What’s Brewing in Craft Beer?

Key findings

Definitions continue to evolve

“Independence” continues to gain ground as a key feature of craft. A number of small brewer organisations in different markets have released “seals” which allow brewers to highlight their craft credentials, with the term “independent” featuring prominently. In the US, the Brewers Association has dropped the “traditional” pillar of its craft requirements.

Divergence in a slowing US craft market

The deceleration of craft beer growth continues in the US. The Brewers Association reported just 4% growth in 2018. In this new environment, there will be a divergence in the market, with the very local microbrewers on one side and the larger craft brewers with national or regional distribution, such as Boston Beer Company, on the other.

Brewers branch out

Competition in established craft markets is intensifying as growth slows, while new breweries continue to open. Many microbrewers are diversifying their offers by expanding into spirits, kombucha and, especially, alcoholic seltzers. To successfully incorporate new product types into their portfolios, brewers need to ensure there is a close fit with their original beer brands in terms of transparency, branding and quality of ingredients.

Urbanisation drives emerging market opportunities

A growing middle class and rising urbanisation are helping to drive the growth of craft in Vietnam and China. Microbrewers are opening across the world, focused in the early stages on metropolitan centres, but often quickly expanding beyond the major cities. International brewers are looking to capitalise on this growth through acquisitions.

Importance of adaptation

The development of craft is shaped by the issues and trends affecting the wider beer industry. Microbrewers are tapping into rising consumer moderation, and are taking steps to enhance their sustainability. Such adaptation will continue to prove crucial as fashions change and regulations evolve – those regarding cannabis, for example.