Lake of Bays Brewing Relaunch

Packaged Goods–Beverage (BRONZE)

Client Credits: Lake of Bays Brewing Company
Darren Smith – President
Tamsen Tillson – Marketing Manager

Agency Credits: We Are Tonic
Anita Dong – CEO
David Sylvestre – Creative Director
Jamie Brand – Art Director
Mike Appleby – Writer
Tim Glenn – Writer
Alex Ferreira – Designer
Brodie McNabb – Account Executive

Section I — BASIC INFORMATION

Business Results Period (Consecutive Months):	July 2012 to June 2013
Start of Advertising/Communication Effort:	July 2012
Base Period as a Benchmark:	July 2011 to June 2012

Section II — SITUATION ANALYSIS
a) Overall Assessment

Lake of Bays Brewing Company Relaunch

The craft beer market in Ontario is booming. There are more than 50 breweries [footnote 1] in Ontario that brew craft beer, and that number continues to grow in what is a fairly young market. The first entry and the creation of the modern era of this segment began in 1984, when the Brick Brewing Company, the first modern craft brewery, opened its doors in Waterloo Ontario. Today, a typical craft beer business like Lake of Bays Brewing Company has over 40 employees.

The craft beer share of the Ontario beer market has more than tripled since 2002, going from less than 1% to more than 3% of Ontario’s beer sales volume [footnote 1]. Craft beer is also the fastest growing segment within the LCBO’s beer category. In 2012, craft beer sales were approximately $210 million in Ontario [footnote 1]. Trial is a critical aspect of growing the craft beer business, and the Ontario Craft Brewers along with the LCBO created the “Discovery Pack” to allow consumers to try several different craft beer brands in one package in order to promote the discovery of new brands.

Craft beer drinkers are sophisticated consumers of beer and are looking for something premium, but something different from the mainstream. They value the art of beer more so than the science. And they value the local production of craft beer, perceiving locally produced craft beer to be of equal or superior quality to import brands. The craft beer consumer is very interested in discovering new brands – finding a new taste is part of their fun.

Craft beer companies are small by definition, and typically use specialized ingredients from small suppliers for their locally crafted brew. They also typically begin by selling in their neighbourhood, with success and growth allowing smaller companies to reach out beyond their local area for sales. A craft beer company will typically have one or two styles of beer, or labels, which form the foundation of their success. They will have several other labels that are either seasonal brands, or will come and go depending on their level of acceptance or success. Because the craft beer consumer is interested in discovery of brands, maintaining their loyalty to one label is difficult.

Lake of Bays Brewing Company (LBB) is a small, young company in the craft beer business. Sales were initially focused in the area where the company began, Muskoka (or more properly, Baysville). In order to succeed on a long-term basis, the company had to expand sales beyond their local area and succeed in the Ontario craft beer market. Prior to the relaunch of Lake of Bays Brewing in 2012, marketing had been limited to a sales effort in the local area where the company originated. In order to break out of this area limitation, it was necessary to create a whole new look, feel, and back story for the brand. The back story was not a fabrication, but it had never really been formulated or told.

The team at We Are Tonic and LBB studied the competitive segment and noted a similar company was enjoying tremendous success, seemingly based on their location – Muskoka Brewery. They were capitalizing on the gentrification of the area by Torontonians who enjoy cottaging there, and who form the bulk of craft beer drinkers. There would be little point in duplicating the positioning and strategy of this brand, but the idea of basing the positioning of LBB on their place of origin would provide the basis for the back story that is Lake of Bays Brewing, and would create the brand foundation that would interest and inspire consumers.

This is a case study of a marketing program with a budget of just $100,000 that generated an increase in sales of over $1,000,000 in just one year. With a small marketing budget to work with, there are no elaborate television commercials shot on beaches in far away places. There is simply the development of a strong and meaningful brand position, the complete redevelopment of the products and packaging to bring life to the brand positioning, and several innovative marketing tools deployed to inform and inspire consumers. The result is a +72% increase in dollar volume sales over the course of one year. And because of the nature of the marketing tools deployed, they will continue to fuel growth in future years, while next year’s marketing budget can fuel new ideas to amplify the growth. Exactly what a small company needs to accomplish in order to succeed.

b) Resulting Business Objectives

Increase number of distribution points in Beer Stores, LCBO outlets, restaurants and bars.
Improve visibility of LBB brands on Beer Store and LCBO shelves.
Increase consumer awareness and understanding of Lake of Bays Brewing.
Develop a consumer “taste expectation” for the LBB brands.
Help consumers find LBB brands where they are sold.
Increase sales volume by 50% without discounting.

c) Annual Media Budget
$100,000 – $200,000

d) Geographic Area
Southern Ontario

[footnote 1] Source: Ontario Craft Brewers Factsheet – http://www.ontariocraftbrewers.com/pdf/media_IndustryFactSheet.pdf

Section III — STRATEGIC THINKING
a) Analysis and Insight

An authentic craft beer that reflects the industrious spirit of the North

With the craft beer industry exploding in Ontario, a brewery needs two things to succeed: great beer, and an ownable identity. So, we let Lake of Bays Brewing take care of the beer while we crafted them a new identity.

