Here Comes "Mass Market Craft"

Source

Bryan Roth, beer's Nate Silver, has applied some data journalism to the idea that rare beers dominate "best of" lists--and beer geeks' hearts. Riffing on that, he wondered about causality: do we just happen to like rare beers, or do we like them because they're rare?

"It’s a long-winded way of saying: we may be underestimating the power wielded by the growing number of one-off programs and specialty releases. Emphasized through last 2016’s collection of best beer, there should now be a growing expectation that the most celebrated beers are often going to be ones we can’t enjoy ourselves."

Fair enough--there are scads of scientific studies out there showing how susceptible we are to influence when we think something's special. But what does this phenomenon look like when you flip it around and instead examine those large regional or national brands? Here, I would argue, is the real story. Within the craft segment (however you define it), there are emerging sub-segments. The vast majority of craft beer is still just a few brands--Lagunitas IPA, Sierra Nevada Pale, Sam Adams Boston Lager, Blue Moon and so on.

There are millions of barrels of interest in what beer geeks now deem boring beer. If a brewery wants to appeal to this, ahem, mass market within the craft segment, they can't hope to do it with a brett-aged saison. Indeed, the opposite is happening. As big money flows into the craft segment, it's looking to find stable, large chunks of customers for its products. Buoyed by Heineken money, Lagunitas shipped nearly a million barrels of beer in 2016, 60% of it IPA. Goose Island IPA is actually growing faster than Lagunitas IPA and poised to overtake it. Constellation is pushing tons of Ballast Point Sculpin in all the colors of the fruit bowl. None of these brands is younger than a decade old.

In order to capture that mass market, other breweries are far from "innovating." As one example, everyone is trying to recreate Sculpin's fruit-IPA success. Sierra Nevada has a fruit-infused pale and an IPA that tastes like fruit (Tropical Torpedo). Kona has a passionfruit, orange, and guava IPA. Dogfish Head has Flesh and Blood, a ... fruit IPA. Full Sail's got one with papaya just coming out. New Belgium has Citradelic. And on and on. (It's actually entertaining to visit the website of one of the larger craft breweries and see that they all have one.) Or take Firestone Walker, which scored an unexpected, massive hit with 805, a golden ale. Guess what style we're starting to see the big breweries brew now?

Of course, most of those breweries are also putting out the rare beers Bryan mentions. They have barrel programs or specialty lines, and they make the kinds of beers that make geeks' hearts sing. What this signals is that the market is in the midst of a stratification, and we're seeing breweries attend to both "specialty craft" and "mass market craft" sub-segments. (No doubt drinkers pass back and forth between the categories, as they do between craft and mass market lagers. These are not separate populations of drinkers, but they are separate sub-sectors.)

By chance, I was perusing this page by the consumer research company Mintel and discovered that they were already out in front of me. They distinguish between "true-craft" and "mass-craft." For the moment, they use the dichotomy to honor the Brewers Association's definition of "craft," but that is a dying (or perhaps dead) distinction. There is a real market difference, both in type and price, between the specialty and mass craft segments. And it is only going to widen. Once you introduce the idea of "mass-craft," there's no going back.

So to return to Bryan's thinking. What I'd say is that it's the upper end that's abandoning the aficionado. They're no longer competing to make the most distinctive, interesting beers for the large regional and national markets. They're looking to put out products that capture a large portion of the audience, for however long that beer can keep their attention. Beers like Citradelic and IPApaya were not designed to be workhorse brands that will take breweries into the next decade. They're quick, trendy, and disposable (and of course, occasionally very good). We fall in love with the rare beers because we're not meant to fall in love with these. They're like some of my filler blog posts.* A few clicks/bucks and everybody's happy. You'll know when I put out the good stuff.*

I have a hunch this will hasten the tide of rising cynicism among some beer drinkers, but it's not the breweries' fault; people are going crazy right now for fruit IPAs and golden ales, and so that's what they have to brew. I'm sure your local brewer would rather drink a saison, too, but there's just not enough interest to push one to a national market. Welcome to the era of mass-craft.

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*Ha, ha, kidding. Of course none of my blog posts are filler. They're all carefully considered and reported and run through my team of editors.

