Beverage Dynamics

Beverage Dynamics Sept-Oct 2011

Beverage Dynamics is the largest national business magazine devoted exclusively to the needs of off-premise beverage alcohol retailers, from single liquor stores to big box chains, through coverage of the latest trends in wine, beer and spirits.

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" The fact is that this is a successful system that allows tremendous access to market; it allows new entrants to get established and grow." —Craig Purser, president, National Beer Wholesalers Association traditional "import" audience, young adults with more disposable income. Recognizing that many beer drinkers—particularly craft enthusiasts—are more knowledgeable than ever, Heineken USA recently launched Passion 4 Beer, an educational program that drew on its international brewmasters to educate the U.S.-based staff on core fundamentals of beer knowledge. The program is likely to be extended to distributors and key retail accounts. Another HUSA brand, Newcastle, plumbs its English heritage to connect to the specialty beer con- sumer. This year, following documented trends in the craft sector, Newcastle is introducing a range of season- al beers, all ales, for the first time. And the company's Amstel Light has just announced the launch of Amstel Wheat Bier. Even though HUSA, like Crown, has a half dozen Mexican beers in its portfolio, the success of its most prominent Mexican brand, Dos Equis, has less to do with Latino culture, and everything to do with "The World's Most Interesting Man." This classy series of TV, web and print ads is a refreshing departure from the girls-and-sports cliché, and has paid off handsomely in sales growth of 19.1%. Over the years, Guinness, the Irish brewer, has limited its offerings to the eponymous stout and a few other brands: Harp Lager and Smithwicks in the U.S. The company has flirted with other styles from the craft catalog—among them Breó, a wheat beer that could have been the breakout wit beer before Blue Moon explored the style—but none made a mark. The brewery has recently announced its U.S. debut of Guinness Black Lager, a black lager that combines the taste of a lager with the traditional character and flavor of Guinness, the company says. The Growing World of Craft raft beer, despite having less of the market in total than, say, Corona Extra, remains the creative engine that keeps American beer evolving. Its sales fig- ures—eight years of positive, sometimes dramatic growth—have inspired envy and imitation from larger players. C Jim Koch, founder of the largest of these small breweries, Boston Beer of Sam Adams fame, maintains that "craft beer drinkers" are not consumers who hew exclusively to craft brands. Rather, craft selections have made their way into many refrigerators otherwise full of mainstream brands. "Craft beer has entered the portfo- lio of the majority of American beer drinkers," Koch insists. "It's no longer confined to homebrewers, beer geeks and dabblers, like it might have been 15 years ago. It has become a part of most beer drinkers' occasional or even regular beers." Koch is confident that the creativity of the craft beer movement can draw consumers to beer. "I'm excited about the possibilities of craft brewers' offerings win- ning back some of the confirmed wine and spirits drinkers, and perhaps more importantly, slowing down the migration of 20 and 30 year olds towards wine and spirits," he says. Category 2009 (000 2.25 Gallon Cases) Share 2010 Domestic Beer Super Premium & Craft . . . . .193,879 . . . . . . . . .6.7% . . . . . .207,121 . . . . . . . .7.3%. . . . . . . . 6.8% FMB . . . . . . . . . . . . . . . . . . . . . . . .43,121 . . . . . . . . . . .1.5 . . . . . .42,879 . . . . . . . . .1.5 . . . . . . . . -0.6 Premium . . . . . . . . . . . . . . . . . .349,000 . . . . . . . . . .12.1 . . . . .322,600 . . . . . . . . .11.4 . . . . . . . . . -7.6 Light . . . . . . . . . . . . . . . . . . . . .1,520,400 . . . . . . . . . .52.8 . . .1,492,000 . . . . . . . .52.9 . . . . . . . . -1.9 Popular . . . . . . . . . . . . . . . . . . .234,200 . . . . . . . . . . .8.1 . . . . .224,650 . . . . . . . . .8.0 . . . . . . . . -4.1 Malt Liquor . . . . . . . . . . . . . . . . .75,000 . . . . . . . . . . .2.6 . . . . . .70,250 . . . . . . . . .2.5 . . . . . . . . -6.3 Ice . . . . . . . . . . . . . . . . . . . . . . . .102,100 . . . . . . . . . . .3.5 . . . . .100,300 . . . . . . . . .3.6 . . . . . . . . -1.8 Total Domestic Beer Total Imported Beer Total Beer 2,517,700 359,600 2,877,300 87.5% 2,459,800 12.5% 362,800 100.0% 2,822,600 87.1% -2.3% 12.9% 0.9% 100.0% -1.9% 44 • Beverage Dynamics • www.beveragedynamics.com • September/October 2011 As craft beer has grown from a local oddity to a major influence on the beer industry, the craft sector, itself, is chang- ing. Faced with the seeming contradiction of local appeal and national demand, some craft brewers are build- ing partnerships that extend the reach of their brands without— they hope—compro- mising character. Share % Change The most dramatic example is the sale of

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