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08.2007

Massachusetts Beverage Business

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Article By: Lew Bryson

The jury's still out on which category malternatives fit into. Just when you think they're yesterday's news a new flavor comes out, or a new package, or a new positioning, and suddenly malternatives are hot again.

That's the nature of "hot". It's that fast-moving part of the market, whether it's a big part or a small one, it's the beer that's got all the buzz, the one that has the sellers and the buyers talking.

Hot is not in the big brands right now, with one predictable exception. The usual summer rush to Corona is taking place as the sun beats down. "Once the warm weather comes, the Corona picks up," said Dan Demuth, store manager at Yankee Spirits in Sturbridge. "We sell a lot year 'round, but some people associate it with the beach."

Demuth also saw a recent surge in popularity for Corona's little sister, Corona Light. "A few years back, I might keep 2O cases on the floor," he said. "Now I've got to keep pallets of it. Light in general does very well, even more so in the summer. People are more concerned about how they look."

Other than that, the major brands are holding steady. Heineken Premium Light has come out in cans now, something that's pushed sales, and the growth for this new brand looks good, but after last year's amazing launch, the numbers will have to be very strong indeed to look good in comparison. Newcastle Brown is very hot nationally, continuing the strong growth it's seen over the past five years or so, but it's already an established brand in Massachusetts (though with national promotions coming along, it might be a good idea to take another look at it).

CHILL'N' HOT

One new big brand product that might be hot - though its name is not - is Miller Chill. It was hard to say at press time whether this brand-new brand was really going to hit, but initial orders and reports were strong, and the beer's gotten some good reviews from some sources.

As you probably know by now, Chill is a pre-made version of a chelada, a Mexican beer cocktail of somewhat hazy origins. "Michelada" is a slangy Mexican way of saying "my cold beer", evidently, and is a mix of beer (usually a darker beer like Dos Equis or Negro Modelo), lime juice, hot sauce, and spices, served in a glass with a salted rim, a "beerita" kind of thing. Chelada is a simpler version: light lager, lime juice and the salted-rim glass. Miller Chill is all that wrapped up in a green glass bottle, ready to drink.

Is it selling? It's still pretty early, but Chill looks like a hot-weather hit. "They were excited about Chill," said Rudi Scherff of his customers at the venerable Student Prince in Springfield. A recent boston globe article talked about the whole chelada idea, and guessed that the chelada's quenching appeal would easily extend to Chill.

STIR IT UP

Chill's heat might well be borrowed from a hot concept we've talked about here before, one that's driving craft beer sales and firing up the majors as well: variety. You might say that's not a hot beer, per se, but as a trend, as something the customer's looking for, you can't really ignore it.

Pamela O'Brien is the manager at Penguin Pizza, a favorite craft beer spot in Boston. Variety is driving beer expansion at Penguin: they're adding 8 new draft lines for a total of 28, and an additional 3O bottles to a total selection of 18O bottled beers.

"There's a demand for variety," she said. "We have a beer club, and when they complete it, they get a 22 ounce stein. So they want more draft, for the variety and for the stein. We've got a lot of seasonals, really a bit of everything: wheats, pilsners, fruity beers. The thing's that really picking up is the Monty Python's Holy Grail Ale, it's taken off in the last month, and Whale's Tale [Pale Ale from Nantucket-based Cisco Brewing] is really selling."

Cindy French, the beer manager at Spirit Haus in Amherst, echoed that for off-premise. "People are buying a lot more variety packs," she said. The variety 12-packs are selling very well these days, ones like the Harpoon Summer Vacation, and the Saranac 12 Beers of Summer, those are very big."

Demuth sees that as well. "Various suppliers do mixed packs," he said. "Harpoon and Magic Hat do very well. Smirnoff and Mike's [Hard Lemonades] do mixed 12-packs, and that's also very popular."

He compares today's thirst for difference with the old days he recalls. "I've been in this 23 years," he said, "back when you had Bud 12-packs, 24 bottle cases, and 24-can suitcases, and that was about it. Now consumers are demanding new products. They want to try new things, and the producers are providing them. A-B throws ten products against the wall and hopes two will stick. It's hard to figure what will work. Some of the things you'd think would do real well, don't."

CRAFT, QUALITY and VARIETY

The craft beer revolution was about variety to begin with, of course: not better beer, not stronger beer, not even so-called hand-crafted beer, but different beer. Variety is deep in craft beer's DNA, and that's reinforcing the category's popularity. And of course, the more beers there are, the more there is to know, which has its own appeal.

"We carry a lot of craft brews: Harpoon, Wachusett, Victory," said Kris Wollet, the restaurant manager at Boston's famous Jacob Wirth's. "More people are becoming snobs about their beer, treating beer like they treated wine in the 198Os, they all of a sudden know everything about the drink. You've got beerAdvocate, websites like that feeding into it. It's a consumer trend. And it's definitely a better ring."

"Our clientele is off-the-beaten-path, looking for small breweries, not the stuff you can get at any old beer joint," noted Carrie Anne Martin, the manager at Marty's Liquors in Newton. "People are looking for high-quality hand-made products, which is different from what we saw in the last ten years. They're branching out from the major brands."

She backed that up with a look at what was popular at Marty's going into the hot weather season. "Oh, Dogfish Head 6O Minute IPA and Avery White Rascal seem to be really taking off. Stone Brewing, the whole line's strong, but Arrogant Bastard and their IPAs, these are all real hot right now."

HOT NEW PACKAGES

The next thing Marty's Carrie Anne Martin said pointed up another trend: big bottles. "We find those are going really well in the 22 ounce bottles as well," she said. "People are looking for some variant in packaging."

