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Craft Brewer Hits Home Run With Sponsorship

When Major League Baseball hosts its Mid-Summer Classic this year, all eyes will be on Kansas City’s Kauffman Stadium. Fans watching the Home Run Derby or the All-Star Game may notice something not often seen in a major league stadium — signage for the local craft brewery.

Source: Boulevard Brewing Co.

“Any play that goes to left field, you’ll see our sign,” says Bob Sullivan, vice president of sales and marketing for Boulevard Brewing Company, the tenth-largest craft brewer, by 2011 sales volume, in the U.S.

Fans inside the stadium will also get a heavy dose of Boulevard presence. Kauffman Stadium features three Boulevard-branded concession stands including two Boulevard Grill locations and a Boulevard Pub, located on the concourse directly behind home plate.

More importantly for beer drinkers attending the game, it’ll be easy to get a Boulevard Beer.

“No matter where you sit in the stadium you can easily get one of our beers,” says Sullivan. “There’s no need to go on a hunt and give up a half an inning to find a Boulevard beer.”

In fact, fans may not even need to get up from their seat with as many as a half-a-dozen vendors serving draft pours of Boulevard beer out of specially equipped backpacks.

It wasn’t always so easy. Boulevard’s presence is the result of a risky bet the brewer took when it struck a three-year deal with the Kansas City Royals before the start of this season to become one of three official beer sponsors of the team.

Before the deal, Boulevard beer was sold at the stadium but the brewery was limited in the number of locations it could be sold. Sullivan says that out of an estimated 400 taps at Kauffman stadium, only six taps (spread out over three locations) in the stadium sold Boulevard. Now the number of taps is determined by Kauffman Stadium concessionaire Aramark, who sets the numbers of taps based on public demand. While the exact number of taps currently pouring Boulevard Beer may not be known, it’s safe to say demand is good.

“Every year for the last 15 years, Kauffman Stadium has been our No. 1 volume ‘on premise’ account,” says Sullivan. “Now we’ve increased the ability to get our beer out there by about 15-fold. We’re in the best position we’ve ever had at the stadium and our business is up about 180 percent.”

Founded in 1989, Boulevard has long been considered Kansas City’s “hometown beer,” but Sullivan says the Royals had always adhered to a strict “pay-to-play” policy where the top two bidders, historically some combination of Anheuser Busch, Miller or Coors, were awarded the stadium sponsorship rights.

Things began to change after Belgium-based InBev bought Anheuser-Busch and began to lower the amount they were willing to pay for sponsorship rights. Miller and Coors had also become a joint entity, which limited the bidding competition.

Source: Boulevard Brewing Co.

Looking to make up the difference in lost sponsorship revenue, the Royals opened up the category before this season by adding a third sponsor, creating an opportunity for a smaller-sized financial deal with Boulevard.

While terms have not been disclosed, Sullivan admits the deal was a stretch financially with the size of sponsorship going beyond the previously established Boulevard marketing budget. Still, after reviewing the numbers, the brewery's steering committee agreed to appropriate the Royals sponsorship funds from elsewhere in the company and the brewery went ahead with the deal. Halfway through the first season, it’s proven to not only be good for the bottom line, but it has also generated local goodwill.

“The general public understands what it takes to do these sponsorships — that for a lot of reasons, it’s not been attainable to small vendors because in the context of the real world, how much more limited we are financially as compared to the bigger players,” says Sullivan. “People know it’s not free and that we had to do something above-and-beyond to be out in the stadium, and I think there’s an overall sense of appreciation from Royals game attendees.”

It’s even paying off beyond the stadium's walls. Sullivan says the exposure is helping drive sales outside the stadium

“In the past, we were lucky to have more than one or two brands out there. Now you can go to the stadium bar and they carry six different Boulevard brands,” Sullivan continued. “We’re introducing baseball fans to brands they have not had before. They’ll go to Kauffman and say ‘Wow, there are six Boulevard beers? I thought there was only two, or I’ve only had one.’ So from a sampling standpoint, it’s been great exposure.”

Now with the All-Star game hitting town, Boulevard will get increased exposure as baseball fans, executives and media from all around the country convene in Kansas City.

“So many people when they travel now, they really want to try things that are local, so they gravitate to our beer. Bud and Miller, you can get those in a 140 different countries. So with Boulevard, there’s a romance and novelty of discovery of the local beer. So with the All-Star game, we get people from all over the country discovering our beer who have never had it before,” says Sullivan.

But while the chance to introduce Boulevard to consumers who live outside the 21 states in which Boulevard is currently available is nice, it’s the passion displayed by local consumers for the company’s product that made a deal with a team like the Royals possible, says Sullivan.

“The local fans that support our beer, they don’t have an allegiance to the big brands,” he continues. “In fact, you might say it’s the opposite. Customers are better-educated than they ever have been. They know ABI is owned by Brazilians and Miller Coors is owned by Canadians and South Africans, and they know we have 110 employees in this community and we put a lot of money back into our hometown in a lot of ways. So they want to support us, and they like our beer.”

So while Sullivan knows Boulevard will never have the resources of his larger competitors, he’s hoping Boulevard's experience with the Royals might serve as a blueprint for other craft brewers and the sports teams in their respective markets.

“We’re finally at a point now where thankfully the community loyalty has superseded our need to be able to compete on a financial level with companies that will always be significantly larger than us,” says Sullivan. “So if this is a model of things to come, then kudos to these professional sports franchises for finally listening to their fans.”

Questions? Comments? Email us at consumernation@cnbc.com. Follow Tom Rotunno on Twitter @tomrotunno.

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