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The Anatomy of a Comeback

How one CEO brought a regional beer back from the brink by saving the brand.
Narragansett Brewing's comeback
photo courtesy of Narragansett Brewing Co.

Back in the 1950s and 1960s, Narragansett Brewing Company could claim to be New England’s beer. But as the nation’s mega-breweries grew, Narragansett — which at its peak held a 65 percent share of the market — shrank.

The Rhode Island brewery was later sold to Falstaff Brewing Corporation, which in 1981 closed down Narragansett’s operations but kept the brand. By 2005, the beer was for sale in only 10 bars, Bloomberg Enterprise reports.

That’s when Ocean State native Mark Hellendrung swooped in and bought Narragansett. His mission was to revitalize the brand as much as the beer. Hellendrung (@MarkHellendrung) told Bloomberg Enterprise that, upon taking over as Narragansett’s owner and CEO, he faced a decision: He could invest in either bringing the brewery back to Rhode Island or re-establishing the brand. He opted for the latter and continued to brew the beer out of state.

It appears he made the right decision. Today, the beer is sold in about 2,500 bars across New England and up and down the East Coast. Revenue has increased at least 20 percent a year since Hellendrung took over; he expects 2013 sales of $12 million.

Simply put, Narragansett — once close to extinction — is in the midst of a comeback. Here are two ways Hellendrung and his team made it happen.

1. They remembered the good times and forgot the bad ones.
As a brand, Narragansett was loaded with history when Hellendrung, formerly the president of Nantucket Nectars, took over. The advantages to this were plenty: Dr. Seuss, for instance, drew advertisements for the beer, which also made a cameo in the movie Jaws. He’s played on these pop culture artifacts in reintroducing the brand, banking on the rose-colored power of nostalgia. “A lot of people lived through the demise of the brewery and the product,” Hellendrung tells Build, noting that it had become widely perceived as “cheap swill.”

2. They knew who would give the product another chance.
Named for a town in Rhode Island, Narragansett as a brand came with one other advantage: Local bars were willing to give the local business a chance, Hellendrung says. As the brew caught on anew, it grew from the “inside out.”

The lesson learned? When attempting a turnaround, your edge doesn’t necessarily need to be local. But you’d better appeal to the people who are most likely to give you another chance.

#marketingcomeback

THE PLUS

Hellendrung says he initially expected older beer enthusiasts to remember Narragansett’s golden days and flock to the revived brand. But he’s struggled to attract the nostalgic crowd, which still seems to have a negative perception of the beer. Instead, younger customers (dare we say “hipsters”) are the ones being wooed by the old-time brand, he says.

‘Gansett’s popularity among bearded Brooklynites has been aided by the curious popularity of Pabst Blue Ribbon (PBR) among the hipster set. In his Time magazine article “After PBR: Will the Next Great Hipster Beer Please Stand Up?” writer Brad Tuttle (@bradrtuttle) says the Narragansett is battling it out with other regional subpremium beers like Genesse and Yuengling to overthrown PBR.

According to Tuttle: “Mark Davidson, one of the founders of the beer-price-tracking site SaveOnBrew.com, says Narragansett’s active targeting of hipsters could backfire. ‘You can’t set out to be the beer of choice for a counterculture,’ he explained via e-mail. ‘Just like you can’t set out to make a viral video.’”

Or can you?

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