It’s the world’s most popular drink after water and tea. There’s even a crater on the moon named after it. We’re talking about beer of course. Jason Caddy looks at the beer category in Scotland’s on-trade to find out what shape it’s in right now, which brands are up to interesting things, what the future holds, and what licensees in beer pubs predict for this year.
Beer stats for starters
Beer is a serious business in Scotland. You don’t need to be a card-carrying CAMRA member to know that. A report commissioned by the Scottish Beer and Pub Association (BBPA) in December 2018 showed that overall beer and pub activity in Scotland sustains 66,830 jobs and makes a £1.66bn contribution to the Scottish economy. Activity in the brewery element sustains 8,550 jobs, £203 million in wages and 571m in GVA (gross added value). There’s also been an increased level of investment by the industry in Scotland, with £176 million provided in capital investment last year.
An uplift in sales of beer in the UK on-trade has also been reported by the latest Beer Barometer sales data, again from the BBPA. Pubs benefited from a strong end to 2018 with beer sales growing by 2.2% in Q4 2018 compared to the same period in 2017. This was the first time Q4 beer sales grew in the UK on-trade since 2011.
Value is trouncing volume, plus customers seem keen to try new products, according to Gordon Muir, Marketing Controller, Belhaven Brewery. He said, “We continue to see value outstripping volume with drinkers prepared to pay a little more for a better experience. For example, our own Twisted Thistle IPA is growing at 71% year on year, reflecting drinkers looking for great tasting beers with interesting stories to tell and quality service in the pubs. Belhaven’s 300th birthday beer, 1719, is perfectly placed to appeal to these drinkers and we are seeing great results in its first two months.”
Scotland’s brewing industry has, in fact, enjoyed growth since 2010, in spite of beer consumption declining globally. That’s according to research by the Scottish Parliament Information Centre (Spice) which found that there were 115 breweries across Scotland last year – compared with just 35 eight years ago more than four-fifths of businesses in the sector were micro-breweries. The study also found that 30% of all brewing enterprises were in the Highlands and Edinburgh.
The report said, “Globally, beer consumption has been falling for decades. However, this has not dampened the significant brewery start-up rate, responding to consumers choosing to drink more expensive, specialised beers.”
Environmental, Ecological, Ethical
In these enlightened times, environmental, ecological and ethical factors are also influencing brewing. Take the Bute Brew Co for instance. It is making ‘Thorough Bread’, which is made using leftover bread. The 5.1% alcohol craft beer is made from unsold loaves of bread. The leftover bread is used in place of some of the malt that would normally be used in the brewing process.
Mental health awareness has also found its way into beer brands. Neil Leiper and John Kidd are the founders of a non-profit organisation to raise funds for mental health awareness with the launch of a new beer in collaboration with Fierce Brewery, ‘Fitlikey’!
Are students still drinking beer?
Beer has always also been the preserve of students of course, but in light of the fact that figures from a Portman Group survey show that nearly a quarter (24%) of British drinkers have either already switched some of their drinking to low alcohol alternatives or would consider doing so in the next six months, do students still have a healthy thirst for beer?
Dave Whitton is GM At Andrews Student Association said, “We, Northern services, the purchasing consortium that includes Glasgow QMU, St Andrews University Students Association, Glasgow University Union and Dundee University Students’ Association signed a new four-year deal with Molson Coors. Carling and Coors Lite are the two strongest brands across all sites, with Pravha on draught showing significant growth.
“Blue Moon also sells very well. In St Andrews, we have also sponsored both male and female football teams and they’re both happy with the brands we have in stock.
People are drinking less but we are getting more bodies through the door and that is what keeps volumes up. There’s definitely still a pre-gaming culture in the student market so we have to have brands that they want to drink.”
There have also been some quantum leaps in terms of the technology that underpins how beer is stored and served. Food grade gas can deliver a superior product. Air Products offers tank installations available that use remote fill points so that gas can be delivered without the need for on-site staff to accept the delivery and the manual handling of cylinders. This saves time in change-overs, cellar space and providing the peace of mind that a securely monitored system can deliver. The system monitors the gas levels so that you don’t run out, you never pay for gas that you’re not using and that deliveries can be handled seamlessly, through external fill points.
