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Keeping up with craft

The enormous demand for craft beer in recent years has continued on into 2015 where craft continues to dominate the beer industry, especially in the UK market.

Craft beers are usually distinguishable by branding and their small scale production, however with the increase in interest, there have been examples of beer brands that do not meet the craft criteria but are attempting to capitalise on the same creative appeal. The craft boom is therefore creating a level of consumer scepticism in a market that was once a minimal collection of brewers.

Overall, mainstream beer sales have seen a decline and many big brewing groups are starting to buy independent craft breweries to capitalise on the surge in craft beer sales. For example brewing giant, Anheuser-Busch InBev purchased a craft brewery, 10 Barrel Brewing Co, in 2014. Following the acquisition many consumers complained via social media, labelling the 10 Barrel Brewing Co. “sell-outs”.
Big breweries buying into the craft beer revolution dilutes the niche of these products, as much of the charm of craft beer brands is their distinct and personable character.

However, there is a pressure on the craft beer industry - in order for these businesses to continue their growth trajectory in 2015; many will need to have significant production capabilities to meet the growing demand. This, in turn requires a substantial investment which large brewers can provide.

However, accepting investment from a big brewer creates a ‘catch-22’ situation - to continue development craft breweries need big investments, but opting for sale and mass production could also potentially hinder success by appearing too mainstream and contradicting the ‘craft’ USP.

With the increase in popularity of craft beer it appears that breweries are fighting over the same names for their beer brands. As a result there has been an influx of trademark and copyright infringement. In the event of a trademark or copyright infringement lawsuit IP valuations are necessary to determine liability and assist in quantifying losses.

Global brewers regress under craft success

Sales for global beer producers have weakened substantially over 2014. Beer affordability for low-income consumers is one of the main obstacles for volume expansion in emerging beer markets.

It will inevitably be a challenging year for global beer brands, whilst the craft beer segment is likely to maintain its market share in 2015. With the craft beer category continuing to thrive, the rest of the beer industry may be forced to reconsider it’s branding to keep up.