07 Jul Craft Beer Takes a Bigger Swig of the Shrinking Beer Market
Fourth of July is the biggest holiday of the year for big beer companies, but craft beer companies have plenty to celebrate.
Craft beer makers have experienced huge jumps in market share while the overall beer market size has shrunk. The Census Bureau announced yesterday that the number of breweries in the in the U.S. doubled in five years–an increase largely due to craft beer. On average over the past two years, 1.2 craft breweries opened each day, contributing to a total of 15.6 million barrels of beer last year.
While that’s only 7.8% of the U.S. beer market share, according to data Brewers Association, an American craft beer trade group, craft beer is taking an ever-increasing chunk out of noncraft beer companies’ sales. The number of liters of beer purchased per year has stayed the same and is expected to shrink slightly, according to data from research firm Euromonitor. Meanwhile the population has risen. That means people on average are consuming less beer and, if they’re consuming beer, it’s more and more likely to be craft.
The Brewers Association defines American craft breweries as small — producing under 6 million barrels a year — and independently owned — they can’t have greater than 25% investment by a noncraft-beer alcohol company. The definition also makes it easy for people to figure out how American their beer is.
Mr. Watson says it’s tough to say whether big beer companies’ forays into craft-like beer have affected craft beer sales but that they do represent craft beer’s popularity.
“It shows the real demand that underpins it,” Mr. Watson said. “People are looking for fuller beer and beer that’s tied to places.”
After the World Wars, national beer companies like Anheuser Busch and Schlitz began to grow rapidly because of their beer’s dependability and light taste — a departure from the often idiosyncratic and sometimes heavy beers of craft breweries. These national breweries bought up smaller craft breweries, bringing their number to a historic low in the 1980s.
Now the trends have reversed.
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