The craft beer market segment has grown steadily in recent years and doesn’t seem to be slowing down, making it a prime area of interest for label converters looking to diversify their portfolio. Data from the Brewers Association shows that specialty beer sales in the United States are on the rise, increasing an impressive 6.2% last year alone.
On the flip side, national brand beer sales remained constant, proving consumer beverage preferences are shifting to something more experiential, consisting of exotic flavor profiles, fun packaging, and an overall “cool” vibe. With over 12.3% market share, there are plenty of indicators this specialty movement is more than a fad.
To be considered a craft brew producer, a company must manufacture less than 6 million barrels of beer annually. There are 4 types of brewers that fall under this umbrella: microbreweries, brewpubs, contract brewing companies and regional craft beer producers.
One of the biggest challenges faced by most alcohol companies and their suppliers is intense competition. There is a constant struggle to remain top of mind and gain a following in such a heavily saturated market. In 2016 over 5,000 breweries were in operation within the United States, with greater than 10,000 fueling the craze worldwide.
While craft brewers do not compete on production levels with national brands, they are competing head-to-head on store shelves. To maintain relevance, the small guys build their brand by experimenting with themed packaging and seasonally-inspired flavors.
These creative short run labels are the brainchild of Mark Andy’s European team.
Brewed in smaller batches or production runs, the labels required by necessity are also short run. Of course there is always the potential of expanding distribution or growing into a global brand, with a requirement for longer runs once a brand becomes established and expands into other markets.
The relationship between a label printer and brewer (or any small business) is truly symbiotic. As the popularity of a product grows, more labels will be required, making it important as a business partner to position yourself as an authority on label design and specialty market needs, with the capacity to grow with your clients.
Craft beer brand owners tirelessly brainstorm ways to stand out and boost shelf appeal, with the goal of differentiating themselves from the more familiar brewing giants. Packaging is the number one way to do this and there are a variety of trends our team has picked up on from customer work printed on our digital hybrid and flexo technology.
At Mark Andy’s recent open house in Warsaw, attendees enjoyed small-batch brews with decorative flair printed on our full-production digital/flexo hybrid.
While beer packaging has historically consisted of glue-applied paper labels on bottles, trends are shifting to include pressure sensitive materials, such as BOPP, shrink, and even estate stocks. With over 30% of breweries making the shift to pressure sensitive labels, endless opportunity is at the converter’s disposal. BOPP is currently the most popular, flooded with either matte or gloss varnish. Craft cans are also increasing in popularity thanks to portability, sustainability and cost, causing a rise in the use of pressure sensitive wraps and shrink sleeves for beer labeling.
In terms of the design of the label itself, abstract typeface, witty names, and out of the box artwork are becoming the norm. Breweries have become very creative with their graphics, some keeping to a clean and contemporary look while others utilize 3-4 specialty applications on a single label. That could be cold foil, vibrant spot colors, textured varnish or unordinary die cut shapes.
Craft brewers are generally smaller companies in a regional market, requiring quick turnaround, smaller run sizes, and cost-effective label pricing. Digital printing is a logical solution to fill these requirements, and many of our customers have reported that breweries frequently request digital production.
When it comes to digital, breweries know quality is there, cost is competitive and final product or live label proofs can be received in a fraction of the time.
Digital One team testing new materials and craft brew artwork. Like brewers, we love to think outside the box regarding packaging applications.
Label converters are adding digital assets to their pressroom for many of the same reasons. Shorter run lengths may prevent traditional flexographic processes from being profitable and vintage digital technology does not support the atypical materials or advanced decoration capabilities which are growing in popularity.
The converters who will be successful in this market are those who can differentiate themselves from their competition and support these special requirements. Inline hybrid presses that combine traditional digital with flexographic decorating and converting in a single pass have a true advantage here. Converters who also have advanced flexo assets will be able to support those specialty jobs as these smaller brewers grow and expand to national or even international success.
As with any growing market, there is always someone new coming on the scene to try to get a piece of the pie, making competition one of the biggest challenges for craft brewers. In recent years, the number of breweries in the US has doubled.These entrepreneurs see opportunity and are willing to take risks, but tend to rely heavily on partners to help guide them in ways to differentiate their product.
This is a paradigm shift from the major brewers who strictly define the look of the label and are shopping for the best price. So for the converter, the challenge is to remain flexible to support the changing designs and run sizes. Converters need to leverage their ability to be flexible in substrate offering and add value to the label or packaging, otherwise they may be left behind as the brewer looks for another partner who can better serve their needs at a competitive rate.
The Mark Andy team continues to educate ourselves on niche markets and what modern consumers require. In response, we continue to advance our full portfolio of print technologies for any size converter, any size run, and every application.
We know the kind of business our customers are winning, and our solutions are more than equipped to take on the challenge. No matter the market or decoration level. All in line, in a single pass.
To see the craft beer work we have been able to produce on our digital assets, click here. You’ll have the opportunity to request your own sample pack with the 14 different microbrew labels inside.
About the Author
James “Nat” Davis is a Digital Product Manager at Mark Andy. In this role, Nat wears many hats to support our full production hybrid solutions. When he’s not enjoying the great outdoors or working on his wood carving art, he can be found in our demo room brainstorming ways to propel Digital Series into the future. You can also find Nat on LinkedIn.
Is your production team having fun with craft beer work? Let us know the types of applications you are running in the comments below.