Cindy French sees the same thing at the Spirit Haus. "We are getting more of the 22s in now," she said. "We used to have just a few, and now we've got a whole row of them, we've started on a second row. Hey, if you're just going have one beer, that's the one to get!"

Demuth saw a hot new trend in craft beer packaging we've noted here: cans. "I'm looking for craft cans for a customer who likes premium beer, but he has a pool, and people with pools don't want glass," he said. "I've got five premium beers in cans, and I'm looking for more. It's not a huge demand, but a few years ago you sold Heineken, some Amstel, maybe some Corona in cans, but no one wanted premium beer in cans. But now I've brought a few in and they surprised me."

It's not just the craft beers, either. As brewers and importers get more capable with their packaging, they're able to change package sizes to more precisely meet customer interest. "I'm seeing the 2O-pack bottles picking up," Demuth ticked off the different packages he's selling. "When they first came out with that, it just sat. The 18-pack can cases do well. And the 36-pack cans do well in the summer."

RED-HOT NICHES

There are a few hot niches to work, too, beers that either didn't exist five years ago or represent explosion in a category. Take gluten-free beers, for instance. People with celiac disease, a hereditary disease that's estimated to affect as many as 1 in 133 Americans, have an autoimmune response to gluten, a protein that's found in wheat, rye, and barley. Even the small amounts of gluten that remain in beer after the brewing process can ravage a celiac's small intestine. Beer is a dangerous drink for them.

In thirteen years as a full-time beer writer, I have probably received over 1OO e-mails looking for gluten-free beers. Until recently, I had nothing to offer. When I was on a trip to Italy with my church choir four years ago, a celiac in the choir found an Italian gluten-free beer that was sold in drugstores for around $5 a bottle. He was chortling with pleasure, and plotting how many bottles he could stuff in his suitcase and take home.

That's the same kind of small but intense reaction being seen by retailers to the gluten-free beers that have finally hit the shelves in Massachusetts: Bard's Tale, Lakefront New Grist and Anheuser-Busch's Redbridge. "Hardly a week would go by that I wouldn't get an e-mail asking if we had gluten-free beer," said Demuth. "Then I finally got these in."

"It's not cheap," he cautioned. "The Bard's Tale is selling for $12.99 a sixpack. But I saw one guy loading up his cart with four cases of it. I said to him, I don't want to talk you out of buying that, but you should know that it's $48 a case. 'I don't care,' the guy said, 'It's the only beer I can drink.' The Redbridge is about $8.49 a six-pack."

Organics, as we reported a few months ago, are another red-hot category. With more attention being paid to the environment, to farming methods and pesticides, and with the popularity of organic foods, organic beers are only going to get more popular.

Martin at Marty's Liquors thinks that once things get better defined, the organic beer market will boom. "We do a good amount of organics," she said. "But I think 'organic', because of the [loose] regulation of what can be labeled organic, is being diluted slightly. As people lock down on what is and is not an organic product, I think they will do better."

You may remember fruit beers as a hugely hot item in the 199Os. After a serious backlash, brewers and importers are trying them again, and beers like Wachusett's blueberry ale are selling almost faster than brewers can make them.

"The general run of the mill purchaser is getting into fruited beers: lambics, and so on," said Martin. "More people are asking about them. A lot of the products that caused that backlash were the cheesy ones, and people are now finding that 'fruit beer' doesn't necessarily mean 'chick beer'. There are beers that are dry and fruity, just a hint of fruit, not syrupy sweet."

Two trends come together in Saranac Pomegranate Wheat. Not only is this new beer from the old New York brewery a fruit beer, the fruit is the hottest trend in food and drink. Pomegranate's beautiful dark red color and bountiful antioxidants have made it an overnight success in juice, diet supplements and cocktails. Apparently it's working with beer, too. "The Pomegranate Wheat's real good," said French. "I have one gentleman who's buying it by the case."

HOTTER than the BEER

What may be the hottest trend of all is who's drinking beer. Everyone mentioned that there is a new wave of beer drinkers: women. "More women are starting to drink beer, they're coming in on the fruitier craft beers," said Wollet. "Some come in and just stick with that, but about half branch out and try other beers. Something like the Young's Double Chocolate Stout is heavy enough for a guy, but chocolatey enough for a woman."

"When we first opened," said O'Brien, "women were drinking Coors Light, Smirnoff Ice, Miller Lite. Then they started joining the beer club, and now more and more of them are drinking all kinds of beer."

"Ten years ago, women were light beer drinkers," Scherff agreed. "Now they're going across the gamut. You've got a lot more women exercising and watching their weight, so they don't feel they have to limit themselves to a low-calorie beer."

BACK to BASICS

A couple things haven't changed. A good local beer can always do well. Berkshire and Wachusett continue to build on their strong local sales, Harpoon is solid in Boston, Cape Cod and Cape Ann do well in their home markets.

Even the Opa-Opa Steakhouse and Brewery, the brewpub located in Southampton, is into the off-premise market and getting noticed. "We have local beers now," said French. "Opa-Opa has growlers and six-packs. We carry 5 different growlers which are doing well." Scherff sees it doing well at the Student Prince as well.

Scherff also believes that familiar, simpler styles like the maibocks and pilsners popular at the Student Prince are due for a comeback. "I think you're going to see people getting back to the basics," he said, "maybe what you'd call 'comfort beers'. A beer you can sit down and have a couple of, without it being cloying. The big crazy beers, the novelty beers, the really hoppy beers; I think they're going to die away."

Maybe, Rudi. One thing's for sure: the hot beers are always changing, and that's good for beer sellers and beer drinkers alike. It keeps things interesting, and that's what keeps beer fun.

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