A company called IntelligenceX has created an AI-brewed beer, for example, where the recipe changes based on customer feedback interpreted by an algorithm. Codes printed on bottles direct people to a Facebook messenger bot, which takes feedback and sends to human brewers, who adapt the recipes accordingly.
Kirin brewery in Japan is using AI right now in fact, to discover optimum-brewing formulas based on 20 years of data that would take a professional human brewer more than a decade to learn.
Beer trends spotted by licensees and their predictions for 2019
Daniel Wylie of Edinburgh’s Brewhemia has noticed a change in customers’ beer drinking habits. He said, “Customers are increasingly keen and willing to try new brands and explore the history and pedigree of the beers – how they are made, where they come from and what makes them unique. We regularly see customers trying selections of beers in flights, making pairings with food and treating beers in the same way that we historically do with wines to accompany elements of the meal. The beer category appeals equally to all types of customers now and this has opened up the selections to all demographics.
As for predictions for 2019, he said, “Growth for the smaller, microbrews. People are trying new and innovative beers and open to more complex flavours. Beer as a pairing with foods and a credible accompaniment to meals – we are increasingly cooking with beer and incorporating it into menus, it makes a fantastic brownie!
In terms of who’s innovating, Petra Wetzel founder of WEST on The Green in Glasgow, said, “Innovation’ is becoming more and more budget orientated with big breweries spending tens of thousands on provocative campaigns using big creative agencies. One activation I admired was the ‘Proper Beer’ campaign that Meantime did last year. They issued thousands of free beer vouchers, anonymously, valid at several of the outlets that sell their beer in London.
She continued, “Once guests redeemed their vouchers and were served their mystery pint they were sent a text message revealing who the brewer was and telling them about the brand and the beer. Anyone can hand out free beer but they sent footfall to their customers and educated people about their product at the same time.”
Meanwhile, Josh Barr, GM of The Bier Halle in Glasgow, talked about who’s doing interesting stuff on social media. He said, “I follow a lot of different breweries on Instagram and Facebook and for me Brooklyn Brewery has been one brand that I’ve fallen in love with over the past few years their social media presence is really accessible and aesthetically pleasing and their recent marketing campaigns have been great fun, such as their huge American school bus fitted out with a bar and tasting room.”
He continued, “I would hope to see sour beers taking more of hold in the category. Brew Dog, Fierce and Magic Rock already have some great ones and Brooklyn Brewery is bringing theirs across to the UK soon too.”
Observing trends among his customer base, Alistair Soutar of The Steam Packet Inn, Newton Stewart, said, “It’s noticeable that beer drinking has increased across all ages and genders through real ale which we specialise in. Specifically, there has been considerable growth in cask/craft ale drinking by women and in the younger age groups.
“Also, there is a general increase in people trying a variety of beers instead of sticking to a particular brand or style. This is especially true of younger drinkers. Stronger beers and different styles are much more popular, to give examples we have brewed an old school mild at 3.5% and a 6.5% modern IPA which both sold well. Customers are also more interested in the story behind the beers and specifically looking for local products.”
And changing trends haven’t escaped the notice of Douglas Ross, owner of the Allanwater Brewhouse in Bridge of Allan. He said, “Having been a publican for over 30 years I have witnessed many changes, some major, over the years. Now is an exciting time for those of us active in the expanding craft beer market. There has never been such a great time to drink craft artisan beer in Scotland with hundreds of breweries and thousands of unique beers available in all styles and characters available on draft, bottle and now cans.
He continued, “However, it is the customers’ awareness now of the natural ingredients that make up beer that is exciting. Their knowledge of hop & malt varieties and their quest for unique local ingredients making locally brewed beers, with provenance, so relevant to today’s knowledgeable beer drinkers.
“This new upsurge of interest has also had an effect in expanding the marketplace with interest from young adult beer enthusiasts and also capturing the imagination of many female drinkers who previously would not try beer.”