Small-batch beer, spirits drive beverage trends

Whether they’re beer fans or cocktail connoisseurs, US consumers are craving artisan, small-batch and craft beverages in ever-increasing numbers. Beer remains the most popular alcoholic beverage in the US, but there’s evidence that sales of spirits are on the rise as millennials increasingly opt for cocktails over brews.

Sales of liquor rose 4.1% last year, according to the Distilled Spirits Council of the United States, continuing a trend that sent liquor’s share of the alcoholic beverage market to 35% in 2015 from 29% in 2000, while beer’s share fell from 56% to 48% and wine’s portion  inched up from 16% to 17% over the 15-year period.

Part of the credit for the increase may go to the bartenders behind the rise in cocktail bars from the East Coast to the West, the Wall Street Journal reported earlier this month, along with consolidation in the liquor industry that gave companies more clout when it came to promoting spirits alongside beer and wine. Additionally, liquor companies dropped a ban on advertising and began promoting their spirits on TV five years ago, just as shows like “Mad Men” were making cocktails cool again.

At the same time, craft distillers have carved out a growing niche, with artisan spirits that appeal to millennials who haven’t formed loyalties to big brands. The number of US artisan distilleries soared from 50 to about 600 between 2005 and 2013, according to the American Distilling Institute. Demand for US-made bourbon, whiskey and rye is on the rise at home and abroad, and the growing craft-style spirits are boosting sales for producers of all sizes, according to the Distilled Spirits Council.

Just as craft spirits are boosting liquor sales, craft brews are the brightest spot when it comes to beer.  Beer is still the alcoholic beverage of choice most often, and 16% of US adults have a beer on an average day, according to a recent report by Datassential.  Craft beer sales rose 22% to $19.6 billion in 2014, and there were 3,418 US craft brewers, according to the Brewers Association. The group defines craft brewers as small and independent, turning out 6 million gallons or less of beer each year.

In recent years, sales have been growing both at home and abroad as craft brewers boosted their export volumes with the help of efforts like the Brewer’s Association’s Export Development Program. Additionally, brewers are increasingly looking to food to help boost beer’s popularity. Last year, the Brewer’s Association named Adam Dulye as its first executive chef. The Culinary Institute of America-trained chef and former restaurateur is focused on expanding craft beer education for culinary students, chefs and restaurant operators.

The same individualistic streaks that are driving millennials to craft beer and artisan spirits are also influencing the way Gen Y chooses and buys wine, according to research from the Wine Market Council. Baby Boomers are still the biggest group of wine drinkers, but millennials are gaining on them rapidly and 59% of the younger generation’s frequent wine drinkers reported drinking more wine in 2014 than the year before, the council reported.

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