The year so far has been a flurry of volatility. The ongoing uncertainty around US tariffs, brought on by President Donald Trump, have left many in the global brewing sector on tenterhooks, unsure of how to proceed.
Combined with a world that’s witnessed escalating global conflicts, an intensifying climate crisis and ever-shifting consumer needs, there’s plenty brewers are having to grapple with as they assess future business plans.
It was in this somewhat chaotic and uneasy context that brewing business representatives and executives met in Prague, Czechia, last month at the Beer Strategies Conference hosted by Just Drinks’ sister events arm Arena International.
The two-day event saw figures from brewing heavyweights including Molson Coors and Damm come together to discuss the challenges facing the industry and how to tackle them, as well as continuing to look ahead to the categories and trends driving beer’s future growth.
Man-made crises certainly offer their own set of hurdles to tackle, but one factor highlighted in particular was that the brewing sector shouldn’t fail to ignore how consumer behaviour continues to shift in the background and how to find ways to meet those evolving needs.
“Even if the policies in the permacrisis change because of culture wars, economic trade-offs, regulation on the environment and on net zero may become lighter, your consumers, of course, are not going to change their views and their expectation that you will respond,” explained Christopher Granville, managing director at macroeconomic forecasting group TS Lombard, which is owned by Just Drinks’ parent company GlobalData.
Localism, sustainability and wellbeing are top of mind for consumers, he said, with “global fracturing” also contributing to those values, as China continues to edge its way forward as a global superpower.
“It’s almost up there in obviousness with climate and public health, but it needs saying there’s a new kid on the block in the world… There will be a brutal, inexorable, proliferating decoupling between the worlds of the US and China.”
Granville did, however, try to find a bright spot in what seems to be a particularly gloomy time: “Policy-made crises come and go, but you have to be ready for them all the time – the permacrisis, deep trends, they create opportunities.”
Christopher Granville speaking at the International Beer Strategies Conference in Prague. Credit: Just Drinks
Premiumisation continues to remain a prominent topic for the beer industry, and there was resounding agreement in Prague that the term today no longer simply means an expensive or ‘upmarket’ product, but a drink which a consumer sees value in and would be willing to trade up for.
“Premium really means something that’s worth paying more for, something that I would value and will be prepared to pay more,” said Helen Green, strategy, innovation and sustainability director for the EMEA region at Molson Coors.
One example Green gave was its Alpacalyse session IPA launched with Salt Brewery in the UK earlier this year. The product looked to “[play] into their heritage that they’ve built their proposition around textile manufacturing and the fact that actually alpaca wool was the basis of that, and that was where the brand idea was born”.
She added: “It is more that modern take of storytelling. There are versions of the heritage, history base, but then there’s also that more irreverent, cheeky.”
The Alpacalyse Session IPA, created by Molson Coors in partnership with Salt Brewery. Credit: Molson Coors
For Damm, storytelling around the business’ origins, Barcelona, is key to helping it stand out against other Spanish world lagers which “are booming” in the UK, the group’s international business director Juan Gonzalez Gil explained.
“We play a lot on origin, we play a lot on authenticity. If you go to Barcelona, more than 60% of the beers that you will drink there are just one beer – Estrella Damm. You live and breathe the brand whenever you go to Barcelona. I think that’s quite unique, and that talks a lot to being authentic and being recognised.”
Provenance is also becoming a growing trend seen in flavours as well as overall branding, according to Mike Bagshaw, owner of International Taste Solutions, and it’s likely to become more important in driving consumer choices down the line.
“We’ve seen things like Sicilian lemons in particular, different extracts of different places. I think the premium side for me over time is going to – I would say this because, I have a flavour house – but I think flavour is going to become more and more important in terms of evoking emotion and getting consumers to actually say: ‘Do you know what? I believe in that brand’.”
When it comes to no-and-low alcohol, the “low” part of the category in beer is losing traction globally, according to GlobalData research.
“Low-alcohol has really struggled,” Kevin Baker, the company’s global head of research for beer and cider, explained, referring to volumes of beers in the 0.5% to 3.5% abv segment.
“It’s not no-alcohol, but by the same token it’s not giving you a lot of benefits…It doesn’t really do what consumers are looking for,” Baker said.
GlobalData research estimates low-alcohol volumes declined 0.4% in 2019-2024 to sit around 34 million hectolitres in the final year of that period. Those beverage types are expected to grow just 0.1% from 2025 to 2030.
Non-alcoholic beers are forecast to have grown 5.3% in volumes in the 2019-2024 period, outpacing all other beer categories.
Another reason driving the declines is the widescale move of Radler-style drinks from a low-alcohol to 0.0% proposition, Baker said, as well as the fact that lower alcohol beers are “primarily” targeted at beer drinkers.
It’s not no-alcohol, but by the same token it’s not giving you a lot of benefits…It doesn’t really do what consumers are looking for.
Kevin Baker, head of global beer and cider research at GlobalData
“Some markets are more open to it,” Baker told Just Drinks. “China sits on the boundary of what we call low alcohol. It’s about 3.5%. Some of them might be just under what we would class as low-alcohol, but they don’t think of them as low-alcohol. Generally, that’s what beer is.”
Given the growing consumer interest in moderation, it may come as a surprise that GlobalData’s research also predicts growth in higher alcoholic beer, led by speciality brews.
These could include Belgian speciality brands like Duvel and Leffe, or brands entering brand extensions in this segment, said Baker.
