Is the Craft Beer Boom Over?
A few years ago you couldn’t keep up with the number of new, locally owned, craft breweries that were popping up. It seemed like every small town had at least one brewery and big cities had multiple fighting for supremacy. But, as with any booming industry, there reaches a point when the market is simply saturated and there’s not enough money (or consumers) to go around. Many of the bright, excited, and innovative breweries that launched in just the past few years have either been acquired by much larger brands or have shuttered their operations because they couldn’t find profitability.
A Brewer’s Association report released just two years ago notes that the craft beer industry grew just 6% in 2016. That figure is just half the growth seen in 2015! Has the beer bubble burst?
But smart breweries are still going strong all over the country. How are these industry leaders thriving while so many others are barely surviving? They’re ahead of the trends!
Trend #1: Find Alternative Income
If you think your profitability has to come from beer sales alone you’re not thinking creatively enough. As a small brewery owner you have to find new ways of carving out niches, tapping into tiny markets, and maximizing the potential profit from your current consumer pool.
One popular option with breweries throughout the country is establishing memberships. When consumers become members, breweries create a steady current of additional income through membership fees.
But smart marketers will take that one step further. Offering a tiered membership option allows you to tap into “casual consumers” as well as those completely dedicated to your craft. Offering upsells like exclusive VIP beer events, attractive giveaways, and early access to your newest craft creations is a great way to get an average consumer to spend a little more.
Plus, when you invest in your customers through membership options, they become invested in you. Adding these types of upsells allow you to get to know your customers better—what they like, what they don’t, what they’re willing to spend more on, what they would like to see more of, etc. And anything you can do to make the experience a more personalized one will reap a ton of incidental benefits.
For example, a 2018 survey conducted by Microsoft found that 56% of consumers say that when a brand provides a “personalized experience” they’re more likely to purchase from that brand in the future. How do you know how to personalize that experience? 37% of consumers are willing to give you personal data (data you can use to refine future event planning, marketing strategies, and more) for automated reordering of frequently purchased items.
Lastly, how do you entice fence-sitters to take the plunge and become a member? Sometimes, all it takes to earn that coveted brand loyalty is a coupon. (96% of Americans use coupons at least once in a while.) That impression of “getting a good deal” is often enough to overcome any hesitation a person might have about becoming a card-carrying member of your brewery.
Trend #2: Exploit Local Links for What They’re Worth
The real allure of craft breweries (other than the quality of the beer they produce) is that they’re local. They’re not subsidiaries of some giant multinational corporation. Consumers love that their favorite beers are made next door.
Smart craft brewers are really diving deep into that local allure to add more value to their brands, thus increasing their pull, profitability, and potential longevity.
How can you shine the limelight on your local roots?
Source Ingredients Locally
This might be harder for some breweries than others, but if you can get local ingredients, not only does it add value to your beer, it presents your brewery as a valued part of a local community. Can’t find local hops? Try local fruit and berries for your flavored brews or locally sourced woods for your aging barrels.
Partner with Local Businesses
Don’t have the time or resources to build a brew pub? Can’t break into grocery chains? Regional distributors shutting you out? Try partnering with local outlets who can sell, showcase, or promote your beers. Some examples of how to do this right include:
- Enticing local restaurants to use your brews in innovative recipes
- Sponsoring local contests, festivals, events, and fairs
- Getting your beers into privately owned beverage stores
Hire Local Businesses Craftspeople
If it’s time to expand, outsourcing your label and production isn’t the only option. Look local and find new ways to invest in your own community.
- Need more beer barrels? Find a craftsperson who could produce those barrels for you.
- Want great label art and logos? Approach your local art studios to find artists right next door.
- Think a brewpub is the next step but can’t build one from the ground up? Lease space in a local restaurant.
- Want a digital marketing team on a shoestring budget? Partner with businesses development programs at local universities and colleges.
Trend #3: Give More, Get More
The vast majority of young beer drinkers say that it’s important to them that their favorite breweries (and businesses in general) give back to the community. That sense of reinvesting in the local economy and improving the lives of your neighbors is a tenant of doing business in a world soon to be run by Millennials.
- It’s estimated that this age group is worth about $30 trillion nationwide.
- 84% of these individuals have given to a charitable cause on their own.
- Over two-thirds would prefer to work at companies that give charitably.
- 86% of them expect the companies they buy from to be good Corporate Citizens.
- The vast majority are more likely to purchase from a company or recommend that company to a friend if it gives to charitable organizations.
It’s not enough to give—people have to know you’re doing it. It may appear unseemly, but you have to toot your own horn when you give to charity.
- Partner with non-profits and market their cause to your consumers
- Use your brand recognition to promote awareness of local issues
- Team up with fundraisers and sponsor local charitable events to get your logo on the marketing materials
- Get your senior leadership involved, on the news, and in people’s Facebook feeds
- Have your team volunteer at food pantries, for charity walks, and in soup kitchens (while wearing company t-shirts)
- Create internal fundraisers and food drives then host a special event to give your grand totals away
Creativity Plus Responsibility Creates Sustainability
In short, if you want your brewery to survive and thrive, you need to find creative new revenue streams, break out of old patterns, and standout from the crowd. Ticketstripe’s ticketing system allows you to cut costs, increase the reach of your online marketing, and more easily manage special members-only events, charitable fundraisers, and more. For tips on how you can utilize these tools to help your business grow, contact us.