Craft beer was still the largest gaining alc segment among Total Alc sales in IRI multi-outlet stores in 2015; up 13.5%, $301 mil, IRI's Dan Wandel shared during BA Power Hr. That was $83-$87 mil ahead of next two largest growth segments, Table Wine ($11-$14.99) and (beer) Imports. Yet Wine "had 7 different segments" among top-15 growth segments in Total Alc and most had highest trends of the bunch, Dan pointed out. And both wine and spirits total $$ growth "outpaced [total] beer last year" in MULO.

Craft Solid but Slower Share Gains in OND; Beer Innovations Lead Total Alc During OND (Mostly Craft & FMB) Craft had another solid sales clip in key October, November, December (OND) in IRI foodstores. Tho growth slowed a bit, craft managed to snag another half a share of total alc sales to just under 10 share total (9.9). That's as total beer lost a bit of total alc share to wine & spirits last yr. Meanwhile, craft share of beer category $$ jumped another 1.5 in supers to 22.6 of total beer $$ during those final mos. Yet share gains in both Total Alc and total beer slowed compared to recent years, Dan pointed out.

Separately, beer category new product sales that were released during OND far outpaced wine & spirits, Dan showed. Indeed, beer had 259 new skus released that sold combined $9.1 mil in IRI supers during period, compared to 164 spirit skus selling $4.2 mil and 182 wine skus selling $1.6 mil. Almost all of beer's new product dollars came from craft and FMB segments: a little over half from craft and another $3.3 mil from FMBs.  

Wrapping up Brewers Assn Power Hour presentation yesterday, IRI's Dan Wandel drew "parallels" in craft biz to his beloved Chicago Cubs in the spirit of Spring training. "Expectations remain very high this year" and craft coming off "great offseason" like the Cubs. Yet competition has put a "target on the craft segment." Dan's advice, quoting another MLB manager: "embrace the target." "Even though we've seen a slowdown in sales" there's still "a lot of positive news" and "innovation." And "it's not gonna get easier" as comps get larger and competition increases, but craft still has "a very powerful story that can be taken out to the trade."  

Most recent craft trends slightly slower than the segment kicked off 2016. Indeed, 4-wk $$ trend dipped into single digits, though still up 11.8% yr-to-date thru Feb 21 in IRI multi-outlet + convenience data. Segment gained 0.67 share of $$, closing in on 11 share in all IRI-tracked off-premise outlets. Volume up just 8% and craft nearing 7 share of cases. Total Boston Beer biz now down 1% by $$ YTD including tea and cider. Throw in Alchemy & Science and trend significantly better, +5.2%. A&S growth still about 3/4 Coney Island Hard Root Beer. Sierra Nevada $$ sales up just 5% thru most of Feb, while New Belgium flat. Lagunitas still up near 30%. For other suppliers, trends range from slight improvement to -1% at CBA to Firestone Walker +74%, Founders +61%.

Craft brand picture in early 2016 even more a mixed bag than suppliers. Among top 30 craft brands in IRI (which, again, includes Blue Moon, Leinenkugel, Shock Top, etc), trends range from +276% to -45%. Interestingly, both those trends from large brewers: Goose Island IPA far and away fastest grower; Blue Moon Seasonal quickly losing ground. Other big brewer craft/craft-like brands faring different so far this yr. Blue Moon Belgian White $$ up 10%, not quite making up for big declines or seasonal and variety pk. And though Goose flying, Shock Top squeezed out just 0.3% gain (tho that's a much better 4-wk trend in period around Super Bowl than brand started this yr). Plenty of other negative trends in this set too, including biggest Sam Adams brands. All of 'em down so far this year, led by Seasonal -19%, Boston Lager -10%. Even Rebel -7.6%.

Indeed, top 30 brands collectively up just 5.6%. Rest of craft up over 17%, so slow and declining big brands really dragging down trend. And those brands largely slowing much faster than rest of segment. While top 30 brands collectively slowed by more than 2 points in Feb, rest of the segment barely slowed a point, $$ still up over 17%. But don't assume entire top 30 slowing. In fact, some of biggest growth stories keepin' on in early 2016. Lagunitas IPA still up 22%, and Sumpin' Sumpin' +58%. Firestone Walker 805 continuing its climb up this list to #17, up over 150% thru Feb 21. Founders All Day also still more than doubling and fellow IPA from Mich, Bell's Two Hearted up near 40%. Been said for a while now, but just as this segment keeps growing, making generalizations about it gets harder and harder.  

