Tapping the secret of craft beer

The answer to the craft beer question was right in front of brew fans’ faces.

To be more precise it was hanging from the signs just above their heads. And although most at the Great American Beer Festival didn’t realise the symbolism, by taking notice of the messages they subconsciously proved the point.

And it is an idea Big Brother Beer has failed to understand.

The best way to divide the 780 breweries at this month's Great American Beer Festival so that fans could find them with a reliable map system was by geography. Boulder Brewing Company was in the appropriate Mountain section since it is part of the Colorado beverage explosion. Spoetzl from Texas was in the South West area. Chicago’s Moody Tongue operation worked under the Great Lakes banner.

The bottom line to the plan is location. The ethos of craft (or choice) beer is being local. Beers and their brains trust are viewed as much for where they are as what they produce.

So while consumers might be enjoying the craft beer revolution it is actually a collection of pocket areas that have combined as an umarshalled force across the globe.

Instead of accepting an AB InBev product made on licence in a big city, consumers are increasingly seeking independent breweries nearby or from areas of interest.

There are a few economic factors behind the trend. With more than 4800 breweries across the 50 States of the Union – and an estimated 1800 more to come in 18 months – if there isn’t success at home then there is very little likelihood of a win on or down the road.

Also, 90 per cent of new breweries are nano-size. Many don’t package or offer growlers or canimals. Distribution is very short range. Even for medium-sized breweries, shipping beer interstate has plenty of red-tape.

Significantly, the Brewers Association pushes the line that punters will travel to different locales to try fresh beer from independent brands.

Almost 50 per cent of respondents in a BA survey of craft beer enthusiasts indicated they had visited at least one brewery while travelling interstate in the past year.

The same sample was asked the most important aspects when considering a beer purchase and 95 per cent replied freshness. Almost two thirds said a priority was that the drop had been made by an independent brewer.

Scott Metzger, the boss of Texas’ Freetail Brewing and a BA board member, emphasised the local link during GABF.

“There is an emotional connection between brewers and craft drinkers that we don’t see anywhere else,” Metzger said.

“It is that affinity that is driving the market.”

In terms of benefits the independent brewing industry is greater than the sum of its parts. The sector contributes $57 billion – yes that is billion – to the US economy.

That’s 425,000 jobs, many in places that need employment opportunities. It gets back to supporting your own.

BA’s chief economist Bart Watson highlighted the impact of beer tourism, noting the propensity of beer aficionados to visit local or nearby breweries when away from home.

“Our estimate is that last year’s GABF in Denver generated around $28.6 million or around two per cent of Denver’s GDP,” Watson said.

Take the annual release of Russian River’s enigma, Pliny The Younger. Its two-week-only availability has turned into something of pilgrimage for beer lovers.

By going to its source in Santa Rosa, California – it isn’t available anywhere else – the local Sonoma County authority estimates a $5 million benefit to the region on the back of 16,000 visitors, 61 per cent of whom come from 40 other States and 11 countries.

Big Brother Beer has tried to buy its way into the craft brewing vibe. However, all that has done in the minds of drinkers is to create a wolf in sheep’s clothing. The lustre is loss. So is some of the trust.

When Lagunitas sold half its stake to Heineken there was a backlash from those passionate to the craft sector. Consumers questioned Lagunitas commitment to community under the new Megabrew ownership.

Even the BA, whose job it is to lobby on behalf of small independent brewers, has structured its management on 50 State Guilds rather than one central body. It is a lesson Australia’s smaller brewers need to consider.

Metzger said regionality presented different issues and that a local approach was often needed.

“The Guilds are ground zero in ensuring a fair marketplace or small independent brewers to compete on the merits of their beers,” Metzger said.

“Many Guilds have achieved big legislative and regulatory wins in their States and it is these wins that are driving a lot of the economic impact we talked about.

“Up until 2013 I used to be able to say the following statement and it was true, I can sell more beer in Texas if I moved my brewery out of Texas. It was sad but luckily the law has changed since then the number of craft breweries have exploded in Texas. The number of brewing related jobs has increased exponentially.

“Texas craft beer drinkers are living in a golden age of choice. It can be repeated in more States and it is those State Guilds that are leading that charge.”

So Big Brother Beer has it wrong as it monsters through the independent brewing industry swallowing healthy homegrown operations at will in the hope of maintaining strength.

The people have spoken with their wallets and their taste buds. Their desire for local beers has helped the US craft sector enjoy 8 per cent growth already this year.

And as the Australian industry should heed, local is the lure.