Big or small, schooner or shandy: How our love of beer is reshaping a traditionally stable and iconic industry
There are those of us who would profess that beer is what makes the world go round.
So important was a good drink that early humans ceased their nomadic ways to become domesticated farmers in order to grow crops and brew a good brew. Since that time, our love of beer has never faded. So versatile and enduring is that love, that there’s little wonder it’s also big business. The Australian beer market has historically been stable, produced standardised quality and was driven by traditional attitudes. However, as Australia’s foodie fascination grows (and the average Australian wallet grows), we have begun to demand something extra from our beer. Status, variety and innovation have emerged as key business drivers, with craft beers and microbreweries becoming the unexpected cash cow in this industry.
The Australian beer market has traditionally been dominated by four big brands: Carlton Draught, Tooheys New, Victoria Bitter and XXXX Gold. In a world where identity is as essential as the product, these iconic Australian brands have sought to associate themselves with traditional, male, working class ‘Aussie’ values. Attested by their all too memorable advertising campaigns, they have each succeeded by building and maintaining a persona of larrikinism, mateship and humour to ingratiate themselves with consumers.
Nowhere is this more evident than in the ever-exuberant brand image shaped by Carlton Draught, whose recipe for marketing success seems a simple one: the bigger, the better. Its constant aim is to produce large scale campaigns, typified in the ‘Beer Chase’, the ‘Big Ad’, ‘Flash Beer’ and the ‘Slo Mo’ campaigns which have all become viral sensations, entertaining countless audiences. Meanwhile, Victoria Bitter (VB) has ridden a wave of success with its ‘Hard Earned Thirst’ campaigns. Its advertisements idolise the daily heroics of the tough, hardworking, blue-collar Australian male, positioning itself as the only beer to quench such “a hard-earned thirst”.
XXXX Gold is the people person of the beer industry, unmatched in terms of direct customer engagement and consumer aspiration. The secret to piercing the naysaying Gen Y market lies in direct and personal lived experiences. Purchasing an island to rename ‘XXXX Island’ and populating the area with consumers ‘mates,’ (often hand-picked from competing brands) thus represents both marketing genius, and an absolute nirvana for their male drinkers.
The beer market in Australia, however, is undergoing a substantial shake up, with new players and changing consumption patterns threatening to destabilise this conventionally unwavering industry. Micro-breweries and craft beers have exploded into the Australian market, inducing a change in consumption patterns that had been relatively stable for the past 100 years. In 2004, VB, the leading beer brand, commanded in excess of 25 percent of the market share; today it holds a mere 9.5 percent. In fact, the top four beer brands, VB, XXXX Gold, Toohey’s New and Carlton Draught combined now only control approximately 33 percent of the market. The ‘premiumisation’ of Australian tastes, an elevation of status and social significance attached to our alcohol choices, has meant that consumers have begun to trade mainstream beer of a lower price point for high-quality, premium and more flavoursome beers. The quality-over-quantity maxim is back with a vengeance.
This has driven the growth of craft beer – with boutique brands gaining greater influence and capturing market share away from the global beverage giants. Over the past five years, premium beers have grown at approximately 11 percent per annum, a whopping pace that is four times faster than mainstream brands. While individually craft beers pose little threat to the traditional players, together they represent a tidal force, marketing as one. Reminiscent of the ‘Campaign for Real Ale’ movement in the UK, drinkers of boutique beers have developed a collective, organic ethos in which the product, rather than the marketing, is fundamentally important. Industry cooperation has seen organisation of mass events that have remained exclusive from the mass market. The Great Australian Beer SpecTAPular and the Sydney Craft Beer Week showcase hundreds of craft beers together for consumers who realise that alcohol is increasingly becoming embedded in our food culture, increasingly an issue of status, and increasingly about being seen drinking certain brands.
But what we are beginning to realise is that the image of these beer brands are one in the same. The mammoth parent companies associated with the big four are now diversifying by acquiring individual boutiques, particularly those in the craft beer segment. In 2012, Lion Nathan, maker of Tooheys and XXXX and the owner of James Squire, acquired Little World Beverages, the maker of Little Creatures and White Rabbit. Clearly our new and exciting love affair with microbreweries is more than just a summer fling, and the backing of microbreweries by big companies serves only to assist their future growth.
Never has the beer industry been so active and divergent. Beer is even diversifying out of the alcohol market and merging into cocktails, lollies and ice cream flavours.
While purists may disagree with such frivolity, none can deny that ultimately microbreweries are improving the stature of beer in Australia by bringing high-quality, distinct beers to the market, and this increased variety will ensure that a new standard of beer emerges. Beer is a category that fits consumers of all shapes, sizes, tastes, genders, ages and interests. The industry shake ups mean accessible beer now casts an even wider social net, ensuring that this beautiful beverage will, in one way or another, remain an integral component of Australian life.