What is the status and future for craft brew?

Status: Mo' Money
Future: Mo' Problems

 

What do you think?

 

I think InBev does compete more with spirits for share of drinking occasions among people who don't care so much for or about quality.

 

Would it be fair to say that the majority of macro drinkers are using the beer as an alcohol delivery device? If so then I can totally see where spirits would be their main competitor.

I mean is the guy buying the case of Natural Ice at the grocery store going home and pouring into a tulip glass and posting about it on marcoadvocate.com or is he drinking to get a buzz and relax?

 

I tend to buy into the argument that craft is not really a big competitor for macros. They're kind of different markets. I think if you split up alcohol in general in to 1) the cost-driven market and 2) the differentiated, luxury market, macros tend to fall into 1) along with cheaper liquor, and craft into 2) with nicer wines and spirits.

Honestly, craft's more direct competition might be good wine and spirits, or at least for many BAs. I know for me personally, I don't debate between BMC and craft, I debate between good whiskey (and occasionally wine) and craft. On some level, the craft market can pull people from the BMC market by convincing people that, "Hey, you don't have to drink that bland BMC stuff. For just a few bucks more, you can drink this flavorful beer", but there is a certain level of the BMC market that is "Spend a small amount of money, get a lot of beer to throw back all day" that craft probably won't have much effect on.

Of course, the market is more complicated. Even within BMC there is cheaper brands, premium and super premium or however they split it up. I guess in my opinion, before craft, beer just had no place in the luxury alcohol market, but now craft is making it's way into it.

 

The coffee industry provides an example worth considering. Fresh coffee was roasted locally and was replaced by mass produced, national brands. I think people got used to an inferior product that was well marketed. That remained the case until Starbucks came along and provided better quality coffee and consumers became more discerning. Now, craft roasters are emerging with an even higher quality product and the market has changed.
Boston Beer Co, and Sierra Nevada have been at the front of the line, and for many, are an introduction to the craft beer world.
Now that craft beer has gained market share and momentum, more people will be converted from BMC adjuncts to the real deal. The trend should continue as more people learn about and choose craft beer. If the giants make more 'craft' beers, they will only fuel the movement.