High-Alcohol and Non-Alcoholic Beers Dominate the Craft Beer Industry


Facing the brightly lit doors of the beer cooler at his local bottle shop or bodega, Danny Tejada mentally performs the same calculation each time: he takes stock of the prices of different beers, the pack sizes and, most importantly, their alcohol content.

“If I have to drop $12 for a six pack, I want to make sure the alcohol content is 6% [alcohol by volume] or more. That way I can just drink one or two and be satisfied, and still have a few beers left for later,” says Tejada, a college counselor who lives in New York’s Brooklyn borough. “My brain says ‘6 percent or more.’ Below, I’m not interested.

It’s not just economic calculus that drives him, though inflation has put pressure on the budgets of many Americans. Instead, Tejada is among a growing number of drinkers who are increasingly gravitating towards the extremes of beer’s alcohol spectrum, choosing either very strong beers or beers with no alcohol at all.

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This is especially true in craft beer, where beers with an ABV percentage above 8 – mainly double and even triple Indian lagers, but also Belgian-style tripels and imperial stouts – gained 5% market share. compared to four years ago, according to retail sales data from the Beer Institute chain and the NielsenIQ National Beer Wholesalers Association. During the same period, non-alcoholic beers also gained 1% market share in these same grocery, drug and big box stores.

Growth in both the low-end and high-end beer segments has come at the expense of beer’s historical sweet spot: the only ABV range in all of beer to lose share over the past four years has was 4 to 6%.

“We’re seeing high-intensity beers getting more intense, and we’re seeing low-intensity beers getting less intense to the point that some of them don’t even contain alcohol,” says Dave Knospe, senior brand manager for Voodoo Ranger, a line of IPAs brewed by New Belgium Brewing Company, based in Fort Collins, Colorado. “That doesn’t leave much in the middle.”

Knospe has been at the forefront of this polarization of consumer tastes. For decades, New Belgium’s flagship beer was Fat Tire, an easy-drinking 5.2% amber ale located at the heart of the beer. But in the summer of 2019, something remarkable happened: a relatively new beer, the Voodoo Ranger Imperial IPA, caught fire. New Belgium has doubled down on its efforts by redesigning the beer’s packaging to more prominently display its 9% alcohol content. (That’s more than double the ABV of a standard light lager such as Coors Light or Miller Lite.) By the end of the following year, Voodoo Ranger Imperial IPA was the brewery’s No. 1 beer, raking in another $25 million in chain retail sales. than Fat Tire. According to Nielsen data, it’s now the top-selling IPA in America – a title it achieved starting in March 2021 when it topped Lagunitas IPA (6.2% ABV) and Founders All Day IPA. (4.7%) – and one of the most successful new craft beer brands of the past decade.

But for all the drinkers who choose high-intensity, high-flavored beers, many also run to the opposite pole. Non-alcoholic beer accounts for less than 1% of the overall US beer market, but in the case of craft beer specifically, its recent growth has raised eyebrows. Since 2019, non-alcoholic beer has increased its chain retail sales by 27%. Athletic Brewing Co. in Stratford, Conn., exclusively brews non-alcoholic beer, and last year it was the 27th-largest craft brewery in the country. This boom is being fueled by new, better-tasting non-alcoholic beer options from craft brands like Athletic and Brooklyn Brewery, as well as top brands like Heineken and Budweiser.

Danelle Kosmal, vice president of research for the Beer Institute, a DC-based trade group, says growth in alcohol-free craft beer appears to be at the expense of beers in the 1-4% ABV range.

“This potentially illustrates a shift in consumer trends, with craft beer drinkers moving away from low-alcohol craft beers like radlers, craft light lagers and session IPAs and towards non-alcoholic craft beers,” says Kosmal.

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Amid recent high and low ABV trends, perhaps no style has been left in the dust more than the venerable American pale ale. Launched by the Sierra Nevada Brewing Co., based in Chico, Calif., in 1980, lager has been a staple of craft breweries and beer bars for decades. With a balance of malt and hops and an ABV typically around 5.5%, lager was about as appealing as craft beer could get. Until that is no longer the case.

“Lagers are a dying style,” says Suzanne Schalow, chief operating officer of the Craft Beer Initiative, which owns the Trinktisch brewery and Craft Beer Cellar bottle store in Belmont, Mass.

Schalow estimates that at any one time, Craft Beer Cellar offers 250 different versions of IPA, the bigger, boozier sibling of the pale ale, including its best-selling beer of 2021: Lawson’s Finest 8% Sip of Sunshine IPA. Liquids in Waitsfield, Vt. In contrast, the store only carries half a dozen lagers.

“People don’t seem to like the words ‘pale ale.’ For them, it’s inferior to the term IPA,” says Schalow, adding that many of her customers are what she calls “price” buyers who will always choose a 13% triple IPA over a 6% if they are also expensive.

“Things get a bit lost in the middle,” Schalow says.

It is not clear to what extent this is an existential problem for the industry. Trends come and go in all consumer goods, especially in an area as grounded in innovation as craft beer. But if craft beer continues to drain its ABV midfield, it risks losing the beers the segment was built on: the ones with more flavor, but beers you can still take camping or biking or to a BBQ without risk of lethargy or drunkenness.

It sets up two possible futures. In one, drinkers continue to move towards the poles of ABV, widening the beer’s traditional strength range. (New drinks such as hard seltzer and hard kombucha, meanwhile, have been happy to step in to fill that void.) In another, the growth of alcohol-free beers and imperial IPAs is slowing, and eventually, Overall beer ABVs again stabilize near the middle. Historical data would support the latter scenario.

“The alcohol-free and high-end ABV trends, there are ebbs and flows,” says Kosmal. “If we look at the past two decades across the beer category, the average ABV doesn’t deviate much from 4.5 percent.”

After all, the status quo is powerful enough. The best-selling beer in America has been the same for 21 years: Bud Light, a clearly intermediate lager with 4.2%. Voodoo Ranger Imperial IPA may rule the craft for now, but it’s unlikely to dethrone that king any time soon.

About Michael Brafford

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