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Monday, March 18, 2013

Brewers Association 2012 Numbers: Ten Percent

The Brewers Association has the latest numbers out on their members' annual performance and, as we've grown used to seeing, they're eye-popping.  The topline results:
  • Member breweries produced 13.24 million barrels
  • BA member breweries now control 6.5% of the market (up nearly a point in one year)
  • BA member breweries earned 10.2% of the retail sales in the $99 billion market, up over a point from a year earlier.
  • Total breweries in the US (not just BA member breweries) increased by a net 366 to 2,403.
Identify the key stat there?  I suspect the brewery total will get the most attention--and it's a gaudy figure.  But it's meaningless: there are over 7,000 wineries in the US, too, but what does that tell us?  Almost none of those breweries will make more than a few hundred barrels of beer, so together they amount to about one Full Sail-sized craft brewery.  The total production soaring over 13 million is more impressive--just two years ago they were still below 10 million--as is that figure about total market share.

But what really catches the eye is the one about sales.  Keep in mind that 10% only counts member breweries--if you look at the total market for non-macro lager it's probably around 15%.  And that is easily enough to put the whole business of selling beer upside down, particularly when you look at the trend line.  As recently as a generation ago, mass-market domestic lagers controlled almost the entire market--97, 98% of it.  Since then, thanks to imports, craft beer, and whatever you want to call that category Blue Moon is in, it has continued to dwindle annually.  And it's now in freefall: in 2011, BA's member breweries sold $8.7 billion of beer.  They took another 1.5% of the market in one year.

Americans' beer tastes are changing, and I don't think there's any doubt but that we've reached a tipping point.  To what is not clear, but the country is not about to revert to drinking only mass market lagers.


  1. Well put, and fully agree. Long-term structural changes are accelerating, IMO.


  2. I understand (well, I think I do...) what you're trying to do by using the term "BA member breweries" rather than using their "craft brewers" terminology but it should be noted that the Anheuser-Busch and MillerCoors individual breweries (all 20 of them) and their subsidiary brewing companies (like Goose Island or Leinenkugel) are each "BA member breweries", as are a few of the breweries they don't consider "craft" like Yuengling, Cold Spring and Genesee/NAB.

    Also, the B.A.'s use of 10.2% "dollar share" of the market is an interesting statistic especially when compared to their actual, smaller volume share (which has traditionally been the industry convention to measure and compare sales in barrels, not dollars) but it does have its problems.

    If those breweries' dollar share went up 1.5% that does not mean necessarily that the amount of beer sold went up that much, but instead could imply that their prices went up that much (more) or their more expensive products sold better.

  3. I'm struck by the emergence of craft/crafty/what have you in bars and restaurants that I would never, ever expect to see it in. If there is a visual indicator for the success of good beer, that has to be it. 'Round these parts, it's almost becoming an anomaly for a bar or restaurant to NOT offer something other than the expected brands.

    I'm not sure if this exists, but I would love to see data showing what percentage of drinkers consume both craft and macro brands regularly. I think we fall prey to thinking that the majority of drinkers would fall into an "either/or" category. But I'm willing to bet that a large portion of drinkers happily consume as much Sierra Nevada as they do Budweiser.

  4. Jess, that's actually my point. Beer geeks tend to focus on volume as the relevant measure, but obviously, the thing that is really turning the market is dollars. Nothing is more persuasive to a company than the bottom line. And right now, making "craft" beer is showing impressive profitability.

    Christopher, here's some ammo for your theory.