Chris DePeppe Talks About the Philly Craft Beer Festival, Purchasing Beer for Events and How He Sees His Role on the Local Beer Scene.

As promised, the result of my telephone interview with Chris DePeppe at his request after he read this earlier post of mine. As the organizer of the Philly Craft Beer Festival, Chris felt he wanted to have his say and I was more than happy to let him. Because this a volatile issue in some corners, I’ve kept my own opinions out of what follows and have reported Chris’s comments almost verbatim, with only a few prods from me, pretty much the way the real conversation went. A few comments have been moved around in his remarks to tighten things up and place them where they more logically belong. Chris wanted a few things—very few—off the record and I have respected that. You will all hear a lot more from me on this topic, promise, but not now, not in this post.

I started things off by saying that I know there are at least a few brewers who believe that they were told after last year’s event that they would be paid for their beer this year and that Chris has reneged on that.

His response: “What I said last year, and I can’t remember it verbatim, was I thanked everybody for coming out and said that I wished we could pay for the beer and that we hoped to be able to do so in the future. It was more about setting a goal and not making a promise. And it certainly wasn’t date as in ‘next year we will.’ I am aware of the situation. I appreciate that brewers have better things to do than give their beer away, although I also believe that a large majority of brewers view that as the biggest part of their marketing. A couple of the brewers contacted me directly about it. Actually, I think only one mentioned anything about believing I’d made a promise. Basically, I’m not breaking a promise to anybody. That’s not the way it went down.

“As far as the issue itself, paying for beer, I’ve been a supporter of craft beer for 11 or 12 years now, I’ve been a member of the Brewers Association as a trade supplier. These guys, the brewers, are my customers, just like the public. And I think it’s on the horizon that things will change. I’ve talked to many brewers who say they are choosing only events which are entirely for charity or where the beer is paid for. Hey, over in New Jersey, they have to pay for the beer. But there has to be a way to do it that makes sense for everybody. When you have an event the size of the one we’re putting on, the rule of thumb seems to be you lose money the first year, the second year you might break even and the third year you might make some money. Now the fact that we flipped that on its head and made money the first year…I’d hate to see that held against us, you know. At some point, it almost seems like that, if had only a middling success or a failure, all the breweries would come back willingly.”

At that point, I interrupted to suggest that the brewers’ questions have to do with the amount of money last year’s event seemingly produced. Given the price of the tickets and the number of people who attended, I said, they find it hard to believe that there was only a $7,000 donation to charity and that there wasn’t a huge profit generated for the organizers.

His response: “What you have to understand is that, when you go into these things, you don’t know that you’re going to sell it out. You go in taking a huge risk. We had 70 breweries and we did take care of them, we got them hotel rooms, we fed them, we had a really nice after-party. I didn’t hear a complaint from anybody. We had a 16-page pullout in the newspaper last year; this year we’ll be in the New York Times Travel Section on Sunday. There’s a lot which goes into the making of an event and you can’t just look at the result.

“This year, with Philly Beer Week going on, there’s like 50 events in the next 20 days so there are a lot more opportunities for people to spend their discretionary income. There is no guarantee that we are going to sell out this year. We were overwhelmed last year, I’ll be honest with you. We did not anticipate the crowd that we had. It was like 75 degrees that day and the walk-up crowd was huge. I’m not going to get into a conversation with anybody on the record about what the figures were. That’s private. If the brewers decide not to come because they think we’re being whores or something, then they won’t come. But I don’t think that’s fair at all.”

I interrupted again to say that I felt most brewers believed that some reasonable profit was to be expected, but that, given the amount of money that could be estimated just from ticket sales, there almost surely was a profit generated which was greater than was expected going in.

Chris: “But what does that mean? That because of that….”

The charitable donation seemed pretty small in the big picture, I interjected.

Chris: “Now we’re talking about two different things. The charitable donation was agreed to because we didn’t know upfront what the numbers would be. This year it will go up. We committed to a range for our donation beforehand and we met that commitment. That’s a matter of negotiating with the charity every year. They were certainly thrilled and are coming back again. They also probably made another couple of grand in raffles and other things they did that day.

“Look, there are people out there who only do special events and they do them for a lot of industries. I do one special event and it’s the Philly Craft Beer Festival. My main business, Total Bru Marketing, is about the propagation of craft brewing. That’s what I’m here to do. When you do an event like this, there are always people who will complain. I made the mistake of going onto after last year’s event and…well, there are people who just want to complain about anything, obviously. We can’t be all things to all people. I position myself where I’m bringing new people into the fold. The real value of a craft beer festival like this is the crossover market. A very unscientific straw poll from our event last year indicated that a large percentage of the people were at their first beer festival. The BeerAdvocate guys might not think that going in and tasting HopDevil or Pikeland Pils is such a big deal, but it is to the breweries who want people to discover their beers.

“If you bite something off the size of this, I think you have to have it as part of the model that you make some money. I think everybody understands that. And we’re talking about maybe two or three percent of the breweries that have expressed any complaint about this, really. I mean, 95 percent or more of them haven’t said a word. And we had 90 breweries contact us this year and want to participate. “

But everything else is paid for, I responded. Everybody else is making money, the food vendors, the musicians, people who work the event.

Chris: “Again, 95 percent or more of these breweries are more than willing to bring their beer and donate it because they recognize the promotional and marketing value of doing so at a major event that is going to have 4,000-plus people there, we hope. Are we supposed to change our model for the other two percent? I’m doing an event on March 7 at Philly Beer Week, Don Russell’s event, where we are paying for the beer and I’m trying to do some things throughout the year where I kind of mitigate this objection a little bit. I’m not defensive about it, I’m fine with what we’re doing and I do think it’s on the horizon somewhat that beer will be paid for. But with an event the size of ours, with 70 brewers and four to six kegs each, we’re not quite there to do that yet. In the future…I dunno, we’ll have to check with the LCB to see what’s legal. Can you pay for two kegs and get two free? Can you pay some sort or wholesale price?

“I know this isn’t a new thing, it’s something that brewers have talked about for years, and I don’t mean to say that because only two or three brewers have talked about it with me directly that means they are the only ones concerned. Between you and me, I understand their complaints to a degree. But I also think they should respect the effort that goes into all this. There’s a reason why there hasn’t been a large public craft beer fest in Philly for about 12 years. It’s not a easy thing to put together.

“And I say again, I don’t think we should be blamed for our success. If we had had a poor turnout last time and we decided not to come back this year, people would regret that we were not around….I think there’s something to be said for doing it for the right reasons. Whether I’m making more money than they want me to or not, if I can say so myself, I’ve been a pretty good ambassador for craft brewing over the years and I think I’ve always added something to the culture of craft brewing with my Beerheads booths at shows or by having beer tastings at the Marketplace in East Falls. I support Ale Street News and Mid-Atlantic Brewing News with advertising.

“I think it all feeds back and I would say that it’s better me that somebody else doing it. Our event opens doors to media sponsors and new partners, brings more people into the fold and does a lot to establish craft beer as a mainstream commodity. I’m proud of that.”

And there we stopped. Chris later emailed me to make one further point: “Our event focuses on the BEER and we do not make money from dozens of exhibitors, car dealers or the local strip club. We have a few beer-related vendors and some tables for our charity and for Philly Beer Week this year.”

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