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Craft beer biz still booming

Craft beer biz still booming

The craft beer industry is growing, and it seems like there’s nothing anyone can do about it — especially not the massive macro brews that once dominated the U.S. beer market.

Need proof that the craft beer industry has the old guard on the backpedal? Lagunitas Brewing Co. founder Tony Magee says that proof is in the big guys’ actions.

“When Budweiser announced the arrival of Budweiser American Ale … they gave everybody who was a Budweiser drinker, or otherwise a macro beer drinker, permission to leave the reservation and experiment. Every time that they come out with another one — Blue Moon, Shocktop, Summer Shandy … — every time (macro breweries) do one of those things, it’s a moment of capitulation and they’re handing the torch to us (craft brewers),” Magee said to close out his keynote address at the Sonoma County Craft Beer, Cider & Spirits Conference in Santa Rosa, Calif., this week.

Listen to Tony’s full keynote here:

And it makes total sense. When you give a guy who’s only ever reached for the bow-tie the opportunity to stay brand loyal but try something different, there’s only a matter of time before he goes from reaching for that Budweiser American Ale to reaching for that Lagunitas Pale Ale. And then he’s gone.

Magee’s address wrapped up the first session of the conference that was chock full of information surrounding the phenomenal growth the craft beer industry has experienced lately, and the experts at the conference don’t really see that growth slowing anytime soon.

Specific to Sonoma County, the craft beer boom has continued to the tune of 41% more sales in 2012 over the previous year. That compares to a 15% growth in craft beer sales nationwide, according to the 2013 Sonoma County Craft Beverage Report.

“The (craft beer) industry in 2012 had a (total) economic impact of $123 million (in Sonoma County),” said Kevin McGee, founder of Tradecraft Strategic Holdings. “At the rate things are going this year, I think we’ll have a $200 million impact (for 2013).”

Growth, while not as pronounced everywhere as is in Sonoma County, it is seen everywhere.

According to the Demeter Group’s State of the Craft Beer Industry report from earlier this year, the U.S. overall beer production is down 4 million barrels from 2007-2012 but the craft beer production is actually up by over 5 million barrels. Key components to the craft beer boom over that time are current consumers upping the amount they buy (30%) and consumers who are new to the market (11%).

Craft beer made up about 5 percent of the overall beer industry in 2010, but industry experts project that craft will represent nearly 15 percent of the overall market by 2020, according to the report.

The growth isn’t all about sales. Craft beer contributes to the economy to the tune of more jobs and tourism as well.

According to the Brewers Association, the craft beer industry is responsible for more than 100,000 jobs nationwide.

Meanwhile, breweries known for their seasonal releases and those that are on popular “beer destination” routes are responsible for booms to local tourism. Take Russian River’s yearly Pliny the Younger release: In 2013, 12,500 people visited Santa Rosa, Calif., for the Younger release. Of those, an estimated 65 percent were tourists. Those tourists provided a $2.2 million spike for the local economy, according to the Sonoma County Economic Development Board.

Jobs and tourism? Yeah, that’s the kind of economic growth local governments like to see. And politicians are starting to play a role in craft beer’s growth.

Also present at this week’s conference in Sonoma County was California Assemblyman Wes Chesbro, who has co-authored several pieces of legislation to help enable the craft beer industry grow in California.

Local brewers guilds are also getting into the game.

In Beer Army’s home state of North Carolina, the N.C. Craft Brewers Guild recently appointed Margo Knight Metzger as its executive director (effective Jan. 2, 2014), according to a report from the Triangle Business Journal. Metzger has experience in government affairs and tourism promotions. Moves like this will likely lead to a better cooperation between brewers and local governments, which could pave the way for an even faster-paced growth for the industry.

So whether you’re in the craft beer world as a consumer of the fine products, an employee or a stakeholder (or all of the above), there are no signs on the horizon this beverage boom slowing down anytime soon.

So crack open a cold one, and raise your glass to the many professionals making this growth possible.

Cheers!

 

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