The “Oh, Schlitz!” Mistakes

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In 1849, August Krug founded a brewery in the basement of his Milwaukee restaurant. After he died, in 1856, his bookkeeper, one Joseph Schlitz, took over the operation, renamed the company, and married Krug’s widow.

Things went well. In 1902, Schlitz became the top-selling beer in the world, with the ad slogan, “The Beer that Made Milwaukee Famous.” It held that position, with a brief timeout for Prohibition, on and off until the mid-1950s.

From then on, Schlitz struggled to catch up in sales as giant Anheuser-Busch pulled away. Nothing seemed to work, including some of the great beer ads of all time, with slogans like “Grab for the Gusto” and “When you’re out of Schlitz, you’re out of beer.” The ads might have made things worse because they convinced beer drinkers to drink a less-than-stellar product.

By 1975, the Schlitz board decided that they probably wouldn’t catch up in the sales race, so they tried some things to increase profitability. First, they shortened the brewing process.

That was “Oh Schlitz” mistake number one. The company churned out more beer faster, but the bear had no foam. So, the company added seaweed extract to increase the fizz.

That was “Oh Schlitz” mistake number two. The seaweed extract turned solid after a short time on the shelf. That resulted in a beer with no foam and chunks of seaweed floating in it.

By this time, beer drinkers were pretty sure that what came in a Schlitz can was not something you wanted to drink. The company pondered what to do. Recalling all the sludge labeled as beer would be very expensive. They decided not to recall.

That was “Oh Schlitz” mistake number three. The company saved money by not recalling the beer. And that just gave beer drinkers another reason to avoid Schlitz in favor of just about anything else. A few years later, the company was bought by rival Stroh’s.

Most good things take time. Cutting down the time usually means cutting the quality of the final product. Trying a quick fix usually makes things worse. Not treating your customers like people is usually the kiss of death.

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