…what explains the nature of the craft-beer boom? From several interviews with economists and beer-industry experts, I’ve gathered that there appear to be two big reasons—a straightforward cause and a more complex and interesting history.
The first cause is something simple yet capricious—consumer tastes. “At the end of the day, the craft-beer movement was driven by consumer demand,” said Bart Watson, the chief economist at the Brewers Association, a trade group. “We’ve seen three main markers in the rise of craft beer—fuller flavor, greater variety, and more intense support for local businesses.” These factors are hardly unique to the beer industry. One could use the same descriptors to explain the concurrent rise of fast-casual restaurants, like Sweetgreen and Dig Inn, or the growth in expensive coffee from $5 lattes at Starbucks to a $55 cup of Esmerelda Geisha. There is, perhaps, a new trendiness to rare beer and expensive coffee that is luring new entrepreneurs into the space.
Craft breweries have focused on tastes that were underrepresented in the hyper-consolidated beer market. Large breweries ignored burgeoning niches, Watson said, particularly hoppy India Pale Ales, or IPAs, which constitute a large share of the craft-beer market. It’s also significant that the craft beer movement took off during the Great Recession, as joblessness created a generation of “necessity entrepreneurs” who, lacking formal offers, opened small-time breweries.
Derek Thompson, “Craft Beer Is the Strangest, Happiest Economic Story in America”, The Atlantic (19 January 2018) [https://www.theatlantic.com/business/archive/2018/01/craft-beer-industry/550850].