Marketing Of The Craft Beer Market

During the past 30 years, Big Rock has provided beer drinkers across the country with a high-quality product line consisting of reputable brands such as Traditional and Grasshopper Ale. Moreover, due to the continuous change in craft beer drinkers, Big Rock has provided a diverse variety of flavours to compete in the craft market segment primarily in Alberta. However, as the industry becomes increasingly more competitive due to the exponential growth of microbreweries, Big Rock must continue to develop its brand and spread awareness beyond Alberta and across the country in order to address the stagnated growth that currently exists within the business.

One of the biggest problems companies may face is keeping up with the current trends and habits of all customers in their respective age groups. In a time period where trends can change as rapidly as they come, that makes it even harder for smaller and more domestic companies to compete with the larger, more known brands. This is especially true for the beer market, where the younger population consumes the more than 27% of all beer consumption in the United States and that number is still growing. In addition, these adults age 21-27 spend twice as much per capita compared to beer drinkers over the age of 35 and is projected to

     In this paper I will be talking about the U.S. beer industry and in short an overview of the brewing industry worldwide. I will talk about the barriers to entry, economies of scale, government intervention, pricing, current market trends, product differentiation, and imports. The focus being mainly on the U.S. brewing industry oligopoly. The U.S. brewing industry has three major players: Anheuser-Busch, SAB Miller, and Coors/Molson. Anheuser-Busch is currently the largest brewer in the world, producing over 100 million barrels a year. Anheuser-Busch currently owns over 50% of the market in the United States, with Miller trailing behind at 20% and Coors at about 11% with the rest of the market occupied by imports and craft breweries. When analyzing any industry, how easy it is for newcomers to enter the market is a great importance. If there are high barriers to entry

In a world where large, corporate breweries rule the market, craft beer is created to please an audience that applauds the styles, techniques and flavors. Though craft beer can be purchased through several different outlets, the best place to thoroughly enjoy the entire experience of the specially made beer is in the brewery where it was made. The article titled, “In Lean Times, a Stout Dream” in The Wall Street Journal1 states that, despite the hard economic times and consequent consumer cutbacks, sales of craft beer, the industry 's fastest-growing segment, rose

New Belgium is, however, the third-largest craft brewery in the nation, with estimated sales of over $100 million, equaling approximately 700,000 barrels of beer per year. An analysis of the craft beer industry as a whole suggests that there is continued growth potential for New Belgium. Exhibit 5.1 of the New Belgium Brewing (B) case shows that craft beer is the fastest growing segment of the U.S. alcoholic beverage market, with an increase in market share of over 100 percent from 1999-2011. It is also an industry whose customers tend to be extremely loyal, making them less likely to view craft beer as a commodity. Consequently, craft beer has a higher probability of being immune to competition from inferior goods and substitutes. This is particularly applicable to New Belgium’s target market of “beer connoisseurs” that appreciate the high quality and taste of craft beer and who include “executives, lawyers, and accountants” with the continued ability to pay higher prices for craft beer, enabling the craft beer industry to achieve gross margins of up to 30 percent (Clark & Rogler, 2013).

As of June 2015, there are eight breweries in Huntsville, soon to be nine. This smallish southern city, population 180,000, has undergone a total transformation as far as its craft brewing industry is concerned. Like so many other American cities, beer has come into the vogue, but few if any can claim to have experienced such as a rapid, radical, city-defining seismic shift. In just five years, “old veteran” brewing presences have been established and a younger generation has come along to reap the rewards of a clientele that continues to refine its taste. It’s still very much a work in progress, but to compare the “before” and “after” statistics is shocking. Thanks to a timely repeal of some antiquated laws that held the brewing industry back-a home brewing ban, an ABV cap, a ban on large-format bottles-craft beer is now free to thrive.

