Craft Beer - US - November 2012

Report Length: 173 pages

1. Scope and Themes

   • What you need to know
   • Definition
   • Data sources
   • Sales data
   • Consumer survey data
   • Advertising creative
   • Abbreviations and terms
   • Abbreviations
   • Terms

2. Executive Summary

   • Craft beer’s popularity rises as does number of new breweries
     • Figure 1: Total U.S. sales and fan chart forecast of craft and craft-style beer market, at current prices, 2007-17
   • Foam is rising: Drinkers are increasing craft beer consumption
     • Figure 2: Changes in craft beer consumption habits, July 2012
   • Craft beer not yet part of drinking routine for beer fans
     • Figure 3: Incidence and frequency of personal beer consumption, by type of beer, July 2012
   • Craft beer wins on taste, falls flat on value
     • Figure 4: Attitudes toward taste and value, domestic vs. craft beer, July 2012
   • • Figure 5: Attitudes toward taste and value, imported vs. craft beer, July 2012
   • Taste, full-bodied flavor most important to craft beer drinkers
     • Figure 6: Important attributes when selecting craft beer, July 2012
   • Craft and craft-style brewers jockey for space in growing segment
     • Figure 7: MULO sales of craft and craft-style beer by leading companies, 52 weeks ending September 2012
   • New product releases fuel the segment’s expansion
     • Figure 8: New craft beers launched between Oct. 3, 2011, and Oct. 3, 2012, by company
   • Selection, education key to craft beer retailing
     • Figure 9: Craft and craft-style beer sales in supermarkets and other retail channel, by year
   • What we think

3. Issues in the Market

   • How many craft breweries are too many craft breweries?
   • What sets craft breweries apart from their beer competition?
   • What are the best ways to encourage trial among consumers?
   • How can craft beer tap into its feminine side?

4. Insights and Opportunities

   • Encourage trial with multiple packaging options
   • Promote craft beer as a more routine alcoholic beverage choice
   • Give craft beer fans a piece of the creativity
   • Reward craft beer loyalists with more insight into brewery, processes
     • Figure 10: The Craft of Beer, Crate and Barrel, Fall 2012

5. Trend Applications

   • Trend: Carnivore, Herbivore…Locavore
   • Trend: Guiding Choice
   • 2015 Trend: Access Anything, Anywhere

6. Market Size and Forecast

   • Key points
   • Craft beer proves to be a recession-resilient bright spot
   • Sales and forecast of craft and craft-style beer market
     • Figure 11: Total U.S. retail sales and forecast of craft and craft-style beer market, at current prices, 2007-17
     • Figure 12: Total U.S. retail sales, forecast, craft, craft-style beer market, inflation-adjusted prices, 2007-17
   • Fan chart forecast
   • • Figure 13: Total U.S. market and fan chart forecast of craft, craft-style beer market, current prices, 2007-17

7. Market Drivers

   • Key points
   • Evolving habits present consumption conundrums for alcohol marketers
   • Entire Millennial generation will be of legal drinking age in 2015
     • Figure 14: Population, by generation, 2012
   • Escalating obesity rates spur alcohol reduction
     • Figure 15: Obesity, by age group, 2008 vs. 2012
   • Rising food prices could squeeze craft beer budgets

8. Competitive Context

   • Key points
   • Domestic and imported beer remain an obstacle for craft beer
   • • Figure 16: Consumption of beer by category in 000 of 2.25-gallon cases, 2010-11
   • Wine most successful at stealing share in the alcohol market
     • Figure 17: Wine consumption in 000 of 9-liter cases, 2010-11
   • Variety provided by spirits tempts drinkers
     • Figure 18: Distilled spirits consumption by category in 000 of 9-liter cases, 2010-11
   • Hard cider follows path blazed by craft beer
   • • Figure 19: Leading brands of cider in 000 of 2.25-gallon cases, 2010-11

9. Category Performance

   • Key points
   • Craft and craft-style beer continues growth amid recession
   • Dollar sales of craft and craft-style beer market
     • Figure 20: Total U.S. sales and forecast of craft and craft-style beer, at current prices, 2007-17
   • Case sales of craft and craft-style beer market
     • Figure 21: Total U.S. sales and forecast of craft and craft-style beer, in 000 of 2.25-gallon cases, 2007-17

