What was Beam thinking? Speculations........

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What was Beam thinking? Speculations........

Unread postby Mike » Fri Oct 18, 2013 5:42 pm

Jim Beam is the world's largest selling bourbon, if you do not count Jack Daniel's as a bourbon, which most do not, even though I believe it could qualify.

That means they have vast resources. Which means they can, or should be able to, explore the demands and wants of their market. Now all this must fit into an extraordinarily complex enterprise. All their planning must be done, especially for their premium brands, well in advance of actual demand.

Now, I would expect that demand remains fairly consistent year to year. I would expect that the consumption of bread and butter bourbons (or Tennessee) whiskies is reliably predictable. And, I would expect (knowing that I could be and probably am, quite wrong in some of my assumptions) that plans proceed apace to meet those demands.

However, and about this I am unsure, what about the premium and super-premium brands? There would be enormous profits there (I think). If you make several recipes at the outset and put them up as such, where do the premiums come from? I suggest that they come from the palate (palates) of trained tasters, presumably with the oversight of a master distiller, who at this point in this game is more of a marketing agent than actual taster. Distillers have years of experience at barrel placement to achieve certain taste characteristics.... and years of experience at where they must aim most of their production. I would suggest that we BourbonEnthusiasts cast a rather small shadow over these deliberations, since the deliberations belong primarily to the financial guys and gals, not to bourbon lovers. Still, like all but a very few enterprises (I can think of none off the top of my head) the market has some volatility......... tastes do change. The Scotch, Beer, and Wine markets impinge upon the bourbon market as presumably the bourbon market might impinge upon the other markets.

So even the most secure of bourbon producers (cost vs production) which I assume would still be Beam, cannot afford to rest upon its laurels (from whence do you think Maker's Mark 46 came - a few well place wooden boards and a few extra months maturation - different taste profile ...... genius, I say). The easiest way to do this (I reiterate, this is mere opinion) is to take the course I assign to Beam.

Say you have some bourbon in your storage barrels that somehow got overlooked in fitting the profile for Beam White (maybe a bit better?), but at seven years it is not suitable for Booker's or for Baker's a bit later, and still not making the grade a few years later for Knob Creek....... and since it did not contain enough rye for Old Grand Dad, or a couple of years later for Basil Hayden's, this bourbon sat and sat, in the barrels.

Now, in an annual review of your barrels in storage you come across a significant number of unused barrels that are approaching 12 years of age. What to do? You know that aged bourbons often sell at premium prices, there are those off palate drinkers (yours truly) that find something unique in many (but not all) older bourbons. So let us create a new bottle, and sell this bourbon, not to aficionados of aged bourbon, but to regular Beam drinkers who (status conscious) might want to step up when they have a bonus or small increase in income, and/or perceived status. What's to lose? We can either put that bourbon in small doses into Beam White (as we do now) or dilute it to the point of it being inoffensive, and sell it as a premium bourbon. If we lose in this game, we won't lose much and what we will learn is how much the market is open to marketing an inferior bourbon as a premium product.

Beam's answer is: 'Let's put out at 12 YO Beam Premium bourbon'.

Were I a strategist at Beam, and believed in my obligation to maximize Beam profits within the window of opportunity, I would support this strategy. Do all distilleries support such a strategy?.......... Well, I think that depends upon the foresight of the people who lead their strategy. And, that strategy is dependent upon the interests of producing superb bourbon only in the degree to which it is perceived as in the distiller's long term interest. To do otherwise is to risk market share. Something that only small producers, or well funded distillers, can afford to do (e.g. Chris Morris at Brown Foreman)........... without great risk to the enterprise.

My opinion is that Beam is trying to be only as innovative as it thinks is minimally necessary to stay in this risky game. They may be right, I do not know.
Do not go gentle into that good night,
Old age should burn and rage at close of day;
Rage, rage against the dying of the light. - Dylan Thomas
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Re: What was Beam thinking? Speculations........

Unread postby 393foureyedfox » Sat Oct 19, 2013 1:38 am

do you ever write a short post?
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Re: What was Beam thinking? Speculations........

