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Home | The Hop Bine | Trend of the Year – Convergence

Trend of the Year – Convergence

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On your bike: when will craft become multinational?

Multinationals gauge their responses to craft, and vice versa

This is perhaps unique: a website age-verification with prescience. Oregon-based 10 Barrel Brewing asks as expected if visitors are aged 21 or over, or with humour suggests they possess a good fake ID. And then there’s an additional option: “I’m a brewery owner with no game trying to steal your ideas.”

Was this wise? For it’s the option Anheuser-Busch checked in November, with enthusiasm, announcing that it had acquired 10 Barrel’s brands, brewery and three brewpubs for undisclosed financial considerations. Chances are the price tag ran into the millions, what with the company’s name disguising that its annual production is in the region of 40,000 barrels rather than 10, marking it as a regional player.

It’s A-B’s second regional American craft brewer acquisition this year, having snapped up Blue Point Brewing Co, based in the state of New York, again for an undisclosed sum.

Add to this its earlier acquisition of much larger Chicago-based Goose Island and a pattern emerges of a brewer intent on having regional craft brewing presences. I could be wrong about thus, but if I’m right there’ll be an announcement within the next 12 months of the purchase of an as yet unidentified craft brewer in Texas who’ll then be able to enjoy thumbing through glossy brochures for yachts. 

For A-B it makes sense. In the American three tier system many of A-B’s distributors are tied houses and would benefit competitively from having greater access to craft offerings. Keep the craft brewery founders in place, as is the case with 10 Barrel, add to this A-B marketing muscle and distribution and it’s a winner.

All of which illustrates what can be termed the Trend of the Year 2014 – convergence – the competitive responses of multinational brewers to the ever-growing challenge of craft brewers. And vice-versa.

For as craft grows, industrial-scale brewers are starting to resemble giants who have lost their fingers and toes. Or trees without roots. Or office workers bleeding from a thousand paper cuts. Small can defeat large, with individual puniness redressed by strength in numbers.

A-B isn’t alone in fighting back by acquiring craft brewers. There was an under the radar acquisition earlier this year by Carlsberg of a Czech brewer, Zatec, one with considerable heritage that could have its brands positioned as craft offerings. And there may be more to come from the Danes in the realm of craft brewing acquisitions.

Heineken has said in the past that it isn’t looking for craft acquisitions – but it doesn’t mean that it won’t make use of what becomes part of their brewing empire through bigger transactions. This autumn a portfolio of beers from Monteith’s, a New Zealand microbrewer, were launched in several Western European markets. And one wonders when there’ll be news of new markets for beers from the Caledonian Brewery in Edinburgh, which became Heineken’s property in the division with Carlsberg of Scottish & Newcastle assets. 

All of which allows larger brewers to round out their portfolios, to allow their salespeople to talk up craft in the on-trade alongside the surer marketing-driven excitements of their premium brands. It may seem like small potatoes but its importance at the coalface is not to be underestimated.

On the other hand

The flip side of this is that there are a handful of craft brewers who are starting to act much more like larger brewers than as one of their craft brethren. In the US, there are handfuls who are investing in brewing platforms that allow for a national presence. Boston Beer was the first, but they’ve been joined by New Belgium and Sierra Nevada, both of which are opening breweries in North Carolina, opposite coast opportunities distant from their respective Colorado and California starting points.

And add to this San Diego’s Stone Brewing, which not only plans to have operational a brewery in Richmond, Virginia by the close of 2015 but is also working on what could might classed as a regional brewery in the heartland of European brewing, Berlin, Germany. 

Perhaps you’re thinking that I’m getting ahead of myself here – and you could be right. But at the moment everything favours craft brewers: a younger demographic that has tired of marketing led-brands and favours tastes, and discovering said taste. Add to this localism, where increasingly in pubs and bars customers are asking what the ‘localist’ beer is on tap. 

And in marketing terms craft brewers have occupied the territory that will certainly undermine – and should have belonged to – their larger competitors, with an insistence on communicating use of buckets full of natural ingredients, and traditional brewing processes. 

So industrial scale brewers need to compete in the craft realm, increasingly for reasons of self-defence rather than for simplistic profitability. And there are craft brewers now who in five years’ time will be able to be classified as multinational brewers in their own right. 

The Brewers Association in America, the country’s organisation for craft brewers, is targeting 20% of national beer volumes by 2020. Increasingly this seems like a realistic possibility. 

And there’s the thing – come 2020 the convergence of craft and industrial brewers will no longer be the Trend of the Year. It will be the Story of the Year, not just in the craft heartland of America but across Western Europe, Australia, perhaps even China, Japan and South Korea. 

To date we’ve just witnessed the origins of the competitive responses between brewers large and small. It is very much game on.

A verison of this column was first published by the good people at



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