How Do Local Breweries Market Globally?

Hal Conick
Marketing News
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Key Takeaways

What: The world of beer is growing. Regional companies and craft brewers have taken advantage of increased international demand by expanding their markets.

So What: The global beer market is expected to increase 6% annually until 2020 when it may reach nearly $700 billion.

Now What: A global marketing strategy doesn’t make sense for every brand, but companies must follow where their brand takes them, as Brooklyn Brewery founder Steve Hindy says. Partnerships are critical for production and brand building.

​July 25, 2016


The world beer market is getting larger by the day. To compete, native breweries must use savvy marketing tactics to prosper in faraway, previously untapped markets.


People often ask Brooklyn Brewery founder Steve Hindy if he expected his beer to be as well-known as it is now; he often replies, “hell yes.”

“I didn’t start this to be small,” Hindy says. “But I didn’t really imagine we’d be selling a lot of beer in Stockholm or Paris.”

Hindy initially imagined competing with the import beer market, which was 2% of the U.S. market when he founded Brooklyn in the mid-1980s. Since then, the craft and import beer markets have boomed. Statistics from Mintel show a huge increase in imported beer’s share of the U.S. market, rising to 15.5% of the beer market in 2015. Craft beer has risen from almost nothing to 10.2% or 12.2%, according to Mintel and the Brewers Association, respectively. 

While U.S.-brewed beer has been steadily gaining market share stateside, it’s also starting to earn admiration overseas. The Brewers Association, which represents small and independent craft brewers, reports the craft beer market export volume grew 16.3% to $116 million in 2015, mushrooming by approximately 446,000 barrels. 

An even greater number of beers have entered the states. The Beer Institute reports more than 11 million barrels were imported by the U.S. as of April 2016. The majority, more than 230 million barrels, contain popular Mexican beers, such as Modelo and Corona. 

“That’s just going to grow and grow,” says Jonny Forsyth, global drinks analyst at market research firm Mintel. “That’s just tip-of-the-iceberg stuff.”

Image of Brooklyn Brewery's Kegging Line. Source: Brooklyn Brewery

Just as craft beer has disrupted the U.S. beer market, Hindy and others believe it is also changing and creating beer markets​ across the world. These breweries ensure new markets know about their brews by navigating tricky international regulations, unique populations and social norms. 

Serendipity in Brooklyn, Ephemera in Denmark

Hindy’s brewery opened in 1987 in Brooklyn, New York, its namesake borough. Very quickly, importers from across the world started calling. The calls surprised Hindy, as they were still having a difficult time catching on in Brooklyn.

“Nobody understood that kind of beer 30 years ago,” he says. “It really required a lot of work and a lot of educating people about what we were doing. We needed the sales, so we basically said to people in Japan and Stockholm, ‘We’ll send you beer—just pay us before we send it,’ which is a great deal for us and a terrible deal for them.”

Now, Hindy says, approximately 50% of the company’s business comes from sales overseas, with its biggest markets including Scandinavia, the U.K., France, Brazil, Australia and China, the fastest-growing market for Brooklyn Brewery. 

After years of practice, Hindy and company have connected with better importers and watched Brooklyn beer gain popularity across the world. In 2016, Hindy traveled to cities, including Seoul, South Korea, to evangelize for his brand. He threw parties and hobnobbed with local residents, letting them get to know the beer and the brand. 

“The biggest thrill for me as a craft brewer is going into a place and seeing people ordering my beer,” Hindy says. “It’s a double thrill to see them ordering the beer in Stockholm or London.”

Across the Atlantic Ocean, Mikkeller, a Denmark-based microbrewery founded in 2006, also had a bit of serendipity involved in its spread across the world. 

Company co-founders Mikkel Borg Bjergsø (pictured right) and Kristian Klarup Keller started as a home brew operation in 2002 and almost immediately began winning home brew competitions and awards. Their first customer was in the U.S., according to Jacob Gram Alsing, operations manager at Mikkeller. The U.S. beer scene became Mikkeller’s main driver and inspiration for its beer and business.

Brewing creativity and creating inroads to new markets have been essential to Mikkeller’s success. Denmark is what Alsing calls a “discount market,” where consumers mainly buy beers far less expensive than those Mikkeller produces. Even now, Mikkeller’s home country is only its eighth- or ninth-largest market, with Sweden and the U.S. coming in first and second, respectively.

