Call it what you want: David vs. Goliath, Pint vs. Keg, Local vs. Global. But there’s simply no denying the fact that all across America, upstart craft breweries are thriving in a market once dominated by Big Beer.
The birth date of the American craft beer movement is highly debatable. Some say it began when Jim Koch brewed that first batch in his kitchen in the early ’80s. Others claim it was started by Jack McAuliffe’s New Albion Brewing Company in 1976, or even as far back as 1632 with the Dutch West India Company. The truth is likely somewhere in between. But what is not up for debate is the astounding growth over the past couple of years.
The $100-billion (that’s BILLION with a B) domestic beer market is dominated by world #1 Anheuser-Busch InBev, along with MillerCoors, the American branch of world #2 SABMiller. Although these two behemoths have consistently accounted for more than 90% of sales, the numbers are shifting. In 2013, craft beer sales were up 17.2% for a total of $14.3 billion, while total beer sales were down 1.9%. And at mid-year 2014, craft beer production had increased 18% annually, while the number of craft breweries increased nearly 20%.
AN UPSET BREWING
How are craft brewers making such headway at the expense of their big brew brethren? With challenger thinking, of course. Here are five basic tactics that seem to be consistent with those who are thriving.
1. INNOVATION: A quick tour of any supermarket beer aisle reveals an impressive variety of flavors and styles of craft beer. Thanks to nimble and flexible production capabilities, the little guys can profit off smaller seasonal batches and experimental flavors. But don’t expect Budweiser to put out a limited edition raspberry-cappuccino-with-hints-of-lemongrass double IPA any time soon. Many craft brewers are also tapping interesting new trends such as nitro and growlers.
2. GOING UPSCALE: The craft guys have elevated brew well beyond the traditional can of Duff. Today’s craft beers are positioned more like wines, with complex tasting notes, food pairing suggestions and brewery tour samplings. Forget the chips—these brews are being paired with everything from cheeses to cigars, with special glassware for every variety.
3. COMMUNITY CONNECTIONS: The craft brewing industry has harnessed the “local” movement more effectively than just about anyone else. The brewers who do it right build huge brand loyalty through sourcing local ingredients and participating in festivals and charity events that allow them to give back to their communities. Not to mention the intimate relationships they’re able to establish with local bars and pubs.
4. SOCIAL MEDIA: Local brew budgets typically don’t allow for anything more than word-of-mouth advertising. But chatting one-on-one with your audience via Facebook, Twitter and email is ideal for promoting events and product introductions.
5. CREATIVITY: In addition to flavor creativity, craft brewers are also leading with bold package design and quirky names, with a seemingly endless supply of “hop” puns. It’s all right in the wheelhouse of their target market: millennials who have an eye for design aesthetic, don’t take their brands too seriously, and are known to make purchase decisions based on packaging appearance alone. The battle for shelf space and tap handles is a serious one, and craft brewers know they have to grab eyeballs.
While 2015 may very well be the year the craft beer movement comes to a head, this seems to be a brewing trend that’s here to stay. A growing number of Americans are thirsty for new beers and are clearly willing to pay a premium. Expect the little beers to continue to fling rocks at the big beers, pushing innovation, quality and creativity throughout communities across our great land.
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