Barney Gumbel, the American Beer Consumer of Old
The craft beer market is booming. No questions needed. Look around town and bear witness to an abundance of businesses incorporating craft beer. Examining the macro, craft beer obtained double digit ownership of the US beer market for the first time in 2014. Comparing it to 2010, the craft beer market doubled in size from its 5% market share (source). According to Bart Watson, chief economist at the Brewers Association, “This steady growth shows that craft brewing is part of a profound shift in American beer culture, a shift that will help craft brewers achieve their ambitious goal of 20 percent market share by 2020” (source).
But what is causing this profound shift in the American beer culture? Is it:
A) Cool brands?
B) High quality and distinctly flavoured beers?
C) Organically sourced ingredients?
D) Captivating stories surrounding brewers and their origins?
Answer: E) All of the above
Millennials are leading the charge in the recent craft beer pandemic, searching out innovative beer styles and redirecting the need of drinking solely to get drunk.
“The appreciation of the craft nature of the category is evident in the fact that drinkers of craft offerings are significantly less likely than drinkers of regular domestic beer to say the purpose of drinking is to get drunk,” Beth Bloom, a food and drink analyst for Mintel.
(For a funny Simpsons reference, click here. We get to examine a trivial disagreement between Barney Gumbel & Wade Boggs after the excessive drinking of Duff beer.)
Millennials are driving sales, specifically ages 25 to 34, a majority of whom tell pollsters that the beer they drink is a reflection of their identity, according to market research by Mintel. In other words, you are what you drink.
Looking at the micro, we see craft beer in Santa Cruz following a similar pattern. Currently, there are eight established breweries in Santa Cruz County, more are on the way. Customers are dying for it. Businesses are trying to incorporate it. To many within the industry, the growth seems unlikely to let up anytime soon. “I think that’s a consumer phenomenon that will persist for a while,” said Kim Jordan, chief executive and co-founder of New Belgium Brewing in Fort Collins, Colo. “I don’t think people will say, ‘Gosh, I really have a hankering for Wonder Bread.’ ”
To summarize, cheap, shitty beer is on its way out, while fresh, craft breweries will continue to trend upwards.