Sands Family Gets Set to Bail from Constellation Brands

Posted on April 4, 2022 by Joel Whitaker

That’s not how they are spinning it, of course.  Officially, Constellation Brands said the Sands Family has proposed declassifying Constellation Brand’s common stock, a move that would lead to a single-class common stock structure.  Each Class B common share would the converted to 1.35 shares of Class A commons stock.

But that’s the practical effect.  Currently the Sands Family controls 59.5% of CBrands’ voting power.  If the move is approved, it would reduce the collective voting power of the family to 19.7%. Anything less than 50.01% voting power means the company can be taken private regardless of what the Sands might say.

Why the family is proposing the move is not known.  What is certain is that the move will result in the family losing absolute voting control, and that will most likely lead to lower returns to shareholders.  Research over the years has found that, over the longer term,  family-controlled public corporations tend to outperform non-family controlled corporations.

It is also a fact that once a business-controlling family sees its voting power dip below 50.1% of all shares, the company is open to a hostile takeover.  That’s what happened to Anheuser-Busch, and it’s also what happened to the Cadbury chocolate company.  The Cadbury family’s voting control dipped below 50%, and while the family, like the Sands family, remained the largest shareholder, Kraft bought up smaller shareholders until it became the largest shareholder, at which point it bought out the Cadbury family.

CBrands’ situation is much closer to that of Anheuser-Busch: 4.5% of shares are held by CBrands insiders, and 84.23% of shares are held by institutions.  So the Sands Family just hung a “for-sale” sign on the company.

This is a different approach than taken by the Brown Family of Brown-Forman Corp.  or the Ford Family of Ford Motor Co.  The Brown family has been very clear that their No. 1 objective is perpetual family control, and their two-class stock structure is designed to ensure that happens.

As for Ford Motor Co., the Ford Family owns only 2% of all stock outstanding.  But it  control 40% of voting power, and Bill Ford Jr., the company’s chairman, directly owns 16.1 million, or 23%, of the Class B shares, which are only available to descendants of founder Henry Ford. That’s quadruple the roughly 4 million, or 5.7%, he owned in 2012.

“I think it’s really important that the family legacy continue. It gives us a face and maybe a humanity that a lot of other companies don’t have,” Bill Ford Jr., says.

Posted in Finance | Tagged , , | Comments Off on Sands Family Gets Set to Bail from Constellation Brands

Deutsch Family to Market, Sell Beau Joie Champagne

Posted on April 4, 2022 by Joel Whitaker

Deustch Family Wine & Spirits entered into a partnership with Toast Spirits LLC giving Deutsch a minority stake in Beau Joie Champagne as well as exclusive sales and marketing rights for the U.S., Canada and the Caribbean.  Terms weren’t disclosed.

“Traditionally, Champagne has been defined by heritage and tradition,” said Tom Steffanci, President of Deutsch Family Wine & Spirits. “Beau Joie in contrast, is youthful and high energy, attracting different consumers to the world of Champagne. We are proud of our new partnership with Jon Deitelbaum and Toast Spirits, and with the help of the best distributor network in the U.S., we are confident we can help introduce the brand to a huge number of new consumers.”

Beau Joie is a hot brand and grew 65% in 2021. By comparison, Champagne grew 25% in the United States in 2021, more than double that of Sparkling Wine’s overall growth of 11%. Beau Joie sold 13,000 cases globally and 12,000 cases in the United States in 2021.

“We are thrilled to enter into a partnership with Deutsch Family Wine & Spirits, to continue fueling Beau Joie’s remarkable growth,” said Jon Deitelbaum, Founder/CEO of Toast Spirits. “Beau Joie has been climbing the ranks of Champagne because of the brand’s highly differentiated positioning. My co-founder, Brandis Deitelbaum, and I are excited to enter into a partnership with Deutsch Family Wine & Spirits, and their distributor partners, to continue fueling Beau Joie’s remarkable growth.”