10. Retail Channels

    • Key points
    • Other channel far outsells competing off-premise retailers
    • Sales of craft and craft-style beer, by off-premise channel
      • Figure 22: Total U.S. dollar sales of craft and craft-style beer, by off-premise channel, 2007-12
    • On-premise segment takes second place in craft beer sales
    • Microbreweries attract consumers to their on-site brewed beers

11. Retail Channels—On-premise

    • Key points
    • Beer is top on-premise alcohol choice, but faces “spirited” competition
    • On-premise sales of alcohol
      • Figure 23: On-Premise retail dollar sales of alcohol, 2006-11
    • Consumers most likely to increase on-premise craft beer orders
      • Figure 24: Alterations in beer consumption habits, by type of beer, July 2012
    • Restaurants make room for craft beer on menus
      • Figure 25: Ingredient by quarter for domestic beer, only brand is listed at buffets, chain restaurants, independents, non-commercial locations, top 100 chain restaurants, and top chefs, Q3 2012
    • Large beer selection encourages on-premise purchases
    • Playing matchmaker: Food and craft beer pairings proliferate

12. Retail Channels—Off-Premise

    • Key points
    • Specialty retailers corner craft beer market, supermarkets make inroads
      • Figure 26: Craft beer retail channel preferences, July 2012
    • Convenience a factor for all ages in choice of craft beer retailer
      • Figure 27: Craft beer retail channel preferences, by age, July 2012
    • Westerners most likely to buy craft beer in supermarkets
      • Figure 28: Top five retail channel preferences for craft beer, by region, July 2012
    • Supermarkets craft innovative beer strategies, private label
    • Craft brewers place emphasis on convenience stores
    • Liquor, specialty stores highlight craft beer selections
      • Figure 29: Binny’s Beverage Depot “The Beer Buzz” e-newsletter, Nov. 2, 2012
    • Ever-expanding craft selections in natural channel home to niche beers
    • Sales of craft beer in the natural channel
      • Figure 30: Natural supermarket sales of craft beer, at current prices, 2010-12*
    • Sierra Nevada, New Belgium lead natural channel sales

13. Leading Companies

    • Key points
    • Blue Moon, Leinenkugel’s lead MillerCoors’ dominance
    • A-B InBev growing its craft beer stable through Shock Top, acquisitions
    • Leading corporate-owned craft-style brands
      • Figure 31: Manufacturer case sales in 000 2.25-gallon cases, 2009-11
    • Boston Beer tops craft brewer ranks due to diverse portfolio
    • Sierra Nevada, New Belgium feed demand with East Coast brewery plans
    • Shiner, Bell’s see strong growth, Deschutes set to expand
    • Top craft brewing companies, 2009-11
      • Figure 32: Craft beer manufacturer case sales, in 000 2.25-gallon cases, 2009-11

14. Brand Share—Craft-Style Brands

    • Key points
    • MillerCoors positions Tenth and Blake brands for growth
    • • Figure 33: Henry Weinhard’s coupon flier, Nov. 4, 2012
    • Innovations from Shock Top grow A-B InBev’s craft-style portfolio
    • Vast portfolio benefits Craft Brew Alliance
    • North American Breweries transfers ownership
    • U.S. craft and craft-style beer sales
      • Figure 34: Multi-outlet aggregated (MULO) sales of U.S. craft and craft-style beer, 2011-2012

15. Brand Share—Top Three Craft Brewers

    • Key points
    • Boston Beer Company retains top spot among craft brewers
      • Figure 35: Boston Beer Company Shipments, 2006-11 in 000 of 2.25-gallon cases, 2006-11
    • Sierra Nevada looks to expand capacity to keep up with sales
      • Figure 36: Sierra Nevada Brewing Company Inc. Shipments, in 000 2.25-gallon cases, 2006-11
    • New Belgium’s growing portfolio spurs brewer to look eastward
      • Figure 37: New Belgium Brewing Company Inc. Shipments, in 000 2.25-gallon cases, 2006-11