Historically, the company has worked batch-to-batch, partnering with other brewers and creating unique recipes instead of opening its own production facility. It has also opened a network of bricks-and-mortar bars and breweries to create more inroads to the international beer market, Alsing says, opening locations across the world in places Bjergsø enjoys visiting. Now, Mikkeller has an official brewery open in San Diego, bars in cities across the world and beer available in 49 states, as well as countries such as Thailand, South Korea and Iceland. 


Photos Courtesey of Mikkeller Press


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“[Mikkel has done an] extremely good job by using the right designers, the right packaging, putting the right collaborations in place and putting his beer in places where it gets noticed,” Alsing says.

Another European craft brewer, the Scotland-based BrewDog, made a similar choice in joining the U.S. market by moving its production stateside. After starting in 2007 and opening more than 40 bars across the U.K., co-founder James Watt says BrewDog is working to open a 42-acre “hop cathedral” in Columbus, Ohio. This will allow BrewDog to roll out its beers in the U.S. and Canada this fall.

“The craft revolution knows no borders. We’re firmly on a mission to get the best beer to all corners of the world,” Watt says. “We’ll start with Columbus, but we’ll spread quickly.”

A Period of Discovery

The increased interest in international beer comes from what Mintel’s Forsyth calls “discovery,” or the interest in products and cultures different from the consumer’s own. 

A beer from a different country—one which may tell the story of its culture—will have great allure in a foreign market, particularly with millennials, he says. 

“Consumers assume it’s superior just because it has come from a different part of the world, especially if it comes from another part of the world that’s known for beer making,” he says. “There are similar things going on in food as well.”

This is all very new for beer, Forsyth says. Just five years ago, the world had “no respect” for U.S. beer, which languished in the endless creation of big-brewery lagers since prohibition ended in 1933. Now, a typical U.K. resident will walk out of a bar if there are no U.S. craft brands on tap, Forsyth says. 

The Brewers Association reported in December 2015 that there are currently 4,144 breweries in the country, breaking the 1873 record of 4,131 breweries. This has given many brewers new license to export their beer, Forsyth says. While Europeans still tend to avoid big U.S. breweries, craft beer has gained something of an iconic status, carving new niches ​in foreign markets.\

Bart Watson, chief economist with the Brewers Association, says regional breweries have seen stateside growth begin to diminish. Looking to international opportunities gives brewers an improved chance at maturation.  

“Brewers who are used to a certain growth rate are going to look for other places where they can get that growth rate, and markets abroad will be one of them,” Watson says.

Matt Simpson, owner of The Beer Sommelier, an industry consultancy, says the export market from the U.S. is still almost nil, so brands will typically open their own production facility or partner with another local brewer to save time and money, as well as preserve freshness. This is the route Brooklyn and breweries such as San Diego-based Stone Brewing have taken. But, he qualifies, “There is no typical. Everything is new and being played by ear.”

Instead of playing by ear, here are some tactics used, tips offered and challenges faced by brewers trying to launch a product in an international market. 

Branding an Image

A tactical marketing plan can go a long way to win favor in a novel market. Two brands that do particularly well with using their country-of-origin and name as a selling point are Stella Artois and Guinness. 

Forsyth cited a Mintel study that found 38% of U.S. millennials think Stella is a craft beer, while 27% believe Guinness is craft. In reality, both are mass-produced. Far from craft, Forsyth called Stella a “down-market” beer. 

“In America, there’s a certain reverence for Europe,” he says. “It’s the Old World and they do things really, really well. They’re trading on a bit of that. [U.K. residents] find it absolutely hilarious.”

While Guinness sees a huge lift from being “foreign and different,” Forsyth says Stella Artois has played up the heritage and history of Belgium. As an example, Stella came to the U.K. in the 1980s with the tagline “Reassuringly Expensive,” taking with it an above-market price tag to increase sales. Robert Cialdini​ wrote about this marketing method in his landmark book, Influence. If customers follow the “You get what you pay for” rule long enough in life, they’ll end up believing that expensive is always better. 

“It plays on the fact that the average consumer really doesn’t know and they’re very influenced by perception and branding,” Forsyth says. “If you say your brand is more expensive, they’ll take that as proof that it must be better.”

Unique Traits in Unique Markets

Before launching in a new market, the Mikkeller team sits down with importers and distributors to discuss strategy. Every market is unique and deserves to be treated as such, Alsing says. For example, Mikkeller didn’t want to send hoppy beers from Belgium to the U.S., as that style already dominates the local market. 

