The Buzz on Beer Growth

Football season is upon us and I am inevitably thinking about beer.  Beer & football go together like peanut butter & jelly, like Cheech & Chong.  Football means big business for beer brands, and PR professionals should have brews on their minds as well. Take advantage of halftime to “tap” into these three beer trends that have the marketplace buzzing this season.


Craft Beer Finds Its Footing

Craft beer consumption is on the rise.  More and more often, we are seeing Americans opt out of Megabrews in favor of local or domestic craft brews. According to Beverage Information & Insights Group, domestic craft beer sales were up over 15% in 2014, despite that fact that overall beer volume sales actually fell half of a percent from 2013 to 2014. When we’re talking about 2.8 billion cases of beer sold in the US last year, half of a percent accounts for way more beer than you might think. Megabreweries are noticing this shift in consumer purchases. In response to dropping market share, Anheuser Busch (AB InBev) recently announced a deal to acquire MillerCoors for over $104 billion dollars. If this merger will reclaim lost domestic beer sales is yet to be seen, but what we do know is the market is opening up for other segments.

While megabreweries are busy merging, they are also using another strategy to fight their declining sales: acquiring craft-style selections to add to their portfolios. Some of our favorite small brands are actually partnered with big shots. AB InBev owns ShockTop and Goose Island. MillerCoors owns Blue Moon.  SABMiller scooped up everyone’s favorite summer shandy when they acquired Leinenkugel (which grew 16.5% from 2013 to 2014 with 6.4 million cases sold).

James Campbell of Bay Ridge Wine & Spirits in Annapolis, MD speaks about the trending buying habits of retailer customers: “Our number one seller is Miller Lite 30-packs, hands down, out of everything in the store – beer, wine, liquor. But going over the numbers from previous years, we are noticing…a lot of people who are used to grabbing a 30-pack, now they’re only getting an 18-pack and they’re grabbing a six-pack of craft, because craft is just through the roof right now.” Craft beer brands are quickly becoming a force to be reckoned with.


Import Rise – Lackluster Light Beer Might Be to Blame

Beverage Dynamics reports American consumers perceive imported beers to be more premium than domestic brews. With market share over 85%, domestic beer fell 1.5% to 2.4 billion cases in 2014, while imported beer performed better: consumption increased 6.3% and total volumes seals increased 1% from 2013-14.

Speaking on behalf of Heineken USA, an import beer still brewed in its native Holland, Chief Sales Officer Ray Faust explains, “Imported beer brands like Heineken are unique in that they embody the traditions and craftsmanship of their native country,” reinforcing the notion that when American consumers buy imports, they believe they are getting a product of higher quality.

Recent headlines have pondered if it really matters where your beer is brewed? For Americans, the answer seems to be a resounding “yes.”  This summer, a class action suit was filed against Anheuser for selling and marketing their Beck’s brand as a German import, even though it was brewed right here in the states. Many consumers felt it was manipulative marketing, despite that fact that brewing the beer locally allows for a fresher product on the shelf and decreased shipping costs.  This may be due to America’s desire for “provenance.” According to Tom Shellhammer, professor of fermentation science at Oregon State University, “It’s really a question of what a consumer desires. Is it the image of an import or the flavor?”

Additionally, beer consultant Mike Mazzoni asks: “If it’s made here or there with the same formula, you can make the argument: Why ship something 3,000 miles?” As marketing professionals, it is important to understand that it’s not just about the liquid in the bottle, but rather the image of the brand and how that image reflects on the consumer.


Cider Gives Beer a Run for Its Fans

It isn’t just craft beer taking away from the market share of the big boys. Appealing to both male and female consumers, hard ciders are exhibiting tremendous growth as well.

While ciders may have once been seen as a cheap alternative to beer, recent trends show that cider is becoming more popular than ever. Perhaps it has to do with the tendency of more and more Americans moving towards a gluten-free diet, or maybe it’s because recent cider brands are bringing higher quality products to the market. Angry Orchard Cider, brought to market by Boston Beer Co. (the same people who supply Samuel Adams), reports 81% growth from 2013 to 2014. Redd’s Apple Ale by MillerCoors, with a tagline “Pick Different,” saw a 21% growth in the same time period.

Stella Artois (owned by megabrewer AB InBev) launched their own brand this year, known simply as “Cidre.” VP of High End Marketing Ricardo Marques explains why his brand has been so appealing to consumers: “Ours is a European-style cider made with hand-picked apples from wine-growing regions.” Sounds like this brand is taking advantage of America’s perceived premium of imported products.


So whether you are heading to the liquor store to stock up on tailgating supplies for your next football gathering, or creating a marketing plan for your newest booze brand, keep in mind that trends are changing and American pallets are shifting away from light beers.  Craft beer, imported brews and even hard ciders are finding their own place in a market once dominated by megabreweries. I’ll drink to that!


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