16. Brand Share—Up-and-coming Craft Brewers

    • Key points
    • Gambrinus’ Shiner, BridgePort brands fuel sales growth
      • Figure 38: Gambrinus Company shipments, in 000 2.25-gallon cases, 2006-11
    • Deschutes Brewery continues modest expansion pace
    • Craft beer’s rising tide helps float many brewers across the country
    • • Figure 39: Shipyard Brewing Company, television ad, 2012
      • Figure 40: Breckenridge Brewery, television ad, 2012

17. Innovations and Innovators

    • They put what in a beer? Craft brewers show no fear of experimentation
    • Teamwork: Collaboration beers capitalize on brewery loyalty, curiosity
    • Crowd-sourcing projects give craft beer fans a piece of the process

18. Marketing Strategies

    • Overview of the craft beer landscape
    • Brand analysis: Blue Moon
    • Online initiatives
    • TV presence
      • Figure 41: Blue Moon, television ad, 2012
    • Brand analysis: Leinenkugel’s
    • Online initiatives
    • TV presence
      • Figure 42: Leinenkugel’s, television ad, 2012
    • Brand analysis: Samuel Adams
    • Online initiatives
    • TV presence
      • Figure 43: Samuel Adams, television ad, 2012
    • Print and other
    • Brand analysis: New Belgium Brewing Company
    • Online initiatives
    • TV presence
      • Figure 44: New Belgium, television ad, year
    • Print and other
    • Brand analysis: Dogfish Head Craft Brewery
    • Event marketing and other initiatives
    • Online initiatives
    • Brand analysis: Stone Brewing Company
    • Event marketing and other initiatives

19. The Consumer—Usage, Purchase, and Occasions

    • Key points
    • Craft volume consumption in line with other beer segments
    • • Figure 45: Volume consumption of beer, by type of beer, July 2012
    • More experienced 25-34 year olds lead craft beer consumption
    • • Figure 46: Incidence and frequency of craft beer consumption, by age, July 2012
    • Young men most frequent craft beer consumers
    • • Figure 47: Incidence and frequency of craft beer consumption, by gender and age, July 2012
    • Women more likely to consume fewer craft beers
    • • Figure 48: Volume consumption of beer, by type of beer, by gender, July 2012
    • • Figure 49: Frequency of beer consumption, by type of beer, by gender, July 2012
    • Consumers choose craft beer as a partner in social situations
    • • Figure 50: Craft beer consumption occasion and location, by age, July 2012
    • Picket fence dwellers more likely to pour a craft brewed pint
    • • Figure 51: Incidence and frequency of craft beer consumption, by area, July 2012
    • Premium-priced craft beer finds niche with $100K+ earners
    • • Figure 52: Incidence and frequency of craft beer consumption, by household income, July 2012
    • • Figure 53: Volume consumption of craft beer, by household income, July 2012
    • Increase in consumption more likely among younger men and women
    • • Figure 54: Alterations in craft beer consumption habits, by gender and age, July 2012
    • Health the biggest reason for drinking less craft beer this year
    • • Figure 55: Reasons for reducing craft beer consumption, July 2012
    • Wine, spirits represent beacons for bored beer drinkers
    • • Figure 56: Reasons for reducing beer consumption, by beer types, July 2012
    • Men see taste advantage of craft beer, not quite sure of value
      • Figure 57: Attitudes toward taste and value, domestic vs. craft beer, by gender and age, July 2012
    • • Figure 58: Attitudes toward taste and value, imported vs. craft beer, by gender and age, July 2012
    • West stakes claim as most popular region for craft beer
      • Figure 59: Frequency of craft beer consumption, by region, July 2012
    • Midwesterners stepping up craft beer pours
    • • Figure 60: Alterations in craft beer consumption habits, by region, July 2012

