I remember during the early part of the COVID-19 pandemic, around the first quarter of 2020, I developed a new appreciation for occasionally drinking ice-cold beer at home, something I hardly (maybe even never) did pre-pandemic. Because of the...

I remember during the early part of the COVID-19 pandemic, around the first quarter of 2020, I developed a new appreciation for occasionally drinking ice-cold beer at home, something I hardly (maybe even never) did pre-pandemic.

Because of the restrictions then, suddenly we all found ourselves doing things at home which we hardly did before COVID-19 hit all of us around the world.

I was definitely not alone.

In a May 2020 report by Nielsen IQ, online sales of alcohol in the US increased by 234% in April 2020 compared to April 2019. In fact, alcohol was the fastest-growing e-commerce department among consumer packaged goods (CPG), and weekly growth continued throughout that year.

Here in the Philippines, the new term ‘Zinuman‘ was coined to refer to drinking (‘inuman‘) fellowship sessions with friends via Zoom. And because of this, I personally found myself beginning to develop a fondness for beer again and I began to explore new brands and types of beer beyond the ubiquitous San Miguel Beer which we consumed in wild-abandon during our college years back in the mid-1980’s.

One of the new types of beer which I was able to sample in a birthday party of a close friend during the latter part of 2022 was a Filipino beer called Engkanto® Craft Beer which was founded not too long ago back in 2017, by Founder & President Ian Paradies and Partner & Head Brewer John Karten.

“I’ve always enjoyed the world of craft beer and find its flexibility fascinating. The abundance of variety you can come up with allows brewers to really showcase their creativity and can even make for more tailored and specific food pairings. I once went to dinner at NoMad in New York where the wine list was incredibly overpriced, so we took the craft beer pairing instead and were blown away by how complementary each sip was with each bite,” says Ian in an interview with Philippine Star back in 2017.

“We want to transform what people used to think beer was, to what beer can and should be.”

Ian Paridies, Founder & President of Engkanto Brewery

‘Craft Beer‘ is generally perceived and marketed as having an emphasis on enthusiasm, new flavours, and varied brewing techniques

I had seen the brand a few years ago but never tried it mainly because I found its brand logo and bottle design a bit alienating and ominous with its moth x skull design which did not resonate positively with me. The original logo actually reminded me of the 2002 horror flick ‘Mothman Prophecies‘ (top-billed by Richard Geere) which remains as one of the most terrifying movies I’ve ever seen. This only underscores the importance of choosing the right logo (also referred to as visual hammer) that will represent your brand positioning amongst your target audience.

The original Engkanto® brand logo launched in 2017 (left) and the new Engkanto® brand logo as part of the brand relaunch in 2022 (right). The brand shares: “Our sun icon was created to be an enduring beacon of a more courageous, more passionate, more creative life. Our sun logo is a bold, iconic display of our undaunted optimism and positivity—and reminds us of our local roots in relation to our country’s flag.”

However, during my friend’s birthday party, I noticed that the brand’s logo and bottle design had totally changed to something more vibrant and fun and so I decided to give it a try. I tried their Live It Up Lager variant and immediately took a liking for it!

Apparently, the brand had just been relaunched a few months earlier, around mid-2022 and apart from the new packaging design, they introduced a new brand logo, new flavor variants and even appointed a new Head Brewmaster, Michael ‘MJ’ Jordan, who was formerly the Brewmaster of Shanghai Boxing Cat Brewery, an American-style pub founded in Shanghai back in 2008. But more importantly, they have embarked on a new brand positioning which is expressed by its new battlecry ‘Reimagine What’s Possible‘.