The first priority of the joint venture will be to launch a new $49 Brut Champagne, assemblage will be 30% Pinot Noir, 30% Chardonnay and 40% Pinot Meunier, and it will be aged 6-8 years on yeast. It will feature a unique, elegant package design and new consumer communication.

“Impressively, Jon and his team were able to build a Top 16 Champagne brand comprised of offerings above $80. This launch of the $49 offering will enable us to scale Beau Joie,” added Steffanci.

Posted in Acquisitions | Tagged , , | Comments Off on Deutsch Family to Market, Sell Beau Joie Champagne

Murphy-Goode’s ‘Really Goode Job’ Campaign Returns

Posted on April 4, 2022 by Joel Whitaker

Last year’s viral “A Really Goode Job” campaign from Sonoma winery Murphy-Goode garnered more than 7,200 applications and offered the candidates, not one but two people, their dream wine jobs. It was so good, that Murphy-Goode is launching the job search again to offer the ultimate dream job in wine country. Applications are being accepted now through June 30, 2022. The job comes with major perks: a foot in the door in the wine industry, a $10,000 per month salary, vineyard-front living rent-free for a year in the charming town of Healdsburg, one of Sonoma County’s premier destinations, and a year’s supply of Murphy-Goode wine.

“After receiving an incredible number of applications for last year’s ‘A Really Goode Job,’ it was a no-brainer decision to replicate it this year,” said Dave Ready Jr., Murphy-Goode winery’s winemaker. Over the course of last year’s campaign and interview process, the winery saw so many talented candidates who loved being a part of crafting their own destiny, which was documented in a mini-series. “We hope to again see a diverse pool of candidates inside and outside the industry, in our backyard and beyond. Living and working in this beautiful part of the world is a true gift, and we relish the opportunity to share that with someone who is passionate about breaking into wine.”

A key component to the previous campaign was the opportunity for the candidate to work in multiple job specialties of the business, as opposed to a single designated position, and that comprehensive job training aspect will again be highlighted in the current campaign.

To apply, candidates must create a short video introducing themselves and explaining what they would bring to Murphy-Goode winery, why they want to work in the wine industry and why Murphy-Goode should hire them, then upload it to the official campaign website. Finalists will be announced in July, taking their final interviews in Sonoma County. The candidate will be selected and announced in August. Once selected, the candidate will begin their year-long adventure with Murphy-Goode, first by shadowing winemaker Dave Ready, Jr., exploring the ins and outs of harvest in Sonoma County. Inspired by their application, Murphy-Goode will then work with the candidate to identify their passion and create the ideal role at the winery for the remainder of the year, and hopefully beyond.

Posted in Advertising, Marketing | Tagged , | Comments Off on Murphy-Goode’s ‘Really Goode Job’ Campaign Returns

Wine and Spirits Continue to Gain On-Premise

Posted on April 4, 2022 by Joel Whitaker

With consumers becoming more comfortable going out, the on-premise Channel Shifting Index reached a new high of 85.3 for the 12 months ending February 2022, a two point improvement versus the 83 CSI for the 12 months ending January 2022. Both  wine and spirits posted gains.   But the latest SipSource CSI “is still lagging where it was pre-COVID,” said Danny Brager, SipSource analyst.   Wine’s recovery lags well behind spirits.  Brager added:

“We would expect to see further on-premise share improvements as COVID cases decline and restrictions fall, along with warmer weather just around the corner. At the same time, some consumer behaviors like where they choose to eat and drink might persist, benefiting off-premise. So it’s still a hill to climb for on-premise to get back to pre-COVID levels.”

Regionally, the pace of recovery still differs across the country, with the on-premise CSI for South Central and South Atlantic generally leading other geographic areas.