Constellation looks "to become more than just an import company" and has "raised our internal bar of success…to become the high-end leader," said Constellation Brands chief commercial officer Bruce Jacobson at its annual mtg earlier this week. "Idea is not to sit around and wait" but rather to ensure "even while we've got some of the fastest growing major brands in the industry, that we have those brands backed up by many ideas that will also be the growth drivers of the future," ceo Rob Sands added. Co's already off to a billion $$ start with its acquisition of Ballast, of course. And Bruce hinted several times that there could be "further acquisitions in the craft space." Indeed, this is part of larger goal for co to actively diversify its portfolio thruout other high end segments as the high end collectively shifts to a more dominant position within the industry. In Constellation's view, above premium segments were already 44 share of $$ in 2015 and could be 2/3 of the entire biz, newly appointed prexy Paul Hetterich said. Yet aside from Ballast deal and small Tocayo project developed with Chef Rick Bayless in Chicago, the only high-end segment it really plays in is imports. So there's "a lot of white space," said Paul. Co "just getting started" with craft and certainly "more to do there," he acknowledged. And Constellation will look into FMBs ("constantly shifting but it keeps getting bigger") and Domestic superpremium ("largely a one brand play" with Mich Ultra) as it expects "more sessionable big brands [to] evolve over time as the premiumization continues."

Ballast Alignment "Not a Guarantee," "Decision is Theirs"; Tocayo Solid Start, Lands Jewel Osco Accts "Ballast Point is making the call" on when and where it can change its distribution, Bruce reiterated during mtg. "That decision is theirs" and "eventual alignment is not a guarantee." Yet "when and where Ballast Point considers moving" it's "certainly going to engage the Gold Network partners," he assured. Recall, earlier this yr Ballast made moves to switch to several Gold Network distribs in NY and WI, however Ballast stayed with Sheehan's Hunterdon operation in NJ and moved to Sheehan in MD (see Jan 15 CBN). And it's in the process of expanding to several new mkts including IN with Indiana Bev and Monarch as well as K&L in AK. So it appears there's no set formula for how Ballast will go about future distribution appointments or changes. Of course, Constellation's "desire" is to have as many Gold Network distribs as possible "benefit" from any partnership it has; "not only with Ballast…but with other future acquisitions" too. However craft portfolio has "completely different go to market strategy," Bruce acknowledged. And franchise laws could prevent switches in "some states."

Then too, Constellation's other craft brand project, Tocayo Brewing, is off to a solid start in 2016. It already has 183 draft handles in Chicago mkt and is "sticking in the Hispanic accounts," said cmo Jim Sabia. This mo it will expand into all 158 Jewel Osco stores in the area. Recall, Tocayo launched in Oct 2015 with Hominy White Ale and is currently contract brewed at Two Brothers facility.  

Craft brewers have clearly learned that nothing quite matches the direct consumer interaction at a taproom or brewpub. So besides more new standalone small companies serving food and brewing beer on site, lookout for plenty more brewpubs operated by larger craft cos. Out in Calif, Ballast Point seems to have a Long Beach brewpub in the works, as it applied for a license and construction permit there, expected to open this Spring. Recall, Firestone Walker's nearing completion of its Venice Beach location too. Elsewhere in the state, Bear Republic announced today it's opening a brewpub in Rehnert Park, which, once open, will give the co the opportunity to remodel its original Healdsburg pub. Out east, Southern Tier will open a brewpub in Pittsburgh in a 6,200 sq-ft space with a 9,800 sq-ft patio in the North Shore, the Pittsburgh Post-Gazette reported.  

IN's Sun King already lookin' to expand capacity now that law change allows in-state brewers produce up to 90K bbls a year and still sell on-site. Sun King will invest $1.5 mil to boost production cap from current 30K bbls/yr to 55K bbls/yr with additional 1200 sq-ft space and three 480-bbl fermentation tanks, reported Indianapolis Business Journal. Last yr Sun King produced all it could (30K bbls) and only recently re-partnered with Monarch Bev for southern IN distribution, with expectation to have distribution statewide by this Spring, co previously announced. "Our long term goal is to be Indiana's beer," said owner Clay Robinson.  

Wisc-based Sand Creek Brewing acquired two smaller local cos, Furthermore Brewing and Cross Plains Brewing, simultaneously back in Oct 2015, reported Wisconsin State Journal. Sand Creek already contract-brewed for both cos, neither of which had its own production facility, so seems like a natural progression. Both sets of owners will "continue as brewery representatives" and both "Furthermore and Cross Plains will operate as subsidiaries of Sand Creek Brewing Co and retain their names and distributor networks 'for the time being,'" paper noted. Interestingly, both deals happened separately and "they didn't know they were talking about the same thing at the same time," co-owner and GM Jim Wiesender told paper. Another part of the deal includes building a new brewery and tasting room with 3-bbl brewhouse in Cross Plains, WI. Last yr Sand Creek produced 9,900 bbls, Cross Plains produced 2,000 and Furthermore produced 1,500 bbls; that's 36%, 18% and 7% growth respectively according to Brewers Assn stats. Both acquired brewers expect to expand distribution into Minneapolis, MN and Chicago, IL mkts.  

