOISE] "Above all,

FEMALE_1: they wanted to be recognized for being different,

FEMALE_1: to diverge from the mainstream and Karva

FEMALE_1: cultural Neish all for themselves.

FEMALE_1: This is the story of how

FEMALE_1: PBR tapped into the hipster consumer."

FEMALE_1: [MUSIC] The Pabst Blue Ribbon can is a classic.

FEMALE_1: It's decorated with clean red lines, ornate font,

FEMALE_1: an artistic Hopp necklace and of

FEMALE_1: course the iconic blue ribbon logo.

FEMALE_1: It's an ode to Pabst's early practice of tying

FEMALE_1: ribbons on each bottle to

FEMALE_1: symbolize its award winning taste.

FEMALE_1: To this day, you'll see America's best in the

FEMALE_1: 1893 printed on every can.

FEMALE_1: Sales peaked in 1977 at [NOISE] 18 million barrels.

FEMALE_1: To put that into perspective,

FEMALE_1: the number one brand of Budweiser sold

FEMALE_1: 26 million barrels in 1976.

FEMALE_1: But by the turn of the century,

FEMALE_1: PBR was far from their glory days.

FEMALE_1: In 2001, they recorded selling

FEMALE_1: under [NOISE] one million barrels.

MALE_2: The company really at that time was

MALE_2: very accustomed to declining volume.

MALE_2: There was not a culture of winning.

FEMALE_1: That's Neil Stewart.

FEMALE_1: When he took the job as

FEMALE_1: senior brands manager of Pabst Blue Ribbon In 2000,

FEMALE_1: he was charged with reversing a 20 year sales decline.

MALE_2: When I started, the company was very focused

MALE_2: on the consumer that you

MALE_2: would've just kind of thought was into cheap beer,

MALE_2: which was like retirees,

MALE_2: older guys that are spending

MALE_2: their days out on a fishing boat.

FEMALE_1: Stewart not only looked at PBR marketing,

FEMALE_1: but the State of the beer industry.

MALE_2: Back then, a lot of premium brands were still

MALE_2: using girls in bikinis for their advertising.

MALE_2: A lot of larger brands were using

MALE_2: kind of cheap humor for their advertising.

FEMALE_1: PBR's target demographic wasn't buying the product.

FEMALE_1: And the younger generations were not

FEMALE_1: buying into the advertising.

FEMALE_1: [NOISE] But there was one place where Pabst

FEMALE_1: was selling, Portland, Oregon.

MALE_2: Our distributor in Portland,

MALE_2: Oregon was like," Yeah this Brand's on

MALE_2: fire literally there was a time

MALE_2: probably in 2001 or

MALE_2: 2002 where their volume was doubling every month.

FEMALE_1: Stewart flew out to see why.

MALE_2: What I found was kind of validating

MALE_2: what we thought that it was extremely

MALE_2: rejecting traditional marketing tactics

MALE_2: and they had really adopted it as their brand.

MALE_2: But it was a variety of different sub cultures.

MALE_2: So, it was people that were into rockabilly,

MALE_2: it was people that were into indie rock,

MALE_2: it was bike messengers. [MUSIC]

MALE_3: It was people that were into Vespa scooter rallies.

FEMALE_2: While walking bar to bar,

FEMALE_2: talking to these new PBR drinkers,

FEMALE_2: Stewart noticed they liked it for three reasons.

FEMALE_2: One, it was retro.

FEMALE_2: Two, it was cheap.

FEMALE_2: Three, it wasn't flashy.

FEMALE_2: Despite its blue ribbon,

FEMALE_2: the taste probably wasn't a reason.

FEMALE_2: Beeradvocate.com scores Pabst a lowly

FEMALE_2: 2.93 out of 5 points.

FEMALE_2: Stewart left Portland with his new target consumer.

FEMALE_2: Anti-corporate, anti-marketing, and nostalgia loving

FEMALE_2: members of subcultures living in specific urban centers.

FEMALE_2: He didn't know it at the time,

FEMALE_2: but his target consumer was the hipster.

FEMALE_2: Pabst then implemented a geographic strategy.

FEMALE_2: It worked in Portland,

FEMALE_2: so next up was Seattle,

FEMALE_2: San Francisco, and Denver.

FEMALE_2: In each city, the strategy was very grassroots.

FEMALE_2: Instead of launching a message you

FEMALE_2: hope will appeal to many people,

FEMALE_2: you target your efforts to a small group and hope

FEMALE_2: the group will spread your message

FEMALE_2: to a much larger audience.

FEMALE_2: Because remember,

FEMALE_2: this new consumer did not want to be advertised to.

MALE_4: One time, I was in San Francisco,

MALE_4: and San Francisco has a lot of bike messengers,

MALE_4: and we knew that bike messengers love PBR.

MALE_4: So you know, I kind of looked

MALE_4: the part, I went into a bar,

MALE_4: I had a bike messenger bag and it was full PBR swag,

MALE_4: and I went in there and

MALE_4: I introduced myself to the bartender.

MALE_4: I told them I was like, 'Don't tell them who I am."

MALE_4: I gave them my card

MALE_4: and I was like "Don't tell them I work for Pabst,"

MALE_4: and of course he did exactly what I wanted him to

MALE_4: do which was tell everyone that I worked for Pabst.

MALE_4: For the rest of the night, I had

MALE_4: tons of people coming up to me

MALE_4: and like introducing themselves asking for swag.

FEMALE_2: This grassroots campaign hopped from city to

FEMALE_2: city purposely targeting small groups of subcultures.

FEMALE_2: In each city, Stewart and his team attended

FEMALE_2: subcultural events like indie music festivals,

FEMALE_2: facial hair clubs, and amateur sports games to

FEMALE_2: spread PBR's reach through word of mouth.

FEMALE_2: The strategy was as grassroots as it gets,

FEMALE_2: and it was more successful

FEMALE_2: than anyone could have predicted.

FEMALE_2: In 2003, sales rose 15 percent.

FEMALE_2: Each year that followed saw similar growth,

FEMALE_2: and in 2009, sales jumped by 25 percent.

FEMALE_2: Let's remember PBR sold

FEMALE_2: less than one million gallons of beer in 2000.

FEMALE_2: In 2012, PBR sold 92 million gallons.

FEMALE_2: Businessman, Dean Metropoulos,

FEMALE_2: bought Pabst Brewing Company for

FEMALE_2: $250 million dollars in 2010.

FEMALE_2: He then turned quite a profit when he sold

FEMALE_2: it to San Francisco-based private equity firm

FEMALE_2: TSG Consumer Partners for $700 million in 2014.

FEMALE_2: In recent years, PBR's growth has plateaued.

FEMALE_2: The rise of craft beer started stealing

FEMALE_2: more and more of the market share.

FEMALE_2: But maybe the biggest detriment to

FEMALE_2: PBR's success was exactly that, their success.

FEMALE_2: PBR became popular, PBR became mainstream.

FEMALE_2: In doing so, they may have turned

FEMALE_2: away their biggest buyer, hipsters.

FEMALE_2: [MUSIC]