| February 08, 2017
Ben Marshall referred me to this article which suggests the growth in craft beer consumption is largely the result of people seeking cultural capital. Consuming craft beer and decrying mainstream brands was a way to gain standing with your peers but which may now face a countervailing trend of “beer poptimism”.
Now I am on record as saying that I like a good craft beer but it was something of a relief to see a French Country Ale with a 4 percent ABV when I stopped in at the Worthy Kitchen the other night. Craft brewers seem to have decided that maxing out on flavor and alcohol content is the only way to attract drinkers these days and sometimes I want to be able to drink more than one beer before I am over the limit. And maybe I am not the only one who is struggling to find a craft brew that fits my needs and palate. Time reports that the growth in craft beers in the U.S. is decelerating.
If the appeal of craft beer has gone flat as the Time article proposes, then it might come as a relief to the big brewers. Domestic brews like Budweiser, Bud Light and Miller Lite still take a large share of the U.S. beer market; however, while millions of people still pick up brands like these on a regular basis, consumption is not growing. According to the Brewers Association craft beer has doubled its share of the market from 6 percemt in 2011 to 12 percent in 2015. Worse, craft beers sell at a premium, which means that in 2015 they took 1 out of 5 dollars spent on beer in the USA.
The big brewers have fought the rise of craft in a couple of different ways. The first is the ‘if you can’t beat them buy them’ strategy pursued by ABInBev with the purchase of Goose Island and others. The second is the ‘imitation is the sincerest form of flattery’ approach which has enabled Blue Moon to take a big share of market while being owned by MillerCoors. Finally there is the ‘popular and proud’ strategy pursued by Budweiser which took mocked craft brew drinkers and then renamed itself America for the Olympics and election run up.
But maybe the big brewers need not worry because craft beer may have sown the seeds of its own demise. Firstly the growth in the number of craft brewers may simply be outstripping growth in demand. There are now 5000 craft breweries in the U.S. up 4255 in 2015, a rise of about 18 percent compared to the 6 percent growth in sales. And then there is the ‘push it to the max’ strategy pursued by so many craft brewers, or what Jake Tuck describes in his article as “the whole flavor-exploding-iconoclast thing”. And then maybe the whole sophisticated beer palate thing is losing steam as people get fed up with hearing others laud the latest competitor to Heady Topper.
But what do you think? Is the whole craft beer thing waning or are simply seeing a segmentation of tastes, needs and budget? Please share your thoughts.