New Belgium officially announced it will enter NY, its 44th state, on May 16 with a variety of different distribs. It went with largest Manhattan Beer in NYC area, and aside from DeCrescente, McCadam Dist and John G Ryan Inc, ended up with mostly AB houses and a coupla Sheehan operations upstate: Try-It, A Cappione, Eagle, Sanzo, Arthur R Gren, Tri Valley, Lake Beverage Corp, Rocco J Testani, TJ Sheehan Dist and Craft Beer Guild Dist of NY. Recall, NBB just entered WV and HI and announced it will enter NJ in Q1 too, now that its 500K bbl/yr brewery in Asheville is nearly complete. Indeed, NBB "will focus on building deep connections in the Tri-state Area throughout 2016," per release (it also entered PA in late Aug 2015). Initially it'll introduce most of its core brands and seasonals in May (including new Glutiny) and wait 'til Aug to roll out Slow Ride Session IPA, 1554 Black Lager and Lips of Faith brews.  

 There were 1231 tracked IPAs in IRI supers, up another 231 from 2014, Dan showed. That's just a bit fewer than the 247 intro'd in 2014 data set. All together those 1231 IPAs gained 4 share of craft $$ to just about 25 share of segment in supers. Lookin' at sub-styles of IPA, again, more than half (125) of those new IPAs were American IPAs. But last yr nearly as many session IPAs (37) were added as Imperial IPAs (41). And 20 more Fruit/Veggie/Spiced IPAs were intro'd last yr to 35 total (the first time Dan broke that out as a separate sub-style). Indeed, Session and Fruit/Veggie/Spiced IPAs not only adding lots new brands, but also growing the fastest. Fruit/Veggie Spiced (+826%) and Session IPA (+201%) saw particularly outsized gains compared to next closest, 70%+ trends for both English and Belgian White IPAs. And growing at much faster rate than most established styles, American and Imperial, each up 20% plus. So net-net, Session IPAs snagged 3.8 share of style to 6.9 while Fruit/Veggie/Spiced jumped 1.3 share to 1.5 total. Most of that came from American and Imperial IPAs, which shed 4 and 2 share of style respectively to 65 and 20 share total. All in, it "would not surprise me to see that number" of new Session and Fruit/Veggie/Spiced IPA brands "jump significantly," said Dan.

Last yr, a "record number" of new brands released in supers, "almost double" # in 2014, noted IRI's Dan Wandel on BA's Power Hour. But they collectively sold less. In 2015, 1150 new brands released in IRI foodstores, compared to 612 in 2014. But total new beer brand case sales at 4.9 mil cases in 2015, and that was lowest volume total in 4 yrs. That compared to 7.4 mil cases in 2014. So new brands sold 1/3 fewer cases even though there were almost double the # of new brands. Average new brand in 2015 sold just 4,245 cases down from about 12,000 cases. Interestingly, broader look of "new products" that also includes new packages intro'd last yr show that gap was a bit closer in terms of volume: 7.7 mil cases of new beer products sold vs 8.7 mil in 2014. Indeed, "new packaging can be just as effective" as new brands for innovation, said Dan. In fact, "new package product sales actually outpaced sales generated by new brands" within a handful of vendors like ABI, Pabst, Constellation, and Lagunitas, Dan noted.

Coney Island Hard Root Beer's $13.7 mil in sales was largest of all new beer brands in 2015 supers. That marked first time a "craft" brand (as defined by IRI) was #1 new brand in toto. Six other new craft brands were among top-15 new beer brands overall and, with Coney, totaled over $50 mil in 2015. That included Sierra's Hop Hunter IPA (#4) and Nooner Pils (#7), MC's Leinie Grapefruit (#5) and Blue Moon White IPA (#10), New Belgium Slow Ride Session IPA (#12) and Sam Rebel Rouser Double IPA (#13). Indeed, Sierra Hop Hunter was larger than any of Bud Mixx Tails intros, all Tenth & Blake intros, and just $1 mil behind Redd's Green Apple Ale (#2) and Oculto (#3) in supers. And looking only at top BA-defined craft intros, 11 brands reached over $1 mil in sales in craft's most developed channel (9 of top-15 craft intros were IPAs). Gotta note, that's compared to just 5 craft brands over the $1 mil mark in 2014. So even tho this year's top intros weren't nearly as large as 2014 top dog, Sam Rebel IPA ($22 mil), the top-15 new craft brands this year were collectively a bit larger than top-15 in 2014. So even if avg new brands sell less, top new craft brands sell more and hit with more force.