Is Beer the New Wine? Part I

The craft beer segment of the American beer market has certainly heated up in the last few years and is now (and has been for a while) the fastest growing segment in the alcoholic beverage industry.  While I do not believe that the segment will continue indefinitely at its current hot pace, contrary to opinions expressed by some of the major macro brewers, it should be clear to all industry pundits that after over 20 years now craft beer is not a “fad” and is here to stay. In fact, in many ways I am reminded of the growth and development of the American interest in wine that began in the early 70’s, and no one certainly ever suggested that that was a “fad”.  The parallels are significant and can lead one to believe that perhaps craft beer is today’s new wine.

Both product categories were dominated by a few large players (and really still are) focused on making rather generic products sold mostly on price point rather than quality.  The consuming public was largely ignorant of different styles of wine (and beer) and was largely content to purchase almost whatever happened to be on the shelf, on sale, or properly displayed.  In the late sixties, as small wineries began to gain momentum in California, they correctly realized that they needed to teach Americans about different kinds of wine – Cabernet, Chardonnay, Pinot noir.  This differentiated them from the ubiquitous generic “Chablis” and “Burgundy” and began the process of teaching consumers to understand different kinds of flavor profiles.  This mission has been successful to the point that many American wine consumers can now differentiate all the more common varietals, and have indeed moved on to such sophisticated grapes as Viognier,  Sangiovese, and Syrah.  That’s a lot of education in about 40 years!

In many respects America’s small brewers embarked on a similar approach beginning in the late 80’s.  People who once thought all beer was pale yellow and very light now understand the difference between Pale Ale, Stout, and Weizen.

An entire media industry has grown up around the growing interest in wine, both assisting in consumer education and sustaining consumer interest – The Wine Advocate and Wine Spectator just to mention two examples.  Craft beer has also developed a large number of publications – from Michael Jackson’s great volumes on beer styles to the electronic medium of the internet with BeerAdvocate.com.   Newspapers are also beginning to add columns on beer to go along with the wine columns they have run for so many years.

One of the results of increased consumer education is consumer awareness of wine and beer as foods to accompany other foods.  Wine dinners paring particular foods and wines have been popular for years and many restaurants are also beginning to do beer dinners.  Indeed, there are a growing number of publications that discuss specifically the art of matching the right food to the right beer.  Even some die hard wine buffs have to admit there are certain foods that go better with beer than wine!

The parallels continue.  Areas which were once the exclusive territory of wine are now being shared with beer. We see people planning beer excursions to Europe.  We see people discussing different “vintages” of particular age worthy beers.  We see people coming to brewery tours in unprecedented numbers.  We see new beer festivals springing up with regularity.  We see people discussing American versus Belgian versus English versus German styles of beer in much the same way as we see people discussing the difference between California and French cabernet.  And we see people who are willing to drink less in order to drink better!

All of this just goes to point out that today’s craft beer seems to be following a parallel developmental path, albeit 20 years later, to the one followed by wine.  Assuming my analysis is correct, this bodes well for the continued growth and stability of craft beer as a continuing force in the market for years to come.