While a couple private label/low priced brands are peppered in among top-25 "craft" gainers in IRI, and much of the rest of the list consisted of "usual suspects," as Bump put it, there are also four small, local up and comin' brands - Deep Ellum, Lawson's, Switchback and Perrin - that made the list. Lawson's (+360%) more than quadrupling, Deep Ellum (+231%) more than tripling, Switchback (+143%) more than doubling and Perrin sold all incremental 42,633 cases with new cans thru Jul 17. These are examples of brands that "fall within the 'long tail' of Craft, with minimal national distribution coverage [that] have become important drivers of growth," said Bump.

Walmart's new private label brand, Trouble Brewing, already sold incremental 55K cases in IRI multi-outlet + convenience data thru Jul 17, already the 20th largest "craft" vendor total gain, lookin' at list of top-25 growing IRI "craft" vendors (by volume) shown in Bump Williams Consulting Group's latest monthly report. (Editor's note: this data includes top-25 gainers by volume from total IRI database, whereas last issue of CBN, we were looking the top gainers among Top-60 brand families by $$ in Foodstores only). Recall, Walmart just announced launch of the brand in early Jun, making it available for $13 a 12pk in about half of their 4600 stores (see Jun 2 issue). And indeed, Trouble's currently goin' for just over $26/case in scans compared to overall avg of $36+ per case. Trouble currently brews 4 styles including flagship Red Flag Amber Ale, an IPA, pale ale and belgian white.

Similarly, another private label brand, World Brew's Rockdale Brewing, comes up even higher on the top-growth list, with incremental 119K cases thru Jul 17. That puts total case gain at 8th largest among IRI-defined craft vendors. Not much info about Rockdale brand, but Rockdale Light lager providing all the sales, selling at a measly $13/case YTD. Recall, World Brew's total portfolio of private label brands rapidly declined over the last several yrs, and was down 18% again this yr, last we saw thru May 1 in IRI MULC. We don't know whether or not consumers consider these brands "craft," but these brands quickly and clearly getting some pull at some very low prices.  

Hop Valley is fastest growing brand family among all suppliers, craft or otherwise, in Portland, Oreg IRI foodstores this yr. Its $$ up 70% for 26 wks thru Jul 10 there, gaining over 1 full share to 2.6 of total beer. Impressively, that makes Hop Valley 7th largest $$ brand family overall, ahead of Budweiser (-7%), Pabst (-9%), and Mike's Hard (-6%) and not too far behind Bud Light family (flat) in this channel. It's the #4 craft brand family, already ahead of AB's 10 Barrel (+13%), only behind Ninkasi (flat), Widmer (-6%) and Deschutes (-5%).

Indeed, each of top 3 craft families strugglin' in Portland mkt. Both Deschutes and Widmer shed 0.4 share of $$ to 5.3 and 4.4 respectively for 26 wks, while Ninkasi lost a bit of share too. Handful of other top craft brand families havin' even tuffer times there. While New Belgium improved to +3% and Lagunitas maintained +4% growth, Sierra flat (-7% for 13 wks), Blue Moon down 18%, BridgePort down 23% and Pyramid down 6%. Collectively, Blue Moon (-0.3), BridgePort (-0.4) and Pyramid (-0.1) shed another 0.8 share of total beer $$ for 26 wks. Meanwhile, Full Sail brand family up strong 21% for the yr in Portland foodstores after flyin' up 46% for latest 13 wks. Yet recall, Full Sail actually down in natl IRI foodstores thru Jul 10 (see Jul 29 issue).

All in, top craft brand families are finding it much tuffer to grow in ultra-developed Portland craft scene. Hop Valley and Full Sail are main bright spots among top players, but even more so here, a big chunk of craft growth comin' from plethora of smaller local cos.  

In past yrs, state of Mich tracked all beer by brewer, so you could see full picture of craft. Now, like Oreg, numbers only available for in-state brewers, still an interesting picture and one put together by Rex Halfpenny for Michigan Beer Guide. Data for 2015 shows in-state brewers shipped 501K bbls in Mich alone, up 93K bbls, 23%. That's just over 8 share of Mich total beer, using Beer Inst as base for total. Rex uses slightly lower number for Mich so he gets in-state craft to 8.6 share and he's confident in-state brewers will pass 10 share there next yr. In any case, half-mil bbls for in-state craft is higher than Constellation (171K), Pabst (155K) and HUSA (98K) combined. It's also up over 200K bbls, 69% in just 2 yrs.

