America has fallen out of love with beer, the story goes. Sales are down. Market share is shrinking. Spirits-based drinks are ascendant. And for breweries, a storm is coming.
That story is incomplete, at the very least. A seismic shift really is occurring within the beer industry, which weathered a pandemic that kept Americans out of bars and, before that, withstood the Trump administration’s trade war that put a 10 percent tariff on aluminum imports, and which now faces intense competition from hard seltzers like White Claw and Truly. Today American consumers have the most diverse array of alcoholic options, from the most diverse array of producers, in the country’s history. And while this may be great news for drinkers—especially those who don’t like beer-flavored beer—it may not be for brewers.
The overall business picture of beer is that it’s in decline. But the decline is not a free fall. Beer is still, by far, the most widely consumed alcoholic beverage by volume. In fact, overall alcohol consumption had actually increased in the past couple of decades leading into 2021. So, when alcohol industry analysts say beer is falling, they’re talking about beer losing market share of retail dollars. In 2022 spirit sales amounted to 42.9 percent, and beer accounted for 41.2 percent—its first year in second place.
Beer has actually been losing market share for some time. From 2011 to 2021, for example, Anheuser-Busch InBev—the conglomerate behind Budweiser, Bud Light, Michelob, Stella Artois, and more—fell from 46.9 percent of the market to 38.6 percent. But now Americans’ changing taste in alcohol has reached an inflection point, and it isn’t the Budweiser bottle that’s sweating. If your brewery is very large—or, perhaps surprisingly, if it’s very small—you’ll likely find comfortable shelter from the storm coming for the beer market.
It’s the brewers in the middle—the craft-beer makers that have a regional or national footprint, the non-Buds, the non-Millers, what you probably think of as the good beers—that could get soaked.
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