Out with the old l (left) and in wit the new (right)

Finding an Open Hole in the Massive Beer Market

The global beer market is massive at an estimated USD768.2billion in 2021. The Philippine beer market accounts for only less than 0.5% of the global market at an estimated USD3.2Billion this 2023. Beer consumption in the Philippines constitutes around 70% of total local alcohol consumption wherein the average Filipino consumes almost 20 liters per year and still growing at a clip of around 15% per annum. The local market is overwhelmingly dominated by San Miguel Beer®, founded by Don Enrique María Barretto de Ycaza y Esteban over 130 years ago in 1890 under a royal grant from Spain, which today has a commanding 95% market share in the Philippines.

But this market dominance of San Miguel Beer® did not stop the founders of Engkanto® Craft Beer from finding an open hole in the local beer market.

There’s Always an Open Hole

I always encourage my students in The Brand Architecture course that even if a particular market segment is highly competitive and even dominated by a very strong brand market leader, it’s always possible to still find an open hole in the market for a new brand entrant.

One of the notable examples I often refer to is the fastest-growing social media platform TikTok® which was founded as late as 2016, or a good twelve years after market leader Facebook® was founded in 2004. When TikTok® was launched in 2016, Facebook® was already being used by almost eight of ten online Americans. Today, according to a recent pronouncement by its CEO during his appearance before the US Congress, TikTok® is now being used by over 150million online Americans, which is a massive rate of growth considering that just seven years ago, they had zero users in the US. For sure this is something that market leader Facebook® considers a serious competitive threat to its market dominance.

What was the open hole that TikTok® found?

Their brand slogan gives us a hint: ‘Real People, Real Videos‘.

The way TikTok® positioned themselves capitalized on two important factors which were likely deemed important to social media consumers: (1) Being real, or authenticity, and (2) video consumption. The mobile app was designed to provide users with easy-to-use video editing tools, coupled with a massive music library in order to create instant short videos of just about anything which were fed to the app users based on their interests and not based on their social network. In a very real sense, TikTok® provided a real-time, consumer-centric entertainment platform in the most popular form of content which is video. This was highly relevant to users and yet none of the leading players were doing this in a strong way, hence an open hole.

TikTok® has become enormously successful that Meta was forced to launch Facebook Reels which was a clear response to TikTok®’s growing popularity.

For me, the key is finding an open hole in the market. And this is always what I look for whenever I study a brand, especially new brand entrants into any market segment, but even existing brands who are looking to re-position themselves in a stronger way.

Engkanto® Finds an Open Hole

In the case of Engkanto®, they have clearly found an open hole in the Philippine market, that is: ‘better-quality craft beer‘. This is something which is relevant to a market segment of more discerning beer consumers and also something that market leader San Miguel Beer® does not own in the minds of consumers given that its flagship product is simply a basic lager.

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“Engkanto® was founded on the idea of taking risks, trying new things, and setting a new standard.”

Engkanto Website

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Being up against a behemoth brand leader, it was certainly a highly risky business venture for the founders of Engkanto®. Furthermore, the concept of ‘craft beer‘ while common in other advanced markets, was something quite new in the local Philippine scene. And finally, setting a new standard of ‘better-quality beer‘, while an audacious goal, was certainly something that was technically attainable with the right people, equipment, ingredients, and processes.

However, even if Engkanto® found this open hole back in 2017, the way the brand architecture was developed, launched and executed in its first few years did not effectively connect with its target audience, presumably myself included. I go back to my own personal experience of not being attracted to the brand simply because of its packaging design which falls within ‘Product‘, the first P of the 6 P’s of a brand’s marketing mix. They may have been offering a ‘better-quality beer’, but the way the brand was originally launched did not properly reflect this. This was a classic case of an inconsistent brand architecture.

How Engkanto® Re-Positioned Itself

An open hole in the market is premised on two important pillars: relevance and uniqueness. In other words, without relevance and uniqueness, there is no open hole for a brand to position itself in.

Without relevance and uniqueness, any brand (but especially a new brand entrant into an established market segment), will inevitably find itself forgotten in the ocean of failed brands throughout history, unless it is able to properly re-position itself.