Brewpub biz kinda soft in Mich. Up just 1400 bbls, 6.2% to 24K bbls. Micros (under 60K bbls) jumped 52K bbls tho, 25%. Two companies with "brewer" licenses (Bell's and Founders) shipped 220K bbls, up 22%. Like elsewhere, lotsa new players in Mich last yr: 70 in all, an increase of 33% to 280. And Rex counts more than 50 breweries "in progress right now."

Bell's dominates, of course, with 3 locations. It shipped 151K bbls in home state last yr, up 23K bbls, 18%. That's 2.5 share and only 4K bbls behind Pabst. That's also still over 40% of Bell's total biz last yr. Founders is distant 2d at 69K bbls in 2015, but a 33% jump. Founders does about a quarter of its total biz in home state. Short's is #3 in-state brewer, clocking in with 42K bbls in 2015, up 23%. Only one top-10 Mich brewer lost volume in-state: Keweenaw slipped 2.6%. Gainers ranged from Griffin Claw (+58%) to New Holland and Arcadia (each up 10-11%). Oskar Blues partner Perrin built its in-state biz by 1/3 and jumped in-state biz from 5400 bbls in 2013 to just below 14K last yr. Griffin Claw grew by more than 6X in 2 yrs. Large long tail of 260+ other players up 26% and represented almost 30% of total in-state brew sold in Mich in 2015.    Go To Top  

Midwest craft beer bar chain, HopCat is set to open its 12th location in Louisville KY this Saturday, Jul 30, reported Insider Louisville. Recall, BarFly Ventures LLC, which operates HopCat outlets, announced plans to open 6 new locations in each of the next 5 yrs thruout the Midwest after securing $25 mil for less than 5% equity stake (see Sep 3, 2015 issue). Back then it only had 6 locations in operation, so it looks like it's ahead of schedule. On top of 5 Mich-based locations, HopCat's already in several major Midwestern cities such as, Chicago, IL, Indianapolis, IN, Kansas City, MO, Lincoln, NE, Madison, WI, and Lexington, KY, according to co website. Again, HopCat Louisville is set in a sizable 13K sq-ft space with 132 taps. It'll keep "at least 20 Kentucky beers, dozens of regional beers and craft beers from all around the world" along with Pabst Blue Ribbon as the lone "macro beer" option, paper noted. Indeed, HopCat "does not carry any product" from AB or MC including craft options. Co expects to employ "around 200 people" in Louisville. 

Just like IRI data above (and our reports of craft shipment data in recent years), "top level number" for craft growth reported Tuesday by Brewers Assn "hides a great deal of variation (perhaps even more so than in previous years)," BA's economist Bart Watson wrote in follow-up post also Tuesday. For example, "the growth rate for microbreweries and brewpubs appears to be nearly as strong as ever," he noted. He found "clear evidence" in survey responses for larger, regional craft brewers driving the overall slowdown in craft volume growth. Collectively, brewers producing less than 15K bbls grew by about 30% last yr, Bart reminded. And, specifically speaking of microbreweries (production breweries less than 15K bbls/yr), another yr of 30% growth for that group isn't "unrealistic," in his view.

Cans Growing, Bigger During Summer Months, But Could Be Incremental "Cans are steadily increasing" as a percent of total craft sales in IRI data, "and have a heavy seasonal component, typically peaking around July," Bart continued in analysis based on "a member request." He looked at series of 4-wk IRI multi-outlet + convenience data to show that cans represented only about 11% of craft volume during summer of 2014, then about 15% last summer, again peaking in July and August. Cans were about 19% of craft volume for 4 wks thru June 1 this yr. But importantly, growth of cans "hasn't really eaten into the volume of bottles." Indeed, graph he prepared shows that bottle volume clocked in just over 7 mil cases for 4 wks thru 6/1/14, which grew to about 7.5 mil cases during same period this yr. But cans grew at faster pace on top of that.

Depending on the style, cans can be even more seasonal, or less, natch. For example, canned IPAs similarly bigger during summer months, Bart showed. However, bottled IPAs actually adding more absolute cases on average than cans. Tho gotta note that so far this yr, cans' share of total IPA volume growing at much faster pace than in previous years. Cans topped a quarter of all IPA sales for 4 wks thru 6/1. His final analysis of variations in total craft trends and canned craft trends further "suggests can volume that is largely incremental," since they're "filling occasions that bottles didn't." 

