Bill Hackett, CEO of Crown Imports
How CEO of third-largest beer seller in U.S. found his beach
In an interview at his company's recently completed lobby and office bar in the Loop, the jocular executive pontificated about the importance of foam. More head on a beer means more carbon dioxide has been released, and the beer tastes better, Hackett explained.
Beyond knowledge of just how a draft beer should look in its glass, "being behind the bar gives you the insights into (the) consumer, and you develop social skills," Hackett said. "And that's really how I got to know people in the business."
Today, Hackett's job is a little more complicated, as he leads a $2.4 billion company with more than 350 employees and responsibility for some of the nation's top import beers. His company's recent history includes navigating a brutal recession and a jarring merger.
Chicago-based Crown Imports, which ranks third in U.S. beer sales volume, is a joint venture between Victor, N.Y.-based Constellation Brands and Mexico's Grupo Modelo, which makes Corona Extra, Modelo Especial, Pacifico, and Negra Modelo. Crown imports those beers as well as Germany's St. Pauli Girl and China's Tsingtao.
Imports in the $23.9 billion U.S. beer industry, as measured by Euromonitor, were particularly hard hit in the depths of the recession. Following a bumpy start to the joint venture in early 2007, Crown's Corona, the nation's top import, saw sales declines ahead of its peers. But Crown's sales rebounded in fiscal 2011, with it revenue rising 6 percent .
As a whole, the beer industry is expected to post a third consecutive year of declining sales in the U.S. for the first time in more than 50 years. . Shipments from beer manufacturers to wholesalers, a standard industry measure, are expected to fall by as much as 2 percent in 2011, according to Beer Marketer's Insights.
"As unemployment increases, beer volume decreases," Hackett said. "That's why the beer industry has suffered over the last four years."
Corona in the U.S.
Hackett's start at what is now Crown Imports came in 1984, when Mike Mazzoni, a beer industry friend, contacted him with a job opportunity. Mazzoni had been hired to start a beer division at Barton, a small, Chicago-based spirits company rolling the dice on a little-known Mexican brew called Corona.
Imports were a small fraction of the American beer business. Hackett wasn't interested.
"I said, 'Mike, are you out of your mind? Nobody knows this brand,'" Hackett said. But Mazzoni pushed back.
"He said, 'You're young, we've both got some pretty good experience, but this is a chance to see how smart we really are and to build a business a different way,' with different principles that were really different from how the beer business was established at that time," Hackett said, referring to beer in the 1980s as "an old boys' club."
In those days, he said, executives took wholesalers out to remind them to do their jobs and got angry if they didn't hit sales goals. Hackett and his team worked closely with the wholesalers , teaching them how to establish relationships with retailers and get the right placement in stores.
"We brought some process and discipline to the business, and a level of sophistication that we truly took on the spirit of being partners with wholesalers," he said.
Rocky Wirtz, president of Wirtz Beverage Group, chairman of the Chicago Blackhawks and a friend, said this approach helped Hackett succeed.
"He'll makes sales calls, work with salesmen — he understands everything" about the industry, Wirtz said. "It's the range of his business acumen that makes him successful. He understands the business."
Getting started, Hackett had a lot to learn about Corona, which was just beginning to attract attention in the western U.S. and major cities. In Austin, Texas, a retailer explained that Corona was popular with the ladies. Fraternities bought it for mixers because the girls liked it, but they'd end up trying it and liking it when they ran out of their own beer. He also traveled to San Diego, where Corona had become popular because surfers were bringing it home from Mexico.
"It was really kind of a cult brand," with little marketing support, Hackett said. He recalled wholesalers bemoaning the lack of promotional merchandise like mirrors or neon signs to give to bars that sold Corona. He suggested using the bottle itself as a display item on the bar. At the time, he said, a long-neck bottle was uncommon, as was the painted, rather than paper, label.