Friday, June 12, 2009


Been to a gas station or grocery store lately? Noticed the beer aisle? Full of craftish looking beers isn't it. Wild Blue, American Ale, Blue Moon, and the entire line of Michelob's new brews. This is a direct response to craft beers recent surge in popularity. Just for a second, lets consider why craft beer is more popular today. The public in general is interested in higher quality things. Go to any grocery store and I bet you will notice gourmet things every where; cheese counters, olive bars, 5 or 6 types of olive oils, etc. Hell, my local Winn Dixie has truffle oil. Consumers in general are becoming more informed and are demanding better quality products.
The craft beer industry has shown people that beer doesn't have to mean pale and fizzy with no taste and people are becoming interested. Craft beer is one of the fastest growing industries right now, and it's all due to consumer awareness.
Now the boys at BMC are no dummies, they saw the potential of good beer and jumped on it. Blue Moon is the fastest growing brand in beer, period. Michelob is putting out some beers that are actually good. Hell, even Budweiser American Ale is pretty good. Now, we hard-core beer geeks aren't biting, but not everyone is like us. We want to try every beer made, and enjoy beers that push the envelope. Most people, however, don't want to keep up with the latest trends and drink 1,000 different beers. They just want one or two different beers that taste better than what they are used to. These faux-craft beers more that satisfy that, and at a cheaper price. If they see a 6 pack of DFH 60 Minute for $9.99 and a six-er of Michelob Pale Ale for $6.99, which one do you think they are gonna get? Now add the sheer dominance of BMC when it comes to shelf space, the monster that is Anheuser-Busch's marketing strategy and their lobbying on behalf of silly laws that give them an advantage and craft beer will never really do any serious damage to the big three.The only way craft is going to be able to gain any advantage is to market better. They are doing a helluva job of reaching their core base, but their core base is small. To make real money they need to reach the Heineken drinker, the blue moon drinker, the Michelob drinker, etc. They need to convince people that their product is better than that of the big three. The only way to do that is mass marketing. There are two problems with that... First is money; no craft brewer, with the exception of the Boston Beer Company has that kind of resources. My suggestion there would be a co-op of sort. Just like the dairy farmers and beef and pork producers do. I would love to see ads from the Craft Brewers of America all over the boob tube. They could combine resources and really reach out.The second issue is a bit harder to deal with. There seems (to me at least) to be a certain pride in not using marketing, and just letting the product speak for itself. That works fine in something like the wine world, where hardly anybody engages in mass marketing and the consumer base as a whole is very informed. However, when taking on BMC, the kings of marketing, it's a different story. These guys built an empire on ad campaigns. They make an inferior, water downed product and conviced people that it was what they wanted. Sometimes, you just have to fight fire with fire. So, start putting out ads making fun of pale watery beers produced by huge corporate giants. Until craft brewers realize that they have to do more in the ad department, they are going to continue to lose market share to the big boys. I really believe BMC is just getting started on the craftish trends and once they get rolling, unless crafts fight back in a more effective manner, it's going to get ugly.


  1. I enjoyed your post, but disagree with "unless crafts fight back in a more effective manner, it's going to get ugly." As we know craft beer drinkers are craft beer drinkers through and through. So what if BMC starts tapping into the's not going to push current craft beer drinkers towards their product. What this does for BMC is it gives them a larger advantage against their major competitors, which do not include craft breweries.

    Looking towards the future I have two major thoughts on this issue...the only way craft beer can lose out is if enough craft breweries sell out to the macros. If companies like BMC can control enough of the actual craft beer market then all hell will break loose. Otherwise, I feel as though BMC's attempts to compete with craft beer will only be a detriment to them in the long run. By turning people onto better beer they may be tempted to continue to try new beers.

    Good work with your post. I thought you were very even handed.

  2. Nice write up Gil, most has been said befoe, but you did put a newist slant on it. I have a different opinion of course. i think craft beer is in a fad phase still, way way too many brewers atm, it will crash, is has too. Simply because of money and market share. its economics 101.

  3. First of all thanks for reading and giving feedback. As far as craft drinkers go, I'm not referring to people who really love craft, and try to learn as much as possible. I mean the guy who is tired of bud or miller or whatever and wants something better. I really believe that's the consumer that's really driving up the sales figures for craft beer. Sure us true blue craft nerds are the base of the market and the ones the breweries market to, but we are a small group.
    Now on to you Steve, i see your point, but i don't think its just a passing fad. I do agree that the market can't support 1,400 breweries for much longer. One of two things is gonna happen. The lesser breweries will fail and the cream will rise to the top leaving about 100 or so breweries producing the majority of craft beer. Or, the big boys take over, drive out the smaller guys and we get sorta craft. Its happened before, after prohibition, it can happen again.

  4. While I think American Ale stinks, especially for the price, Michelob does have some pretty palatable offerings at a 4.99-6.99 (depending on retailer) price point. If the "battle" with craft beer is getting better product on more shelves, so be it. Good beer is good beer. If people start drinking better quality brews, we're going to see more and more quality brews offered (regardless of the source).