It’s no secret that America loves beer – in 2015, beer companies in the U.S. raked in $105.9 billion. This was 0.2 percent less than was sold in 2014, an unexpected fizzle felt by large beer companies and not the trendy craft breweries whose market share instead continued to rise. Another stat surprisingly revealed that 44 percent of 21 to 27 year olds have never had a Budweiser, which is arguably the most recognizable beer in the country. It’s safe to say that big-name beer companies have some work ahead of them if they want to stay on top and on tap.
In an attempt to redirect some attention back to its signature brand, Budweiser aired a 2015 Super Bowl ad that focused on the beer’s history and crisp flavor. It also pretty blatantly made fun of craft beer and those who drink it, sending fans of craft beer into a rage. Some, however, saw it as a good sign for craft beer – the biggest American beer company had acknowledged the competition. While they created a controversy that got tongues wagging and social media buzzing, they also admitted publicly that craft beer was a threat.
More recently, Budweiser decided to celebrate the election year and America’s participation in several international sporting events by temporarily changing the beer’s name to ‘America,’ complete with patriotic packaging. While we have yet to see the impact this might have on sales, critics have been quick to point out that the beer is actually owned by a Belgian company.
Budweiser isn’t the only big brand that has taken on craft beer. In 2012, Guinness was sponsoring an awards ceremony for the British Institute of Innkeeping. The winner of the Bar Operator of the Year award was initially supposed to go to BrewDog, a craft beer competitor that had clashed with Guinness in the past. When a different bar was given the award, it eventually came out that a representative of Guinness’s parent company, Diageo, had threatened to withdraw their support from the organization if BrewDog won. Diageo apologized to the organization and BrewDog, giving the smaller company free advertising and smearing their own reputation in the process. Guinness managed to turn a sponsorship that should have been positive publicity into a national scandal.
The one success story in the midst of all this decline is Michelob Ultra. While other domestic beers lose sales at an alarming rate, Michelob Ultra, owned by the same company as Budweiser, has increased sales by 27 percent by marketing their beer as one that fits in with an active lifestyle. Ultra’s latest slogan, “Brewed for those who go the extra mile,” reflects that focus on attracting customers who are more interested in healthier drinking options than the flavor they might get from craft beer.
If You Can’t Beat Them…
With mixed marketing results, some big beer brands have instead turned to purchasing craft beer companies to try to cash in on the trend. While this has sent some craft beer fans into a panic, we have yet to see if being bought out by larger companies will affect a craft brewery’s long-term sales. In 2015, large beer companies bought at least 24 craft breweries, giving big beer a sales boost and small breweries the capital they need to increase production, and expand branding and marketing.
The Brewer’s Association defines a craft brewer as one that produces 6 million barrels of beer or less annually, with less than 25 percent of the company controlled by non-craft alcohol companies. Local organizations like the Texas Craft Brewers Guild have changed their definitions of ‘craft beer’ to exclude those purchased by big companies. Despite this not being a legal definition, one offended craft brew customer has filed a class action lawsuit against MillerCoors after he found out the large beer company owned Blue Moon, which he had previously considered a craft beer. If the case goes to court and is settled by the justice system, that decision could establish a legal definition for a craft brewery. For now, macrobreweries will continue buying the competition, though whether craft beer lovers will remain loyal to their favorite brands after they sell out remains to be seen.