Variety" "quality" and "flavor" remain the top reasons for craft consumers to purchase more craft beer than they did previous year, Danelle noted during Power Hour: 65% of respondents lookin' for more variety, 60% lookin' for more quality and 58% lookin' for more flavor. Interestingly, "the only area where there was a significant increase" vs last yr was with consumers lookin' for more flavor options, said Danelle. Both quality and availability actually declined as purchase factors vs last year, tho quality still high on the list. In fact, 80% of weekly craft drinkers "say quality is much better or somewhat better" within the past couple years, including 46% of weekly drinkers that said "much better." Compare that to 36% of "regular drinkers" that say quality's gotten "much better." Gotta note, older consumers were more likely to say that quality's "much better," while millennials response "slightly below average" at 35%. This "could present a challenge to brewers" since Millennials quality expectations are "already high" and "continue to increase," said Danelle. Conversely there's an oppy to educate consumers further on quality of cans. About half of respondents still consider taste, quality and freshness a reason to consider buying bottles compared to just 4-7% of respondents for cans.

Altogether, these findings seem to line up with 99% of respondents that said flavor "very/somewhat important" and 95% that said freshness "very/somewhat important." Other top categories, Aroma (78%), Ingredients (75%), Bitterness (68%), Appearance (63%), Independent (63%), and Locally Made (60%) were still considered at least somewhat important by majority of respondents. Yet fewer consumers consider bitterness important vs last year, while more consumers consider appearance important this time around. Could be "an early indication of IPAs reaching their peak" said Danelle (Editor's note: IPA's still make up the majority of craft segment's growth, so still remains to be seen in sales trends). And while indie and local are lowest of the group, that's "still a large percentage" that consider those important factors for craft, said Danelle. Importance noticeably increased, about 8 pts each, for weekly craft drinkers. Craft beer still has largest consumer base of any alc bev category that considers local important, she reminded. However, 82% said their "favorite beer" is their favorite "no matter who makes it or where it comes from."

"More Affordable" Prices #1 Reason Consumers Would Drink More Craft; Southern Consumers Lookin' for More Craft Biggest factor that would make consumers drink more craft beer is "more affordable" prices. Just over half of respondents said "more affordable" prices would make them drink more craft beer compared to about 1/3 that said "better quality," "more availability" and "more variety." Important to remember "there is some price sensitivity to craft beer," said Danelle. Consumers typically still "willing to pay more for quality" but "keep in mind…craft is an affordable luxury." Meanwhile, one regional consumer difference that stood out: consumers from the south "were more likely to say there is not enough craft on shelf, total category items on shelf, styles/flavors, and brands."

Brewery Visits and Food Pairing Oppys Craft is "rapidly becoming a destination, not just something to drink," associate client manager, Caityln Battaglia noted. In fact, 61% of respondents visited a craft brewery within the past yr, averaging 3.1 per year. And just under half said they visited breweries within the last year, averaging 2.1 visits/yr. Those % spike up 12-13 pts among weekly drinkers. Importantly, 60% of respondents also acknowledged that they purchased more of a particular brand after visiting the brewery, including nearly 78% of millennial males.

Then too, beer has "opportunity to capture dessert and seafood" dining occasions" among craft consumers. Respondents overwhelmingly choose beer over wine as beverage of choice when eating a salty snack or a quick meal at home, survey found. And consumers also typically chose beer during full course meal featuring meat. However, these craft drinkers still choosing wine far more frequently with full course meals featuring fish and dessert.  

"There's lots of noise" out there, Nielsen's Danelle Kosmal kicked off yesterday's Brewers Assn Power Hour. So BA and Nielsen rebooted last yr's Craft Beer Insights Poll of consumers to "cut through some of this noise and hear what really matters for the craft beer drinker," she explained. And tho craft's total growth trends may have changed since this time last yr, many of the 1000+ survey takers this yr responded similarly to those surveyed last yr. Just over half, or 54% of respondents, said they drink craft beer weekly, with about a quarter of drinkers saying they drink craft "several" times a week.

Craft drinkers still largely reported drinking more craft beer than they did last year. But that could be "leveling off a little bit," Danelle cautioned. About half of weekly craft drinkers told Nielsen they're drinking more craft, whereas just 7% said they're drinking less. Less frequent, "regular craft drinkers" ("drinks craft at least several times a year"), were slightly more likely to moderate craft consumption. About 13% of regular craft drinkers said they're drinking less craft than they did a year ago, while 40% said they're drinking more. About 80%+ of regular craft drinkers still drinking lots of other alc bevs too, including imports and domestic beers, wine and spirits. But importantly, they're also more likely to report drinking less of those other kinds of alc bevs than they did a year ago. About a third of regular craft drinkers reported drinking less spirits, FMBs and non-craft domestic beer, 2-3X the size of the group drinking more of those alc bev types, suggesting net-net craft drinkers moving away from those bevs. But change in interaction between craft and cider is most noticeably different. Last yr, a net 17% of craft drinkers were drinking more cider. But this time, about the same number of regular craft drinkers said they're drinking more cider as those drinking less.

