Mexican craft beer may be what hops next
Company hopes to tap growing Hispanic market
Mike Snider
While overall U.S. beer industry sales remain flat, Americans’ thirst for craft beer continues to grow and Mexican beers such as Corona Extra and Modelo Especial have unquenched market appeal.
Could craft beer made by Mexican brewmasters be the next big beverage trend in the U.S.?
A trio of former Anheuser-Busch executives and a Mexican entrepreneur are betting on it with a new venture, Quest Beverage. The company has already introduced four beers into Houston and St. Louis and throughout Missouri, and the beers are now hitting markets in California, Illinois and Texas.
The beers currently being imported are a citrusy Crossover IPA and crisp Blonde Ale from Cerveza Urbana, based in Mexicali, Mexico, and a light, dry Kölsch ale and a malty, mildly bitter London-style ale called Cerveza Rrëy from Monterrey, Mexico.
New trends
A trio of trends points to potential success:
❚ A growing Hispanic population in the U.S. now makes up 18 percent of Americans.
❚ Mexican imports are hot. Corona Extra and Modelo Especial each owned 5 percent of the retail market last year, according to IRI, a Chicago-based market research firm. Modelo Especial sales rose 18 percent, dollar-wise, from 2017.
❚ Growth in craft beer, brewed by small, independent breweries, has slowed, but its share of the overall $111 billion-plus U.S. beer industry is expected to increase beyond the 23.4 percent it captured in 2017, according to the Brewers Association. “We saw an opportunity to combine those converging trends,” said Quest Beverage CEO Gregg Billmeyer, who spent 28 years in marketing and sales at Anheuser-Busch.
About two years ago, he and the rest of the startup team – master brewer Dan Driscoll and exec Mike Redohl, both former Anheuser-Busch veterans, and Mexicali-based financial exec Eduardo Muniz – began surveying the Mexican craft beer scene. “Craft beer in Mexico is exploding,” Billmeyer said. “It looks like the U.S. 20 years ago.”
That led to consumer taste testing of Mexican craft beers in Houston and the beers from Cerveza Urbana and Cerveza Rrëy stood out as favorites. Now, those beers are being served in bars, restaurants and at retail.
“We’ve got very aggressive expansion plans, but at the same time we want to continue to learn, continue to adapt and see what is accepted ... as we look at additional markets,” Billmeyer said. “We have seen this as a national opportunity.”
Potential potholes
The beers will be priced to match premium imports and craft beers, another trend that’s proving palatable with consumers. U.S. craft brewers already offer Mexican-style lagers, so why wouldn’t consumers be tempted to try a real Mexican craft beer?
Mexican craft beer “absolutely” can be a “success story in the U.S.,” said Bump Williams beers, a beverage industry analyst and consultant. But there’s “lots of potential potholes,” including retail shelf space in a flooded marketplace with more than 20,000 beers being sold in the U.S., he says. “Mexican craft beer has a future in the U.S., but it won’t be easy.”
The Quest team sees imported Mexican craft beer as the start of a long-term strategy. After beer drinkers try national beers, they then seek out regionally and locally brewed beers, Billmeyer says. Next, he said, “they will be intrigued by what is coming from south of the border and eventually crafts from other parts of the world.”