20. The Consumer—Attitudes and Behaviors

    • Key points
    • Craft brewers’ focus on taste resonates with fans
    • • Figure 61: Important attributes when selecting beer, by type of beer, July 2012
    • Brand name remains top pull for craft beer drinkers
    • • Figure 62: Attitudes and behaviors toward craft beer purchase, July 2012
    • Peer pressure less of a concern for craft beer loyalists
      • Figure 63: Beer drinking attitudes and behaviors, personal vs. peer, July 2012
    • Is curiosity a natural part of craft beer consumers’ habits?
    • • Figure 64: Beer drinking attitudes and behaviors, beer discovery and recommendation, July 2012
    • Draft, freshness not as much of a preference for craft beer drinkers
    • • Figure 65: Beer drinking attitudes and behaviors, draft and freshness values, July 2012
    • Promotion, price more of a concern for craft beer consumers
    • • Figure 66: Important attributes on price and packaging when selecting beer, by type of beer, July 2012
    • Expense, desire for education pose barriers to craft beer consumption
    • • Figure 67: Attitudes toward craft beer, July 2012
    • Craft beer + food = One happy couple
    • • Figure 68: Beer drinking attitudes and behaviors, Beer pairing, by beer type, July 2012
    • Social settings might help more women consider craft beer
    • • Figure 69: Craft beer consumption occasion and location, by gender and age, July 2012
    • Men care about brewery while women prefer flavors, beer claims
    • • Figure 70: Factors influencing purchase of craft beer, by gender, July 2012
    • Millennials most opinionated about price and flavor
    • • Figure 71: Important attributes when selecting beer, by generation, July 2012
    • Millennials, Gen X like craft beer’s taste, but give no points for value
      • Figure 72: Attitudes toward taste, domestic vs. craft beer, by generation, July 2012
    • • Figure 73: Attitudes toward taste and value, imported vs. craft beer, by generation, July 2012
    • Quality appreciation more prevalent among Millennials
    • • Figure 74: Attitudes toward craft beer, by generation, July 2012
    • Younger consumers also more interested in brewery details
    • • Figure 75: Factors influencing purchase of craft beer, by age, July 2012
    • Interest in ingredients transcends age
    • • Figure 76: Factors influencing purchase of craft beer, by age, July 2012
    • In the West, brewery’s role is best, Northeast is all about green
    • • Figure 77: Factors influencing purchases of craft beer, by region, July 2012
    • Independence is valued in the country, while artisan favored in cities
    • • Figure 78: Factors influencing purchases of craft beer, by area, July 2012

21. Race and Hispanic Origin

    • Key points
    • Asians, Hispanics among most frequent craft beer drinkers
      • Figure 79: Incidence and frequency of craft beer consumption, by race/Hispanic origin, July 2012
    • Hispanic consumers opt for six-pack or so of craft beer a month
      • Figure 80: Volume consumption of beer, by type of beer, by Hispanic origin, July 2012
    • Brewers should capitalize on Hispanics’ craft beer curiosity
      • Figure 81: Attitudes toward craft beer, by Hispanic origin, July 2012
    • Price, selection influence the retail choices of Hispanics
      • Figure 82: Retail channel preferences for craft beer, by Hispanic origin, July 2012
    • Blacks show least interest in craft beer segment
      • Figure 83: Attitudes toward taste and value, domestic vs. craft beer, by race/Hispanic origin, July 2012
      • Figure 84: Attitudes toward taste and value, imported vs. craft beer, by race/Hispanic origin, July 2012

22. Appendix—Other Useful Consumer Tables

    • • Figure 85: Alterations in craft beer consumption habits, July 2012
    • • Figure 86: Attitudes toward taste and value, domestic vs. craft beer, July 2012
    • • Figure 87: Attitudes toward taste and value, imported vs. craft beer, July 2012
    • • Figure 88: Important attributes when selecting craft beer, July 2012
    • • Figure 89: Incidence and frequency of personal beer consumption, by type of beer, July 2012
    • • Figure 90: Natural supermarket sales of craft beer, at inflation-adjusted prices, 2010-12*
    • • Figure 91: Incidence and frequency of craft beer consumption, by generation, July 2012
    • • Figure 92: Volume consumption of craft beer, by age, July 2012
    • • Figure 93: Volume consumption of craft beer, by urban area, July 2012
    • • Figure 94: Volume consumption of craft beer, by age, July 2012
    • • Figure 95: Retail channel preferences, by craft beer, by household income, July 2012
    • • Figure 96: Beer consumption occasion and location by craft beer, by Hispanic origin, July 2012
    • • Figure 97: Beer consumption occasion and location by craft beer, by generation, July 2012
    • • Figure 98: Alterations in craft beer consumption habits, by generation, July 2012
    • • Figure 99: Attitudes toward craft beer, by age, July 2012
    • • Figure 100: Factors influencing purchase of craft beer, by generation, July 2012

23. Appendix—Trade Associations