Rogue Ales & Spirits has remained true to its founding principles—not to mention its name—nearly 30 years after its establishment. While other craft brewers and distillers are targeting volume and distribution gains, the Newport, Oregon–based company is more focused on creativity and brand innovation. “We never intended to get big,” says Rogue president Brett Joyce. “Growth for us is a byproduct of doing the things we think are consistent with our brand.” Indeed, Joyce measures the company’s success by the fact that it remains “independent and true to the spirit of Rogue,” rather than by scale.
Rogue Brewery & Pub was opened in 1988 in the basement of the Rogue Public House in Ashland, Oregon, by Joyce’s father, Jack, and his partners, fellow Nike executives Rob Strasser and Bob Woodell. The following year, the business moved to an empty storefront and garage in Newport and began operating as Bayfront Brew Pub. Then in 1992, it expanded into a larger space across the street and was renamed Rogue Ales Brewery. The company branched out into spirits production in 2003 with the opening of Rogue House of Spirits in Newport, one of the first distillery pubs in the country. Rogue also introduced ciders to its portfolio three years ago. While distributed in about 30 states, Rogue spirits such as Hazelnut spiced rum and Dead Guy whiskey represent just a small part of the company’s sales, Joyce says. “The spirits business is very different from beer,” he explains. “We’ve learned that to make that a real business venture, we’ll have to get more serious about it in the future. We’re patient.”
While Joyce spent his summers as a youth cleaning kegs, driving trucks and washing dishes at the breweries and pubs, he joined Rogue full time in 2006, following 11 years in consumer products marketing. “I had the opportunity to learn the business of beer and the three-tier system,” he says. “It was a chance to come back and see if the combination of me, my dad and Rogue would work, and fortunately it did.” He was named president in 2007. While his father and Strasser are now deceased, Woodell is still active in the business. “After 29 years, we’re excited to say that we’re still independent and ownership is still comprised of the same group of family and friends that shook on it in 1988,” Joyce says.
Hard Work And Authenticity
With its beer distributed in all 50 states, Rogue sold 106,000 31-gallon barrels last year, level with its year-earlier performance. “As long as we’re doing projects that we’re proud of, we’re happy with the results,” says Joyce, noting that the company has ample capacity for the foreseeable future and room to expand, if needed. The company’s biggest markets—Oregon, Washington and California—continue to see organic growth, while Idaho, Florida and Pennsylvania are also performing well. Rogue distributors are comprised of a mix of Anheuser-Busch InBev, MillerCoors and specialty craft houses. Rogue employs about 300 workers. Annual sales revenue is undisclosed.
Rogue was the first U.S. craft brewery to export beer to Japan, starting over 20 years ago. Today, the company exports to some 55 countries. In addition to Japan, Canada and China are strong overseas markets for its brews. “Exports have been a solid, growing business for us,” Joyce says. “It’s a natural evolution for U.S. craft beer to share its product with the rest of the globe.”
Dead Guy ale, first brewed in the 1990s, has emerged as Rogue’s top-selling brew, followed by Hazelnut Brown Nectar and the Hop IPA line. The recently introduced Cold Brew IPA, featuring Stumptown Coffee Roasters’ cold-brew coffee, has been well received. “Our core products are doing well, but the biggest stars of the show this year are our new cans,” Joyce says. Dead Guy and Six Hop IPA were expanded into 12-ounce cans earlier this year, and both have exceeded expectations. Joyce explains that the brewery has been late to cans, as 22-ounce bottles have long been its hallmark. But based on early results, “We’ll definitely have a range of cans going forward,” he says. Rogue six-packs are generally priced at $11.99, while 22-ounce bottles range from $5.99 to $7.99.
The company also continues to innovate. Paradise Pucker sour ale, originally produced for the Hawaii market last year, was recently rolled out in other markets, and according to Joyce, Dead ‘N’ Dead—Dead Guy ale aged in Dead Guy whiskey barrels—should be available by Halloween. John Maier, who joined the brewery in its early days, leads Rogue’s brewing team. “I get a lot of inspiration from homebrewers,” says Maier, who started out as a homebrewer himself. The brewmaster adds that new versions of Yellow Snow IPA and Santa’s Private Reserve will be released in November.
The Oregon brewery was one of the first to grow its own ingredients for inclusion in its brews. Rogue farms produce an array of crops, including malts, hops, pumpkins and jalapeños for use in beers like Chipotle ale, Fresh Roast and Pumpkin Patch ale. The company even raises honeybees for help in producing brands like Honey Kölsch. Joyce says consumers have responded positively to the “DIY approach” and notes that the company has recently begun to make barrels at its own cooperage. “People appreciate hard work and authenticity,” he says. “We have a vision and we dare to take risks. I think that comes through in our products too.” But Joyce concedes that farming comes with its struggles. “It’s very expensive, and the weather can be challenging,” he notes. “You can have a great growing season with great yields and a bad growing season with bad yields.”
Supporting The Trade
About 75 percent of Rogue’s sales are in the off-premise, with supermarkets and liquor stores comprising its largest trade channels. “We’ve always had a strong presence in independent liquor stores,” he notes. “We pay special attention to that channel.” While warehouse clubs are a small part of the company’s business, he says convenience store sales are growing.
Over the years, Rogue has expanded its own on-premise locations, and today the company operates two brewpubs, one distillery pub and several pubs or “meeting halls” with full kitchens. Despite concerns from wholesaling and retailing interests over breweries’ expansions into the on-premise trade, Joyce says, “We’ve developed a clear understanding with our wholesalers and they completely understand the benefit of the pubs for the bigger business. It hasn’t been a problem for us.”
In fact, Joyce says that Rogue’s pubs are “the single best way we market and interact with people every day,” noting that the company doesn’t advertise in traditional forums. Rogue’s digital and social media efforts have become important. And for the last few years, the company’s “Rogue Nation” RV has toured the country, visiting on- and off-premise accounts. “We’re spending a lot more time at retail doing events with retailers,” including tap takeovers, farm-to-table dinners and beer and food pairings, Joyce says.
The brewery supports numerous community organizations through its Rogue Foundation, including the Oregon Coast Aquarium, the American Red Cross, the Boys and Girls Clubs of America and the Special Olympics. In a partnership with its Northwest distributor, Columbia Distributing Co., Rogue has awarded more than $200,000 through the Jack Joyce Scholarship program to fermentation science students at Oregon State University.
A "Real Business"
As Rogue closes in on its 30th birthday next year, Joyce reflects on the changes and challenges of the craft beer category, using an hourglass as an analogy. “At the top are the brands and the SKUs, and that’s widening,” he says. “At the center is distribution, and that’s getting narrower. And at the bottom of the hourglass are consumers, who want more variety. The top and bottom are getting wider, and the middle is a squeeze. The world is creating more breweries, but not more wholesalers. The pressure on the middle tier is the biggest problem today.”
But despite the many craft breweries with which Rogue competes today, Joyce says he’s not worried. Rather, he sees it as a challenge for all craft brewers to improve. “What it means is that we have to get better all the way around,” he says. “The quality has to go up. Just having products isn’t enough. You better have a strategic plan to go to market, retailer support, good follow-up and good sales people. It’s a real business now.”
As for Rogue, Joyce takes pride in the fact that “we are independent and we plan to stay that way.” As in the past, he says the company will “continue to do things that we’re proud of. As long as we do that, we’re going to be fine. We don’t have to take over the world.”