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Commentary

Beverage Beat

Experts highlight necessity for craft purveyors to shift sales strategy

Consumers becoming accustomed to at-home alcohol consumption

August 11, 2020

As businesses continue to adapt during these COVID-19 times, the beverage industry has seen the impact that novel coronavirus is having on businesses. Although no industry is immune to the economic affects, the craft beverage alcohol space was hamstrung as many were forced to shut down taprooms and tasting venues.

In the early throws, we saw that many craft spirits distillers shifted their production runs from spirits to hand sanitizer whether for donation purposes or as supplemental sales. In this month’s cover story (page XX), we take a deep dive into the craft spirits market, including how it is adjusting its direct-to-consumer operations to keep business moving.

In Beverage Industry’s “A New Generation of Craft Beverage Alcohol” webinar, the Brewers Association’s (BA) Julia Herz explained the growing presence of craft beer in the overall beer market. However, Herz noted that since the pandemic, craft brewers have been forced to pivot their operations.

Noting how the smallest brewers have been the hardest hit with declines of keg sales and beer purchases at breweries, Herz pointed out some of the shifts in sales methods. Citing a May report from the BA that surveyed breweries about any changes in sales practices, Herz stated that total delivery sales (combination of brewery and third-party deliveries) was up 31.8 percent compared with numbers prior to the pandemic shutdown.

Given the new limitations that craft breweries have in reaching consumers in on-premise establishments, the opportunities that Herz identifies as “what’s hot” showcase the growing emphasis on eCommerce and in-home tastings. In addition to cans/growlers/crowlers, Herz also pinpointed the opportunities that can be seized through curbside pickup and direct-to-consumer sales. She also cited pack sizes as an option such variety packs, 12-packs and even 30-packs.

These at-home alcohol consumption opportunities also are detailed in a recent “Drizly Consumer Survey Report 2020.” One of the major findings within the report notes that increased home consumption is poised to endure.

“Even as more states reopen and allow for some form of on-premise consumption, those who became accustomed to imbibing more frequently at home are likely to keep at it,” the report states. “Seventy percent of respondents said they are planning to continue to drink less away from home, and 30 percent are poised to do so more at home — for the remainder of the year, at least.”

With so many authorities pointing to this shift, craft distillers and brewers are advised to embrace this new strategy.

KEYWORDS: craft breweries craft distilling direct-to-consumer (DTC) distilling eCommerce

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