As I was skimming through the latest issue of strategy + business, I came across an article about the craft beer industry, and the challenge it faces in continuing to grow. Many of our clients have similar challenges, inherent when a market moves from a high-growth phase into more of a mature phase. “Wait, why aren’t we growing like we were?” “Our strategy hasn’t changed, but where are the new customers?” In most industries, companies who have experienced high growth need to regularly take a step back and look holistically at the market, and their own strategies.
For craft beers, “Much of the flatness in the industry can be attributed to market saturation. There are only so many drinking occasions, and consumers are turning to a wider set of alcohol choices, including craft spirits. In addition, the continued proliferation of brands and styles has made it increasingly difficult to drive growth. Brewers are battling over retail shelf space and a finite number of tap handles at on-premises locations.” Craft beer companies are addressing these challenges through innovation of new varietals, beer and food pairings, adding new taprooms, leveraging social media, improving operational efficiencies, and investigating M&A opportunities. These types of strategies can work for many industries, as continued growth usually involves some form of innovation.
Now I tend to prefer wine over beer but do enjoy an occasional craft beer, especially when traveling. Hoping the craft beer industry will retain its authenticity even in this period of rapid change! And if you would like to talk innovation over a beer, give a shout out!