Investors for Craft Brewery Start Ups _______________________________________________ 24 Craft Beer in a Tin initiative:_______________________________________________________ 25 Corporate Social Responsibility ____________________________________________________ 26 Economics of Beer: _______________________________________________________________ 28 Building a Craft beer brand: _______________________________________________________ 29

Seasonality is crucial in the craft beer industry and it presents a great deal of challenges. Aside from their everyday offerings, which total approximately sixteen beers at any given time, they offer as many as twenty seasonal brews, four barrel room brews, five specialty brews, and fifteen limited releases. Their main seasonal offerings are Winter Lager (available November – February), White Ale (available February – April), Summer Ale (available April – August), and Octoberfest (available August – October). The brewing for these beers needs to be carefully planned to take advantage of the small windows of time that are available. Production needs have to be considered before brewing because the intention of these styles is to be in the market place for a short period of time, and then gone by the time the next beer arrives. The last thing that the company would want to happen is to be sitting on a large stock pile of Winter Lager in May when customers are already consuming the lighter Summer Ale.

The craft-brewing segment of the beer industry has experience fluctuations in demand from a high of 58% growth in 1995 to a decline of 5% annually from 1997 to 2003 (Gilinksy et al., 2014, p. C-92). However, it is now experiencing rapid growth. At the commencement of 2012, 6.5% of U.S. beer sales were generated by craft brewers and that number increased by 15% by the conclusion of the year (Gilinksy et al., 2014, p. C-92). The growth of the market presents LBC with an opportunity to generate additional revenue.

Stack is a newly established craft brewery located in Sudbury, Ontario. It’s the only brewery plant within the two hours’ drive from Sudbury. With only half a year of operation, Stack had received numerous positive feedbacks through selling their beer to 4 popular local establishment located downtown. Given the positive media article, Stack had developed a bunch of loyal customer. Also, a government grant of $125,000 was given to Stack based on growth and job creation potential. This will help increase the production capacity by 500%, necessitating the development of additional distribution and marketing communication strategy.

One key element that adds value to SNB is Ken Grossman’s continuous concern for the environment and the community:

Branding strategies include brand ownership, brand naming, product lines, brand and line extensions, co-branding, brand licensing, and brand repositioning. Pipeworks Brewing Company is a manufacturer’s brand that uses a family brand strategy. The family brand strategy as defined by (BOOK CITE) is where several products are sold under one name. Pipeworks sells hundreds of different beers all under the Pipeworks Brewing Company name. Pipeworks does not offer brand and line extensions, but they do participate in co-branding. (BOOK CITE) defines co-branding as “the practice of marketing two or more brands together, on the same package”. An example of Pipeworks’ co-branding strategy is working with local restaurants to brew beers specifically for that restaurant and placing both the restaurant and Pipeworks brands on the beer label. As of now, Pipeworks has not been involved in brand licensing and they have not had to reposition the brand. The target market and demographics for Pipeworks includes micro-brewery fans or craft beer drinkers. Typically craft beer drinkers like heavier and stronger beer and are not drinking Budweiser and Bud Light. According to Bart Watson, Chief Economist at the Brewers Assocation, the Median target individual for craft breweries are males, Age 39, white, highly educated, with a relatively high income. Bart Watson also goes on to say that “Young women (21-34) now over-index on craft, account for 15% of total craft volume

Within the craft beer market, consumers have many products to chose. A product is anything offered within a market that which fulfills a want or need (Armstrong & Kotler, 2015). In 2012, over 1,750 breweries operated in the United States (U.S.), with over 1,920 the following year (Brewers,

This report plans to outline the craft beer company Hop Invaders, and create a recommendation to help this business move forward. This report will also bring forward the customers, competitors, suppliers, and labour market, and how these feed into the recommendation.

Although sales of premium brands have fallen in a steady response to the growing popularity of the craft beer. The industry revenue has been stable over the past 5 years. As a result, from 2011 to 2016 the industry revenue is expected an increase and growth annually at 6.7 percent over the five years,with a total of $39.5 billion . (IBISWorld iExpert) In the long-term, these numbers are expected that grow 0.9 percent annually within the next five years. The potential growth will be seen in the traditional and premium beer sector. As a response, the giant companies in the industry Anheuser-Busch InBev and MillerCoors look forward into the merges and acquisitions as a strategy to maintain market dominance. The strategy is based on the