Megabrew versus Craftbrew


I was planning on coming back to my little series on Washington breweries this week, but I keep running across other bits of interesting information in the beer world that I want to share with you.

Everyday I check the beer news. While everyone else in the world is keeping an eye on wars and terrorists, I’m blithely ignoring all that to keep up with the latest brews and what the megabrewers are doing to water down American Craft Beer Culture.

The Beer TrollSo far I’ve ignored Anheuser-Busch’s attempts to compete with commercial craftbrewers. Several of my colleagues on other blogs have written about A-B’s Beach Bum Blonde Ale and their Jack’s Pumpkin Spiced Ale, but I’ve remained silent (partly because my drinking card has been so full this summer, that I haven’t had a chance to sample either of these A-B imitators). But I am paying attention to what my colleagues are saying.

While I’m skeptical that any good can come of A-B making beer that looks like craft brew to the uneducated consumer, there are many in the craft beer world, amateur and professional alike, that welcome A-B attempts to make good beer. I found this quotation in an article in the Milwaukee Journal Sentinel last week: Deb Carey, the president of New Glarus Brewing Company in Wisconsin said, “The more big brewers play around in craft brewing, the more it lends credibility to the [craft beer] segment [of the market].” [quoted from “Anheuser-Busch gets crafty with brewing” by Tom Daykin of the Milwaukee Journal Sentinel (6 Aug 2006)]

I think that Carey has the credibility arrow pointing the wrong way. It’s craft beer that is enabling “the beer industry” to cultivate that image of sophistication that A-B wants to appropriate for its “Here’s to Beer” campaign (see my article on the subject from last February). Of course, Carey is really speaking about the appeal of craft beer to the megabrew drinker. I get the impression that Carey hopes for a beer-buying trickle-down effect. If the megabrew drinker likes Beach Bum or Jack’s Pumpkin, then maybe they will be tempted to buy real craft beer. Unfortunately, I don’t think it will work that way. I fear that ultimately A-B will do to craft beer what it did to most of America’s historic breweries—either buy them or put them out of business.

Actually, as long as there are amateur craft brewers the Craft Beer Culture in the US will be secure, so I’m not all doom and gloom with respect to A-B’s foray into craft-like beer. Currently there are something like 1300 commercial craft beer producers in the US. The sales from all of these producers together amounted to only around 3.5 percent of the total market. Not a very large slice of the pie. You have to wonder why A-B would even bother. They control the largest share of the beer market with their undemanding straw-colored grain tea. You would think that they would leave the hard work of making full flavored beer to the craft beer producers and stick with making a beverage they know more about.

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Donavan:
I know past history has been a bit tough with A-B for you but this sort of thing has happened in the wine industry with good results for years.

Many of the big corporate vintners own several different brands/labels/wines and they are targeted at different consumers or market segments.

You have everything from the generally accepted average wines that that are blended to taste exactly the same from bottle to bottle year to year and maybe aren’t all that interesting to some, to the high-end, hard-to-get wines where each vintage has its own character and characteristics.

It may or may not be obvious to the casual observer that the labels are related. But when they are sometimes that actually helps the consumer move up the quality line. They have learned to trust the brand and are more willing to pay a bit more for something else since they “know” the producer or have a relationship with them.

In fact even some of the smaller wineries do the same thing.

One of the advantages of this relationship between large and small is that the big guys have great distribution lines in place, which become available for their smaller entities.

And (in regards to your previous post) although it’s nice to drink NY wines while in NY, it’s also nice to be able to sometimes find them in Washington. How boring our world would be if we were limited only to what could be found within a 100 mile radius. (Although I am a huge proponent of local foods/wines/beers/products.) I just don’t think we should be limited to only those goods.

I could say more but this is only supposed to be a comment… ;-)
~ B

I’m cautiously optimistic about AB’s attempts at craft beer. Like them or hate them, one has to admit that the brewers at AB are top notch with the best technology available to brewers at their fingertips.

I’ve often wondered what these brewers could do if they weren’t tied down by the horrible standards of Megabrew American Pils. I think this is their chance to show their skill in the craft, and like any brewer that takes pride in their work, I think they will do their best to seize the opportunity.

I guess it comes down to a question of how much control the brewers will have over the process and recipes. If this is something that will be handed down from marketing, bean counters and suits, then we can be assured it will be garbage.

It’s kind of like bartenders and cocktails. If the owner of the establishment says, “We make our Old Fashioneds this way!”, you have to do it. Even if you KNOW that it’s not the proper way to do it.

Brenda- One of the reasons I made my statement about buying local is that when I was out in Washington I noticed that (views of Mt Rainier aside) corporate globalization and homogenization had worked together to make the strip malls in your area look like the strip malls on Long Island. And what’s up with strip malls anyway? Whose idea was that? Someday I’ll write one of those paperback books on pop-socio-economics sprinkled with a lot of beer references, because it will take me about that long to explain myself. Bring it up next time we are in the pub together. Cheers!

Rob- We know that the big beer companies can make good beer—no question—just look at InBev. But ask how many Belgian craftbrewers and craft beer drinkers love InBev? Let’s say that beer brewed locally and A-B’s beer were equivalent in the taste department. Still why would anyone drink A-B’s beer when someone in your own community was making perfectly good beer? It’s that kind of thinking that makes me not optimistic because the playing field isn’t level and A-B’s holding more of the cards (insert additional mixed metaphors if you want) than the local brewers. Cheers!

Good post as usual Donavan.

I would agree with Rob if I thought their excellent brewers might be allowed to flex their zymurgical muscles. I’ve recently heard of the Hop Yard IPA described as “IPA training wheels” and the Beach Bum Blonde almost a repackaging of Bud Lite.

The macros will always shoot for a common denominator, carefully crafted to appeal to a wide swath of the world (whether by design or taste e.g., “that’s what beer TASTES like!”).

What we have, then, is an effort by the macros to discredit craft beer by serving massive quantities of their weakened version of widely produced styles. For those millions of folks who drink A-B exclusively, they may give them a shot. Of those millions, a few may even like them. Of those few, a very few may try another brand’s version of the style. They will likely be turned off by the bigger flavors, alcohol, color, etc. and their A-B loyalty is reenforced.

As for why A-B is pushing hard against the tiny percentage of the market that is not theirs, it’s simple. Macro revenues are in a steady decline. They have to exploit other sources of revenue by diversifying their product line. Who cares if sales of Bud Lite slip .2% if your new craft line is growing at 10-15%? They recently posted “superstrong” numbers for this very reason.

Wow, that was rantful. Guess I’m doing my own blogging in the comments of other blogs these days. Keep up the good work Donavan!

TheName- Hey, thanks for the good words. I wonder if they (megabrewers) are trying to take a bite out of craft brew sales. If their attempts taste like you report, then it seems that craft beer is in no danger. So who is drinking these things? Beer columnists curious to see if A-B will actually make good beer?

“IPA training wheels” that makes me realize…if it weren’t for the macro-micros, I wouldn’t have been exposed to “beers with flavor” that easily.
Guess that’s the one good thing, it may convert people from macro to micro