Relevance can be determined through proper consumer-insighting with the aid of relevant consumer x customer market research. While uniqueness can be established through a robust competitive analysis of brands which are directly competing against your own brand.

In the case of Engkanto®, its new brand slogan (or mantra as they call it) ‘Reimagine What’s Possible‘ points us to how they have re-positioned themselves relevantly and uniquely in the beer market, without losing sight of its original brand purpose: “To present better quality beers and educate local drinkers of how great craft truly is.” 

‘Reimagine What’s Possible‘ became the foundation of the new brand architecture of Engkanto® starting in 2022

‘Reimagine‘ connotes creativity, fun, excitement, and sense of adventure.

While ‘What’s Possible‘ points to something beyond what we are accustomed to, something that’s better.

By embracing this new battlecry as the foundation of its brand architecture, they have embarked on a new brand architecture that is more compelling and more attractive.

With respect to its new brand marketing mix (also referred to as the 6 Ps), I wish to highlight two notable innovations that they introduced as part of the brand’s overhaul, specifically with respect to ‘Product‘ and ‘People‘.

PRODUCT Innovation | New Evocative Beer Names

As part of the re-positioning, Engkanto® hired North Carolina-based agency known as Creature Theory. As bannered in this agency’s website, they are “A branding and design agency built to show brave brands a way forward.”

Creature Theory was actually instrumental in crafting the new brand battlecry ‘Reimagine What’s Possible‘.

According to them: “We began by building an emotive market position around the idea that Engkanto® serves as a window into a more passionate and creative life.

Engkanto® was born from a spirit of wonder and possibility—and we’re here to raise the standard. To raise expectations. We are here to change how you think of beer, and maybe, how you think of everything.

We settled on the mantra, Reimagine What’s Possible, and dove head-first into creating evocative beer names, label artwork, apparel, POS marketing and video content.”

As part of the product innovation, the evocative beer names they developed included:

Live It Up Lager High Hive Honey Ale Mango Nation Hazy IPA Green Lava Doube IPA

These were a far cry from the rather generic names the brand originally had in 2017 including: Lager, Pale Ale, Blonde Ale, Ipa and Double Ipa.

What’s more is that the new bottle label designs of the product not only reflected the new positioning of the brand but also provided helpful information on these four new flavors. This information system helped further demonstrate that Engkanto® was truly not just your basic lager. They were clearly educating their target audience to reimagine what’s possible with beer.

As part of the new label design, Creature Theory integrated this friendly information system to further demonstrate that Engkanto was truly not just your basic lager. Green Lava Double IPA Mango Nation Hazy IPA High Hive Honey Ale

PEOPLE Innovation | Hiring of Michael ‘MJ’ Jordan as Head Brewmaster

The hiring of Michael ‘MJ’ Jordan (not the basketball superstar) back in 2021 was perhaps one of the most significant moves that signaled a major repositioning of the brand was underway.

MJ is no ordinary brewmaster. He is a highly successful, globally renowned award-winning brewmaster, who earned his stripes as professional brewer from Portland, Oregon.

In the brand’s announcement of MJ’s appointment, it said:

“MJ has his roots as a professional brewer in Portland, Oregon, circa 1995. Portland’s pioneering mark in the craft beer industry took off in the eighties. Today, the city is teeming with nearly 70 breweries—more than any other city on earth. 

After amassing techniques in the US and then in Denmark, MJ flew to Shanghai, China, and took the helm for Boxing Cat Brewery, China’s most internationally awarded craft brewery. At the World Beer Cup 2016, MJ led Boxing Cat in winning a silver medal for its Ringside Red Amber Lager, making it the first Chinese craft brewery to bring home the prestigious award. 

Along with that, he has notched accolades and recognition from around the world that include the Australia International Beer Award, Asia Beer Championship, IBC (International Beer Competition) Japan, and Great American Beer Festival – Brewery of the Year with Widmer Brothers, among others.” 

