The drunk fest otherwise known as the 2016 Craft Brewers Conference is underway in Philly. There are a number of issues facing the industry, despite positive growth. One of the biggest is the ongoing question of how and why the Brewers Association defines a craft brewer.
"You hear people saying 'craft' no longer matters, that it's 'only the beer' that matters, not where it's brewed." Not so, Tod chided. As he went on to note, the Brewers Association does not define "craft beer." What it does define is what a "craft brewer" is. Because the BA's job is to promote and protect small, independent brewers.
Frankly speaking, there's plenty of room to quibble with the Brewers Association's definition of a craft brewer. Their definition allows Sam Adams and Yuengling in, but keeps Widmer, for example, out. Not the best. However, one thing we can certainly agree on is any craft brewer that is fully owned by a major brewer ceases to be a craft brewer.
There are sound reasons for this and I've been through them here countless times. As Tod reminded the folks in Philly, when you fall outside the small and independent definition, you are fundamentally different. It means you have access to materials, distribution and retail that independent brewers simply don't have. Not to mention capacity and economies of scale.
See, that's the thing. Once breweries join forces with Anheuser-Busch, they simply aren't playing on the same field with independent brewers. They enjoy significant advantages in a number of areas and, even if they make good beer, aren't and shouldn't be considered craft breweries.
The good news is acquisitions can't keep pace with new brewery openings. AB will never own more than a small percentage of the independent craft brewery count. The bad news is they don't need or want to own a huge number of breweries. They just need enough craft breweries to blur the lines of what authentic craft beer is, at least partially via what Stone's Greg Koch refers to as "the illusion of choice."
If you aren't sure what that means, follow along.
In Koch's case, he walks into an airport bar and sees a bunch of IPAs and some other beers on tap, including Goose Island, Golden Road, 10 Barrel and Elysian. The unknowing patron looks at that list and assumes he/she has choices. But Koch knows each of these brewers is fully owned by big beer. The independent brewer has no place here.
In my case, I walk into my athletic club, which has an uneven history with beer variety. I typically see the four taps occupied by Elysian, Widmer, Goose Island and 10 Barrel. Again, the average patron sees choice. But I know each of these breweries is fully or partially owned by Anheuser-Busch. In reality, choice is very limited.
What's the endgame? AB wants to occupy enough tap handles and store shelves that consumers become totally perplexed about craft beer. Once that happens, they'll use advantages in cost (lowest per barrel in the industry) and distribution to squeeze craft brewers out of the market. Then they can gradually get back to selling the homogenized sludge they know and love.
You look at what's happening and you realize how important it is that the Brewers Association continue to define what a craft brewer is. But the real challenge is getting people who don't care who brews the beer to understand why it does matter. That's a tough one.
Because education is never easy, and it's particularly hard when there's a ton of money invested in making people believe something else.