Crafty MarketingLook to Craft Beer & Spirits for Inspiration
It’s an off-season Thursday night at the Park Distillery in Banff, and the joint is jumping as if it was a holiday weekend in the height of summer. Servers are slammed, getting samplers of craft vodka, gin and un-aged rye out to thirsty customers. Guests lean over to their neighbours’ tables, asking perfect strangers what they’re drinking. Downstairs, a steady flow of shoppers is keeping the retail shop busy ringing up bottles of Park Chili Vodka for tomorrow’s brunch Caesars.
“It’s our Alberta grain, and our glacier water,” explains distiller Matthew Hendriks. “It’s the cleanest water you can get.”
This is what the craft scene is all about: vibrant, social, mostly young, and passionately local.
If your business hasn’t already tapped into it, you’re missing out on a lucrative opportunity.
Back to the Future
Think of the craft movement as a return to what Canada does best. Before Prohibition, Canada was known for finely crafted ales and spirits. We had the fields of golden grain, the streams of crystal clear glacial water, and the generations of German and Scottish immigrants who knew their way around a mash tun. But two World Wars, Prohibition, the Depression, and an era of strict government oversight drove nearly all of Canada’s small brewers and distillers out of business.
In the last 30 years or so, they’ve slowly, then quickly, trickled back. Canada’s first craft breweries opened in the mid-1980s, around the same time Canada’s wine industry got serious about vinis vinifera, and by the 2000s, Western Canada’s first craft distilleries were online. It was a perfect pairing for the growing locavore movement in cuisine: not just farm-to-plate, but farm-to-glass.
But what, exactly, is “craft”? It is essentially small batch production, legislated by maximum outputs that vary from region to region. (In Alberta, for instance, a craft brewer is defined as one producing less than 300,000 hectolitres per year.) Although it is not necessarily true, “craft” also implies that a product is made locally, traditionally and independently, from ingredients that are grown just up the road. It’s thought to be more flavourful, more interesting, and more varied than commercial products.
Craft, in short, is what the contemporary market is craving.
Adding it All Up
The numbers alone tell the story. In 2015, sales of craft beer soared by nearly 15% in the US, according to the Nielsen research company. In Ontario, craft beer has long been the fastest growing alcoholic beverage category, with sales up 20-30% year after year. In BC, craft beer sales tripled between 2010 and 2015, with sales of $73 million in 2015 alone, according to a report in The Province newspaper. Alberta boasted a 25% increase in craft beer sales last year. Meanwhile, commercial beer consumption continues to plummet by 6% per year in most markets.
Today, there are some 10,000 craft breweries worldwide, worth US$50 billion, according to Neilsen. Nearly 500 of them are in Canada, making this the sixth largest craft beer producer in the world, and Beer Canada reports an astonishing 108% increase in the number of breweries across the country since 2010. The number of craft distilleries is also on the rise−from 50 in the US in 2005 to 769 in 2015.
Here in Alberta, since 2013, the number of craft breweries and small brewpubs has jumped from 14 to 52, and craft distilleries from zero to half a dozen.
And thanks to a number of progressive decisions by the province, more will be on tap soon: In 2013, the Alberta Gaming and Liquor Commission removed minimum production requirements, making it much easier for small producers to start a business. Then, in 2016, the provincial government announced a $20-million-a-year grant program to assist Alberta brewers. Meanwhile, Calgary amended its municipal zoning rules to allow craft breweries in populated areas, and Edmonton will likely follow suit.
If politicians get it, retailers should too.
Craft customers are often educated, well-travelled, and active on social media.
The Customer is Always Right
It’s not just the numbers. The craft consumer is one any business should be delighted to attract. Both millennials and baby boomers seek out craft products, which unlike commercial beer brands, appeal equally to men and women. Craft consumers are often educated, well-travelled, and active on social media. They have disposable income and are happy to spend it on products that appeal to their sense of quality, variety, and support of local businesses.
What’s Not to Love?
Well, these customers can be demanding and critical. If a product or experience falls short, judgment is swift and harsh and tweeted out to thousands of potential customers.
That’s just one of the drawbacks of the craft movement. Craft products can also be inconsistent, either in quality or supply. Freshness is key, so storage and turnover can be an issue−you likely won’t move pumpkin spice ale in March or radler in November. Laws are ever-evolving, which means that a retailer has to stay on top of the latest changes or face substantial fines.
A retailer also has to be knowledgeable about these products, so it’s important to invest time in education. It’s not always so easy to tell a craft product from one that is simply being marketed as craft, especially as the big players muscle into the game.
Crafting a Strategy
So is it worth carrying craft products in your own retail outlet? It depends on your business model, but if you want to attract a social, engaged market that is knowledgeable about wine, beer, and spirits, then craft should be part of your plan.
Not sure what to carry? Although there are many exceptional craft ales and sprits from across the country and around the world, the best place to start is right here at home. After all, in many consumers’ minds, “craft” is just another way of saying “local”, and Alberta’s growing number of breweries, distilleries, and meaderies offer plenty of great options.
Craft is also another way of saying “social”. Consider installing a growler station or tasting bar where distillers can offer samples, bartenders can demonstrate cocktails, and cicerones can lead classes on tasting. It’ll give customers another reason to visit, and to stay longer and spend more money when they do.
Of course, selling craft products may not be as easy as installing a growler station and watching the money flow in. Then again, sometimes, it is.