Craft beer taking over: Light beer distributors can blame craft beers and flavored alcohol drinks for the change in fortunes. While the overall beer market size is shrinking, craft beer is actually experiencing a huge growth in market share. In 2013, Technomic reported that craft beer production had increased 9.6 percent, while overall beer production dipped 1.4 percent. According to the U.S. Census Bureau, the number of breweries has more than doubled from 2007 to 2012. Young people, or millennials, are looking for the next new thing and share their experience on social media, according to Euromonitor International research. Craft beer has also managed to penetrate the local market, where people are increasingly interested in knowing where their food or drink come from and how they are made. “The innovative nature of these craft brewers has driven this market,” said Bart Watson, staff economist at the Brewers Association. “Every brewer in the market seems like they’re brewing something new that you’ve never heard of.” Danny Brager of the Nielsen Co. made a heady prediction in 2013 that craft beer will more than double its share of the existing shrinking beer market, from 7 percent to 15 percent, by 2020. “The future is so bright,” Brager said, “I don’t see any reason for less than double-digit growth any time soon.”
Light beers slowly fading out
The share of light beer in the U.S. beer market has fallen from 51.4 percent in 2012 to 50.3 percent in 2013, according to the Shanken News Daily reports.
Large beer manufacturers, including Budweiser and Coors, are not giving up. They are jumping on consumers’ shift in taste by adding more flavors to their products. Coors Light came up with Coors Light Summer Brew this spring, which was infused with citrus flavors and was the brand’s first-ever seasonal extension. Bud Light launched its Lime-a-Rita product in 2012, and has so far generated more than $500 million in sales in two years.
“I don’t see the era of big brands being over, but more that there’ll be a bigger mix of beers,” Lawrence Hutter, chief executive of Alvarez & Marsal Corporate Solutions, told Bloomberg. “Don’t forget people still like those lighter, lager-style beers; they’re very drinkable.”
However, light beer’s taste and low calories may also contributed to its decline in market share. Another low-calorie alcoholic drink, Beam Suntory’s Skinnygirl line of diet wines and vodka dived 26 percent in 2013. Could diet alcoholic drinks be losing appeal?
“People don’t drink alcohol for health and wellness reasons,” Spiros Malandrakis, a senior alcoholic drinks analyst with Euromonitor, told The Washington Post. “Sometimes with marketers, navel gazing can become so much of a problem that you forget about how people go out and drink.”