Brewery Ommegang sees continued sales spike on tap

COOPERSTOWN — Overall beer consumption in America is flat. Craft beers, however, are generating double-digit growth as the consumer searches for variety and new styles.

The Brewers Association, the national organization for small and independent craft brewers, defines a craft brewer as one which produces no more than 6 million barrels a year and whose ownership by a non-craft, alcoholic-beverage company must be less than 25 percent. The demand for craft beers creates a new brewery every day somewhere in the nation. The U.S. had fewer than 200 breweries 25 years ago. As of June, the country now has 3,000 breweries, a threshold not crossed since the 1870s. 

While Americans imbibe, on average, 77.1 liters of beer per annum (217 12-ounce bottles), our inveterate propensity for the brew ranks us at number 14 globally; The Czech Republic takes bragging rights at 148.6 liters per capita. Still, America is the second biggest beer market worldwide with nearly a 13 percent market share.

Brewery Ommegang, which opened near Cooperstown in 1997, was an early entrant into the domestic, craft-beer market. (The name Ommegang means “to walk about” and honors a festival held annually in Belgium commemorating the entrance of Emperor Charles V to the city of Brussels.) The founders carved out a unique niche brewing Belgian-style beers, known for their alcoholic content and richness of flavor. 

“Since I joined the firm [in 2008], the brewery has increased its production and sales volume by 20 percent a year [compounded],” says Bill Wetmore, general manager of Brewery Ommegang. “This year, we will sell approximately 650,000 cases (24 12-ounce bottles per case) which equates to a little more than 5.5 million gallons. In 2015, we’re scheduled to craft 24 different beers, some of which are seasonal. Brewery Ommegang relies on one production line to produce four to six different beers per week, but the equipment is flexible so that we can change the line on the fly. To keep up with demand, we have added capacity and run the line 24 hours a day, 5 days a week.”

The brewery sits on a 136-acre former hops farm located in the town of Middlefield, less than five miles south of the village of Cooperstown. It was the first farmstead brewery built in America in 100 years. Brewery Ommegang employs 80 people year-round and adds another 20 in the summer to staff the café and gift shop, which opened in 2010. Management has turned the site into a venue for visitors, who come to tour the operation, eat from a menu paired with Ommegang selections, and enjoy concerts held on the grounds. Allison Capozza, publicity manager for the brewery, estimates that the company hosts 65,000 people annually, 20,000 of whom come for the concerts.

The Business Journal News Network estimates that Brewery Ommegang will post revenue in 2014 of  $22 million to $24 million. The company currently distributes its products in 43 states, Canada, the Virgin Islands, and Puerto Rico. Wetmore expects to add West Virginia to the distribution list by the first of the year.

How it started
The Ommegang concept originated with Don Feinberg and Wendy Littlefield. In 1982, Feinberg established an import company — Vanberg & DeWulf — that specialized in Belgian beers. His wife, Littlefield, joined him in the business in 1990. The couple worked exclusively with breweries that were independent, family-owned, and artisanal. The couple formed the brewery in 1996 in partnership with Belgian breweries whose beers Vanberg & DeWulf had imported. One of the partners was Duvel Moortgat (Doo-vel Moort-got), which bought out all of the other stockholders by 2004. Feinberg and Littlefield sold the importing company in February.

The brewery’s rustic location has one drawback: the difficulty of maneuvering tractor-trailers on County Route 33. The impediment to convenient shipping, however, is outweighed by the setting which attracts thousands of visitors. In addition to several concerts each year, the staff creates annual events such as “Belgium Comes to Cooperstown,” a beer festival with more than 100 breweries pouring samples for 3,000 beer fans.” Then, too, there is the attribute of water. “Water to a brewer is [like] blood,” intones Wetmore. “It is the … [life-force] of the beer. We’re very fortunate to have four wells on the farm that supply us with a steady volume of clean, pure water.”

Crafting the beer is part science and part art. Ommegang has an innovation team, including the marketing department, the innovation manager, the brewmaster, packaging, quality control, and graphics, which is continuously responding to customer demand and creating new recipes. “We start with a concept from the marketing department to determine consumer demand,” avers the general manager. “We are always talking to retailers and to our visitors at the plant to understand what our audience wants. The process also includes trying new recipes created by our innovation manager, brewmaster, and staff brewers. It’s vital that we stay ahead of the marketplace.”