Craft Still Outpacing Other Alc Bevs for 52 Wks Craft growth remains well ahead of other alc bev categories both on- and off-premise, Danelle stressed, at least long-term. Nielsen craft segment grew by over 12% to 14 share off-premise, for 52 wks thru July 16, compared to +3.8% for beer/FMB/cider, +5.4% for wine and +6.3% for spirits. On-premise growth slower across the board, but craft still up over 4% for 52 wks thru May 21. Total beer/FMB/cider down almost 1%, while wine +0.4%, spirits +0.3%. Once again, Nielsen survey showed that about 80% or more of regular craft drinkers also drink lots of other alc bevs, including imports and domestic beers, plus wine and spirits.  

Another measure of craft in most developed channel, foodstores, shows 22 of top-60 craft brand families' $$ down and 24 of top-60's volume down YTD thru Jul 10 in IRI data. That's right in line with ratio of craft brewers growing vs declining in total IRI database we've seen thruout the yr (see May 26 CBN). Yet this cut of data again clearly shows how the bulk of craft slowdown comin' from top cos and brand families. Indeed, lookin' at $$, 6 of the top-8 brand families down for the yr, including Sam Adams and Blue Moon each down 4%, Sierra slightly off 0.4% (tho further off in MULC), Leinie Specialty -1%, Shock Top down 8.5% (much steeper declines in recent period) and Shiner down 4%. And some of the tuffest trends YTD are a bit further down the list. CBA's Widmer (-13%) and Redhook (-16%) and NAB's Magic Hat (-16.5%) and Pyramid (-11.5%) each down double-digits. Harpoon, Saranac and Traveler brand families each down 10% too. And Anchor (-8%), Rogue (-7%), Full Sail (-5%), Abita (-4%), Long Trail (-4%), Alaskan (-3%), Boulevard (-2%), Brooklyn (-2%), Omission (-0.2%), Saint Arnold and Dogfish ($$ flat, volume down slightly) all strugglin' in this channel. Gotta note, some of these cos are underreported in IRI, especially Brooklyn Brewery.

So several of the brand families with tuffest trends are at least partially owned by large brewers, while the same group of top BA-defined craft brands continue to struggle in 2016 too. But lots of the largest growth also from brewers that've done deals, most of which are no longer defined as craft by BA. Constellation's Ballast Point (+99%) has largest total $$ growth of all, followed by Coney Island (mostly incremental alc soda gains), Founders (+74%), Lagunitas (+14%) and Firestone (+51%). AB's Goose Island (+25%) and Kona (+19%) are each top-10 growth brand families, while Elysian (+47%), Devils Backbone (+45%), 10 Barrel (+30%), MC's new craft brands Hop Valley (+76%) and Terrapin (+35%), and Oskar Blues (+20%) all in top-20. Artisanal Brewing Venture's Southern Tier (+22%) and Victory (+16%) combined are now a top-25 vendor in IRI foodstores. Cigar City's keepin' up 31% growth pace in foodstores. Not as strong growth, but SweetWater sustained solid 5.5% growth. And Uinta back up 10% in foodstores tho was down mid-single digits in IRI multi-outlet + convenience data thru May 1, so potentially not as strong altogether.

Then too, two other fast growin' mid-sized brand families - Karbach (+69%) and Rhinegeist (+91%) - continue to shine brightest among next tier of indie craft brands; now 33rd and 54th top craft brand families overall in IRI foodstores, they had 11th and 14th largest $$ gains overall. (Editor's note: Hop Valley was originally included in this section before deal announced earlier today - it's now the 40th largest craft brand family with 13th largest $$ gain). Among indie craft, only Bell's (+25%), Deschutes (+15%) and New Belgium (+5%) had larger total $$ gains this yr. Karbach growth ahead of Elysian and not too far behind NBB. Rhinegeist growth just behind Elysian and Hop Valley, with larger $$ gains than DBB, Stone (+6%) and Oskar among others. Also gotta note 21st Amendment (+24%) now the 35th largest brand family in scans. Tho its growth in foodstores not as fast-paced as these other brewers, 21A arguably in a whole different category of growth; its more widely distributed, larger overall and grew more total volume than any of 'em in 2015.

All in, these top-60 brand families' $$ sales collectively up just 6.5% while all remaining brand families collectively up 23% in IRI foodstores thru Jul 10. So while all other brand families represent just 21% of total craft $$ sales, they're 45% of $$ growth. That's lotsa growth from indie brewers underneath.    Go To Top