Some initial thoughts on the merger of the businesses of Carlsberg UK and the Marston’s Beer Company.
On 22 May 2020 it was announced that Carlsberg UK will merge with the brewing arm of Marston’s. Carlsberg will control 60 percent of the equity in the venture and Marston’s will hold the remainder.
The Twittersphere seems to believe that this is a “classic case” of “Big Beer” exercising control over the British brewing industry. Perhaps it is, but I would characterise it as more of an act of desperation on the part of Carlsberg. Not only will Marston’s continue to hold a large minority stake in the business, but they will receive a one off cash payment of £273 million.
As things stood, Carlsberg UK was undoubtedly in a position of weakness. Despite a major rebrand and overhaul of its recipe, Carlsberg lager remains stuck at third place in the standard lager market, behind Carling and Foster’s. Their only powerful brand in the premium lager market is San Miguel, which admittedly has enjoyed somewhat of a surge in popularity in recent years.
Other than the licence to brew Brooklyn Brewery products, Carlsberg’s most noticeable commitment to craft beer consisted of closing down their Leeds site, the largest cask ale brewery in the world, in 2008. The tie-up with Marston’s effectively reverses this decision, buying into a business that operates six breweries, largely producing cask ale.
Furthermore, the Marston’s tie-up represents a reversal of strategy for Carlsberg. They closed their own distribution network in 2016. Now, four years later, having access to the Marston’s distribution network is an appeal for them.
I honestly wish the venture success. I believe that both businesses are stronger together. Carlsberg has neglected its Tetley cask ale brand, which was the largest in the world as late as the mid-1990s, whereas Marston’s has nurtured and heavily invested in its own. Meanwhile Marston’s lacks strong lager brands, which Carlsberg provides.
Mackeson became the first brewery to introduce milk stout.
The Hythe Brewery and the Mackeson family
The Hythe Brewery was established on High Street, Hythe, Kent in 1669.
Following an apprenticeship to Benjamin Bell (1749 – 1806), the first Scottish surgeon, William Mackeson (1774 – 1821) became junior partner at the Hythe Brewery from 1801.
William Mackeson died in 1821 and the business was continued by his brother, Henry Mackeson (1772 – 1860).
Nine men were employed at the Hythe Brewery in 1851.
Henry Mackeson died in 1860, and his son, Henry Bean Mackeson (1813 – 1894) took control of the Hythe Brewery.
Henry Bean Mackeson was a courteous, and well-respected man. He employed 37 men in 1871, and 36 men in 1881. He served as Mayor of Hythe for nine consecutive years.
Henry Mackeson takes control of the business, and milk stout is introduced
Henry Mackeson (1861 – 1935), studied chemistry at Edinburgh and London. He became the head of the business following the death of his father in 1894.
Mackeson was persistent and hard working, and developed the business. He invested in new buildings and machinery, and updated the range of beers provided in order to meet changing customer preference.
Henry Mackeson was joined in partnership by his brother, George Lawrie Mackeson (1864 – 1950).
Mackeson & Co was incorporated with a share capital of £120,000 in 1900.
Mackeson & Co acquired various patents relating to using lactose, or milk sugar, in brewing from 1908. Stout was already recommended as a source of energy during convalescence, and Mackeson hoped that the addition of lactose would further increase its nutritional value. Mackeson Milk Stout, the first milk stout in the world, was introduced from 1909. 9 lbs (4.1 kg) of lactose were used in each 36 gallon barrel. The product was an immediate success.
Henry and George Lawrie Mackeson sold their shareholdings to H & G Simonds, a large brewery based in Reading, in 1920. The two brothers took the opportunity to enter into retirement.
Mackeson became a well-established brand throughout Kent. The brewery employed 120 people by 1929.
Mackeson is acquired by Whitbread
Whitbread, a large London brewer, acquired Mackeson & Co in 1929. Simonds sold up as the offer price was simply too good to refuse.
Whitbread initially considered the discontinuation of Mackeson Milk Stout, as sales were small and locally based. However following a successful trial in Sheffield the product was afforded nationwide distribution. The J Walter Thompson advertising agency was engaged to market the brand towards women, who it was reasoned would appreciate its smooth palate and sweet taste. Over 50,000 barrels were sold in 1939, and the beer accounted for nearly ten percent of Whitbread production.
The name of the product was changed to “Mackeson Stout” from around 1942 onwards. The Ministry of Food had placed pressure on Whitbread to removed milk from the name as it was erroneous.
Sales gained momentum following the Second World War. Mackeson benefited from an increasing demand for bottled beers, which, although more expensive, provided consistent flavour and quality.
103,000 barrels of Mackeson were produced in 1948.
Mackeson Stout contained eight percent lactose in 1954.
Whitbread bottled beers were available in over half the licensed houses in Britain by 1955. Demand was such that Whitbread had to subcontract around 20 percent of its bottling to other companies.
60 percent of the £850,000 Whitbread advertising budget was dedicated to Mackeson in 1957. Mackeson accounted for almost half of revenue at Whitbread by 1960. Sales had effectively quadrupled during the 1950s, and 425,000 barrels of Mackeson were sold in 1961.
Mackeson held around a quarter of the stout market in Britain by 1963. Whitbread briefly experimented with a draught version of Mackeson at this time.
A reciprocal agreement was signed with Bass in 1965, who agreed to stock Mackeson Stout across its estate of 4,100 public houses in exchange for Whitbread selling Bass beers throughout their estate.
Mackeson was introduced to the South African market in 1967.
Mackeson had an ABV of over four percent in 1968, and sold for a premium price.
The Hythe brewery was closed in 1968 and Whitbread relocated production to the Exchange Brewery in Sheffield.
Mackeson had been introduced in cans by 1971.
Mackeson was withdrawn from sale in South Africa in 1972.
