Beer Marketer's Insights

Beer Marketer's Insights

Shortly after the National Black Brewers Association formed and appointed its first exec director, Boston Beer committed $225K to become an inaugural supporter, co announced at last wk's Craft Brewers Conference in Nashville. Boston Beer's donation is dedicated to the NB2A's mission of empowering Black brewers and brewery owners to create a more equitable and inclusive industry for all, and puts the org well on its way to its initial $1 mil fundraising goal.

Small craft-on-craft deals continue to pop, this time in VA. Farmville-based Three Roads Brewing (not to be confused with CT's Two Roads) is buying Ballad Brewing in Danville, VA, per the Chatham Star Trib. No price disclosed, tho acquisition will double co's production to roughly 2K bbls. Three Roads will also add Ballad's taproom, becoming co's 3rd along with original spot in Farmville and 2nd location in Lynchburg, VA. It'll retain the Ballad brand & its catalog of beers, with both brands to be distributed in VA and NC and available in all co's taprooms. "We are committed to being the leading brewery in Southside Virginia," said Three Roads founder Chris Sadler.

A regional brewer and a CA up-and-comer are on the move once again. Lexington, KY-based Country Boy Brewing is slated to open its 3rd overall space and its 1st in downtown Louisville. Co's newest taproom will open in June on the ground floor of the Omni Louisville Hotel, serving food and selection of location-specific brews in addition to core brands. The regional brewer shipped slightly over 18K bbls in 2021, per Brewers Assoc, finishing as the 3rd-largest craft player in KY behind only Braxton and Lexington Brewing. Its Georgetown production facility, opened in 2017, "is still the state's largest production brewery," Fox reports.

After developing Beer for Humans "easy hop ale" with tied-in fundraising/community engagement components earlier this yr (see Feb 15 issue), Rhinegeist partnered with Cincy Reigns to create and sell co-branded beer dubbed Cincy Light too. "A portion of all retail sales" of the "easy-drinking light lager" will help raise $$ thru Cincy Reigns, "a Name, Image, and Likeness ("NIL") fundraising collective that helps [University of Cincinnati] Bearcats' student-athletes in all sports monetize their personal brands while supporting the Greater Cincinnati philanthropic community," per release. Cincy Light will be available thruout Cincy. And "in addition," this partnership will "feature exclusive fundraising events at Rhinegeist in support of Cincy Reigns and other community initiatives." Rhinegeist has been working with University of Cincy since the early days of operations in 2013, but co's leaning into the concept of raising $$ thru beer brands.

New refreshed look and ad campaign for AB's "premium lifestyle" craft "megabrand" Kona Big Wave is hitting mkts now, co announced yesterday. Main new 30-second spot "Mean Mug" and three 15-second spots, "Dad's Chair," "Noisy Neighbors," and "Standoff," showcase Big Wave on Hawaii beaches among surfing circles, local families, "noisy" gatherings and nightlife, debuting new can artwork and tagline "Bring the Aloha." New packaging design features "the brand's distinct hibiscus flower" with "a more modern, simplistic aesthetic and brighter color palette." Net-net, this messaging and new logo are viewed as having "more universal emotional appeal," as AB has "massive ambitions to be one of the leaders in the premium beer space," and "transcend the craft beer segment," per release.

“Moderate amounts of safely dosed alcohol [are] at the heart of what makes humans humans” and “beer is the safest way,” “the best delivery device for ethanol that we’ve invented” and “the key to our ability to socialize.” Such a resounding rallying cry for beer was not delivered by an industry advocate, a brewer or a PR specialist during last week’s Craft Brewers Conference in Nashville. It wasn’t proclaimed from the mainstage during the general session, broadcast over loudspeakers or shouted from the top of the Music City Center. Ironically, it was delivered quite soberly by a philosophy professor from Canada.

