Shift In Consumer Preference To Craft Beer From Mainstream Beer Is Expected To Drive Market
The demand for craft beer is expected to witness substantial growth on account of the growing consumer preference for craft beer over the mainstream beer. A wide range of flavors coupled with low ABV is expected to be the key factors for the aforementioned shift in the consumer tastes & preferences.
The global market is growing significantly on account of the growing preference for the product among the consumers in the developed economies including the U.S., Germany, Japan, Australia, Belgium and New Zealand. In addition, the several flavors and styles of spirits are expected to attract consumers in the developing economies. Furthermore, the demand for low ABV (Alcohol by Volume) and malt brews particularly in Pacific countries is expected to complement industry growth over the next nine years.
The consumption of craft beer is high in European countries including Germany, UK, Belgium and the Czech Republic. This can be attributed to the premium quality spirits manufactured in Belgium and Germany with the wide range of flavors of the product. In addition, the increasing penetration in countries such as Ireland and Scotland owing to the rising consumer awareness with respect to the different styles of the beer is expected to have a positive impact on the European market.
The different varieties of the product include Pale Ale, Indian Pale Ale (IPA), dark lager, chocolate beer, amber ale, amber lager; barrel aged lager, and herb & spice brew. IPA, amber lager, and amber ale are the most preferred beer among the aforementioned styles. These styles are mostly consumed through different hospitality distribution channels in developed countries.
The market is segmented on the basis of distribution into on-trade and off-trade. The on-trade distribution includes craft brews sold in restaurants, bars, brewpubs, clubs and other channels in the hospitality industry. The demand for the on-trade beer is high in the developed economies such as countries in Europe and North America. This trend can be associated with the increased price of the product in pubs coupled with high consumer ability to pay in developed economies.
Europe is expected to account for the largest revenue share owing to the high consumption of the product in Germany, Belgium, and the UK. The market is growing steadily in these countries with decreasing consumption of mainstream beer owing to the variety of flavors and styles. Furthermore, Middle East & Africa is expected to witness the fastest growth on account of the high penetration of the product in South Africa. This growth is attributed to the increasing consumer preference for low-calorie and low ABV spirits.
The competitive market is characterized by the presence of few global players coupled with a large number of local brewers. The Belgian and U.S. market players such as Chimay Beers and Cheeses and The Boston Beer Company respectively are the major market players. The other major brewers include Vagabund, Feral Brewing Co., The Gambrinus Company, and D.G. Yuengling and Son. Furthermore, the major players compete over the acquiring new and potential markets. On the other hand, local players compete on the basis of the variety of flavors and pricing of the product.