Craft Beer Rising
Craft beer, the loosely defined category that embraces big brands like Samuel Adams and tiny breweries popping up on the edge of every town — almost 2,000 of them now — is the fizz in the beer market at the moment. “The overall beer category was down 1.7% in the first half of 2011,” says Julia Herz, craft beer program director for the Boulder, Colo.-based Brewers Association, “but craft beer was up 15% by dollar sales, 14% by volume.” That’s why there was a big Craft Beer Pavilion at this year’s Nightclub & Bar Convention and Trade Show (NCB Show) — again — and why savvy operators are looking at their beer programs to make sure they’ve got enough of the “right” craft beer.
“Things combined to carry craft beer forward despite the current economy,” Herz says, explaining why craft beer is taking off so strongly. “First, Americans love choice, and we now have 140 different beer styles on the books; we have more breweries than at any time since the late 1800s.
“Also, our culture has become more aware of localization; they value it more, which connects with the accessibility and authenticity of local brewers,” she continues. “I can go into my local brewery and see the brewer, shake hands with them. There’s a real person there, and that’s a lot easier to see than at the big brewery.”
The last “biggie” Herz notes is beer’s reclamation of its place at the dinner table. “Beer and food pairings have brought people and excitement into the category,” she says. “Based on what we see in marketing from the large brewers, that’s something that could help them, too.”
These factors look likely to stay in place, Herz says, and there’s certainly nothing in the past 10 years to contradict her. So how do you know what beers to add to your program? Local, regional, national? Big hoppy ales, frisky wheat beers, solid lagers?
After noting that on-premise numbers are famously spotty, Herz says off-premise data can offer some information. “Off-premise data continually shows us that seasonal ales are the No. 1 style,” she notes. “IPAs are No. 2, over pale ales at No. 3. Bitter is good!”
Still, there are hundreds of beers available in most markets; how do you choose what’s right for your operation? “We (presented an educational session at the NCB Show) on ‘Experience Craft Beer,’” she says. “Retailers have to develop a relationship with their beers. They all have a story, and when it resonates with your staff or your customers, that’s going to work. A mix of local, regional and global beer brands is the way to go, not limiting to any one of the three.” Don’t settle in and never change, don’t sell the same beers the bar down the street sells and don’t be afraid to ask your staff and customers for advice.
But are there too many beers? “Too many choices” was one reason given for craft’s flatline in the mid-1990s; and there are thousands more today. Forget it, Herz says: “There are thousands more wineries than brewers in the country, and no one’s even talking about that possibility with them. This is market-driven demand, not marketing-driven demand. Customers want to buy. It’s a moot point.”
You know craft is a success when it gets the attention of the big brewers. Coors has a huge hit with Blue Moon; Anheuser-Busch’s Shocktop is getting more sales, and their purchase of craft brewer Goose Island will probably put its popular 312 Urban Wheat Ale in national distribution.
Herz doesn’t see this competition as a problem; she sees it as an opportunity. “Domestic specialty brands from the global brewers are, I think, getting a lot of people into flavor-forward beers beyond light American lager,” she muses. “However, I consider there to be three tiers of beer lovers: the beginner, just starting; the beer enthusiast, who drinks more different beers; and the beer geek, the expert. To the beginner, the domestic specialties are interesting, a place to start. But the other two tiers — which are growing — are looking for many different beers from different producers and want the producers they know and love.”
Remember that craft is much more about draft than bottle; bar owners and operators will want to upgrade and maintain their draft installations. Herz and the Brewers Association can help. “Draft beer is a food product: store it cold, serve it cold and pay attention to recommended shelf life,” she said. “If your customers are telling you there’s something wrong with your beer, you need to look internally; you should know something’s wrong before they do. We have a huge draft manual available free online: cleaning, serving, balancing your gas, cleaning glassware.”
Is craft beer a lot of work? Sure. But it’s popular, it can make you a destination and it’s got a great margin. That makes it worthwhile work indeed.