Sunday, May 24, 2015

Macrobrewers & the Craft Beer Market Part 1 - Craft vs. Crafty

Macrobrewers & the Craft Beer Market Part 1 - Craft vs. Crafty

A couple weeks ago, a man by the name of Evan Parent, filed a lawsuit again MillerCoors. The reason? Because he alleges that Blue Moon's marketing, pricing & placement amongst other craft beers lead him to believe that Blue Moon was a craft beer. He also says that it violates California’s Consumer Legal Remedies Act and how it's misleading and a bunch of other legalese I'm not even going to bother with.

Point is that this whole lawsuit has motivated me to write a couple of pieces regarding the whole Craft Beer vs. Crafty Beer argument. I feel that I have enough experience and know-how to throw in my two cents about this topic. Plus I feel that this is an issue that will really start to take off over the next couple of years.

While the whole argument of Craft vs. Crafty has been on the minds of beers drinkers for quite a while, it was never really bought to the forefront and was, until recently, mostly commentary of a not-so-serious nature. That all changed when this commercial debuted during this year's Super Bowl.....

When this commercial was released, the responses were all over the place. Some took an analytical approach to it, other breweries decided to put together their own response and others took this as a declaration of war on craft beer industry. It's no secret that there are breweries out there that may seemingly appear as a craft brewery to the uninformed consumer but are, in fact, owned by a macro-brewer like MillerCoors or AB In-Bev.

Who is a craft brewer?

According to the Brewer's Association, they define a craft brewery as the following:


Annual production of 6 million barrels of beer or less (approximately 3 percent of U.S. annual sales). Beer production is attributed to the rules of alternating proprietorships.


Less than 25 percent of the craft brewery is owned or controlled (or equivalent economic interest) by an alcoholic beverage industry member that is not itself a craft brewer.


A brewer that has a majority of its total beverage alcohol volume in beers whose flavor derives from traditional or innovative brewing ingredients and their fermentation. Flavored malt beverages (FMBs) are not considered beers.

These guidelines were created with good intentions as a means of helping beer drinkers tell the difference between an independent brewer and someone who was, well...............not. It seemed all clean-cut and such, but there was a problem.

A couple of years ago, there was a bit of controversy with what defined a craft brewer. One brewery in particular, August Schell Brewing, was "blacklisted" because the ingredients used their long-standing Grain Belt lager used adjuncts in the brewing process, which started out of necessity when the brewery first opened up and has been used still out of tradition. Even many thought they fulfilled the requirements of all three guidelines.

I remember when I first saw this news, I was shocked. I always have considered them to be the original Minnesota craft brewery, who will be celebrating their 165th Anniversary this year. Sure they make Grain Belt, which is their flagship beer, but they also make a ton of other styles and they aren't owned by any major corporations. In fact, I would even argue that Sam Adams is more along the lines of being big beer than Schell's is. Thankfully, a little over a year afterwards in early 2014, the BA changed their definition as to who was a craft brewer and August Schell's was finally considered to be a craft brewer again.

Compare that to the likes of Goose Island & Blue Moon, both of which are owned 100% by Anheuser-Busch and MillerCoors respectively. Though Goose Island was considered craft prior to its buyout to Anheuser-Busch, Blue Moon was created specifically by MillerCoors about 20 years ago so they were never considered craft at any point of their existence.

Now here is where I become a Devil's advocate of sorts because while I do think companies like Goose Island and Blue Moon are trying to pass themselves off as crafty, isn't that really the point? If there is anything I have learned from marketing, it's that the whole idea behind marketing is so that a company can draw in and retain business long term. In fact, it's safe to assume that the vast majority of craft breweries on the market today owe their very existence, directly or indirectly, to Big Beer.

I've already explained in my review of Bud Light that the newer generation of beer drinkers, namely Millennials, are less likely to drink a Budweiser product because of lack of brand loyalty and a wider selection of beers to choose from than 20-30 years ago. One thing we can all agree upon is that macro-brewers are trying their hardest to appeal to a wider demographic and retain their share of the beer industry. Which is why Anheuser-Busch recently acquired well-known craft breweries like Elysiun Brewing & 10 Barrel Brewing.

This is, of course, something I will touch upon more in the next post.

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