Exploring craft beer's huge growth and possible demise.
The Tasteless 80's
Let’s go back in time to the 1980s where a trip to the bar meant a night of breathing in cigarette smoke, shooting pool, and drinking one of the few beers available on tap. Most of the time, the beers on tap were the same brand as the bottled beer, and let’s be honest, the only thing making beer good in the 80s were hairbands playing on the jukebox. No one was actively going to their local bar to taste beer and explore, but they were simply there to get drunk. In the 80s most of today’s craft beer drinkers had yet to exist.
Beervana covers interesting topics in the world of beer from the business of beer to the culture. They give insight into how people perceived beer in the '80s before the boom of craft beer:
“Americans had no idea that beer styles existed. “Beer” didn’t come in flavors, beer was the flavor. Here in Portland, a transition began early, thanks largely to the growing popularity of brewpubs. People interested in good beer realized brewpubs offered more than one flavor, and they became the medium for exploration.…We felt very daring drinking our black ales. And by the standards of a decade earlier, things had changed. Now there were beer fests and several breweries, and a growing number of people who knew what IPA, porter, and pale ale was.”
Some regions in the U.S., particularly in the Pacific Northwest may have been ahead of the beer game, but to most of America beer was just…beer. There was no asking the bartender “What’s good?”, you simply just asked “What do you have?” and drank it, not thinking another second.
Nirvana, 2Pac, and...Craft Beer?
Fast forward about 10 years to when brewpubs soon started offering more to the public
in the mid-90s with new brands starting to bottle their own beer. A wave of unique beermakers hit the scene by offering a difference in “hoppiness”, “taste”, and “color”.
First We Feast is home to a great combination of eats, recipes, and drinks in order to enhance your tastebuds. Aaron Goldfarb of First We Feast writes about the 90s craft beer surge:
“The breweries that made their mark during this time were ones like Dogfish Head (started in 1995), an early pioneer in culinary beers utilizing things like apricots, algae, herbs and spices, and even boiled lobsters. Or Stone Brewing (1996), famed for hop bombs with bold names like Arrogant Bastard and Ruination. Breweries like these, and even smaller ones like Russian River and The Lost Abbey, would soon bring the geeks into the fold, who seemed to like collecting the beer as much as they liked actually drinking it.”
Craft beer became a commodity due to the goofy, out-of-the-box thinking of craft brewers. Up-and-coming beer companies realized that differentiation was the tactic to reach a new brand of beer drinkers: Nerds and adventurers. Grunge, 2pac vs. Biggie, and chain microbreweries ruled the 90s but of those only one withstood the test of time: Craft beer.
The Next 20 Years (2000-2020)
Beverage Master Magazine gives valuable tips to people about all types of alcoholic beverages and gives up-to-date information on the current trends in the beer industry. They give insight into the mindset of aspiring microbrewery after the 90s surge:
And so, the barrier to entry became the notion that “It’s just so crazy it might work” and the finances to afford the most minimal amount of equipment. Buoyed by an industry (and industry association) that boasted double-digit growth numbers for 20+ years, banks were eager to throw loans at anybody who could write a passionate business plan. But when those breweries started, they were different than the earlier ones. They were not built by the originators and inventors, the people that had traveled abroad and found new ideas to bring home. They were started by their fans. They were started by eager homebrewers who wanted to do the same thing their heroes did, and when they started breweries, they started home breweries instead.
Every Joe Schmoe was making their own beer on the preface of producing the next game-changer. The growth in the industry was comparable to the current Bitcoin craze with everyone trying to buy-in, but if you are not first in the game, you're second. That is why we are starting to see the market flatten out. Too many people are playing the game but there is only room for the few elites.
The Craft Beer Market Flattens
Beverage Dynamics provides its audience with the latest news on beer, wine, and spirits. Sam Calagione in his interview with Beverage Dynamics realizes the future of craft beer is at a stalemate:
“Five years ago, craft beer was still a niche community. Now it’s moved into mainstream acceptance. It’s a trend, not a fad. But we’ve hit a moment where beer overall is flat.”
People simply are not drinking beer as much as they used to because of the competition that the big boy brands continue to roll out. The amount of beer that people drink has seen a 25% decrease which should make brewers very cautious of what is to come in the following years, this can be attributed to the roaring presence of seltzers, ciders, and low carb alcoholic-beverages. The Growler’s Simon Nielson offers his input on the reason breweries don’t work out:
“It is a risk to go with your own unproven creation; it may not resonate with people. It is far easier to go with what seems to be working in the market, but in the long term, that decision carries with it the risk of slowly killing what it is we have all fought together to build.”
When breweries witness other’s successes, financially it makes sense to follow the trend. Following the trend and always being second is what is ultimately putting breweries out of business.