Thursday, July 06, 2006

The Brew Lounge 'Topic of the Week': Can the Macro Segment do Craft Beer well?

Ah yes, the topic of the macro segment of beer making. Can they do craft beer imitations? Of course they can. Are they permitted to do it? Yes. Will they do it? Certainly. Should they do it? Well, I suppose, that based on their business model and the direction of their current economic position, they definitely will. Do I want them to? Absolutely not! But, really, why should we care that much about what the macros are doing? In all honesty, I don't know if it much matters. Though, I do think it would be interesting to understand how much of the growth in craft beer that we hear so much about is due to new customers coming over from the macro side (the dark side?). Because, if the answer is that there are really not that many converts, then let the macros do whatever they want to confuse their customers who just love light, fizzy crap. And, let us continue to enjoy the phenomenal work that so many brewers are doing in the realm of craft/microbrewing. I will admit that I don't have statistics to support my argument. But, it goes something like this. Whether a brewer/operator is taking home $20k, $50k, $100k, or $200k, I don't get the sense that the folks who are doing craft beer at least moderately well are cashing welfare checks. What I'm trying to say is that even for the brewers on the less well-compensated end of the spectrum, they are doing well enough to survive. Would I like to see them taking home more reward for their efforts? Hell, yes! But, do I think that the macro segment doing craft-imitation beer represents competition that they need to match both on style, quality, and/or price? No way! As the well-publicized numbers show, craft beer continues to grow impressively on a annual basis, while the macro segment continues to lose business. If I'm not mistaken, the belief is that the wine and spirits segments are absorbing most of their losses. So, really, I'm not that concerned with what the macro segment is doing in terms of different styles. I mean, after all...Blue Moon, Bare Knuckle, B-to-the-E, Demons these interpretations really give you any pause to think that someday you'll switch over from a Belgian or German wheat, an American or Irish stout, a fruit or lambic beer, or an American IPA that you have been enjoying for all of these years? It's not like we've been waiting for a new interpretation because a better one hasn't existed. And, I would bet that the an overwhelmingly large percentage of the A-M-C crowd may simply give one of these "new" styles a try and then go back to their macro muck. I don't see much changeover in tastes from someone sworn to yellow swill to real beer. The other perspective on this issue of macros dabbling in craft beer is their financial involvement in companies like Red Hook, Widmer, and Goose Island. We'll make this a subject of a future 'Topic of the Week'.


Anonymous said...

What really concerns me is the idea of a macro buying and changing one of the great little guys.

Take Rolling Rock (not exactly a great craft beer, I know) -- sold to Anheuser and moved out of Latrobe... only being from that small town in PA was part of the character of that beer, right?

For a non-beer example, look at Genuardi's -- a phenomenal family-owned supermarket, bought by safeway and turned into another crappy chain. I'd now rather shop at ACME!

Anonymous said...

What you are failing to appreciate are those that may try a Blue Moon (often called a "Gateway" beer), like it's unfiltered quality and then try a true Belgian or German or Oberon. Additionally, potentially another topic for you, what to think of craft brewmasters working for macros? A Stone Brewmaster has just moved to AB. Will his creations reek of macro?

Bryan Kolesar said...

Certainly, Mike, that's where I want to take a future topic. It's one thing for the macros to try brewing more "interesting" beer themselves, but it's a whole other ballgame when they start buying up and potentially changing (for the worse?) true craftbrewers.

Oh, and I didn't mean to imply that gateway beers don't work for some. I'm just skeptical that we can expect much growth to come from "macro converts". I'd almost expect more of the better beer growth to come from wine drinkers, than Bud drinkers. But, certainly there will be some, and the gateway beers will serve a great purpose in that case.

And, to Anonymous's point, the topic of craft brewers in the macro segment and vice versa will be addressed in the future. Thanks for the idea!

Brian said...

Along the lines of what anonymous said...I don't really see faux micros being produced by macros as cutting into the market share currently held by real craft beer. Real beer drinkers won't be fooled in the long run...and if they are, so what? That just means the big guys are (finally) making decent beer, right?

A much more likely scenario seems to be that the macros will be able to use their leverage to get their "micros" widely distributed, and thereby get more people trying beer that isn't the typical yellow swill. And that can only help craft brewers in the long run.

Adam said...

Hmmm...I used to think it didn't matter like Brian (with an I), but, now I'm more concerned. I like to think about it like this.

A large fish entering the shallows will inevitably decrease the number of small fish by eating them. Now in nature there is often a balance with lots of small fish for the big fish to eat, however, sometimes there's a predator that is so effective it pushes another species to extinction.

Will the big fish macros use their economy of scale prices to eat most of the small fish craft breweries? Maybe those breweries were weak anyway? Maybe we’ll never know because they’re extinct and won’t have the opportunity to mature and innovate.

In 20 years I don’t want to be drinking the faux micro brewed crap that is “not offensive” and utterly dull. (I won’t because I’ll brew my own before that happens.). I can hear it now.

“Man that German crap sucks. Blue Moon is the best wheat beer ever ‘cause those Coors guys figured out how to do it right.”