From dusty brown bottles to a post-coronavirus Cambrian explosion.
Supermarket beers are peacocking like never before. It’s a triple-threat!
1) The COVID retreat from boozing in bars means more competition for mindshare on supermarket shelves.
3) A generational ‘vibe-shift’ in what our beer says about us is fueling a color-revolution in refrigerators across the US, and
2) at the same time, ‘craft’ beer has gone so mainstream as to have become a contradiction of itself.
The back story: weak lager, insurgent ale
Once upon a time, not so long ago, there were but two types of beer in American supermarkets.
On one side were crates of red-white-and-blue branded ‘lager’ that any British man would have to drink by the gallon to feel inebriated (source: am British; attempted in 2012).
And on the other side was a slightly dusty wall of brown/green IPA bottles, with brown/green labels, made in hip Coastal Elite strongholds like Brooklyn, or imported from Europe.
At the time Lagunitas - with its cheeky beer names, cute dog mascot, and This American Life sponsorship - was the subversive upstart.
No longer. Drop by your local Whole Foods (or even Safeway!) today, and you’ll see enough vivid greens and reds to oversaturate the lens of even the most HDR-friendly Instagrammer.
COVID lockdowns, the rapid mainstreaming of craft beer, the even more rapid mainstreaming of hard seltzers, and our hyper-visual media sharing landscape has raised competition to stand out on the shelf to an eye-popping level. The pioneers of mainstream craft - Lagunitas and it’s brown-bottled fellows - are barely keeping up.
The brand(s):
At my local whole foods the usual suspects are still there - American-colored stalwarts slumbering on the bottom-shelf:
Interestingly, though, Heineken has opened up some of its shelf space for its nonalcoholic offering (which is actually not bad), and the ‘Light’ branding of Coors’ beer weighs increasingly heavily on their packaging.
When I spoke to the beer buying manager at this Whole Foods he said that Athletic Brewing Company’s nonalcoholic “Upside Dawn” lager is now their best-selling beer right now - beating out all of their alcoholic beers. We live in healthy healthy San Francisco, but even still - light beers are going lighter.
Lagunitas’ flagship IPA is still there - resolute in its brown bottles alongside European and Trappiste brown-bottles like Fin-du-Monde, Chimay and Tripel-karmeleit:
One shelf over, though, the game has changed:
Whole Foods seems very conscious of the split.
Low-strength, big brand lagers (Coors, Budweiser) go on the bottom in bulk, and the rest are divided by “colorful OR brown” - more so than than by type (IPA, pilsner, sour etc.):
What are we to make of this? Old people beer vs young people beer? An emerging old-world/new-world beer divide? Or just the inevitable Pinteresting of our world into color-codes?
Might I venture to suggest…a little bit of all the above.
Who are these beers for?
Let’s take another look at that photo of the beer fridge. We can roughly divide it into three sections, and I feel pretty confident that there’s a persona-use-case type thing going on for each one :
Social Fridge-Fillers
Craft Beer Connoisseurs
Bright Young Beer-Drinkers
Section 1 is our cheaper, lower-alcohol, mass-market beers - they’re on the bottom (below eye level) for a couple of reasons.
They get bought in bulk, so they’re heavy; they’re for people who are looking to drink more over an extended period of time, or drink in larger groups - think house party or backyard BBQ or tailgate.
The people who are buying them - our Social Fridge-Fillers - aren’t too picky about the branding or tasting notes of their beer. They aren’t spending a lot of time browsing between beers, and they aren’t thinking about the aesthetics of the can as a possible bougie conversation-starter (like you might with a contemp-o bottle of wine or a hip sour beer). They probably have a ‘go-to’ beer for occasions and they’ve ‘gone-to’ the supermarket to pick it up.
Sections 2 and 3 are more interesting. They have quite a bit of overlap in terms of the type of beer (although 2 is a touch on the darker side), and the price-points are quite similar.
Contrasting those brown bottles with the lurid cans, though, you can visualize the differences between our Craft-Beer Connoisseurs and our Bright Young Beer-drinkers - our CBCs and BYBs, if you will.
