The Brewers Association just released its “2016 Mid-Year Beer Category and Craft Segment Review,” and it’s fantastic news for craft beer!
Craft beer, according to the presentation, saw the highest growth at 9.4% increase in change versus the year’s average, bringing in an additional $120 million at mid-year to reach a whopping total of $1.4 billion in annual craft beer sales. FMB beer – or Flavored Malt Beverages – saw the largest increase of 18.6% in change versus YA, collecting more than $81 million more dollars, for a total of $518 million in sales as second highest earner of new beer drinkers. With such a massive amount of sales, it is important that those selling it have some way to track and manage this. It’s assumed some form of sales management dashboards has been put in place to do this.
According to the data, infused craft beer bypassed cider for sales earlier this year, the largest instance being in FMBs which lead the growth in all segments at +0.5. Infused beers are seeing significant sales, 12 of the top 16 new beer brands have some flavor element added to them, the biggest player being Henry’s Hard Soda Orange. In 2016, the newcomer sold 2.24 million cases of the beer by the middle of 2016, compared to Coney Island Hard Root Beer, which sold 4.8 million cases in 2015.
Top 16 NEW Beer Brands (including FMBs): (Source: IRI InfoScan Total US FOOD, YTD ending July 10, 2016)
The market also gravitated toward Infused Beers, whose share of Total Beer Dollar Sales has increased by 4.9% since 2012.Leading the New Beers craft beer pack (FMBs excluded) with $5.6 million in supermarket sales is the citrus-infused New Belgium’s Citradelic Tangerine IPA, followed by Samuel Adams’ Rebel Grapefruit IPA. If these two beers tell you anything, they are telling you that Americans love fruit-forward IPAs.
Top 15 New Beer Brands: (Source: IRI InfoScan Total US FOOD, YTD ending July 10, 2016)
Fruity IPAs? Yes. Traditional IPAs? Yes. Samuel Adams’ Nitro? Yes. Mexican beer? Sure! Gluten Free? Yes! Two of the top 15 new beers were gluten free; New Belgium Glutiny Pale Ale and Orchard’s Edge Knotty Pear made this list earning a collective $1.08 million in supermarket sales at the midpoint. (Orchard’s Edge is actually a cider, not a beer so we’re not sure why it was on this list.)
So where is the craft beer market heading? For one, most of this data looks specifically at supermarket sales, which are not exactly standard across the board. Here in Colorado, we recently passed a law abolishing the 3.2% abv cap for supermarket beer, so our sales won’t be reflected in this data.
Top 10 Craft Beer Styles (Source: IRI InfoScan Total US FOOD, YTD ending July 10, 2016)
Will craft products continue to be the fastest growing segment of new beer sold in the country? Will IPAs be replaced by infused beers as the top supermarket seller?
New craft beer (52.6%), FMBs (37.3%) and cider (2.6%) account for 92.5% of all new beer sales in 2016. Craft beer alone is up from 42.6% in mid-year 2015. Keep in mind the majority of craft beer produced in the US is independently owned; infused beers are majorly produced by Anheuser-Busch InBev and MillerCoors ($165,838,449 and $131,618,865 in sales, prospectively). Infused beers or FMBs surpassed craft beer in supermarket sales by almost double for a 4-week period ($331,087,638 in FMB sales versus $$130,330,610 in craft beer sales).
The BA put together a few projections of what the average beer shopper will buy in 2020. They estimate the Hispanic population will account for 53% of population growth, as well as a 16% increase in blacks and 15% increase in asians, leading to a market rich with diversity, and we hope this diversity will be reflected not only in wide-ranging beer styles, but in industry personnel, craft beer fans, as well as in those enrolled in beer education programs.
According to the BA there are infinite ways to attract a beer patron; 26% of all drinkers – no matter the age – admit to drinking once a week or more (73% of home drinkers choose beer over wine or spirits), and prefer to make decisions based on quality over price. Millennials and Gen X’ers both love trying new things, prefer bars or restaurants, and are always trying the newest alcohol trends. We’ll drink to that!