Mackeson was brewed under licence in Jamaica and Trinidad from 1973. It began to be brewed in Singapore from 1978 and Nigeria from 1979.
Sales of Mackeson had began to decline in Britain by the late 1970s, as lager increased in popularity with women.
British Mackeson had an ABV of 4.3 percent in 1988.
The Exchange Brewery was closed in 1993, and Whitbread relocated production to their Castle Eden, Co Durham and Samlesbury, Lancashire plants.
Mackeson XXX Stout was brewed under licence in the United States by the Hudepohl-Schoenling Brewing Company in Cincinnati, Ohio from around 2000.
Whitbread sold its beer operations to Interbrew of Belgium for £400 million in 2000. Interbrew merged with AmBev to form Inbev from 2004.
Mackeson Stout has been produced under contract by a number of brewers since 1999, including Young’s of Wandsworth, Ridley’s of Chelmsford, Cameron’s of Hartlepool and Hydes of Manchester. It is currently brewed by Brains of Cardiff.
The ABV of Mackeson’s was reduced from 3 percent to 2.8 percent from 2012 in order to qualify for duty relief.
According to information kindly provided by InBev, Mackeson Stout currently contains 600g of lactose per hectolitre of final product as of 2020.
* British Newspaper Archive
* The Times Historical Archive
* The Story of Whitbread PLC 1742-1990 by Nicholas Barritt Redman
* Census, birth and death records
* Martyn Cornell
* Ron Pattinson
How did Smithwick’s rise from relative obscurity to become the largest ale brewer in Ireland?
Origins and the Edmond Smithwick era
The Smithwicks were a well-established and highly-respected Catholic family in Kilkenny, Ireland.
John Smithwick (1763 – 1842) entered into business as a wholesale and general grocer with premises on Kilkenny High Street. From modest beginnings Smithwick grew wealthy, and he leased a distillery at St Francis Abbey, Kilkenny, on behalf of his eldest son, Edmond Smithwick (1801 – 1876), from 1827.
St Francis Abbey is a ruinous former Franciscan abbey built in the early 13th century.
An adjoining brewery was acquired on lease from 1833. Ireland had relatively few breweries, numbered at just 207 in 1831, against 5,419 in England. Kilkenny was to prove an advantageous location for the production of beer, given that it was situated in one of the most best barley growing regions in Ireland. The brewery soon overtook the distillery to become the predominant business.
Edmond Smithwick hosted Daniel O’Connell (1775 – 1847), the Catholic emancipation campaigner, in 1840. Amongst this fervour of nationalistic mood, there was a revival of a campaign for Irish consumers to purchase Irish-made goods. Smithwick himself argued that if the middle classes supported Irish industry, lower taxes would ensue, as there would be fewer unemployed to support.*
Highly-regarded by the community, Edmond Smithwick was elected Mayor of Kilkenny in 1844.
Edmond Smithwick greatly extended and modernised the brewery in 1851. He also hired a highly experienced brewer.
Edmond Smithwick funded an all-expenses paid trip for over 100 employees to the Great Exhibition of Dublin in 1853.
His brother, Daniel Smithwick (died 1869), established a bottling works.
Edmond Smithwick had commenced exports to the British Empire by 1855.
The business traded as E Smithwick & Sons by 1861.
Edmond Smithwick was re-elected Mayor of Kilkenny in 1864 and 1865.
Edmond Smithwick had spent thousands of pounds on improvements to his site by 1867. It was one of the foremost industrial concerns in the south of Ireland. The brewery employed hundreds of people. Smithwick had a reputation as a fair employer who paid a good wage.
Edmond Smithwick acquired the precinct of St Francis’s Abbey for £3,100 in 1867.
Edmond’s sons take over the business
Edmond Smithwick died in 1877, and the business was continued by his three sons, John William Smithwick (1835 – 1894), Edmond Smithwick (1839 – 1912) and Daniel Smithwick (1840 – 1883).
The business was incorporated as E Smithwick & Sons in 1890.
The brewery employed around 400 people in 1900.
The market consolidates
The success of the company in the beginning of the twentieth century was credited to its chairman, Michael Buggy (1855 – 1935), a solicitor.
E Smithwick & Sons was one of only 25 breweries remaining in Ireland by 1917, and one of only 15 to brew stout, porter and ale.
James Sullivan & Co, a rival Kilkenny brewery with a production capacity of 20,000 barrels a year, entered into receivership in 1917, and the assets were acquired by E Smithwick & Sons in 1919. The purchase left E Smithwick & Sons as the sole surviving brewery in Kilkenny.
Strong growth under W A Smithwick
Walter Aloysius Smithwick (1908 – 1993), the grandson of John William Smithwick, became a company director from 1931. He was responsible for introducing a large sales team to the business, which was to prove highly successful in increasing revenue. Smithwick’s products had national distribution by 1935. Over 400 licensed establishments in Dublin were supplied by 1937.
E Smithwick & Sons was the oldest and most important industrial concern in Kilkenny by 1937, and employed over 140 people in the city.
E Smithwick & Sons won first prize for best bottle conditioned beer in a British Commonwealth competition in 1937.** Shortly afterwards, the beer was rebranded as Smithwick’s No.1.
The Second World War hampered production, with output reduced to just 6,000 barrels in 1942.
Walter Smithwick became chairman and managing director from 1947. He determined to make Smithwick’s the leading ale brand in Ireland. Sales grew quickly under his dynamic leadership, and improved distribution saw annual production reach 50,000 barrels by 1952.
The Great Northern Brewery in Dundalk was purchased for £37,500 in order to supplement brewing capacity in 1954. The news was greeted positively, as it presented an opportunity for W A Smithwick to introduce his superior management skills to the acquired business.
Smithwick’s Brewery was registered as a public company with a capital of £500,000 in 1956. That year Guinness, the large Dublin-based brewery, took a stake in the business.