Relative to its on-premise share pre-COVID, recovery of this channel’s share has been fastest for rum and flavored vodka and slowest for Irish Whiskey, Scotch, Bourbon, Rye and Flavored Whiskey, according to SipSource. Rate of share recovery though, even when lagging where it was pre-COVID, is not necessarily a problem – in some cases (Irish Whiskey and Rye for example) the segment has grown extremely well in the off-premise during COVID, so COVID may have just shifted the on- versus off-premise channel balance.

SipSource is an affiliate of Wine & Spirits Wholesalers of America.

Beyond those segments above, ready-to-drink (RTD) cocktails is the single category where the on-premise is hugely more important now than it was pre-COVID (its on-premise CSI is now over 160) as a result of its rise in consumer popularity, its convenience to operators, and drinks-to-go legalization in several states.  At the same time though, RTD spirit cocktails volume is still largely off-premise, as the latter still accounts for 93% of its volume.

Posted in Sales | Tagged | Comments Off on Wine and Spirits Continue to Gain On-Premise

Miller Lite Releases New Ad Campaign, Beer Drops

Posted on April 4, 2022 by Joel Whitaker

The new campaign is focused on the “great taste and first-sip feeling only Miller Lite can bring.”  It’s also introducing limited-edition Beer Drops: Miller Lite’s liquid taste enhancer that adds more beer taste to other light beers. “Simply squeeze your Beer Drops into 12 oz. of beer, take a sip and enjoy more beer taste,” the Molson Coors brand says.

On April 6 at 9 a.m. ET, the day before National Beer Day, Miller Lite fans can visit Shop.MillerLite.com/Collections/Beer-Drops and have Beer Drops shipped nationwide for only $4.07, while supplies last (must be 21+ to order). In honor of National Beer Day, Miller Lite encourages fans to reward themselves with more light beer taste, regardless of the label. Plus, consumers can save other-light-beer-drinking friends from less tasteful celebrations by sending Beer Drops right to their door.

While Beer Drops are one starting point for Miller Lite’s new campaign, the brand is also announcing two :15 ads that send a powerful message: light beer shouldn’t taste like water. Depicted unexpectedly through athletic scenarios and couched in humor, the commercials show that Miller Lite is meant for one thing and one thing only: relishing the taste of beer. View the ads here and here.

“This campaign combines Miller Lite’s two most iconic attributes: great taste and Miller Time,”said Sofia Colucci, global VP, Miller family of brands.  “Miller Lite has been an iconic brand since 1975 for good reason. It’s remained true to itself while other light beers have diluted what they’re all about. We know there’s a practical side to why people love Miller Lite, and that’s because it’s a light beer that embraces the taste of beer. But at the same time, there’s an emotional component – it’s that first-sip feeling that ‘Miller Time’ represents. We’re blending these two pieces of our history for the next generation, and we couldn’t be more excited about it.”

Miller Lite’s new campaign will begin appearing this week on national TV during the NCAA college basketball championship tournament, as well as social and digital. Additionally, the campaign will entail increased media investment behind the brand through further TV and online-video placements, national out-of-home, podcast and radio buys, influencer and PR activations, and a robust localization initiative that brings custom Miller Time assets to cities across the country.

Miller Lite Beer Drops and the new campaign were created by DDB Chicago.

Posted in Advertising | Tagged | Comments Off on Miller Lite Releases New Ad Campaign, Beer Drops

Virginia Extends Cocktails-to-Go to July 2024

Posted on April 4, 2022 by Joel Whitaker

Virginia Governor Glenn Youngkin (R-VA) signed HB 426 and SB 254, extending cocktails to-go until July 1, 2024. Cocktails to-go provide increased support for hospitality businesses struggling to rebound from the harsh economic impacts of COVID-19.

Eighteen states and the District of Columbia have passed legislation to make cocktails to-go permanent, and 12 other states passed legislation to allow cocktails to-go on a temporary basis.

Posted in Legislation | Tagged | Comments Off on Virginia Extends Cocktails-to-Go to July 2024