Beer and cider has undergone myriad changes in recent years, and the exciting innovation that has abounded in the category is set to continue in 2017.
Craft, premium and even alcohol-free will be among the buzzwords next year, and through diligence and awareness of market trends, wholesalers stand to make a healthy profit from the category.
If, in 20-30 years’ time, one of those nostalgic ‘I remember the…’ TV programmes picks out a basket of grocery items that define the 2010s, a pale ale would have to be in there.
Looking ahead to what role pale ales have to play next year, Chris France, a co-founder of online beer retailer Beer Hawk, says: “Grapefruit IPAs are going to continue to grow in popularity. Brewdog led the way in 2016 and we expect others to continue this in 2017.”
France also points to the rise of mead, telling wholesalers to be mindful of demand for the alcoholic honey drink next year. He says he expects to see new craft breweries coming to market, too.
“In 2016, Cloudwater came on the scene with some amazing beers and there will be an appetite for similar in 2017,” he adds.
Jess Markowski, head of trade marketing for UK & Ireland at AB InBev, forecasts growth in multi-channel purchasing, with particularly strong performances in online, discounters and convenience, partly driven by the ‘convenience mindset’ of consumers.
“This is leading to less volume per trip, but more frequent purchases across channels,” Markowski says. “We also expect retailers and their shoppers to focus more on shopper missions, occasions and ready solutions, with a simple and easy-to-navigate store offering making it easier for consumers to meet their needs, which ultimately drives loyalty.”
Premium beer pays
Although manufacturers and wholesalers are having to contend with a deflationary market, which is likely to continue for most of next year, Markowski doesn’t expect this to harm the momentum of premium beer, including world, craft and speciality. As she notes: “It is a situation where consumers are willing to pay more for better quality, premium offerings, and use their choice of beer and cider as a social currency.
“We have also noticed that consumers are looking for brands to premiumise their drinking experiences at home. To meet this need, brands are beginning to take cues from the on-trade environment, recreating the experience at home.
“A recent example is the Stella Artois chalice and perfect draught – bringing a more consistent consumption experience across both on-trade and off-trade channels and allowing consumers to recreate a premium serving experience at home.
“We look forward to 2017 as we continue to grow the value of our premium portfolio for wholesale and retail, and bring more authentic, inspirational brand experiences to our consumers.”
The figures back this up: according to British Beer and Pub Association data, sales of premium beer are increasing by 2.2%, whereas total beer sales are declining by 2.4%.
Michelle Chadwick, senior marketing controller at Halewood International, says: “The premium end of beer is really driving category growth. Brewers are refreshing and reviving beer as we know it, to tap into rising consumer interests such as provenance and experimentation.”
The trend for craft beers is likely to continue to boom next year, along with consumers’ willingness to deviate from the norm. AB InBev’s Markowski says: “January often sees people looking to try new things and expand their horizons. Therefore, it is worth stocking more variety in your range and increasing craft or speciality beer options, such as Leffe or Hoegaarden, which demand higher value.”
Gifts and pairing
Several manufacturers also highlight two key sub-trends to keep an eye on in 2017: beer and cider as a gifting option; and pairing foods with beer. As Halewood’s Chadwick says: “Food pairing is a growing trend and linking drink recommendations to food enhances the overall experience. Making suggestions and encouraging consumers to pair beer or alcoholic ginger beer with food and to use it as an ingredient in key dishes offers the opportunity to upsell and gives consumers confidence in their choice. This initiative is an example of the category’s expansion to a wider audience of foodies.
“Considering people’s intolerances and lifestyle preferences is also an important issue. Gluten-free beer is an emerging sector and gives a brand an added point of difference. Offering ginger beer as a gluten-free alternative appeals to those with allergies and those opting for free-from products as a lifestyle choice.”
Certainly, there has been a steady rise in the number of Brits turning to alcohol-free beer during drinking occasions as the result of a long-term health decision or as part of one of the several charity-related ‘dry’ months that take place every year.
To capitalise on this, wholesalers should ensure that they stock alcohol-free beer – AB InBev offers Beck’s Blue and Beck’s Blue Lemon, for example.
Pack sizes are another consideration. AB InBev’s Markowski says: “Wholesalers need to be mindful of key occasions and shopper missions for consumers, and stock the right products to support.
“For instance, in January, as well as low and no-alcohol beers, it is beneficial to stock smaller pack sizes and ranges, as people are looking to moderate their drinking.
“Likewise, summer and sport are huge occasions for beer, so wholesalers should be matching events to beers that pair well with sharing occasions, such as important football tournaments matched with Budweiser, the official beer of the FA Cup, which is well known for its football associations.
“Tapping into the opportunities offered by warmer weather and barbecues using the ‘king of the grill’, Budweiser, or Stella Artois with premium events like Wimbledon, will be a great way to meet shopper missions next year.”
Chris Miller, director of the Craft Beer Clan of Scotland, expects range rationalisation to be one of the defining factors of the category next year, and stresses the importance of ensuring you have the right formats for the convenience market.
He fully expects the craft trend to continue its surge, with craft lager in particular set for a strong 2017. Miller also tips porters and stouts to keep enjoying their resurgence: “Craft consumers are experiential people,” he says. “A lot of them are members of craft beer clubs, and take delivery of eight to 12 bottles a month.”
Beer Hawk’s France recognises the increasing rise of this type of consumer, and urges wholesalers to embrace them: “There’s always a fine line between providing familiar favourites and offering an eclectic choice that may be unfamiliar to your customers and theirs,” he says.
“We believe – and we have built our business upon this – that while commercial favourites provide safety, you can get those stalwarts in any supermarket up and down the land. If you want to develop a customer base that values difference, and who will come back for more and appreciate your offering, then we would recommend you offer distinctive and unusual beers that will whet customers’ appetites and bring them back again and again.