The Dundalk purchase was to prove problematic. Public taste increasingly favoured keg beer, and Smithwick’s lacked sufficient capital to convert the Dundalk brewery for this purpose. The Dundalk brewery was sold to Guinness, who invested to convert the plant towards the production of Harp lager.
E Smithwick & Sons held over 60 percent of the Irish ale market by 1960, a total of around 60,000 barrels a year. The four products were Smithwick’s No.1, a deep gold ale, Smithwick’s Export Ale, Smithwick’s SS Ale, and Smithwick’s Barley Wine.
Time, a pasteurised beer, was introduced from 1960.
Smithwick’s Barley Wine won the Olympic Gold Medal at the World Beer Olympics in 1963.
Takeover by Guinness and investment
Guinness acquired a 60 percent interest in Smithwick’s for £750,000 in 1964. The rest of the business was acquired the following year for £490,000.
Smithwick’s had been slow to anticipate the increased demand for draught beer. It introduced a lager brand, which failed, in part because it lacked the marketing power of Guinness and rival English brewers. Smithwick’s was also struggling with the capital demands of investing in draught beer.
Walter Smithwick did not regret his decision to sell the brewery. He knew the business needed large amounts of capital if it was to remain competitive, and to fail to take the business public would have seen it struggle to survive. Smithwick understood that a workforce of 250 were dependant on the brewery for their livelihood.
A new brewhouse was established from June 1965.
Some Smithwick’s bottling had been transferred to Dundalk by 1968.
The Smithwick’s brewery was expanded in 1969.
Walter Smithwick retired in 1973.
Hop varieties in use in the early 1970s included Irish-grown Fuggles, Goldings and Bullion. Hop pellets were in use by 1985.
Budweiser was produced under licence at the Kilkenny brewery from 1987. A £1 million investment was made to enable lager production at the brewery.
Growth as an export brand
Kilkenny Irish Beer (c.5% ABV) was introduced, originally as an export-only product, from 1987. The Kilkenny name was chosen as opposed to Smithwick’s as it was easier for non-native English speakers to pronounce. The initial market was Germany.
Draught Smithwick’s for the Northern Ireland market was brewed at Dundalk by 1988. Smithwicks Ale bottling was transferred to Dundalk as part of a rationalisation drive from 1989.
Export sales of Smithwick’s and Kilkenny increased by over one third in 1994, with a large market in Canada.
Domestic sales of Smithwick’s declined every year from the mid-1980s, and ale, excluding stout, comprised just ten percent of the Irish beer market by 1995.
A reduced-strength (4.3% ABV) version of Kilkenny Irish Beer was introduced to the Irish market from 1995. A Guinness executive explained that it was a different beer from Smithwick’s. It was a premium-priced product, and was intended to revitalise the declining ale category, and prevent the newly-launched Caffrey’s, a rival Irish ale from Bass, from taking market share.
Dundalk brewed all bottled and canned Smithwick’s, including the Barley Wine, by 1995.
Production of Smithwick’s beer for the domestic market had been transferred to the Guinness-owned Cherry’s Brewery in Waterford by 1997.
43,000 hectolitres (75 million pints) of Kilkenny Irish Beer had been sold across 53 different countries in 1999. The beer was sold in 1,860 domestic Irish pubs.
The Kilkenny Brewery employed 150 people in 2000. It was an efficient site, but was suffering from capacity constraints.
Smithwick’s Barley Wine was discontinued in 2001.
The Kilkenny and Dunalk breweries were closed in 2013, with production relocated to St James’s Gate, Dublin, the home of Guinness.
Smithwick’s remains a leading ale brand in Ireland, with estimated sales of around 58,000 barrels in 2020, according to data from Euromonitor.
* It remains unclear exactly which Mr Smithwick was speaking at this Kilkenny meeting, but Edmond Smithwick (1801 – 1877) is the most likely.
** The Brewing Trade Review Bottled Beer Exhibition was the awarding body
Babycham, a sparkling pear cider, was introduced to Britain in the early 1950s, and was an immediate success.
The Showering family had an association with the innkeeping and brewing trade in Shepton Mallet, Somerset, dating back to the 18th century.
Albert Edward Showering (1874 – 1946), a small-scale brewer, owned three public houses in Shepton Mallet by 1928. He had four sons, and two of them, Herbert Showering (1906 – 1974) and Francis Showering (1912 – 1995) were to prove instrumental in the subsequent growth of the family business.
Arthur Edward Showering (1899 – 1979) took over the licence of the Ship Inn on Kilver Street, Shepton Mallet, which was owned by his father Albert, in 1921. The rear of the Ship Inn housed a small brewery.
Showerings was incorporated as a private company in 1932, with Herbert Showering as chairman. Cider production was established by this time. Albert Edward Showering retired in 1934.
Francis Showering, a trained chemist, was manager of the Showerings cider mill by 1939. He was a stocky, hard-working, no-nonsense West Countryman. He had been appointed managing director of Showerings by 1949.
Showerings won numerous awards for the quality of its bottled ciders throughout the late 1940s and early 1950s.
Following years of research and development Francis Showering developed a new sterile filtration process that improved the shelf quality of perry (pear cider) in 1947. The product was clear and sparkling, and reminiscent of champagne.
Sales of perry in Britain were miniscule. The Showering brothers introduced the new product to the Bristol area and assessed its potential. Francis Showering determined to market the product towards women, and the Babycham trademark was registered in 1950. The product was packaged in 4 liquid ounce (118ml) “baby bottles”, similar to those of Baby Moussec, a popular brand of champagne at the time.
In order to prioritise the production of Babycham, brewing ceased from 1952, and apple cider production ended in early 1953. Babycham was launched nationwide from 1953 and demand immediately exceeded all expectations.
Herbert Showering was responsible for marketing the product, and advertising commenced from September 1953. Advertising was to heavily emphasise its similarity to champagne. Sales quickly boomed. Advertising agency Masius Wynne-Williams created the Chinese water deer mascot for the brand.
