There’s an identity crisis with definition of “craft”
Five years ago, when Black Shirt Brewing opened, it was the only craft brewer in its immediate Denver neighborhood.
The brewery soon became a landmark when the documentary “Crafting a Nation” portrayed its founders as some of the revolutionaries challenging the beer industry status quo.
Now, 14 breweries crowd in the River North area — including two owned by international beer companies. And each time another opened, said owner Branden Miller, “we were holding our breath wondering if this was going to be the thing that killed us.”
The sentiment is familiar to many in the craft beer industry who will gather this week in Denver for the Great American Beer Festival, the largest in the nation.
The increased competition from beer giants such as Anheuser-Busch InBev and Mill-
erCoors is creating an identity crisis in the industry and rendering the term “craft beer” obsolete.
“They basically tried to steal our terms, how we self-defined ourselves,” said Chris Black, the owner of Falling Rock Tap House in Denver and the former chairman of the now-defunct Association of Brewers. Now, he said, “those are terms that don’t really have the impact of what they were intended for.”
The Boulder-based Brewers Association recognized the problem this year when it debuted a new seal that certifies “independent craft brewers.” And it plans a major push this week at the festival.
The campaign to reclaim craft beer represents the most aggressive push from the trade association since 2011, when Anheuser-Busch bought Goose Island, a small Chicago brewer, and ignited the beer wars. The big beer companies now own stakes in dozens of craft breweries.
“We think it’s necessary because we think the beer drinker has a right to know who’s behind the brands that they are supporting or purchasing,” said Bob Pease, the president and CEO of the Brewers Association.
In Colorado, where beer is part of the state’s ethos and a billion-dollar-a-year industry that employs thousands, the implications are significant. The state hosts more than 300 craft breweries with an economic impact of $3 billion, according to new association numbers.
And it is home to operations for the two largest beer companies, with Coors in Golden and Anheuser-Busch in Fort Collins. All together, the Beer Institute estimates a $15 billion economic footprint in the state.
How the Brewers Association’s effort will affect the marketplace remains uncertain, according to analysts, particularly given the massive advertising dollars spent by big beer companies.
Kyle Leingang, an attorney in the craft brewing industry who was involved in the deal for AnheuserBusch to buy Wicked Weed, a cult-favorite brewery from North Carolina, said the most dedicated consumers care about the origins of their beer.
But, he added, “there is certainly going to be a lot of consumers out there who don’t necessarily care who owns their beer as long as it’s high-quality and they can get it at a cost that’s acceptable to them.” The battle to define craft beer. The new “independent craft” seal reflects the association’s definition of a craft brewer, one that has evolved as the industry exploded with growth. The three main tenets are:
• Small: Annual production of 6 million barrels or less.
• Independent: Less than 25 percent of the brewery is owned or controlled by an entity that is not a craft brewer.
• Traditional: A majority of the brewery’s production is beer and not a flavored malt beverage.
The Colorado beer brands that do not fit this definition include Anheuser-Busch properties Breckenridge and 10 Barrel, and MillerCoors brands Blue Moon and Colorado Native.
The more large brewers buy smaller brands, the more they create the illusion of choice, said Andres Gil Zaldana, the director of the Colorado Brewers Guild. He pointed to sporting venues and airports where a row of tap handles can feature only one company’s beers.
The seal, he said, “identifies one of the key issues out there, which is that unfortunately there is consumer confusion and a lack of consumer awareness, especially as a lot of the larger companies have continued to purchase craft breweries.”
The size of the megabeer companies gives them advantages at bars and on the beer aisle, allowing them to sell their brands at lower prices and crowd out craft brewers.
“If there’s one thing independent craft brewers can’t do that macrobrewers can do, it is lose money,” wrote Jacob McKean at California’s Modern Times Beer in a scathing appraisal of recent craft beer sellouts. “And this strategy is, by far, the most effective way for macrobrewers to reduce consumer choice and extinguish the craft beer movement they’re now trying to co-opt.”
With its new campaign, the Brewers Association wants to educate consumadopt ers — not only about who makes their favorite beers but the differences in how the beer is made.
The nation’s craft brewers want to emphasize their product is local and the business profits remain in the community. And they highlight how their beers are made by hand, rather than the automated systems common at the megabreweries.
“Some (consumers) only care about how the beer tastes,” Pease said. “We respect both viewpoints, but what we’ve found is beer drinkers don’t want to be duped, don’t want to be fooled.” Big beer is local beer in Colorado. The argument about local beer is murkier in Colorado, where beers such as Budweiser, Coors Light and Blue Moon are often as fresh as a pint at the small neighborhood brewery.
Gene Bocis, the general manager of AnheuserBusch’s brewery in Fort Collins, said his focus is quality across all brands.
“We know that a Colorado consumer … wants that different plethora of options, and we want to provide it to them,” he said. “I realize that every beer category and every beer brand is fighting for their space. And there is space for each brand.”
The Fort Collins brewery makes Breckenridge Vanilla Porter, Elysian Space Dust IPA and Goose Island brands, all of which they still consider craft.
“I know there are a lot of different definitions for craft beer, but we realize what the consumer views as craft beer, so we use that terminology,” he said.
Denver-based Molson Coors, whose U.S. business unit MillerCoors owns a handful of craft breweries, declined an interview request. But in a statement, spokesman Colin Wheeler questioned the new Brewers Association campaign.
“At the end of the day, drinkers care about how a beer tastes,” he said. “That is why our focus is on the quality of our products and serving up a wide range of styles that all types of beer drinkers can enjoy. We believe labels should tell the consumer what’s in their beer, instead of the ownership structure of the brewer.” Big push at GABF. Since the Brewers Association launched its campaign in June, 2,300 of the 5,000 craft breweries in U.S. adopted the “independent craft” seal, which features an upside-down bottle. It will get prominent placement at GABF when the three-day event starts Thursday at the Colorado Convention Center.
“For years, small and independent craft breweries have been turning the beer industry upside-down. Now you have a seal to show it loudly and proudly,” the association declared in its announcement.
Black Shirt Brewing is one of the breweries to the seal. But Branden Miller is not relying on its marketing to sell his beer. Instead, he’s adjusting his business model in response to the new competition in the neighborhood.
“Competition only makes us better, right? We have had to elevate our game in a big way … to be relevant and sustainable in this industry,” he said.
Black Shirt recently shifted from a production brewery to brewpub that serves food to help it stand out. And he partnered with neighboring craft brewers — but not the big beer companies — to run a free shuttle tour between the RiNo taprooms.
The brewery also opens earlier than the others in the area, often making it the first stop for beer tours. This is what drew Mark Wichner and Denise Schreiner of Baraboo, Wis., directly from the airport one recent morning.
The creativity in the brewery’s pistachio lavender rye pale ale, released for the brewery’s anniversary party, impressed them. “It’s so out of the ordinary, it’s not plain-Jane,” Schreiner said.
When it came time to leave, the couple consulted a green spiral notebook with a list of breweries for their weekend-long tour. Schreiner said she typically drinks craft beer, but she didn’t research who owned the breweries for their Denver tour — just what tap lists looked the best.
“If something sounds good, I’ll give it a whirl,” she said.
And this is exactly what independent craft brewers fear.