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History of Beer Pt. 4: The Modern Craft Beer Industry

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Welcome back to the next installment of the History of Beer. Last time we talked about the Dark Ages for beer, or Prohibition.  This time we will go over a period in history when society not only embraced beer, they made it unique and special; they made it their own. In the process, they gave birth to the modern craft beer industry.

Breweries did what they could during prohibition, but many ended up going out of business. When the Dark Ages finally ended with the repeal of Prohibition, only 160 breweries survived. But in time, those breweries went from surviving to thriving and new ones popped up across the country as beer’s popularity grew.

How much did it grow? In 1966, Budweiser became the first brewery to sell 10 million barrels in a year.

But how could they grow? How could they expand their reach into the alcoholic beverage market? What would it take to convert people who preferred the taste of wine and/or mixed drinks into beer enthusiast?

Simple—make beer that tastes better. Easy, right? Well—not exactly.

By the mid-to-late 1970’s, the American brewing industry was down to 44 breweries nationwide. Light lager dominated the market and was often the only beer available in stores and bars. At the time, imports were not a significant player in the market.

An excellent marketing campaign had completely geared the market towards low-calorie lager. With how the market was acting, some industry experts feared there would only be five brewing companies nationwide by the end of the decade.

However, relief was in sight. While brewing companies were controlling the size of the market and what people drank, some people decided to find an alternative—and a better tasting alternative at that.

How? They’d make it themselves.

If a beer drinker wanted something other than a lager; if he or she wanted to enjoy something similar to what he had over in Germany, England, or Scotland, they began to make it themselves. The desire for different types of beer led to the birth of what we now call the craft brewing industry.

The first craft brewery was founded back in 1976 by an optical engineer and home brewer, Jack McAuliffe. While the New Albion Brewery was only operational for about six years, it served a purpose even more important than brewing beer.

It encouraged others to do the same and start a craft brewery. These smaller breweries began to establish a foothold in the industry in the early-to-mid 1980s. Industry experts were not concerned about them, and the didn’t grab an overwhelming share of the marketplace.

But they were not intended to become nationwide distributors. Their purpose was to perfect their process and embrace their passion and vision. They just wanted to create a beer for their local markets that was full-flavored, respected old-world European traditions but was also uniquely American.

However, with the major brewing companies dominating the market, it was difficult for these smaller, craft breweries to become established. In 1992, five brewers combined to produce over 89 percent of the beer produced in the United States.  But the desire for a better beer remained strong and saw the market for craft beers grow throughout the 1990s.

Growth began to taper off from 1997-2003. But in 2004 the growth curve began to shoot upwards once again. The growth continued over the next few years leading industry experts to think a segment of the beer drinking population had started to develop a connection with their small, local, independent breweries.

As interest grew, craft brewers were encouraged to become even more creative and innovative. It was up to them to expand the minds of beer drinkers and create what would become the most diverse brewing culture in the world.

As of 2008, craft brewers only had about four percent of the market in the United States. But the craft brewing segment of the industry had grown from eight brewers in 1980 to 537 in 1994 and over 6,000 in 2018 (3800 + microbreweries and 2200 + brewpubs).

Over the years, American beer drinkers realized that they didn’t want the same, mass-produced, corporate beet that tastes the same every time. They wanted to explore their beer palate and enjoy new things.

They wanted an experience, not just a beer.

“At the end of the day, the craft-beer movement was driven by consumer demand,” said Bart Watson, the chief economist at the Brewers Association, a trade group. “We’ve seen three main markers in the rise of craft beer—fuller flavor, greater variety, and more intense support for local businesses.”

In 2017, the overall volume of beer sold in the U.S. was down by one percent. But the volume of craft beers had risen by five percent and accounted for $26 billion in sales or 23.4 percent of the overall beer market.

The story of the creation and growth of the craft beer industry is one of perseverance, determination, and ingenuity. It’s the embodiment of the American dream.

Next time you open an ice-cold NoCoast beer, you aren’t just quenching your thirst. You are living the dream. An American Dream! So, be patriotic-- and crack open another!  

 

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