Beer Invades the Metroplex

Note: Because it's apparently not clear in the post, Portland has had beer in theaters since at least the late 1980s.  The McMenamins may well have had the first theater-pub in the US when it opened The Mission in 1987.  Now probably 80% of the indies and local chains serve draft beer.  It is Regal, the Tennessee-owned chain, that has finally--at least in one location--decided to get on board.

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I abandoned movie theater chains a decade ago. They had become too abusive: a high-volume onslaught of TV-style ads in the theater before the movie, sky-rocketing ticket prices, and concessions that were as bad as they were over-priced. Meanwhile, the proliferating indies offered ad-free viewing, low prices and--now almost uniformly throughout the city 4-8 handles of great beer and cider. I could go to the St Johns Cinema on opening day, grab a slice of pizza and a beer for barely more than it cost to go to a Regal metroplex. I was not alone. I watched as the traffic abandoned the Regal experience (a deliciously ironic name) and came over to the indies. 

Yesterday Sally and I decided to catch a Christmas Day matinee of the latest spectacular spectacular, but the indies were not available. (Good for them, giving the employees the day off.) So off we went to the Lloyd Center Regal and: ho!, what is this?

They haven't yet gotten to installing draft lines, but you can actually get a decent bottle of beer now. 

(1) This illustrates an interesting fact about the rise of drinking culture in the US. We no longer drink as much beer as we used to, but we like good beer when we go out to get a bite or catch a movie. This was never going to happen before craft beer came along. (2) Is this a thing everywhere, or just beery Portland, Oregon? My dataset is way out of date. 

The New Breed of Sweet IPAs

Last night, reclining on the roof of an undisclosed warehouse in the inner Southeast beneath an exploding sky, I poured out a measure of the new Deschutes Fresh Squeezed IPA.  It's one of the many IPAs out now that harnesses the intense fruitiness of new American hops, in this case Citra and Mosaic.  The name and tagline tell you everything you need to know about the beer's nature: "no fruit was harmed in the making of this beer."

When you have been tasting beer for decades, your mind has a tendency to become enclosed by habit.  IPAs have evolved in increments, from screamingly bitter, mildly grapefruity versions of the 90s to the increasingly aromatic, dank, dry-hopped incarnations in the mid aughts to now, when bitterness is dialed pretty far back in favor of vividly fruity IPAs.  Since it has gone in increments, I have mainly just revised my old mental model to accommodate for new trends.  IPAs are bitter beers rich with aromatics and hop flavor.  The formula may change, but these facts remain the same. 

But last night, one of the roof-sitters--not a beer geek--sampled Fresh Squeezed IPA and remarked: "Wow, that's a sweet beer."

He's right.  Deschutes put 60 bitterness units in this beer, but it has a ton of caramelly body (it's closer in color to Newcastle than Pilsner Urquell) that adds a lot of sugars to the mix.  Layer those intensely fruity new-variety hops on top and you add a level of juiciness the mind tracks as purely sweet.  From a sensory perspective, these aren't bitter beers at all--they are actually sweet. 

Even when the beer is stronger, has less sugars and more bitterness, the purity of the fruit flavors gives these beers a distinctly sweet character.  Boneyard and Gigantic make juicy IPAs that were, in Oregon, the harbingers of the sweetening trend.  Hop-growers have been going crazy bringing new products to the market, and what people seem to love most are the tropical fruit flavors.  (Hops with resiny, dank qualities or piney character seem to be fading, trendwise.)  I saw this in Europe, too, where breweries have more ready access to New Zealand hops, which also have saturated fruit flavors--though they tend toward berry and lychee. 

I was feeling somewhat oppressed by the heavy, ganja-like hopping that was most popular a few years back--those beers were a sensory and alcoholic kick to the head.  These new IPAs, sweet with the sunshine of fruit and often more sessionable, are right up my alley. 

The Hastening Death of Grampa's Beer

Mintel, a food and drinks market research firm based in London, released a remarkable report this month on consumption patterns of American beer drinkers.  It's the same company that offered this eye-opener in a report from two years ago:

Only a modest percentage of beer drinkers say they prefer domestic craft or microbrew beers, but an impressive 59% say they like to try them, and 51% would try more craft or microbrew beers if they knew more about them.

This factoid exposes the key mental mistake most of us hold: Americans regularly drink both craft beer (using the term advisedly) and regular tin-can lagers.  Think of it this way.  There are actually three groups: those who drink only craft beer, those who drink only tin-can lagers, and those who drink both.  It's not a binary choice.

