Brewers frozen out by ice hockey dispute
Last winter's Canadian ice hockey season was wiped out by a wage dispute and while both team owners and players counted the cost, Canada's brewers also paid a heavy penalty, deprived of both a prime sales opportunity and a key marketing vehicle for their brands. Monica Dobie reports.
The unimaginable happened in Canada this past winter. There was no professional ice hockey, the national sport, for the entire season because of a wage dispute between National Hockey League (NHL) team owners. The dispute has lost players and team owners a lot of money, but it has also hit the pockets of other industries too, notably the beer sector.
Canada's brewers not only sell a lot of beer at ice hockey stadiums, they exploit the game for marketing and sell millions of beer bottles to armchair television fans to guzzle whilst watching their team win or lose. According to the Brewers Association of Canada, the country saw a sharp downturn in the amount of draft beer sold in October 2004, the traditional start of the ice hockey season, down 14% compared with October 2003.
John Sleeman, president and CEO of Ontario-based brewer Sleeman Brewers Inc., told just-drinks.com his company lost the most money in sports arenas in the west coast of Canada where Sleeman is sold directly to fans via concession stands. "In the stadium in Calgary Alberta and Vancouver, when there is no hockey the sales don't come in, plus in the surrounding area at the bars restaurants we sold a lot of beer before and after the games so that has had noticeable impact on our beer sales in Western Canada," he said.
Sleeman sales in the six months to the end of the first quarter of 2005 were down by 5%. "It's amazing when you come to rely on something like that and you don't realise how important it is to the business until they go on strike," he added.
As for home consumption, Sleeman said that although this picked up after an initial fall, without hockey it was not enough to offset the decline of bar and venue sales. "If you're sitting at home with your wife and kids watching the game you'll probably only have one or two beers, whereas if you're in a stadium or a bar with the guys, you'll probably have twice that amount," he said.
Fans even stayed away from Wayne Gretzky's Restaurant, owned by the man generally hailed as the best hockey player in the history of the game, in downtown Toronto, five blocks from where the Toronto Maple Leafs play. "We did feel an impact in the bar obviously," said manager, Michael Young. "The hockey brings people together and without it we noticed we had slower nights, definitely."
Edgar Mitchell, president of The Pub and Bar Coalition of Canada, said the hockey lockout meant a decrease of business of 20% for pub and bar owners, in particular those that catered to sports fans. He said disillusioned fans will impact the bar trade for years to come. "There's no doubt they will lose a segment of customers in the long term. People have found something else to do with their time and other ways to spend their money. Bars will have to promote their food or other sports because some people have lost interest in hockey now."
Slipping beer sales at bars and stadiums are not all the brewers have lost.
Opportunities to keep their products in the minds of that precious target male market were also lost. Canada's sport of choice is hockey and although the Canadian and American football seasons clash with the National Hockey League season, the real advertising money within Canada is in hockey.
For example, the Canadian Broadcasting Corporation's (CBC) Hockey Night in Canada on Saturday nights attracts about 1.2m English-speaking viewers, of which 56% are adult men. The numbers increase during the play-off season, where the league's top teams enter a knockout competition to win the sport's 'Stanley Cup' trophy.
Without the television slots during the games, beer giants Molson and Labatt, were at a disadvantage. Molson launched a "Hockey, Please Come Back" campaign with 30-second television spots airing during what would have been week four of the NHL's regular season. However, neither of Canada's beer giants has been in a hurry to talk about how the lock-out had hit their fortunes, however.
Sleeman said that his company's brands do not rely as heavily on sports as Molson and Labatt. "The larger companies may (now) have been looking at marketing areas that Sleeman had been traditionally using," he said. "We have a disproportionate number of women with purchasing decision."
Clearly, the entire beer industry would like the NHL to get started again next year. Although no deal has been confirmed by either side, there is a general feeling of optimism regarding the chances of a resumption in the autumn.
"We haven't had much of a plan B, but if the strike continues we'll work with bars and restaurants that seem to do well independent of hockey and figure out how to get into those places," said Sleeman. "Right now we're in the middle of a heat wave and that's good for selling beer."
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