Chapter 1

U.S. Beer Industry

Beer Segments

The market for beer in the U.S. consists of essentially the following ten segments (see Table 1.4): imports, domestic specialties, super-premium, premium regular, light, ice, maltalternatives, malt liquor, popular regular, and others. Table 1.5 lists popular brands by each segment.

Light

As far as domestic segments go, the most significant and unstoppable trend in the beer business is the continued momentum of light beer. Since the creation and marketing of the first light brands in the mid-1970s consumers have increasingly been attracted to these beers for their smooth, mild taste and lower calories.

Imports

Imports have made significant incursions into the U.S. beer market, mostly at the expense of domestic brands. Indeed, imports made a major impact on the U.S. beer market in 2007 and did so despite uncharacteristically slow volume growth that actually lagged that of the market overall. In 2007, the market share of imports was 14.0% with a volume of 29.9 million barrels.

Domestic Specialties

Although growth in domestic beer segment has been relatively flat except for light beer, the domestic specialty segment has shown strong double-digit growth that should continue in the foreseeable future. This segment includes brewpubs, microbreweries, and regional special breweries.

Big Brewers Get Crafty

In response to the significant growth in the craft-beer industry, the three major brewers-Anheuser-Busch, SAB-Miller, and Molson Coors Brewing Co.-have all entered this fast-growing market, either through developing their own specialty craft beers or by acquiring or forming partnerships with existing craft brewers.

Super-premium

Like imports and domestic specialties, the super-premium segment has experienced strong growth over the past several years. This too can be attributed to the fact that Americans are becoming more yuppified and "trading up" to better products across the board in food and beverage.

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