After a thorough audit of the existing brand, we turned our attention to the competition. We focused on Muskoka Brewery, a craft beer maker that has enjoyed a spike in popularity by embracing the region’s reputation for cottaging and leisure. As Lake of Bays’ closest geographic rival, we had to distance ourselves from their Muskoka chair lifestyle. So we set off in a different direction, and for the sake of authenticity we chose to identify with a trait that Lake of Bays knows well – the friendly, industrious spirit of the North.

To reinforce our authenticity we would need to associate Lake of Bays Brewing not with the North that is now defined by Range Rovers, jet-boats, and air-conditioned summer homes, but rather, the North that attracted us there in the first place. The one defined by interesting and sometimes formidable wildlife, crystal-clear lakes, and inspiring views. All of our products, packaging, labels, and communication materials would need to reflect this insight and brand position.

The overall insight – An authentic craft beer that reflects the industrious spirit of the North

b) Communication Strategy

Media

Given the limited marketing budget available, media choices could also be limited. The bulk of the budget was directed to the redesign of all packaging and labels in order to address a primary objective for LBB brands to be more visible on Beer Store and LCBO shelves. The redesign would also help with the sales process to garner more distribution points in restaurants and bars, as well as Beer Stores and LCBO outlets.

Another portion of the marketing budget was directed to the complete redesign of the LBB website. Since craft beer drinkers are actively searching for new brands, and they want to know all about the brands they try, it was important for the LBB website to engage and inspire craft beer drinkers and to create a taste expectation for all who investigated the brand.

One of the most innovative and effective elements of the media program was the development of a mobile app that would help potential consumers discover where they could find LBB brands. The app “beerfinder.ca” was created to allow consumers to use their phone or tablet to show them where the closest places were that offered LBB brands, whether LCBO, Beer Store, restaurant or bar.

A small portion of the budget was allocated to the development of traditional media: radio advertising and an outdoor billboard that would be deployed in specific markets where distribution warranted.

Additionally, budget was allocated to develop a variety of typical beer business promotional materials, like tap handles, coasters, tent cards, and truck wraps for the distribution vehicles. No budget was allocated to discounting in order to secure additional distribution.

Creative

The rebrand began with re-naming and redesigning the labels for all of the LBB brands, and got off to a hot start with 10 Point India Pale Ale, a new summer seasonal brew whose bold name and iconic logo won silver for design at the 2012 Mondial De La Bière Festival. And the rest of the lineup followed suit.

We reassigned the flagship Pale Ale as Crosswind Pale Ale, adopting the image of a biplane, an icon among bush pilots of the North. We took the Rousse Red Ale into new territory with a fire tower icon and a fresh name – Spark House Red Ale. We gave the Mocha Porter a new home with the help of a compass and the name Old North. And for the newest seasonal brew, we called up the excitement of the first big winter thaw with Spring Maple Belgian Blonde Ale.

A marketing program that begins with the complete redesign of the product line, product names, and all packaging allows for all points of communication to be consistent, and to reinforce the overall brand position.

With the product and packaging redesigned to reflect the new brand identity we set out to develop communication materials and program to inform and excite the craft beer consumer about our products.

Section IV — KEY EXECUTIONAL ELEMENTS
a)Media Used

Media Elements

With a marketing budget of $100,000 our media program needed to be innovative, efficient, and effective. Much of the budget was directed to redesigning all aspects of the product and packaging. Then we made sure everything else we did reflected our new position. Wraps for the delivery trucks, all typical beer promotional material (tap handles, coasters, tent cards, etc.), a new website, our mobile “beerfinder” app, and some outdoor and radio ads.

b)Creative Discussion

Creative Elements

With a lineup of beers so rich with imagery, a website rebuild presented the ideal opportunity to go deeper into the brand’s story. We set the stage with an illustrated map of Baysville and gave visitors a place to read the mission, tour the brewery, learn about the brewing process and salivate over the delicious beers. Each label was given a page that sets the taste expectation for the customer.

