Mike’s Hard Lemonade was founded in 1999 and headquartered in Lakewood Colorado. At the time, it was a Canadian company and the liquid was spirit-based, however, due to U.S. restrictions, Mike’s was malt-based when they opened the U.S. market. It was a very unique product for the time with edgy marketing and the brand quickly took off.
While Mike’s was unique and different, which helped get consumer attention, it was Mike’s culture, at that time that was helping to drive sales. The western half of the U.S. was led by Paul Harvey. Paul was in his mid 40s and was highly respected by both wholesalers and employees.
Mike’s team in Texas had a state sales manager in addition to six to seven other sales people. Their numbers rocked. During this time period Paul, who, after a business dinner in Denver, was conducting meetings with a wholesaler, failed to show up the next morning for a planned meeting. After many attempts to contact him, the hotel manager found Paul’s body in bed. Paul had passed away during the night as a result of a massive heart attack.
Paul’s passing began a series of changes that culturally altered Mike’s for years. Paul’s replacement was a wine salesman from Gallo who brought Gallo’s programs and attitude with him. People started to leave and were not replaced, and sales began to slow. By now, other breweries had developed RTDs to compete and made inroads into the category. But the culture at Mike’s was now toxic. There were other leadership changes that continued to damage sales and their culture until Mike’s eventually hit the bottom.
A recent story on Mike’s written in Beer Business Daily, focused on comments from their current CEO, who took over in 2012. He gave great insights regarding the challenges a leader has to overcome after years of negative growth. By focusing on employees, and creating a positive culture, Mike’s has made a great turnaround.
Slowly, and over the years, Mike’s has experienced double digit growth. Trimming the SKU number down in their portfolio, while increasing their marketing spend by 75%, added to the fact that management was treating employees positively, showed the industry that beer companies can be successful with the right formula. It is not that complicated.
Mike’s is one company that shows what can happen by making a change in the positive direction. Mike’s is a positive example in the beer industry that has, of late, seen so many companies move in a negative direction.
The right leadership says it all. For example, Bill Hackett’s longtime tenure at Crown made that product a monster in the beer segment, whereas Gambrinus gone the opposite direction. In fact, Gambrinus could be considered the poster child for negative culture. Simply talk to any ex-Gambrinus employee, especially the ones from the Modelo era, and you will learn of the less than positive culture of that company.
Many top people from AB, Miller, Coors or others, joined Gambrinus thinking they could handle that way of life, only to be searching for another place of employment within six months. Other companies including Labatt USA or New Belgium, in their early years, had such cultures which fostered positive growth and positive attitudes. But that has since changed.
Mike’s current leadership has once again been an industry example that a company can be highly successful by just creating an environment that puts people first, not egos.
The manager accepts the status quo, the leader challenges it…
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