Beer: Identifying the Key Trends for 2013
Craft: Semantics, definitions and existential questions
What makes a craft beer, well, craft? Is it the flavour profile, ingredients, branding and word-of-mouth promotional strategy? Is it pricing and positioning? Or does it come down to the brewer’s ultimately independent nature and small scale production? However, even accepting that last and marginally more consensus-driven definition, what constitutes independence and small scale? Is it set in stone? Can a successful craft brewer fall victim to the momentum of its own success, raising volumes and revenues at the expense of its integrity and authenticity? Do consumers really care?
The days that the nascent craft revolution was only relevant to bearded aspiring alchemists experimenting with exotic hop varieties in their backyard shed are long gone. Home-brewing will not stop gaining acolytes, however. Nano-brewing will indeed be the next chapter in the industry’s frothy history, fostering irreverent experimentation, stretching definitional limitations and forcing the hand of bigger players. Their hand, after all, has already been forced.
“Craft inspired” or “faux craft,” depending on one’s perspective, offerings from the industry’s behemoths have already began making waves. As an initial incubation period now comes to an end, 2013 will see big beer players invest in more complex and stratified specialty portfolios at the same time that price competition inevitably intensifies further.
The explosive expansion of micro-start ups across the US and UK will plateau. Many of these will either scale production back, be acquired or close altogether. Distribution issues and the potential for inflationary pressures on production will only accelerate such developments as craft will finally come of age.
On-trade: poured by a cicerone, sipped from specialty beer glasses
Quaffing (less and less) pints of lager at a local bar/pub has become emblematic of the on-trade’s demise in the majority of mature western countries. However, the brave new world of craft and specialty beer surely needs its own ambassadors, experts, rituals and paraphernalia. Cicerones – sommeliers’ equivalents for the increasingly sophisticated beer world – will become flag bearers for the logical conclusion of the craft beer revolution, educating discerning drinkers as ales, bitters, Weiss beers, porters and stouts keep on stealing the limelight from lager. The on-trade across the west can thus have one more chance to reverse its seemingly unstoppable decline while increasing terminally hard-pressed profit margins.
Spirits and wine were traditionally perceived as the arch villains in big beer players’ version of the unfolding alcoholic drinks industry narrative. They are however now turning into a source of inspiration. Staying in the story’s sidelines while bemoaning a loss of consumers, drinking occasions and loyalty to more daring, youthful and dynamic categories will no longer suffice. 2013 will see beer borrowing concepts straight from wine and spirits’ marketing playbook, including maturation techniques, barrel ageing, champagne yeasts and hybrid offerings blurring the lines between once rigidly defined categories. These trends will spearhead innovation.
Social media, internet sales and the virtual battleground
Twitter followers, Facebook “Likes”, viral videos and a solid presence in the ever expanding blogosphere will eventually become as important as once totemic television and print-focused promotional campaigns. Major players will utilise the full advantages of targeted marketing and forge closer relationships with data providers, search engines and the social media. They will thus try to catch up with the bottom-up, alternative, more cost-effective and millennial targeting advertising strategies employed by micro-brewers. Diageo’s detrimental twitter spat with the beer industry’s agent provocateurs Brewdog should and will serve as a cautionary tale for those focused on damage control and new media penetration.
From France to Russia: from filling state coffers to curbing consumption
Excise tax hikes, advertising curbs and impulse channel sales restrictions are likely to make headlines once more across the globe. The more mature the sales in a country, the higher the probability of such measures being implemented as neo-prohibition winds and mass deficits add additional barriers to the category’s myriad troubles. Providing the option of lower abv offerings and engaging with governments in the ongoing debate will be major brewers’ primary weapons of choice. Expanding into emerging countries where beer can still claim to be far healthier than deadly homebrews or fiery local spirits will be a secondary strategy.