Stepping outside of our virtual Baysville, we launched a mobile app that uses GPS to guide beer-lovers to the nearest establishment with the good sense to serve Lake of Bays. The “app” is housed at the website “beerfinder.ca” so that it does not need to be downloaded to use – it is available to anyone at any time and simply takes their current GPS coordinates from their phone or tablet, or uses their Postal Code to advise where the closest place selling Lake of Bays beer is located. We even recorded custom on-hold music to keep calling customers entertained while they wait.

Meanwhile, we flaunted our makeover across Ontario through a variety of media. We sent redesigned delivery trucks on the road, spreading the word across Ontario’s highways and avenues. We introduced our renewed attitude with billboards and PAL banners. And we blasted our stories into the Muskoka-region airwaves with radio spots.

c)Media Discussion

Our limited media budget necessitated a disciplined focus and an innovative approach to media. We had to view every aspect of marketing as a form of media – if it wasn’t contributing to informing, enticing, and exciting the consumer about Lake of Bays beer it couldn’t be a part of our program. Our brand and label redesign would achieve the objective of improved visibility on Beer Store and LCBO shelves. From there, our redesigned website, with complete back story on Lake of Bays Brewing and all of the individual beer brands would set taste expectations and entice craft beer drinkers. Our sales and distribution contributed with all of our delivery trucks wrapped to show off our latest brews. Radio and outdoor advertising would start the process of building awareness. And our “beerfinder.ca” app would help interested craft beer drinkers find the closest place to get Lake of Bays beer. Once there, tap handles, coasters, tent cards and all of the usual beer business promotional items would remind consumers of the great taste they could expect from Lake of Bays Brewing.

Section V — BUSINESS RESULTS
a) Sales/Share Results

The primary objective was to increase the number of points of distribution, which was accomplished – the number of places a craft beer consumer can find Lake of Bays brands more than doubled in the 12 months since the relaunch. In many categories, this might indicate that it was not the marketing program that fueled the sales increase, but in this particular category a company cannot get new points of distribution without convincing proof that consumer demand will be there if the product is stocked. In the beer category you do that by showing an excellent marketing/advertising program. If the restaurant owner is convinced, they’ll stock your beer.

The other quantifiable objective was to increase sales +50%. Our marketing program increased sales +72%. Dollar volume sales increased from $1,193,604 during the Benchmark period (July 2011 to June 2012) to $2,054,112 during the results period (July 2012 to June 2013).

b) Consumption/ Usage Results

c) Other Pertinent Results

d) Return on Investment

Section VI — CAUSE & EFFECT BETWEEN ADVERTISING AND RESULTS
a)General Discussion

Establishing a cause/effect link between advertising and sales success can be difficult. With the Lake of Bays Brewing program a great deal of the sales success comes from the increase in distribution. For a small company in the craft beer business, distribution is critical in achieving sales success, and that distribution increase would be impossible to obtain without a marketing program in-place to convince establishment owners, along with Beer Store and LCBO buyers that consumer demand would be there to move Lake of Bays beer. Of course, that has to be followed by an increase in consumer demand for the beer so that product doesn’t sit on shelves and discourage the continued build of distribution.

A look at the timing between the Base Period and the Results period shows the 72% increase in sales followed the implementation of the marketing program. We believe this is due to three factors:

The marketing program built consumer interest and demand for Lake of Bays beer
The marketing program helped consumers be able to find Lake of Bays beer.
The marketing program helped the Lake of Bays sales force accomplish a significant increase in distribution so that consumers could more easily find Lake of bays beer.

b)Excluding Other Factors
Spending Levels:

The Lake of Bays Brewing spend level could be considered minimal in the world of beer marketing. There certainly was not enough budget to afford the luxury of “buying” market share.

Pricing:

Pricing can be a factor in garnering trial in the beer business, both in terms of consumer trial, and in terms of increasing the number of points of distribution. However, craft beer is a premium priced product and Lake of Bays Brewing did not offer any discounts to increase distribution or to encourage consumer trial.

Distribution Changes:

There was a significant increase in distribution between the Benchmark period and the Results period. It should be noted that this increase in distribution would not have been possible without the convincing and effective brand redesign and communication program in-place, since it is these programs that convince restaurants and bars to stock Lake of Bays beer, and give LCBO and Beer Store planners the confidence that consumer demand will move Lake of Bays beer off their shelves.

Unusual Promotional Activity:

No unusual promotional activity.

Other Potential Causes:

None.