This big move by MJ to Engkanto® is a major statement by the brand that indeed, “we’re here to raise the standard. To raise expectations. We are here to change how you think of beer“, as declared by Creature Theory when they collaborated with the brand for the relaunch.

The brand shares: “When Michael ‘MJ’ Jordan, Brewmaster for Engkanto, arrived at the brewery in March 2021, he immediately felt home. In a little over a year, he realized that shaking up the current beer portfolio was necessary to connect more to local drinkers. He gathered the team together, put forward his idea, and that’s how the rebranding began.” 

“I learned of Engkanto®’s future goals and that inspired me greatly. I thought their dedication to respect a true and traditional beer recipe by never using chemicals or adjuncts, was incredibly authentic and it motivated me,” said MJ. “But above all, their desire to have their beers encourage others to challenge the status quo, to challenge something they’ve wanted to change for so long, hit home.”

Michael ‘MJ’ Jordan, globally-renowned and award winning Head Brewmaster of Engkanto® Brewery

Engkanto®’s Brand Re-Positioning Pays Off, Big Time!

It didn’t take long after the brand’s relaunch for the beer world to notice.

In the World Beer Awards 2022, three of the four beer variants of Engkanto® each brought home medals!

High Hive Honey Ale, Green Lava Double IPA and Live It Up Lager won Gold, Silver and Bronze Medals respectively. Apparently, the fourth variant, Mango Nation Hazy IPA did not make it to the competition because of shipment issues. “Regardless, we are confident it could’ve brought home recognition, making the Engkanto beer line-up a perfect four-of-four in winning awards,” declared the brand, confidently.

Locally crafted, globally awarded beers of Engkanto – another emerging world-class Filipino brand. The World Beer Awards is under the main umbrella of the prestigious World Drinks Awards. Each year, the organization presents internationally recognized awards after a rigorous, blind tasting judging from an acclaimed panel of experts. 

“Congrats to the whole Engkanto® Team, so proud of all of them! This is just one of the first steps before we start to run. I’ve been with the company just two months, but the feeling of quality and knowledge in the company is immense,” said Ricard Basora, Engkanto®’s Managing Director. “Engkanto® is going to the next level at the hands of our world-awarded Brewmaster MJ and these awards for two years in a row prove the good work done. High Hive Honey Ale is an incredible beer together with the Mango Nation Hazy IPA that will give us many more happy moments,” he added.

Brewmaster MJ inspecting a honeycomb, the source of Engkanto’s High Hive Honey Ale which contains natural honey. High Hive Honey Ale is brewed with pure and all-natural honey from local apiaries and farms. The careful combination of hand-selected and imported ingredients in the brewing process provide light floral honey notes and balanced bitterness in this medium-bodied beer.

“What a feeling to win awards at WBC 2022 for the second year in a row! I knew High Hive Honey Ale was scoring well with Filipino craft beer fans and this Gold Medal is validation that Engkanto Brewery is kicking ass and taking names,” said MJ. “All beers arriving to the UK and getting a medal keeps us motivated on our quality focused approach to craft brewing while having fun,” he added. 

But beyond the international accolades, most importantly, its consumers are now loving the brand!

Some consumer reviews on the brand’s beer variants, including the new Paint Me Purple Ube Lager which is available on a limited time offer

This brilliant brand leaves us with two key lessons:

First, finding the open hole in your chosen market is key, but it’s not enough. In order for a brand to strongly occupy that open hole, it must build a brand architecture that is relevant (consumer-centric) and unique (against competitors) in order to make the brand attractive amongst its target audience.

Second, even if a new brand gets it wrong the first time, it doesn’t mean that it made a mistake with the open hole that it has identified. The open hole helps define the brand’s purpose. And the purpose remains. It’s the entire strategy (aka brand architecture) that needs to be revisited in order to ensure that a brand’s stake in that open hole is firmly established.

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