Bottoms up for the bottom line: School-branded beers provide exposure, revenue
Cans of North Carolina State’s licensed beer, Old Tuffy, are sold in 1,400 locations across the state and they’re going fast.
“We are seeing it sell out of grocery stores. Often,” said Brad Bohlander, N.C. State chief communications and marketing officer.
The university launched the premium lager in July through a five-year agreement with New Belgium Brewing that has a five-year renewal option. New Belgium pays N.C. State an annual guaranteed sum, which goes to the school’s fermentation sciences program, and the Wolfpack also receives an amount based on how much Old Tuffy is sold.
N.C. State is one of 11 schools (see list) to license its marks to a brewery to create a branded beer, including Purdue, which has two licensed beers. Seven of the colleges are land-grant institutions with STEM education leanings, and six of them offer beer-brewing degrees.
The majority of these deals were struck in the last two years. Most of the schools, like N.C. State, are motivated by three things: an academic initiative, branding and the lure of additional revenue.
“The funding is very beneficial; it allows us to do some things we can’t do otherwise,” said Bohlander, who is in his eighth year overseeing the school’s brand identity. “Then there is the branding perspective. What they’re able to do through their marketing and distribution we feel helps elevate our top-of-mind awareness and our brand in ways we couldn’t do on our own.”
The business of beer has gradually infiltrated the college space since West Virginia started selling it in its football stadium eight years ago. Anheuser-Busch InBev and MillerCoors have grown their sponsorships across most of the 65 schools in the power five conferences during that same time frame. Corona and Dos Equis are another pair of big brands spending heavily with college properties.
The next frontier for breweries, beyond pouring rights and sponsorships, is putting licensed college marks on their beer packaging. In most cases, the school has initiated the branded beer with the help of its licensing agent, Collegiate Licensing Co. or Affinity. New Belgium, however, made the first call to the Wolfpack.
The University of California-Davis is believed to be the first school to license its name on a beer as part of a program that lasted only a year in 2011, but was restarted in 2017. The University of Louisiana introduced Ragin’ Cajuns Genuine Louisiana Ale in 2015, promoting it as the first college licensed beer in the country.
By 2017, a half-dozen schools had licensed their marks to breweries and that number has nearly doubled since then. Still, college-licensed beer has not taken off in the last two years like some predicted it would.
UC Davis’ deal with Sudwerk Brewing Co. to make Gunrock Lager, arranged by what is now known as CLC, has a deep tie-in to the school’s brewing science program. Davis alumni created the recipe for Gunrock, brew the beer at Sudwerk, and donate the rice that gives the beer a crisper taste.
The lion’s share of revenue from Gunrock, named after UC Davis’ blue mustang mascot, goes to the school’s athletic department, but Deputy Athletic Director Rocko DeLuca didn’t want the beer to look like a revenue-grab by athletics. “We tried to make it the full UC Davis story,” he said.
The two Purdue beers, licensed with the help of CLC and brewed by People’s Brewing Co. in Lafayette, Ind., strengthen already close ties between the brewery and the university. Revenue from Boiler Gold and Boiler Black ales goes to the school’s food science department, specifically the fermentation sciences minor. Purdue students analyze the brewery’s hops, learn about supply chains and distribution, and some are now employed at People’s, which is owned by Purdue alumnus Chris Johnson.
College-licensed beers can be especially helpful in growing smaller breweries’ brands. Boiler Gold is People’s best-selling beer and its popularity forced the company to greatly expand its distribution network, including into Chicago where Purdue has a large alumni base.
Sudwerk sold 350 cases of its UC Davis-branded beer last year, but DeLuca said the expectation for 2019 is closer to 1,000.
Bosque Brewing, which brews a New Mexico State-licensed beer called “Pistol Pete’s 1888 Ale,” jumped from brewing 100 barrels in 2017 to around 700 this year. Bosque’s owners are New Mexico State graduates. Their deal was arranged with the help of CLC.
College Licensed Beers
“For local breweries, even distilleries, it’s a great opportunity because you get to represent your state, your schools,” said Justin De La Rosa, Bosque director of marketing.
At the same time, though, each school must deal with the sensitivities associated with pairing a school mark with a brewery.
Academic components made the deal an easier sell to stakeholders at N.C. State, Purdue and UC Davis. All three schools ensure that a portion of the proceeds goes to further fund their food science, fermentation or brewing programs, as well as to providing access to internship and experiential learning opportunities. And the schools contribute research — like how to grow hops in the country’s different climates — that benefit the breweries.
“You have to be careful with how you do it, but I think everyone is getting closer to finding out what that line is we have to walk with it,” De La Rosa said.
A possible eruption of college licensed beers is bubbling just below the surface, said Leslie Saloom, the associate director of trademark licensing at Louisiana. Because many people in the college space see the Ragin’ Cajuns as a trendsetter in this category, Saloom is often the go-to source when college administrators want to know how to start a program.
“I probably get a phone call a week about it,” Saloom said. “There are a lot of schools that are thinking about it. It’s not going away.”
Andrew Judelson, executive vice president of national sales at Learfield IMG College, wondered aloud if schools might also look for branding opportunities with wineries or the makers of hard seltzers, especially considering the multiyear decline in U.S. beer sales.
And there could be a bigger revenue play for schools if enough of them agree to license their marks to MillerCoors or ABI — think about Bud Light or Coors Light cans with the marks of all 65 schools in the power five, similar to Bud Light’s NFL program.
ABI is experimenting with a program this football season that features six schools on cans, but five of them — Alabama, Iowa, Texas A&M, Texas Tech and Virginia Tech — don’t include their official school marks. Only Bud Light’s LSU can features its actual logo. The big difference is that the Bud Light program isn’t nearly as integrated.
“We’ve seen a continued opening of this category,” Judelson said, speaking to some schools’ willingness to align with beer brands. “Will branded cans for the bigger beer companies be next? Maybe or maybe not, but we’ve got 11 right now. That’s not the volume that would make sense for an ABI or MillerCoors.”
N.C. State and New Belgium represent the biggest school-brewery pairing to date. In State’s case, the timing was perfect. The Wolfpack launched Old Tuffy at the same time that North Carolina Gov. Roy Cooper signed a bill in June approving alcohol sales at on-campus college sports events. That enabled the school to sell its branded beer inside Carter-Finley Stadium.
According to the school, Old Tuffy constituted 42% of the 12,265 beers sold at the Wolfpack’s home opener against East Carolina on Aug. 31, then 50% of the 9,598 beers sold during the second home game against Western Carolina. Old Tuffy is one of six alcoholic beverages sold at the stadium.
New Belgium gets to use N.C. State’s tradition-laden mascot, Tuffy the wolf, on its beer, which helps it connect to the school’s 180,000 alumni who live in North Carolina, a state with a highly competitive craft brewery scene. New Belgium is based in Colorado but opened a brewery in Asheville, N.C., in 2016. It launched a Colorado State-licensed beer in 2017, called “Old Aggie.”
The brewer initially approached N.C. State in December 2018 with the idea of a licensed beer. No one at the school had considered the possibility, Bohlander said, but the revenue and branding potential quickly became clear. Within months, the beer was available on draft in over 200 locations across North Carolina, thousands of Old Tuffys were being guzzled at Wolfpack football games, and the school now is considering licensing Old Tuffy beer merchandise.
While the vast majority of schools remain on the sidelines of the beer game, N.C. State and a handful of other schools are finding new ways to distinguish their brands.
“Do I think the licensing space will continue to grow?” Judelson said. “I believe it will as the category continues to evolve.”