GlobalData has forecast strong beers to grow 3.6% in volume in the next five years. Its predicted volumes for strong beers in 2024 sat at 122mhl.
What premium means nowadays is also changing, depending on the consumer group, and one group in particular which has been causing quite a stir across the alcoholic drinks sector is Gen Z – legal drinking age adults born between 1997 and 2012.
According to Green at Molson Coors, while this generation is typically understood to be a generation that is not only “the first truly digital native cohort”, they also experienced “significant life stages, milestone moments” during the Covid pandemic, which has affected their view on the world and their approach to socialisation.
While it might seem unlikely right now, Green also noted that these consumers are expected to be the largest and wealthiest generation. “They do have money, but actually they feel quite pessimistic about it.”
Green’s comments chime with findings from Bourcard Nesin at Rabobank released last month, which showed that while Gen Z-led households are spending less on alcohol than other age groups, they also have a smaller income and make up a smaller percentage of the legal drinking age population.
As they age and start to earn more, their “increase in income will mechanically rachet up their spending on alcohol”, Nesin said in his note at the time.
“How they spend their money is something that we really need to understand to be able to unlock it, because value is really, really important to this group,” added Green.
So, what is it that these consumers value most in beer? Choice and authenticity, with the latter being “absolutely crucial”.
How they spend their money is something that we really need to understand to be able to unlock it, because value is really, really important to this group.
Helen Green, strategy, innovation and sustainability director EMEA at Molson Coors
“Obviously, non-alc is going to play a really important part in these category choices,” said Green, noting that the “beyond beer” segment was also worth exploring, “because it really is about understanding these consumers lives, their occasions, their needs on their occasions, and what matches with that, and that will require a broader set of solutions.”
How can a beer brand be authentic? It needs to be transparent, and this can come down to a company being able to show transparency around sustainability and “really demonstrated progress against that agenda”.
It can also come down to which celebrity a company chooses to represent their brand, but it needs to be someone. During her research, Green found that Gen Z consumers in both the UK and US were more trustworthy of influencer’s product recommendations, but they’re still skeptical too.
“That’s why often there’s this relationship with influencers. People become known, but might be less known, and they’ll trust their point of view as a more ‘normal’ person,” she told Just Drinks. “Celebrities can be a tricky one. It’s about picking the right celebrity for the right brands, and making sure that those things work together, otherwise you can really lose [consumers] quite quickly.”
As well as being able to meet Gen Z’s values, later in the conference Green also spoke about the need to understand how consumer occasions are changing in beer. While on-premise venues are still seen as important for building brands, the industry needs to start thinking about finding ways to target drinking occasions that happen outside of traditional on-trade locations, as growing numbers of consumers, including Gen Z, take their drinking occasions outside of pubs and bars.
“It’s about really understanding those socialising moments that are really important, but they could actually happen anywhere,” said Green. “Because it could be shared interests, it could be board games, it could be sport-related, it could be in a pub, it could be lots of different places.”
Helen Green, strategy, innovation and sustainability director at Molson Coors EMEA on stage at the International Beer Strategies Conference. Credit: Just Drinks
Global circumstances remain shaky, and lack of certainty continues to circle the beer industry, as it does for most alcoholic beverages industries at the moment.
As Baker highlighted on the second day of the conference, “we are living in very uncertain times” and “one of the things we can be certain of is uncertainty”.
In spite of this, the future still appears relatively stable for beer, with it still being the leading alcoholic drinks category in volume and value terms, according to GlobalData;s research.
In its predicted figures for 2024, beer made up 42% of the global share of alcoholic beverages in value terms in 2024, reaching $765bn.
While on a global scale, flavoured alcoholic beverages were estimated to have made up just 3% of total global alcoholic beverages market share last year, beer is losing out to other categories like ready-to-drink products (RTDs), which GlobalData calls “flavoured alcoholic beverages”.
In Europe, growth of this segment still remains rather small, but it’s scaling up quickly in developing regions, including some markets in Asia and Africa, which have seen “very fast” growth, said Baker, “driven by a growing young population, increases in urbanisation, and a growing middle class”.
Where does this leave the category long-term? Total 2024 volumes have been forecast to potentially hit pre-Covid levels. Baker cautioned, however, that it was “still a bit early to tell… but it has taken a while to recover”.
Volumes between now and 2030 are also expected to stay relatively flat, reaching 2 billion hectolitres by 2030, an increase of 6% on forecasted 2025 volumes.
This is driven by an unsteady geopolitical context and a changing consumer relationship with alcohol, which is anticipated “to shrink beer in both the short to medium term”, said Baker.
What remains to be proven, however, is whether certain essential aspects to beer sales strategy (and realistically the entire alcohol category) like premiumisation will still hold true with consumers down the line.
Reflecting on the ongoing permacrisis engulfing the world right now, early on in the event, Baker noted that economic crises have tended to benefit premium beers in the past, with consumers looking to treat themselves with “something that’s really, really worthwhile”.
Is the situation now any different? He concludes: “Now it will be interesting to see whether that is going to happen in the current situation, or whether indeed we’re going to see a change. Obviously, these are unprecedented times. This is not the old boom-and-bust cycle. It’s completely different. It’s a new paradigm, and I’ll be interested to see whether premium beer can weather that in the same way.”
“Challenges and opportunities facing brewers in uncertain times” was originally created and published by Just Drinks, a GlobalData owned brand.
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