Unread postby Mike » Sat Oct 19, 2013 10:38 am

If my posts are too long for you, do us both a favor and just don't read or comment on them.
Do not go gentle into that good night,
Old age should burn and rage at close of day;
Rage, rage against the dying of the light. - Dylan Thomas
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Re: What was Beam thinking? Speculations........

Unread postby RandyG » Sat Oct 19, 2013 5:36 pm

You have the brands that let their product stand on their own merits and then there are the giants, who sometimes sell themselves and their product out for the sake of profits. Happens in every industry. Your investors demand bigger returns each year. The accountants take over. The marketing crones start pulling rabbits out of their ...... hats. The execs. cave under the pressure. Before you know it your trying to create your own markets or jumping on ones dreamt up by one of their competitors. This foray with an inferior 12YO or even their Devil's Cut project does not strike me as silly as their flavored bourbon (Red Stagg, Maple and Honey) hijinks. It seems everybody is jumping on the "honey" bandwagon. Got ahold of some free samples of these and each one went down the drain. Who knows what's next? Who cares?

RG
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Re: What was Beam thinking? Speculations........

Unread postby 393foureyedfox » Sat Oct 19, 2013 6:27 pm

Mike wrote:If my posts are too long for you, do us both a favor and just don't read or comment on them.



Sorry, the internet still lacks the sarcasm button to let you know i was messing with you
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Re: What was Beam thinking? Speculations........

Unread postby TonyW » Sat Oct 19, 2013 8:49 pm

Mike, I think your "what the heck are we going to do with this stuff?" theory may be correct. At least it fits the human profile as I've observed it in my time on this earth. Unfortunately people are silly enough to buy it. Myself included, though not in this instance.

For RandyG, I happen to like some of the honey whiskey. The Wild Turkey is good but the Evan Williams is best for the money IMO. I stick it in the freezer and have a shot every now and then. However, it is not bourbon and should not be labeled as such.

'fox, try using /sacrasm after your posts. Most internet type people understand that.
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Re: What was Beam thinking? Speculations........

Unread postby Patrick_OKC » Sat Oct 19, 2013 10:39 pm

Mike, and Randy for that matter,

Beam doesn't exist to serve up bourbon and coincidentally make a profit. They are a profit-seeking enterprise, like any other business. Customers will either buy, or not buy, their output. Given scarce resources, if the customers don't buy the 12-year, then it will dwindle down over time, and Beam will devote time and attention to other offerings to the public. The finance geeks, accounting bean-counters, and marketing yahoos are doing exactly what they are supposed to.

I have purchased the 12-year, and the brandy-finished offering as well. Haven't cracked either open yet. I know that I may not like them, but heck, I end up liking nearly every bourbon I buy. I am an optimist. I even like Devil's Cut, but it's not my first choice.

I do enjoy reading your posts, I must say.

Pat
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Re: What was Beam thinking? Speculations........

Unread postby Mike » Sun Oct 20, 2013 7:48 am

393foureyedfox wrote:
Mike wrote:If my posts are too long for you, do us both a favor and just don't read or comment on them.



Sorry, the internet still lacks the sarcasm button to let you know i was messing with you


Fox, being aware myself that I tend to write too much probably makes me oversensitive to your sarcasm. Methinks I was a mite quick on the draw.
Do not go gentle into that good night,
Old age should burn and rage at close of day;
Rage, rage against the dying of the light. - Dylan Thomas
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Re: What was Beam thinking? Speculations........

Unread postby Bourbon Joe » Sun Oct 20, 2013 10:24 am

Mike wrote:Beam's answer is: 'Let's put out at 12 YO Beam Premium bourbon'.


By all means, except add the caveat " It must be good whiskey". It is not. I have had it and rank it alongside all other Beam products........mediocre at best.
Joe
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Re: What was Beam thinking? Speculations........

Unread postby 393foureyedfox » Sun Oct 20, 2013 11:29 am

Mike wrote:
393foureyedfox wrote:
Mike wrote:If my posts are too long for you, do us both a favor and just don't read or comment on them.



Sorry, the internet still lacks the sarcasm button to let you know i was messing with you


Fox, being aware myself that I tend to write too much probably makes me oversensitive to your sarcasm. Methinks I was a mite quick on the draw.




thats okay....if you read my comment without 'sarcasm' context, i did sound like a smartass. drink on!
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