A significant factor behind the success of Babycham was that it appealed to the relatively underdeveloped female market. “It was the right product at the right price. It filled a gap for people, especially women, who didn’t want to drink beer or spirits”, recalled Keith Showering (1930 – 1982), the son of Herbert Showering. At the same time, bottled beers and ciders were becoming increasingly popular over draught drinks due to their more consistent quality. Furthermore, the brewers who owned much of the licensed premises in Britain readily introduced Babycham to their public houses, as it was not in direct competition with their beer.
Showerings found it was unable to meet demand for Babycham in the pre-Christmas period of 1954. Rather than compromise on product quality, which could have increased supply, strict rationing of Babycham was introduced.
Babycham became the first alcoholic product to be advertised on British television in 1955. Around £300,000 was spent on advertising between 1953 and 1956.
Showerings acquired R N Coate & Co of Nailsea, near Bristol, one of the four largest cider manufacturers in Britain, in 1956.
Showerings had installed the largest and most highly-mechanised bottling plant in the world by 1958. Tens of thousands of bottles of Babycham were produced every day. Supplies had to be delivered almost daily to holiday resorts across Britain during the summer.
Showerings was converted into a public company in 1959. Over 1,000 people were employed. By this time Showerings bought much of Britain’s perry pear crop, and had to import additional fruit from Europe. A two and a half year stock of pear juice was maintained in order to ensure supply.
Aided by heavy marketing expenditure, annual sales of Babycham had reached £8 million by 1961.
Showerings was keen to reduce its dependence on the Babycham brand. The family-controlled William Gaymer & Son of Norfolk was acquired for £150,000 in 1961. Gaymer was the third largest cider producer in Britain, best known for the Olde English brand. However it had struggled against the greater resources of its major rival, H P Bulmer. The deal transformed Showerings into the second largest cider manufacturer in the world.
30 bottles of Babycham were produced every second by the mid-1960s.
Allied Breweries merger to present
Showerings merged with Allied Breweries in 1968. Francis Showering was appointed chief executive of the wine and spirits division.
2.5 million bottles of Babycham were manufactured every week by 1969, utilising the majority of British pear production.
The Shepton Mallet plant had a production capacity of 90,000 bottles an hour, and Showerings employed around 500 people in the town.
Babycham overseas sales tripled between 1962 and 1971. Babycham was exported to 52 countries by 1971.
R N Coate production was relocated to Shepton Mallet from 1974.
Keith Showering became chairman of Allied Breweries from 1975. Allied was the largest drinks business in Europe by this time.
Allied Breweries sold 144 million bottles of Babycham a year in 1977. The product was distributed across 90 percent of licensed premises in Britain.
Babycham was made with 25 percent apple cider by 1979. It had an alcohol content of 8.4 percent.
Babycham sales were successfully established in South Africa and the Far East and the product was exported to more than 70 countries by 1980.
Sales had plummeted to an all-time low by 1982, and Showerings admitted that there was an “embarrassment factor” associated with the drink. The Babycham recipe was reformulated in order to provide a drier finish.
The Shepton Mallet site employed nearly 800 people in 1986.
Much of the Showerings pear orchards were ripped up in the early 1990s. Lower-cost fruit could be imported from overseas.
The Allied Breweries cider business was subject to a management buyout named the Gaymer Group in 1992. The deal valued the business at £140 million. 125 jobs were lost at Shepton Mallet.
Annual sales of Babycham had fallen to around one million bottles by 1993, and the deer mascot was retired.
The alcohol content of the product had fallen to six percent by 1993.
The Gaymer Group was acquired by Matthew Clark for £109 million in 1994.
Babycham sales suffered in the mid-1990s as alcopops grew in popularity.
Matthew Clark was acquired by Constellation Brands in 1998.
The Gaymer Group was sold to C&C Group of Ireland for £43.5 million in 2009. Constellation Brands retained the rights to Babycham.
The Shepton Mallet factory , the second largest producer of cider in Britain, was acquired by the grandchildren of Francis Showering in 2016.
Brothers Drinks, controlled by the Showering family, acquired Babycham in 2021.
How did Newcastle Brown Ale become the highest selling bottled beer in Britain, and take significant sales in the United States?
John Barras & Co
Bells, Robson & Co established the Tyne Brewery on Bath Lane, Newcastle in 1867. It was said to be the largest brewery in the North of England.
Bells, Robson & Co entered into financial difficulty, and the business was acquired by John Barras & Co of Gateshead, after their own brewery site was subject to compulsory purchase by the North Eastern Railway in 1884.
John Barras & Co was managed by Charles John Reed (1820 – 1908), who had leased the brewery since 1861, after marrying into the founding Barras family.
Reed appointed Thomas Watson Lovibond (1849 – 1918) as head brewer and manager from 1887. Lovibond had received scientific training during an era when almost all brewers lacked such formal education. He was to have a significant impact upon the future success of the business.
John Barras & Co traditionally brewed mild ale, but under Lovibond’s direction, pale ale was being produced by 1889, in order to compete with rival products from Burton upon Trent and Edinburgh. Lovibond also introduced greater standardisation of product quality.
John Barras & Co merged with four local brewers in 1890: W H Allison of North Shields, J J & W H Allison of Sunderland, Swinburne of Gateshead and Carr Brothers & Carr of North Shields to form Newcastle Breweries.
All production was centralised at the Tyne Brewery, which was regarded as one of the largest and best equipped breweries in the North of England. As a result, the output of the brewery was doubled from 900 to 1,800 barrels a week.
Newcastle Breweries controlled an estate of nearly 300 public houses by 1897.
The amalgamation was to prove highly successful. Forster’s Bishop Middleham Breweries was acquired in 1910.
