There seems to be no shortage of articles proclaiming the growth in craft beer can’t continue. People say it’s not going to last, that it’s a fad. Recently, in a Bon Appetit article, Sam Calagione of Dogfish Head fame, even went so far as to say, “There’s a bloodbath coming” when referring to the competition the craft beer industry will face ahead. He was referring to the increase in the number of craft breweries and assuming that they’re all going to fight bitterly to the death in a winner-takes-all competition Roman gladiator style battle for market share. That is, after all, how brands like Budweiser, Coors and Miller became universally recognized so it’s no surprise that somebody out there thinks that. Statements like that assume the future will resemble the past, which is never the case.
There may be a bloodbath among the big craft brewers as they lose their “localness” in their quest for greater and greater national market share. That represents something more akin to a mid-life crisis they still have yet to endure, not an industry wide bloodbath. Hopefully when that happens they don’t also begin to compromise quality in exchange for profits. If they do, their beer will become a different product, and will no longer be in direct competition with the smaller more local craft brewery. You can make a very good case that while their quality may not yet have changed they have already crossed that line.
For 90% of the craft industry, it’s all about local. The Internet and technology empowers local like never before. It levels the playing field. In a hold over from the pre-Internet world, which I am old enough to fondly remember, big companies outspend their competitors in the advertising world so their message is the only one in your face. Money has traditionally controlled message. All that has changed. First, they’re putting their message where we’re not looking. Second because their message doesn’t jive with what people crave, sincere, local content. In today’s world, passion and hard work can get you in front of just as many eyeballs through social media. Who doesn’t like an underdog? That’s the American dream after all. We like to see somebody start from nothing and make something of themselves. We like to support those people. You’re reading this blog, aren’t you? Thank you for that by the way!! Craft brewers are full of passion and few of them are afraid of hard work. The world where pretty horses pulling wagons and animated bottles playing football against each other on TV may be cute, but it’s not enough to sell beer. That time is fading into the past. The big guys are only just starting to become aware they’re not driving the bus anymore. They’re still spending billions on ads we don’t care about. What content is more important to you, some beer ad you see with horses and mountains on TV … if you even watch commercials anymore … or what 50 of your closest “friends” on Facebook or Twitter are posting about the new pub that just opened downtown? Chances are the latter influences you more. Passionate content is the key. That’s the world in which we live. Craft brewers are nothing if they’re not passionate. You can see it in their bearded faces. It’s no surprise in that world we are seeing the rise of Craft Beer and other local products. We have access to the world’s information in our pocket. It offers plenty of stupid stuff like Miley Cyrus twerking or What Does the Fox Say, but it also offers local companies the ability to do an end run around the big guys.
An industry-wide bloodbath would be inevitable if every little craft brewer that starts in his garage had ambitions of becoming a behemoth multinational brewery. Big guys would sell cheap. Little guys would go out of business. That scene has been played many times during the era of globalization. That world is changing. Sure, there are plenty of breweries that want to expand as fast and as far as possible, but not everybody wants to be a Dogfish Head or a Lagunitas. There are some that are happy to be like Central Coast Brewing in San Luis Obispo, California. They have a great local following and are content making people happy one pint at a time. At the end of the day, that’s why craft beer is popular. There’s a story and some local flavor in the beer.
I’m reminded of something Doug Donelan from the New Zealand Hops Ltd. said in 2013 at the International Hop Growers Convention in Belgium. When asked if New Zealand growers would be expanding production to meet the unbelievable demand for their varieties, he replied probably not because most of them are happy with the money they’re making now and working day and night for more money isn’t very attractive. I recently had a very similar conversation with a good friend of mine who is a hop grower in the Hallertau region of Germany. Because he runs a small family farm, which is the norm there, the thought of adding an extra 15-20 acres is not appealing despite the fact that he knows he could sell it all and make a good profit. The money is not worth the trade off of time, additional work, stress and risk it would require. Hop growing, he said, is only part of my life. I respect him for that. His beautiful 5-year old daughter will be better off in the long run for it too!
I’d like to think there are people out there who put quality of life first and aren’t just chasing dollars despite the temptation. The solution to the problem in this case is not larger farms or bigger breweries, but more of them. That’s why we’re seeing them pop up all over the US. Big breweries will undoubtedly get bigger, but there is plenty of room for more competition at the other end, locally. In the end, quality is important. As long as there are plenty of small craft brewers producing quality craft beer, there will be a market for it. There will be more hop growers and bigger hop farms producing for them too. In a more competitive market, there will be no room for marginal quality. If that’s the blood bath Sam was referring to, then we welcome it because everybody wins. Craft beer is not just about drinking beer. The wine industry gets this. Craft beer is about the experience of drinking craft beer, which is why there is room for thousands more small craft breweries in the years to come.
In the 1960’s we put a man on the moon. That took courage, foresight and the belief that we can do something seemingly impossible … just because we wanted to. Captain Kirk and the crew boldly went where no man had gone before. Sure that was just a TV show, but it embodied the spirit of challenge and conquest that was alive in America at the time. I don’t think that was just the Kennedy era. I don’t think that adventurous spirit hasn’t died in today’s world of TSA checkpoints and the NSA following our every move. Judging by the number of people willing to go all in and pursue their dreams of craft brewing, I think it’s alive and well.
Long live the hop revolution!