Can Craft Compel More than Beer?

The recent flourishing of craft beer has certainly been a marvel – a few thousand already out there in the U.S., hundreds more on the way. We certainly must live in the best place at the best time ever to be a beer lover. May most of these creative brewers find a way to thrive amid the mounting clutter!

Inevitably, the trend has prompted analogies on the non-alcoholic beverage side from marketers who would like to ride in craft beer’s draft, positioning themselves as similarly artisanal and distinctive, and implicitly on the brink of a similar explosion into broad appeal. It’s a fertile metaphor, and its appeal is obvious to marketers hoping their arduous slog will pay off. After all, a couple of decades ago even the most ardent of us craft beer advocates didn’t expect the segment to ever hit a double-digit share of consumption. Still, much as I’m rooting for many of these companies, I think in some cases the comparison is misplaced and likely to lead to unrealistic expectations. And it’s probably also worth remembering that the phrase craft itself carries all kinds of issues related to scale and authenticity.

One of the most logical analogies to craft beer is craft soda. Like craft beer, these are often made in (relatively) small batches, using higher-quality ingredients in richer amounts, with a more assertive or nuanced flavor profile and a fair amount of personality in the branding. (Who wouldn’t want to order a Thunder Beast Root Beer?) Just like craft beer not long ago, they comprise a tiny slice of total industry volume but – so the thinking goes – are due to ignite any time now as consumers move beyond high-fructose corn syrup and artificial sweeteners and seek to refresh palates that have grown tired of colas, just as craft beer drinkers grew exhausted with the pallid lagers of the industrial brewers. Yes, craft sodas often use fancy glass bottles and, in some cases, as with brands like Bruce Cost Ginger Ale, Joia and Dry Sparkling, offer pretty sophisticated, culinary recipes that move well beyond classic CSD terrain. But I think the analogy breaks down on several fronts. Unlike the infinite variety of effects that can be achieved through the manipulation of yeast, barley and hops, there are only so many ways to differentiate sodas. Their sweet profiles also serve to make them not very sessionable, and as non-alcoholic items they have a narrower role as a social lubricant. Nor are many brands produced at quaint microbreweries with bearded guys sloshing around in rubber boots; usually, they employ outside copackers that are pretty industrial. That doesn’t mean that many of these aren’t great products, or that the category doesn’t have plenty of room to grow. I’m just not convinced craft soda holds the explosive potential of craft beer.

So where do I see the analogies playing out better among ready-to-drink beverages? Kombucha, for one. Like craft beer, this fermented tea category is blessed with a near infinite diversity of approaches and flavor profiles, on both the alcoholic and non-alcoholic sides. Kombucha is fairly sessionable, and serves as a great palette for the artistic incorporation of new ingredients, much in the way American craft brewers haven’t hesitated to break with European strictures on what’s appropriate to a particular historical style. It has a thriving subculture of homebrew enthusiasts who trade all-important bacterial “mothers” among themselves, and is developing into an on-premise play, holding tap handles in progressive bars and restaurants. Not least, just about all the kombucha players insist on making it themselves, creating an added layer of intrigue and authenticity and offering the kind of taproom atmosphere that has proved so potent a marketing tool for craft beer companies. Though it faces undeniable challenges in scaling up, maybe kombucha is due to break out as a bona fide craft category.

That broad product variety and sense of place may translate to other categories. Many of the new generation of fresh-juice producers are insisting on controlling all aspects of production (sometimes even performing high-pressure processing themselves) and also recognizing that there is a fair amount of consumer fascination with the process, watching fresh produce come in on one side of the building and delicious, cold-pressed juices exit at the other. They’re varying their palettes beyond fruits and vegetables, launching lines with nutmilks and other ingredients that can serve other occasions. Daily Greens, for example, is building out its East Austin headquarters plant to include a lot of these touches; with fellow tenants the Austin Eastciders hard-cidery, the complex may become a foodie destination that serves as a totem of authenticity and craftsmanship for the brand.

Cold-brewed coffee seems to benefit from some of the same attributes as craft beer: a process that is full of intrigue, with a good sourcing story, exacting processes that appeal to the food-geek nature of some consumers, and vibrant on-premise opportunities. And beyond kombucha, I’d love to see iced tea as a whole get to that point, given the slate for creativity and storied tradition that the segment represents, though so far most entries tend toward fairly one-dimensional, overly sweetened recipes.

A broader question is what does craft represent? Even within beer, there has been a divide between brands perceived as authentically craft and those from larger brewers that are derided as “crafty.” The phrase also has become a target of the class-action bar, as witnessed in litigation involving the craft positioning of brands like Coors’ Blue Moon Beer. The designation may ultimately prove risky for boutique soda brands manufactured in copacking plants and also for the faux craft products being launched by the likes of Coke and Pepsi. This was highlighted to me, in an amusing way, at the time Pepsi launched Caleb’s Kola. The company posted a video on the new brand’s website that showed the purported creators of the soda gabbing in a rather tenement-y setting far removed from the grassy precincts of Pepsi’s suburban New York digs. In a non sequitur well into the video, one of the guys interrupted his brainstorming to quickly note that both were employees of Pepsi. It was a clunky bit of disclosure that illustrated just how gnarly this whole “craft” thing gets once big companies get involved.

Longtime beverage-watcher Gerry Khermouch is executive editor of Beverage Business Insights, a twice-weekly e-newsletter covering the nonalcoholic beverage sector.