Colonel Porter and the introduction of Newcastle Brown Ale
James Herbert Porter (1891 – 1973) was born in Burton upon Trent, the son of a master brewer. He joined Newcastle Breweries as a trainee brewer in 1909. Porter was a highly courteous and mild-mannered man, a model of an English gentleman. He saw action during the First World War, and was promoted to Lieutenant Colonel.
Newcastle Exhibition, a cask beer, was introduced from 1920.
Sales of bottled beer began to increase after the war, influenced by the inconsistent quality of cask beer. Colonel Porter determined to develop a bottled beer of his own. Newcastle Breweries opened one of the largest and best-equipped bottling plants in Britain in June 1925.
Colonel Porter, by now promoted to assistant brewer, and Archdale Mercer Jones (1881 – 1954), manager of the bottling works, laboured for three years to perfect the recipe for Newcastle Brown Ale. Porter created its distinctive taste by blending a strong, crystal malt-influenced aged beer with a light pale ale. Porter reflected, “I wanted something different but not far too strong”.
Newcastle Brown Ale was launched in April 1927. The sole ingredients were malt, hops, sugar and yeast and it had an ABV of 6.25 percent. It was filtered but was not subject to pasteurisation.
Newcastle Brown Ale would have been seen as a rival to Bass Pale Ale, a comparable beer in terms of strength and quality. Another similar beer, Whitbread Double Brown, had been launched in London just a month earlier.
Newcastle Brown Ale was to enjoy immediate success. It was a quality product brewed to vigorous scientific methods and high standards, and sold at a reasonable price. Colonel Porter had been promoted to head brewer by September 1927, in recognition of his efforts to improve product quality.
Newcastle Brown Ale was named as the best bottled beer in Britain at the 1928 Brewers Exhibition in London. Colonel Porter disproved the long-held notion that water from Newcastle was an inferior brewing liquor.
The blue star logo was introduced in 1928. Each point on the star represented one of the five businesses that had originally combined to form Newcastle Breweries.
The brewery produced six million bottles of beer a year by 1928.
Newcastle Brown Ale had seen its ABV reduced to around 5.5 percent by 1931.
Colonel Porter was promoted to the Newcastle Breweries board of directors in 1931.
Newcastle Breweries encountered material shortages during the Second World War, and as a result brewed lower strength beers out of necessity. However the company refused to compromise on the quality of Newcastle Brown Ale, which went unchanged, although sales were by necessity highly rationed.
Although sales remained confined to the North East of England, 300 million bottles of Newcastle Brown Ale had been produced by 1952.
Colonel Porter was appointed chairman of Newcastle Breweries in 1955.
The Tyne Brewery occupied 6.5 acres by 1956.
The crown cork bottle cap replaced the old screw cap from 1957 in order to help preserve freshness. Amber bottles were introduced, although reverted to clear glass after drinkers complained.
It was claimed that Newcastle Brown Ale was the highest selling bottled beer in the North of England by 1959. That year, “the one and only” was introduced as an advertising slogan.
Production of Newcastle Brown Ale had continued to grow and the brewer’s bottling facility had reached capacity. A new bottling plant entered into production from 1959.
John Rowell & Son of Gateshead was acquired in 1959 to bring the total number of Newcastle Breweries controlled premises to around 700.
Scottish & Newcastle
Newcastle Breweries merged with Scottish Brewers to form Scottish & Newcastle in 1960. Colonel Porter was appointed vice chairman. Newcastle Brown Ale was a leading product of the new company, alongside McEwan’s Export and Younger’s Tartan Special. The merger afforded Newcastle Brown Ale a wider network for distribution.
Newcastle Brown Ale had been introduced in cans by 1964.
Around 130 million bottles of Newcastle Brown Ale were produced in 1967.
Distribution of Newcastle Brown Ale throughout the Midlands and the South of England had begun by the late 1960s. The beer found particular favour among university and polytechnic students.
The Tyne Brewery produced over one million barrels of beer a year by 1972, however increasing national sales of Newcastle Brown Ale saw the facility struggle to meet demand.
Newcastle Brown Ale had earned a near legendary reputation in its local area by the mid-1970s. Domestic sales of Newcastle Brown Ale peaked in 1974, after which sales of bottled beers began to enter into a steady decline. The appeal of bottled beer had been its consistency, but with the increasing distribution of keg beer its unique selling point was lost.
By 1977 a total of 7.5 million barrels of Newcastle Brown Ale had been produced since it was introduced in 1927.
Newcastle Brown Ale was the highest selling packaged ale in Britain by 1980. It was sold in over 97 percent of off licences in England and Wales and more than 90 percent of supermarkets and grocers.
It is believed that Newcastle Brown Ale ceased to be a blended beer from the early 1980s onwards.
Newcastle Brown Ale was known as “Dog” on Tyneside by the 1980s, arising from the “going to walk the dog” euphemism, which implied a visit to the pub.
A new £3.5 million bottling plant was opened in 1984, the fastest in Europe. The Tyne Brewery had grown to cover 14 acres by 1985. 1,200 people were employed there in 1988.
Scottish & Newcastle was the fifth largest brewer in Britain by 1988.
Newcastle Brown Ale had settled on its current ABV of 4.7 percent by 1989.
Newcastle Exhibition was the highest selling draught ale in the North East of England by 1989.
A resurgence for Newcastle Brown Ale
Newcastle Brown Ale underwent a resurgence in the late 1980s and early 1990s with increased distribution in the South of England, as well as a strong presence in student union bars. Marketing efforts dissociated the drink from its working class roots and repositioned it as a premium product. The product was sold in thirty countries.
Scottish & Newcastle took direct control of its United States product distribution from 1990 onwards. Major European import rivals such as Bass, Guinness and Heineken had strength on the East Coast, so Scottish & Newcastle established its American headquarters in San Francisco.
