Chief economists Bart Watson (Brewers Association) and Lester Jones (National Beer Wholesalers Association) spent much of the past couple years staving off fears of a recession and preaching about how beer is “economically resilient.”
Beer must have heard this and decided that it will not only be economically resilient, but it will be “counter cyclical,” as the U.S. economy grew +5% in 2023, while the beer industry – measured by domestic tax paid shipments plus imports – declined -5%.
“I have never ever seen the U.S. beer industry counter cyclical to the U.S. economy,” Jones said while on stage with Watson at the Brewbound Live business conference earlier this month in Marina del Rey, California.
“Everyone started the year worried that the economy was gonna go into recession and the beer was going to be impacted – I was like, “No, no, no, beer is economically resilient, it doesn’t go up or down based on the economy,’” Jones continued. “And here the economy grew +5% and the beer market fell by -5%. Something is incredibly disconnected in the relationship between what’s going on in the U.S. beer market today.”
What’s the disconnect? Watson and Jones dove into beer trends in 2023 to find some answers, sharing a presentation on the “23 Data Points That Defined 2023,” (plus some bonus data points).
Some beer segments and styles have been able to still find growth, including non-alcoholic (NA) beer and imperial/double/triple IPAs. Both the traditional and hazy versions of the latter were the only two craft beer styles to record growth in the last 52 weeks in NIQ-tracked off-premise channels, according to Watson, citing data from 3 Tier Beverages.
However, Watson warned that a growing style doesn’t mean every producer – particularly smaller craft producers – should try to jump on the trends.
“Hazy imperial without New Belgium is a totally different picture,” Watson said, referring to New Belgium’s Voodoo Ranger line of IPAs.
When including only small- and mid-sized craft brewers, imperial/double/triple IPA dollar sales are actually down over the 52-week period (-2.5%).
NA is similar, with the craft NA space dominated by Athletic Brewing. However, Jones suggested that the segment hadn’t reached its peak yet, and encouraged the industry to put stronger support behind the segment as it is “putting beers in peoples’ hands where it wasn’t before.”
Insiders can watch the full presentation and proceeding Q&A above, with Watson and Jones diving into data points about the on-premise, consumer cross-category purchase habits, beer share losses and more.
Plus, if you attended Brewbound Live (virtually or in-person), you can download the presentation slides here by logging into the attendee portal.