David Walker , Cofounder of Firestone Walker Brewing Company .
strong brand building .
“ While beer experimentation is re-emerging , our consumers continue to face economic pressures ,” says Anaokar . “ We must build consumer trust so that they know money spent on our products will meet or surpass their expectations . Building brands that tap into the right consumer insights provides reassurance that their dollars won ’ t go to waste .”
“ This explains breweries ’ ( Founders included ) increased focus on line extensions or themed variety packs that consist of and build on products that consumers know and love ,” he adds . “ Consistently communicating your brewery ’ s brand message while ensuring product quality upholds that trust is key to driving and preserving consumer loyalty .”
Agreeing with him is David Walker , Cofounder of the craft beer pioneer Firestone Walker Brewing Company . Walker ties brand building into the significance of occasion-based drinking in terms of connecting with consumers .
“ Brand building is hugely important ,” he says . “ Occasions matter more than ever in our opinion , so balancing the intrinsic education with that element of ‘ why our brand ( s ) fit that specific occasion ’ is important . Between that and sampling , building bottom up is also very important in our view . Adding the layers of above-the-line marketing , where you ’ re positioning your brand through mass channels , and more direct below-the-line tactics like trade shows and targeted digital placements is the magic that brings it all together .”
RTDS AND HARD SELTZERS Among the greatest changes in the beer industry in the past five years has been the massive gain in market share of RTDs and hard seltzers . Is this good or bad for the category ?
“ We don ’ t call it damage , but more so a guide to re-focus our thinking on what retailers and drinkers are looking for when it comes to taste and convenience ,” says Franco of BrewDog USA . “ Many of the seltzer products offer a sweeter , more tropical taste , as well as a higher ABV , and have opened up that need to keep up with a consumer ’ s palate expansion . It has also forced organizations to look at their R & D process and their ‘ bench ’ for inspiration in helping grow the category .”
This shift in consumer taste has motivated ( and necessitated ) many breweries to expand beyond beer .
“ We feel strongly that globally , we define ourselves as a beverage company who produces craft beer , and now , in some markets , spirits and RTDs as well .” Franco says . “ Some of what we ’ ve seen from RTDs or seltzers has forced the industry to think about those ‘ other ’ products as potential sources of volume and revenue , and some of what we ’ ve seen has been a passing fad . It makes sense to grow if retailers and drinkers are looking for these types of offerings in the long term .”
Many breweries have profited from this expanded consumer palate — or at least not suffered from it .
“ I am not sure that adding new alc beverages to the consumer has damaged beer ,” says Walker . “ There has always been a segment of the market that experiments in the alc beverage space , and that consumer might be moving some market share around , but it will likely come back and is not material to our business .”
WHAT ’ S NEXT ? As Covid-19 recedes fully into the background , what do the years ahead hold for beer ?
“ What ’ s next for the American beer industry is largely what got us here ,” says Walker . “ It ’ s a highly evolved , innovative , profitable industry that will draw bright energetic people , which in turn will serve us all well .”
Anaokar of Mahou Imports foresees a continued emphasis on brand building .
“ Since many brewers have a built-in fanbase with equity in core brands , I predict we ’ ll see a larger focus on those core brands , with breweries innovating within them ,” he says . “ This is counter to what we saw a few years back , when many appeared to chase the latest trends . Breweries will place a stronger emphasis on brands that have stood the test of time and aim to penetrate new consumer sets that are within reach with those brands .”
“ Additionally , mid-to-large sized breweries will place more selective bets on innovation ,” he adds . “ Rather than going all-in to chase a big reward ( like the tactic many took with hard seltzer ), they ’ ll play in innovative spaces within their higher-share markets before making bigger investments .”
This vision of cautious innovation , and emphasizing brands and local regions over larger expansion , is shared by Franco of Brew- Dog USA .
“ Crystal ball moment : the industry will always have foundations rooted in easy-drinking , price-sensitive brands , and a continued opportunity for craft brands and their core styles like IPAs , seasonals and variety packs ,” he says . “ Ciders , which we think have a lot of run room , as well as the aforementioned RTDs and seltzer-like brands and teas will also continue to be options to people wanting something a little different . Assortment and the consumer ’ s want for variety is not going away , although we feel like there will be some contraction eventually , whether it is because retail space becomes more limited as the market becomes more saturated , or whether it is due to beverage companies looking internally and making financial decisions to focus on what brings the most value to their portfolios . At the end of the day , Americans LOVE beer and will continue to do so .” BW
22 Beverage Wholesaler • Fall 2023