25 percent of Tyne Brewery output was dedicated to Newcastle Brown Ale by 1994. 120 million pint bottles (not including cans) of Newcastle Brown Ale were produced every year.
Scottish & Newcastle acquired Courage in 1995 to become the largest brewer in Britain.
Newcastle Brown Ale was introduced on draught to the British market in 2000.
The United States represented the largest market for Newcastle Brown Ale by 2001, with annual sales of 350,000 hectolitres. However sales in Britain were “well down”, according to a Scottish & Newcastle executive.
The Tyne Brewery was closed in May 2005. Production of Newcastle Brown Ale was relocated to the Federation Brewery in nearby Dunston, Gateshead.
Newcastle Brown Ale was among the top fifty highest-selling beers in the United States in 2006.
Bottling of Newcastle Brown Ale was relocated to the John Smith’s Brewery in Tadcaster, North Yorkshire, from 2007.
Scottish & Newcastle was acquired by Heineken in 2008.
Heineken closed the Federation Brewery in May 2010, and production of Newcastle Brown Ale was relocated to the John Smith’s Brewery.
Caramel, used to darken and flavour Newcastle Brown Ale since its inception, was replaced with roasted malt from 2015, amid United States health concerns.
Production of Newcastle Brown Ale for export was relocated to the Zoeterwoude Brewery in the Netherlands from 2017.
Draught Newcastle Brown Ale was withdrawn from the British market in 2018.
Global sales of Newcastle Brown Ale declined from nearly seven million cases in 2014 to around two million cases in 2019.
Production of Newcastle Brown Ale for the United States market was relocated to the Heineken-owned Lagunitas Brewery from 2019. The recipe was subjected to significant changes, including the addition of Centennial and Chinook hops.
Watney’s Red Barrel was the highest-selling keg bitter in the world by the mid-1960s. The beer’s relaunch as Watney’s Red in 1971 represents one of the most famous failures of brand management in recent British history. What went wrong?
The birth of Watney’s Red Barrel
Watney, Combe & Reid was formed by the amalgamation of three London breweries in 1898. The Reid and Combe sites were closed, and production was concentrated at the Watney brewery at Mortlake. It was the second largest brewing business in the world.
Watney Combe & Reid was highly profitable. When Charles Combe (1837 – 1920) died he left a net estate valued at £956,139, or over £374 million in 2023 prices. Claude Watney (1867 – 1920) left a net estate valued at £498,461 (approx. £195 million in 2023).
Watney, Combe & Reid had begun to pasteurise at least some of their bottled beers by the 1920s in order to improve shelf life. A large new pasteuriser was imported from Bernsdorf in Germany in 1930.
Watney, Combe & Reid introduced the Red Barrel as their in-house trademark from 1930.
Watney, Combe & Reid became the first British brewer to introduce a draught “container beer” in 1931. Unlike traditional cask conditioned beer which would last no longer than a week, container beer was filtered, pasteurised and stored under pressure with carbon dioxide, which allowed it to keep its condition for months. The beer could withstand tropical heat and a lengthy shipping period, which rendered it ideal for export. The product was to prove a success and was soon available in outlets where cask beer could not be sold, such as Royal Navy ships, Cunard liners and Middle Eastern oil fields.
Watney’s Container Beer was introduced to the domestic market from 1935. It was initially sold at the East Sheen Lawn Tennis Club, where its improved shelf life was to prove ideal for the intermittent trade of a sports club. Sales were expanded to other clubs and hotels.
Watney’s Red Barrel is rolled out
Simon Harvey Combe (1903 – 1965) was appointed chairman of Watney, Combe & Reid in 1950. He was a forceful figure who had shot his way out of German captivity during the Second World War and been awarded with the Military Cross.
Following the war a large proportion of the managers of free houses had neither the time nor the experience to correctly handle cask beer, and quality had suffered. Customers increasingly turned to bottled beer, which, although more expensive, offered more consistent quality, and accounted for one third of beer sales by 1953. Catering to this trend, Watney’s Red Barrel was introduced as a bottled pale ale from 1950.
Tamplin & Sons of Brighton was acquired in 1953. The purchase brought with it 400 public houses in Sussex.
Flowers Breweries became the first brewery to mass market container beer from May 1955. Named Flowers Keg, the brewery popularised the term “keg” as a genericized term. At first Flowers distributed the beer to free trade outlets across London and the South East of England with insufficient sales to stock cask beer, such as golf clubs and private parties, or public houses with insufficient cellar space. Demand for Flowers Keg was to prove surprisingly high, and the product was soon distributed across the brewery’s tied estate and sold to rival brewers.
Watney, Combe & Reid introduced the keg version of Red Barrel to British public houses from 1956. It was brewed with Norfolk malt and Goldings hops, and was naturally matured for several weeks. Sales initially targeted free trade outlets, and cask beer continued to dominate the tied estate.
Watney, Combe & Reid acquired Mann, Crossman & Paulin of Whitechapel to form Watney Mann in 1958. The merger allowed the group to reclaim its position as one of the largest brewers in Britain, and strengthened Watney’s position in hitherto underrepresented markets such as Essex, Luton and Coventry. Production was concentrated at the Mortlake and Whitechapel breweries, which were modernised.
Watney’s Red Barrel was the most widely-distributed keg beer by the late 1950s, aided by the brewery’s large tied estate of 3,670 public houses and extensive free trade accounts.
Watney Mann fights the takeover threat
Charles Clore (1904 – 1979) had become a pioneer of the hostile takeover in Britain in the early 1950s. He bought companies that had undervalued property assets, which he then sold and leased back, or redeveloped. Clore commented, “in some businesses the profits earned show that existing assets are not being employed in the fullest capacity… [no] business can afford to have its resources remaining stagnant.”