University of British Columbia professor Edward (Ted) Slingerland made those bold claims for CBC attendees after carefully unpacking the extensive research detailed in his book, Drunk: How We Sipped, Danced and Stumbled Our Way to Civilization, published in 2021. Recall, Ted shared his basic take that “beer is better” during discussion at Beer Institute meeting last fall. In presentation at CBC, he walked small brewers thru his primary findings, once again pointing out that prevailing policy discussions about alcohol focus solely on “costs” with “nothing in the benefit column.” But that’s “just inaccurate.”

“No Safe Level” Claims and Recent Dangers Alcohol is increasingly demonized in global and local policy debates, as Ted alluded to. Public health advocates continue to argue that there is “no safe level” of alcohol consumption and that harm begins at the first drop. Policymakers in Europe and Canada have leaned on these arguments to support minimum prices and higher taxes, marketing restrictions and mandatory cancer warnings, as well as formal recommendations to reduce consumption to just 1 or 2 drinks per wk. The same arguments underpin pushes for tax hikes in NM, OR and other states, which only got stronger after the pandemic. (Sibling-pub Alcohol Issues Insights covers these stories in much more depth.)

“Problem drinking got really bad” during the long periods of social isolation brought by Covid, Ted acknowledged. That’s in part because alcohol has “always been a social drug.” For many millennia of human experience with alcohol, there were 2 important “safety features,” his research shows. “People can help other people control their drinking,” which they’re “not very good at doing when they’re alone.” Natural fermentation limits of yeast provide the other safety feature, keeping alc bevs at very low ABVs (think 2-4%) for most of human history. We only started distilling at scale around 300-400 yrs ago, an evolutionary “blink of an eye.”

Old Problems and Older Benefits Humans have known that alcohol can cause harm for a long time, too. In our “earliest writings,” we were “already complaining” about alcohol misuse. Yet “both genetic and cultural solutions to the problem with our taste for alcohol” have not been successful, Ted asserts. That points to “benefits on the other side,” namely “creativity and cooperation.” Both flow from the way alcohol downgrades the brain’s prefrontal cortex. That opens up more “mental flexibility” and makes us both less inclined and less able to effectively deceive each other. Alcohol has historically been present for important agreements, business deals and team building functions. It became a tool “for fundamentally suspicious apes” to “relax” and cooperate, Ted explained.

Beer’s Strengths Rooted in Low-ABV Social Drinking Slingerland’s research into ancient civilizations, brain chemistry and modern social dynamics revealed the benefits of low ABV bevs and social consumption, findings he turned into policy recommendations that should benefit beer. Notably, while Ireland and Scotland work to restrict alcohol affordability and advertising, a new tax credit for draft beer in the UK is perhaps the current policy most closely aligned with Ted’s take. And the US draft beer biz could use a serious boost these days.

Can’t escape that drinking low-ABV bevs socially is the basis of both core beer occasions and craft’s strongest sector. Americans and folks all over the world long turned to beer, first and foremost, at large cultural gatherings, sporting events, concerts and festivals. Taprooms providing contemporary community gathering spaces remain the healthiest piece of the US craft beer biz.

But Market Moving Elsewhere Taprooms remain strong and lots of beer is still sold in stadiums and concert venues, but consumers don’t seem particularly enamored of low-ABV bevs these days. Arguably, alternating between a 6-7% ABV IPA and a non-alc beer works effectively the same as consistently drinking a (far more uncommon) 3-4% beerBut craft’s biggest gains continue to be put up by beers at double the strength in bigger packages, sold to-go in ones and twos. More broadly, beer has been out-matched by the stronger stuff, distilled spirits, for over 2 decades.

In the last 15 years, average beer consumption per 21+ adult (excluding cider, FMBs and seltzers) declined by about a quarter, we estimate. Since 2007, total US industry volume dipped 3-4%, while FMBs, seltzers and cider collectively gained about 10 share. So beer volume fell more like 13-14%. Meanwhile, the 21+ population increased by close to 20%. Craft also gained about 8 share in that time, but avg craft consumption per adult ended 2022 about where it was in 2017. And 3,000 more breweries competed for those pints than did in 2017, per BA estimates. (Consumption stats and more are available in Craft Update 2023.)