Ommegang has historically created its products for a small audience of beer connoisseurs, whom Wetmore describes as “… the top of the pyramid. These are the better-beer drinkers who enjoy exploring new beers. They expect to pay a premium price above the average for a craft beer. Our target audience is 25 to 50 years old with a ratio of perhaps 60 percent male and 40 percent female. Over the past few years, we have focused on adding a variety of beers and styles that are broader in appeal. The new beers are priced a bit lower than some of our complex offerings, and the styles are more familiar to the general public — amber ales, white beers, and pale ales. The goal is to reach the more ‘generalist’ craft drinkers and introduce them to Brewery Ommegang.”

To promote the brewery’s products and events, the marketing department utilizes a number of traditional methods. But it has also leveraged its social media to spread the word. “We’re very active in utilizing social media,” observes Capozza. “Ommegang has 53,000 followers on Facebook, 40,000 on Twitter, and 11,000 on Instagram. This year alone, our Facebook followers are up 28 percent, Twitter is up 34 percent, and Instagram is up 95 percent. In addition, we blog twice a week about everything from upcoming events, to new beers, and what the chef is doing in the café … The craft-beer industry is growing so fast that we don’t think in terms of other craft brewers as competitors as much as they are collaborators. America is enjoying a flavor revolution, and today’s consumer wants choice. Craft drinkers are not sold on their father’s brand; they want to try something new.”

Wetmore agrees that Ommegang needs to be active in promoting and presenting its beers to the consumer. “First and foremost, we invest in people,” says the general manager. “We have more sales people on the street than most anyone else in the industry, because we believe in building strong partnerships in key markets with our wholesalers and the local retail community. We also invest in value-adding innovation in our beers and the corporate strategy emphasizes reinvesting in our production site both to drive efficiencies and to deliver a world-class visitor experience here in Cooperstown.”

“The Duvel Moortgat brewery (Brouwerij Duvel Moorgat) was established in 1871 and is currently owned by three brothers of the fourth generation of Moortgats and an aunt from the third generation,” notes Wetmore. “Duvel owns five breweries in Belgium and the Czech Republic plus Ommegang and Boulevard Brewing Co. in the U.S. The parent set up Duvel USA as the importing unit of Duvel Moortgat, and it also acts as a marketing company to sell beer from all seven breweries [to this region.]  Duvel USA, in effect, is Ommegang’s customer. Duvel USA and the breweries work very closely together: We have staff from both companies on site here.” In addition to being the general manager of Ommegang, Wetmore is the director of marketing for Duvel USA.

The acquisition by Duvel of Boulevard Brewing Co. located in Kansas City, Mo. was announced in October 2013 and closed on Jan. 1, 2014. Boulevard expects to produce close to 200,000 barrels this year and is listed as the 12th largest craft brewery in the country. Boulevard distributes in 25 states, with 90 percent of its business in the Midwest. The parent is planning to spend $7 million to increase the fermentation and cellaring capacity in Kansas City. The acquisition brings the parent company’s consolidated annual revenue to approximately $300 million. The company posted operating profit in 2011 of $40 million on sales of $202 million. Duvel Moortgat went private in 2012.

The management team at Brewery Ommegang includes Wetmore, Phil Leinhart as brewmaster, Rick DeBar as technical manager, Kim White as supply-chain manager, Larry Bennett as creative-services director, Chance Nichols as CFO, and Tara Aitchison as events/retail manager. The company was recognized in 2013 as the Business of the Year by the Otsego Chamber of Commerce.

Wetmore started his career in New York City with food-and-beverage, public-relations agency Gilman & MacKenzie, where he worked on Haagen-Dazs, Betty Crocker, Kraft, and Aveda brands as well as PepsiCo corporate communications. He next served as the customer-marketing director for Scottish & Newcastle, whose flagship Newcastle Brown Ale enjoyed 20 years of double-digit growth. Wetmore, a Syracuse University graduate, joined Ommegang in 2008.                 

Contact Poltenson at npoltenson@cnybj.com