Clore attempted to acquire Watney Mann for £27 million in 1959, in what was the largest takeover bid in British history. Clore planned to modernise the “smoky, smelly, barnlike premises” of Watney Mann by introducing comfortable seating, removing the distinction between saloon and public bars, and improving the food offering. Pubs in areas with high footfall, such as city centres, would be sold off and converted into shops.
The directors of Watney Mann, descendants of the founding families, were horrified. According to TIME magazine, Clore was “the first outsider ever to challenge the clubby, clannish old families who dominate British brewing through a tangle of interlocking directorates”. The Evening Standard commented on the threat: “it threw the whole brewery world into confusion. Here was an outsider trying to storm his way in. It must not be allowed to happen”. Simon Combe was convinced that Clore would “redevelop all the properties and close the breweries”, and that his workforce would lose their jobs. He derided the bid as, “preposterous … deplorable for the brewing industry and a disaster for Watney’s”.
The takeover attempt was to ultimately prove unsuccessful, but it became apparent that Watney Mann was not immune to the threat of market forces. The management team were galvanised. The company property portfolio was reassessed for the first time since 1929 and valued at £34 million. The Stag brewery site at Pimlico was sold off for £6 million. Watney sped up plans to modernise its tied estate of public houses, and Milner Gray (1899 – 1997) was hired to design a new corporate identity.
Watney’s Red Barrel grows and cask ale is phased out
Watney Mann continued to expand by acquisition in order to meet demand for extra brewing capacity. 1960 saw the acquisition of Phipps, with 1,171 licensed premises within a 60-mile radius of Northampton, for £11 million, Ushers of Trowbridge with 900 licensed premises for £4 million and Wilson & Walker of Manchester, with around 1,124 public houses, for nearly £11.5 million. Watney Mann ended the year as the largest brewing group in Britain, with around 6,600 licensed premises.
Keg beer sales grew, initially at the expense of bottled beers. Customers, particularly the young, appreciated the consistent taste, and it commanded a premium price and superior profit margins. Watney’s Red Barrel was heavily advertised, and was the highest-selling keg bitter in Britain by 1961, with a category share of around 20 percent and estimated sales of around 150,000 barrels. Sales were mostly concentrated in the South of England and London.
The success of keg saw the introduction of rival beers from the national brewers, including Whitbread Tankard, Worthington E, Younger’s Tartan Special, Double Diamond and Courage Tavern.
Watney Mann had 34,000 free trade accounts by 1963. Cask beer had been phased out from the 2,000 tied houses in London and the South of England by the end of 1963, and the Manchester and West Country houses were earmarked to follow.
Watney’s Red Barrel was successfully introduced overseas. A higher strength version with an ABV of 5.2 percent was exported to northern France and Belgium from 1962. Nearly 5,000 barrels of Red Barrel were exported to Northern Europe in 1965. A modified version of Watney’s Red Barrel, reformulated to suit the American palate, was introduced in the United States from 1963 and was sold in 100 outlets by 1967. Licensed production of Red Barrel commenced at the Murphy’s brewery in Cork, Ireland, from 1966.
It was claimed that Watney’s Red Barrel was the highest-selling keg beer in the world by 1966. Peter Crossman (1908 – 1989), who had succeeded Simon Combe as chairman of Watney Mann, predicted that cask beer would be extinct by 1978.
Watney Mann continued to expand by acquisitions throughout the 1960s. The takeover targets included the Morgan Brewery of Norwich (1961); Bullard & Sons and Steward & Patteson of Norwich (1963), with 1,800 public houses for £16.5 million; and Drybrough of Edinburgh (1965), with 140 tied houses, for £2 million.
Peter Crossman became convinced that the British beer market was saturated, and decided to expand into continental Europe. The Delbruyers brewery of Chatelet was acquired in 1966 and the site was used to brew Watney’s Red Barrel. This was followed by the acquisition of Brasseries Vandenheuvel of Brussels with 1,740 outlets (1968) and Maes with 700 outlets (1969) to position Watney Mann as the second largest brewer in Belgium.
Watney Mann announced plans to centralise production at its breweries in Mortlake, Manchester, Norwich and Edinburgh in 1970. The Trowbridge, Whitechapel and Brighton breweries would be closed. Production of cask ales had largely ceased by this time, and local names would be phased out in favour of the Watney brand. A range of 80 beers in 1969 had been rationalised to 35 by 1971.
Watney’s Red is introduced
Watney’s Red Barrel volumes peaked in 1969. Sales then entered into decline and fell behind rivals Double Diamond and Whitbread Tankard. Double Diamond offered greater consistency than Red Barrel, as it was only brewed in one place: Burton upon Trent, and it was believed that its sweeter taste and higher strength rendered it more appealing. Meanwhile it was claimed that Red Barrel suffered from inferior marketing.
Julian Crawshay (1923 – 2009), the marketing director for Watney Mann, declared that “a beer developed for the 1950s is not right for the 1970s”. A spokesman for Leo Burnett, the Watney Mann advertising agency, went as far as to describe Red Barrel as “a golf club beer, all bitter and sharp”. Watney’s Red Barrel would be replaced by a new product which would appeal to the 18-35 demographic. Leo Burnett account manager Gordon Barrett emphasised, “the flow of continuity really had to be punctured quite severely”.
Watney’s Red was introduced in April 1971 following experimentation with 30 different recipes. It was a “completely different beer”, crafted to be darker, fizzier and slightly sweeter. It was smooth with a creamy head and good lacing. It was designed as a session beer, with greater drinkability and less of an aftertaste. Crawshay explained, “we were looking for the customer who settles in his local pub and drinks eight or ten pints in an evening”. The Economist reported that the new beer tasted “bland”.
The product launch for Watney’s Red was supported by a £500,000 television and poster campaign. Controversially, portrayals of Castro, Khrushchev and Mao were used alongside with the tagline, “long live the Watney’s Red revolution”. Cowl conversion on 30,000 Red Barrel keg dispensers cost a further £100,000. Pub interiors and exteriors were painted red in order to promote the new beer.