Headlines about alcohol’s ills keep popping up. Younger adults are more likely to be skeptical of alcohol, outright. Consumers that do drink seem most interested in going bigger and stronger. In this moment, can craft brewers harness the ancient, intrinsic benefits of beer and bring some much-needed new energy to one of the world’s oldest intoxicants?

Genius Juice's Alex Bayer has proved outspoken critic of broadliners' practices with early-stage brands, placing himself at center of unrest over things like opaque billbacks and inconsistent ordering patterns, particularly at KeHe (BBI, Feb 14). As squeakiest wheel, he actually drew attention of KeHe brass, who convened special meeting to hear him out (BBI, Feb 15).

Ghost has signed extensive multiyear deal with music fest promoter Insomniac that kicks off at Electric Daisy Carnival in Las Vegas and will inaugurate not just a limited-edition EDC-themed 16-oz can in Wide Awake Watermelon flavor but also brand's first 8.4-oz cans in Orange Cream and Tropical Mango flavors. The special can will offer both glow-in-the-dark and blacklight-activated elements that should capture attention of EDC showgoers ("Headliners") "under the electric sky," co said. Brand will garner prime bar space on festival's Rainbow Road and will be sold at all concessions, Marquee SkyDeck, Camp EDC, Hotel EDC and Maverick Helipads. Beyond this weekend's event, deal calls for Ghost to serve as exclusive energy partner at all Insomniacfests and events nationwide, not just stocking on-site bars but offering flow of limited edition can designs and activations. Idea is "to shatter on-premise event standards and create an inclusive, authentic partnership," partners promised . . . Q Mixers said it's inked multiyear deal with Indianapolis Motor Speedway to become circuit's Official Non-Alcoholic Premium Mixer. In deal announced just ahead of Indy 500 on May 28, Q Mixers will serve specialty cocktails and offer on-site experiences including in all suites, Hulman Terrace Club and 500 Club where guests can imbibe signature cocktail dubbed The Victory Lane that blends Q's Hibiscus Ginger Beer, Crown Royal Whisky and splash of lime. Beyond Indy 500, Q Mixers will be served at all IMS events, including GMR Grand Prix, Pennzoil 150 at the Brickyard, Verizon 200 at the Brickyard, Gallagher Grand Prix and TireRack.com Battle on the Bricks.

Sure, the founders' Mormon parents weren't crazy about the name at first. But Bucked Up is riding oddly effective branding, an unusual and transparently disclosed ingredient list and wide flavor variety to emerge as another energy player that's helping fill the void left in indie channel by recent exit of Celsius and C4 entries. (Launched 2 years ago, the brand name refers to ingredient harvested from antler horns that's proved to be beneficial for muscle repair function as offered in co's first supplements.)

AB up 197,000 bbls, 5.6% in big Mich; up even more striking 95,000 bbls, 8% in Ia (where Busch Light is the #2 brand) and 66,000 bbls, 9% in Neb.  AB gained share in each of these 3 states where it’s already well over half the biz: up 0.9 to 55.4 in Mich, 2.4 to 56.1 in Ia,  and 2.7 to 59 in Neb.  AB gained 8 share in Ia and 7 in Neb last 3 yrs.  Miller up 3% and  held share in Ia and Neb; up 1% and lost 0.6 share in Mich.  AB and Miller combined for over ¾ of beer biz in each state.  Stroh off  132,000 bbls in these 3 states; down 14-16% in each.  Dropped 2 share in Ia and Neb.  Lost 1.3 share in home state Mich to just 5.7.  Coors up strong 24,000 bbls, 14% in Mich, but still under 3 share.