With that I bring you Mintel's newest findings, again eye-opening:

• Craft beer accounts for $12 billion of a $78 billion dollar beer market (15.4%), and craft's growth should rise 50% in the next five years.
• A quarter of American beer drinkers drank more craft beer in 2012 than the year before.
• Craft has an even larger share of the draft market, at 22%.
• Over a third (36%) of Americans regularly drink craft beer, and over half of millennials (under 35) do.  
• Interestingly, only half of craft beer drinkers are interested in locally-brewed beer, and just a quarter in drinking beer where it was brewed.  (Mintel puts those in positive terms, but they seem far lower than I expected, so I'm flipping the emphasis.) 
• And from my perspective, one of the most important findings is this one: “Despite the variety of beer releases created by craft breweries, craft beers are not yet everyday beer choices for most drinkers due to a lack of understanding about their taste profiles.  An additional barrier is lack of knowledge. Craft brewers need to focus on education through tastings and classes that inform consumers about the differentiation in flavor between craft beer and other alcoholic drinks.”

Imagine reading this if your business model depended on selling tin-can lagers ("legacy beers"?).  The young generation doesn't like your beer, and the older folks are sadly not immortal.  It's a structural trend a funny new Super Bowl ad is not likely to change.  (Though you notice that beer ads all feature young people now, not weird old farts arguing in taverns?  Guess why.)   Finally, one of the main reasons people don't drink your competitor's beer is because they don't understand it--which means things are only likely to get worse faster.  You're stuck with old drinkers who regard your product as the familiar, safe tipple.

For some years, I've been predicting that the seemingly inviolable hegemony of tin-can lagers is not so.  But it feels like predictions about global temperatures from the 1990s.  All the new data suggests that things are happening way faster than anyone realized.  If I were to make a prediction for the next five years, it would be that the landscape of what we consider "mass-market" beer is going to go through the first tectonic shift we've seen since the 19th century.  That may be premature--it could happen after 2020, say--but I would be shocked if it didn't happen by then.

That Old Timey Beere and Ale

What's the new sour? (Since there's always the new something, and since the last couple years everyone's been saying sour is the new hoppy, it must be that we're due for a new new.) Old. Anyway, among certain small brewers and homebrewers here in Beervana.

Hot on the heels of my encounter with Burton, I read about Kevin's flirtation with mumme. Mumme, as you know, is an extinct style of malt porridge tinged very lightly with alcohol. You didn't know?

Mumme being a treacle-like dark beer with a massive starting gravity and very low attenuation. Think 3-6% ABV with a final gravity over 1.200. No, not 1.020, 1.200; we’re talking moderately alcoholic malt syrup here.

This level of attenuation makes Burtons look like ultra-dry saisons. Kevin cites Pattinson (whom we'll deal with soon), who cites a clutch of 19th century writers who peg mumme's attenuation between 8% (!) and 20% (dry mumme). Keep in mind that most modern beers finish out with attenuations in the 70-80% range. I found a German Wikipedia entry on the style that cites older sources, but doesn't seem to contradict Pattinson (seem, because I'm working with the Google translate version of the page). In any case, it sounds like a ghastly style, one the world is surely better off to be rid of. I urge you to remember that during the great mumme epoch, people bathed twice in their lives, lived to be 13, and believed some of the womenfolk of the villages to be witches.

The British Connection
The catastrophe of mumme aside, the interest in authentic recreations is a great trend. The historian/bloggers Martyn Cornell and Ron Pattinson are major instigators. They would no doubt be surprised to learn how many people in remote Oregon are inspired by their studies of lost styles. Yet I keep encountering late-stage beer geeks who are planning to brew--or have brewed--a beer based on their research. I can't say how much it has influenced the pro ranks, but I think somewhat. Brettanomcyes is slowly creeping into English styles, a trend I imagine goes back to the research of aged British styles--all infected with brett.

I doubt very many of these lost styles are likely to gain broad popularity. Yet gose has shown surprising resiliency, so you never know. Yet brewing things like gratzer, broyhan, koyt, Burton, or brown-malt porter are all extremely useful to understanding the evolution of brewing--not to mention a fun trip down memory lane. (Personally, I'm hoping for an Adambier recreation--that's a style with legs.) The aspect I find most encouraging is that Oregon brewers (home and pro) are among the most activist tinkerers. The future of beer is the past. And we're on the cutting edge.