Ever since craft beer became trendy a few years ago, sceptics have been predicting the dreaded, “craft beer bubble.” Some stated that supply would outstrip demand in the industry. In contrast, others believed that craft beer will not become a hit among Indian youth. Others feared that “big beer manufacturing factory brands” would buy up the craft beer industry, and it would no longer be a novelty.
Fortunately, none of these predictions have happened. The craft beer industry/ beer manufacturing factories in India has been growing steadily, the last couple of years.
Enter the Covid-19 pandemic. The crisis has shown us that changes that we didn’t expect to happen for decades have become the norm in a few weeks. Work has shifted from cubicles to Zoom meetings and couches, schooling has gone online, and we have used more sanitizer in the last few months than the entirety of our lives!
When it comes to the drinking culture, the pandemic has shut down bars, taprooms, and festivals to at home drinking and raising toasts on Zoom and Whatsapp video calls. How the industry reacts to the pandemic will shape our business for the coming years. In this post, we look at the impact of Covid-19 on the craft beer industry in India and analyse the road ahead.
It Gets Worse Before It Gets Better
Source: Brewers Association
It will take years to fully understand the impact of the Covid-19 pandemic on the craft beer manufacturing industry and our drinking culture. A survey conducted by the Brewers Association found that nearly 60% of American brewers predicted to go out of business if lockdowns persist beyond August. In the UK, beer sales dropped a whopping 82% due to the lockdown. In Germany, a 400-year-old brewery that survived two Cholera outbreaks, the Spanish Flu and the Black Plague closed its doors due to the Corona outbreak. It’s the first time, Oktoberfest – the mother of all beer festivals – has been cancelled since World War II.
Sadly, the situation right now is that – plenty of breweries will face massive setbacks quickly. From finding it difficult to pay their landlords, to getting back employees and bringing crowds into taprooms, the road ahead is challenging.
You can be sure of one thing – It gets better, and there’s light at the end of the tunnel.
What will happen to Beer Culture?
At its core, beer drinking is a social activity. It’s all about gathering with your friends and letting go of your worries, as you lose yourself in the taste of the brew. Even when pubs, bars, taprooms, and restaurants open again, it will never be the same. People won’t visit them in droves and relax like before. And, even when people do visit, they will be wary – and practise social distancing.
Marketing and Strategy Matter More than Ever
When it comes to craft beer sales, marketing and strategy have always played a crucial role. Beer manufacturers have to focus on selling the right product at the right time to the right customer. This matters more than ever!
As the world goes into recession and customers tighten their purse strings, beer manufacturers have to – innovate and think out of the box to survive. As customers experience a reduction in budgets, they are likely to prefer styles that they love the most and stick to breweries they trust.
How to Survive as a Craft Beer Manufacturer in the Post Covid-19 Era?
Now is not the time to experiment or go big. It’s better to play it safe. We recommend breweries to narrow their production – stick to styles that are a hit with customers. Delay expensive and experimental releases for the next few months.
Don’t wait for the customer to come to you. Instead, reach out to the customer. Experiment with no-contact door deliveries, live festivals, live shows, and tutorials – to engage and keep connected with your customers.
Look Out for the Silver Lining
There’s no doubt that we’re going through a tough time than what’ve ever experienced before. But, there are still some positives to be drawn from the experience. There has been a massive surge in demand for online beer sales. Several states are experimenting with different ways to supply beer online. This could play a crucial role in opening up long-term accessibility to craft beer. It could liberate craft brews from taprooms and make them available at your local grocery store.
That’s a big IF, but a change that we are hoping will occur due to the pandemic. If distribution laws get relaxed, breweries might finally ship their products via courier and sell in several local stores.
Another silver lining here is the incredible creativity of craft brewers. Several brewers have hopped on the immunity trend – and including ingredients like Tulsi, turmeric, ginger, and other spices in their brews.
We’re witnessing the Dawn of a New Beer World.
As the Covid-19 pandemic still continues to spread across the world, we have accepted the terms that there is no going back. We need to adapt to the new normal. The same applies to the craft brewing industry as well.
Craft brewing may take some time to recover, but we can be sure that it will get better. It could lead to better sales margins for manufacturers as the beer gets directly to the end-consumer—improved quality assurance, which is beneficial for brewers as well as drinkers. Rohit Jafa Brewing Solutions leading one of the best beer manufacturers in Gurgaon & Delhi NCR.
This is a once-in-a-generation opportunity for the industry to break free from the shackles of draconian distribution laws and go forward. As the beer industry grinds to a halt (just like every other sector), we hope that brewers remain connected and supportive of each other as ever before. That way, once we move beyond the immediate implications of the pandemic, we can all emerge stronger than ever.