Watney’s Red initially enjoyed a 15 percent sales boost against Red Barrel, and was the brewery’s most profitable beer, although Watney’s Special Bitter enjoyed slightly higher sales. Around 350,000 barrels of Watney’s Red were produced in 1972, accounting for around 20 to 25 percent of Watney Mann sales.
The public backlash
Watney Mann was subject to a hostile takeover by Grand Metropolitan, the owner of Truman’s Brewery of London and a host of hospitality concerns, for £405 million in 1972. At the time it represented the largest takeover in British history. The acquisition placed Grand Metropolitan in control of over one third of London’s public houses.
The Campaign for Real Ale (CAMRA) pressure group had been established in 1971. CAMRA rallied against the decline of traditional cask beer in favour of keg beer, which it argued lost much of its flavour due to the process of filtration and pasteurisation. Robert B Semple Jr of the New York Times reported:
Public Enemy Number One for CAMRA is Watney’s, in part because the standardized exterior of a Watney pub, with its bright red background and white lettering, seems to CAMRA to typify the kind of corporate thinking that produces the homogenized beer sold within.
A Watney Mann official dismissed CAMRA members as a “cranky bunch”, and cited market research that supposedly demonstrated that the public preferred keg beer.
Watney’s Red sales began to decline following a successful launch, and volumes remained stubbornly behind those of Double Diamond. The recipe was adjusted twice to increase ABV and original gravity in 1973. Richard Boston (1938 – 2006), a beer writer for The Guardian, derided the tactic as “desperate”, and argued that “Watney’s themselves are becoming uncomfortably aware that people don’t like their beer”.
A “word-of-mouth campaign [had] degenerated Watney and its products; a campaign that started as a whisper and built up to such a roar that some observers felt that the very existence of Watney as ‘a name’ was at stake”, wrote Kenneth Gooding of the Financial Times.
Why did Watney Mann become the target for the most virulent criticism from CAMRA? There is evidence to suggest that their beers really did taste worse than its competitors by the early 1970s. Watney Mann brewed using a grist of up to 50 percent raw barley with added bacterial enzymes in an effort to lower production costs from 1971. The proportion of raw barley had been increased to up to 70 percent of the grist from 1973.* The beer was also subject to excessive pasteurisation, and according to John Keeling, who worked as a laboratory technician for Watney’s during the 1970s, was, “well oxidized by the time it reached four weeks, to be honest … the predominant flavour at shelf life was oxidized beer. But [Watney’s] didn’t seem to care about that, because they weren’t as interested in flavour.”**
Watney Mann responds
Concerned by criticism of the company, as well as by falling sales of its flagship beer, Watney Mann installed Anthony Tennant (1931 – 2011) as marketing and sales director in late 1973. Following a market research study Watney Mann acknowledged that the introduction of Watney’s Red had “backfired”. Marketing director Stephen Lewis explained, “people felt that we had over-rationalised our products after taking over smaller breweries”.
Watney Mann ended marketing support for Red from 1975, and Ben Truman Export Draught was offered as an alternative premium keg bitter. Double Diamond and Whitbread Tankard continued to lead in sales, and Watney’s Red had fallen behind Worthington E, Younger’s Tartan Special and Courage Tavern by 1976.
Watney’s introduced Fined Bitter, a cask beer served under pressure, to its London tied estate from early 1976. A Watney’s spokesman commented, “this is a commercial move, not a labour of love. There is now a demand for traditional beers and we are climbing aboard the bandwagon”. The beer was later renamed Stag.
In a bid to rescue the company’s reputation, greater autonomy was devolved to nine regional subsidiaries from September 1976, and local brands such as Tamplin’s, Usher’s and Wilson’s were revived. Scheduled brewery closures at Trowbridge and Halifax were reversed. Pub exteriors were now painted “varying shades of anything but red”, reported the Vancouver Sun. Efforts were made to reach out to CAMRA.
In 1977 a Watney’s spokesman admitted, “we used to think it was good to be big. Today we think it’s good to be small”. Watney’s London Bitter, a traditional unpressurised cask bitter, was introduced from 1978. Plastic and chrome public house decor began to be phased out in the late 1970s. New pub signs emphasised local and traditional beers.
Watney’s Red was discontinued in May 1979 following years of low sales. For David Manasian of Management Today, the fate of the beer was “a constant warning to over-zealous marketing men in any industry who try to push traditional consumer tastes too far, too fast”.
Cask ale was sold across half of Watney’s tied estate by 1979. The company produced 14 different cask ales by 1980. Webster’s Yorkshire Bitter was introduced from 1982 and became the core cask ale brand. Pressurised cask beer had been phased out by 1983.
The Red Barrel corporate logo was discontinued in 1982. Watney’s Red Barrel continued to be produced for overseas markets, where the brand lacked the noxious reputation it had developed in Britain, including the United States and Belgium, where it had become the highest selling pale ale by 1984.
Grand Metropolitan acquired Ruddles Brewery of Rutland in order to increase its presence in the cask ale market for £14 million in 1986. The brewery received a £5 million investment in order to double output, and a further £1 million was spent on advertising the brand.
Watney Mann exits the brewing industry
The Belgian brewing interests were divested for £28 million in 1986. Drybrough, with 187 public houses, was sold to Allied Lyons for £48.5 million in 1987.
Grand Metropolitan sold its brewing interests to Courage for £316 million in 1991. The remaining Watney’s branded products such as Special Bitter and Special Mild disappeared from Britain shortly thereafter. Watney’s Red remained available in Belgium, France and Spain into the early 1990s. Watney’s Red Barrel continued to be sold in the United States until the mid-1990s.
What remains of Watney Mann? Watney’s Scotch Ale survives in Belgium, and Mann’s Brown Ale remains available throughout Britain.