Introduction
Europe has long been a forerunner in the global beer market with the craft beer segment leading the charge. In the contemporary beer landscape, the preference for traditional, meticulously made beers by independent brewers (craft beers) is increasing at an exceptional pace.
The Overall Craft Beer Market in Europe
According to industry analysts, Europe’s craft beer market was valued at around $38.57 billion in 2019. Accustomed to a compound annual growth rate (CAGR) of 10.9%, it could potentially cross the $67.66 billion mark by 2025. It’s safe to say the craft beer boom is far from fizzling out.
Market Segmentation
The craft beer market in Europe is principally segmented by distribution channel and geography. With respect to the distribution channel, the market is divided into on-trade (beer consumed on the premises, like in bars, restaurants, and clubs) and off-trade (beer consumed outside the point of sale, like store purchases). Of the two, on-trade currently dominates the market, but the off-trade section is expected to grow rapidly due to the changing buying behaviors of consumers.
Geographical Analysis
Geographically, the UK leads the charge in European craft beer sales, causing a ripple effect in the other European countries that are subsequently witnessing a surge in the attraction towards craft beer. Germany and Belgium follow the UK in this craft beer revolution. However, other countries such as Spain, Italy, France, and the Nordic countries are rapidly catching up, contributing to the significant growth of the region’s craft beer market.
Growth Factors
Key factors driving growth in the European craft beer market include experimental and informed consumers eager to challenge their palettes and learn more about brew-making processes, a move away from mass-produced brands and a love for local, ‘small-batch’ products. The trend of adopting western lifestyle and culture, primarily by the young population, and the rise in disposable income, have together created a favorable environment for the growth of the craft beer market in Europe.
Impact of E-commerce
Another unsung player in the craft beer growth story has been the rise of e-commerce. Online sales of craft beer have been booming and continue to steadily gain a larger market share. E-commerce has helped bring craft beers to regions which may not have easy access to a variety of craft beer in physical stores. In addition to that, the convenience of online shopping and home delivery has made it a preferred choice for many consumers.
Challenges
However, all is not rosy in this hops-filled market. The craft beer segment faces many challenges that could potentially hamper its growth. High excise duties on alcohol, stringent government regulations, market competition with big beer companies and the premium pricing of craft beers are a few obstacles that it needs to overcome.
Conclusion
Despite these challenges, it’s the quality of craft beer that will sustain the growth of this market. Brewers who focus on quality rather than quantity, engage with their consumers, and tell compelling stories are the ones who will succeed in this increasingly competitive landscape. From the indications, it is clear that the thirst for craft beer in Europe is far from quenched.
The blog post provides an insightful overview of the growing craft beer market in Europe. It reveals that this sector was valued at $38.57 billion in 2019 with the potential to cross $67.66 billion by 2025. Primarily, beer is consumed on-site in bars, restaurants and clubs, however off-site consumption is on the rise due to changing consumer behaviours. The UK is the dominant participant in the European craft beer market, followed by Germany and Belgium. However, interest is also growing in countries such as Spain and Italy. Overall, this analysis paints a promising picture for the future of the craft beer industry in Europe.
This article provides a comprehensive analysis of the craft beer market in Europe. It highlights that Europe, particularly UK, Germany and Belgium, are leading in the global craft beer market. The craft beer market in the region is expected to continue growing, potentially reaching $67.66 billion by 2025. The article also points out that while craft beers are primarily consumed in bars and restaurants, purchases from stores are expected to increase rapidly due to changes in consumer buying behaviors.