CBCs have probably been drinking a little longer, and the packaging of their drinks lends itself less to big social occasions - there’s less of a need for them to be image-conscious about what they’re drinking.
A CBC probably shares a 75cl bottle of Tripel Karmeleit with their partner or a couple of buddies, but it would be hard to bring it to a party - people can’t just grab one out of the fridge.
Bright Young Beer-Drinkers, on the other hand, are picking up a six-pack on their way to someone’s backyard hang-out, a picnic, or a party, or they’re stowing them in their fridge for when people come over. There’s a value to the customer AND company in a drink that makes a visual impact - begging questions like “I didn’t know you were into sour beers” and signalling expertise or trendiness.
If you’re somewhere around 30 to 45 there’s a high chance you sometimes identify as our Connoisseur and sometimes as our Bright-Young Beer Drinker, but I’m willing to bet that the BYBs skew younger, and some of our more curmudgeonly CBCs are standing in the aisle at Whole Foods scratching their heads at why someone would want to drink something that is both “rasberry sour” and “beer”.
The insight:
Three main market trends are driving these branding decisions, with each of the three clusters making strategic decisions based on insights about their target audience.
Social Fridge-Fillers
Brands like Coors or Budweiser operate at massive volume and are focused on maintaining that volume and market-share. They know that people are increasingly health-conscious - and that young people are drinking less alcohol - and so are going lighter or zero-alcohol to counter the macro trends affecting the industry.
The insight is something like “People want to keep socializing and having a few drinks with friends, but without the guilt of doing something that’s bad for them.”
Fridge-Filler brands aren’t trying to compete with the brown bottles directly, and the companies that own them - like Anheuser Busch (AB InBev) in the case of Budweiser - are catering to our Bright Young Beer-Drinkers through other ‘craft-like’ sub-brands that they own or partner with.
Craft-Beer Connoisseurs
Brands in section 2 of the fridge are adopting one of two strategies - depending on their scale, age and appetite for innovation. The more established (generally more European-y) brands like Delirium or Tripel Karmeleit are leaning into their heritage or quirky roots - trusting that their customers don’t mind a stronger drink and less flashy brand, because their customers are looking for an “occasional luxury” rather than an every-day drink.
Brands like Lagunitas - however - are undergoing a bit more of an identity crisis. No longer able to differentiate as a vanguard of craft beer, and not perceived as prestigious or high quality enough to be a luxury, you can see in the fridge that they are torn between their brown-bottle roots and more bright young branding. Too small to compete with the Anheuser Busch’s of the world, it’s not too much of a surprise that they became a subsidiary of Heineken in 2015; with Heineken taking a 50% stake in the company.
Bright Young Beer-Drinkers
Meanwhile, in section 3 of the fridge a struggle of truly Darwinian proportions is taking place amongst a Cambrian explosion of new brands and products. Knowing that their younger customers are fickle and prone to try lots of new things, much smaller companies and breweries are fighting tooth-and-nail for mindshare and stomach-space - trying to build out brand recognition so that they can either scale, or be acquired by an AB InBev or Molson Coors down the road). The bright colors and trippy visuals scream to be Instagrammed, and the psychedelic branding reaches for an affiliation with the psychic freedom of the sixties, rather than some boozy dive-bard.
Good branding or bad branding?
It’s a really fascinating space.
My personal take is that brands catering to Craft-Beer-Connoisseurs are at the most long-term risk - finding at best a niche market amongst an ageing audience, and at worst total obsolescence as people move to lower-alcohol, more exciting brands. It remains to be seen whether brands like Lagunitas will be able to keep up.
Backed by the leviathans of the alcohol world, social Fridge-Fillers like Heineken and Coors are probably doing the right thing for them - focusing on volume, following social trends in terms of healthier drinking, and scooping up smaller craft-brands to stay relevant.
And in the short-term, brands catering to Bright Young Beer-Drinkers will continue to peacock it out on section 3 of the shelf - building out beach-heads (like Fort Point has in California) or fizzling out unremarkably in splashes of pink and green.
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