“The markets [in each country] are so different, it’s necessary that you actually sit down and think together with the importer and distributor about what the strategy should be,” he says. “In Germany, we’re only in supermarkets. Because they have [an environmentally driven bottle refilling and] refund system that makes it impossible for Mikkeller to introduce all the beers we have. We only introduce five beers out of 1,000 in Germany.”

Each Mikkeller market receives a special touch. The brewery creates unique designs and styles in each, Alsing says, but also tries to take popular aspects of local culture and implement them into its beer.

“It’s still very much a playful thing,” he says. “If Mikkel gets an idea he thinks is interesting, then regardless of what the business case is, he’ll do it. … No matter how much we grow in volume or how many bars we have, we need to always be innovative, have individual solutions and be playful in what we do. The second we lose that, we will not be Mikkeller anymore. It’s a very big part of our DNA.”

Paying respect to the local culture also has a marketing case: Alsing sees breweries enter markets with only their own DNA, but believes this is a “narrow-minded” approach that will limit them to non-local, tourism business. 

“In the states it’s about showing European traditions. In Europe, it’s about showing what the American traditions are,” Alsing says. “Every time we do something, we also take something back. … You need to be humble about what goes on in the [different markets] and, at the same time, showcase what you can do.”

Know Where Regulatory Challenges Lie

The U.S. likely poses the toughest challenges for export-minded brewers. Each state has slightly different regulations on alcohol, whereas most other countries have a single regulatory body, Simpson says. 

“If you decide to come here, you’re going to need to be an importer yourself or find an importer. Then you’re going to have to find different distributors in every one of those states,” Simpson says. “My advice to [breweries] is to always start in populated areas where they’d do really well and then expand out from there once they start getting their legal and administrative act together. Start moving out from one well-providing area to others. You want to entrench yourself.”

To make matters more complex, the National Association of Broadcasters disapproves of consumption of alcoholic beverages in commercials. While there is no law on consumption in advertisements, this disapproval dissuades TV and beer executives alike from pushing the boundaries on air. 


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Other countries present their own set of challenges for marketers, Forsyth says: France doesn’t allow alcohol to be advertised on TV at all. Turkey has cracked down on all alcohol advertising aside from sponsorships. Russia has banned alcohol advertising in most media, aside from certain pay channels with greater than 75% Russian viewership

“There are definitely a lot of regulatory challenges in terms of the big brands and getting their message out,” Forsyth says. “It’s not an easy thing.”

Countries that only sell alcohol via state-run stores present another challenge to exporting beer. Watson says this means stores have to be convinced that the beer deserves a spot in the “local monopoly.” 

However, Watson notes that a lot of these challenges can be opportunities for success once they’ve been worked through. An example is in Germany, which instituted a beer purity law called Reinheitsgebot in 1516. This law only allowed beer to contain hops, barley malt and water. The law has been weakened over the years, giving companies like Stone Brewing opportunities to bring unique flavors into Germany. 

“German consumers have a set of styles of beer they’re used to. Certainly, Stone is going to challenge a lot of those preconceptions,” Watson says. “But at the same time, that means they’re going to be immediately differentiated from every other beer on the marketplace.”

Pick Potent Partners

Pushing a beer into an international market is like traveling to a new country: It’s always easier to have a local show you around. 

“To be honest, we don’t really do much market research; we look for a motivated importer who we believe understands what it takes to build a brand,” Hindy says. “We look for people who will trust our strategy on going into a new market, which basically involves picking out the right kind of bars and restaurants to place the beer into, because it’s not like selling Budweiser in a market where you’re spending $30 million on advertising … You have to find the right bars and restaurants that are into craft beer and place it there and really work to help them sell and market the beer.”

It doesn’t take a genius to realize partnerships are essential, Hindy says. The company’s recent social media success in Seoul came via a connection to a Korean importer. Partners can also help bypass the logistical nightmare of shipping beer across the world by brewing a foreign beer at their local facility. For example, Cooper’s Brewery in Australia brews Brooklyn Lager, allowing Brooklyn to focus on shipping specialty beers that hold up better due to high alcohol volume.

Understanding and solving logistical challenges is essential for forming a local, long-term branding plan, Watson says, as it will allow the brewery to focus on its business goals.

Guerilla Tactics

The overseas growth of Brooklyn hasn’t come from spray-and-pray advertising or dumping millions of dollars into TV commercials; Hindy says its main tactic has been “guerilla marketing.” 

In many cities, the company will hold a Brooklyn Mash: a four-day festival celebrating local, creative culture. Brooklyn invites artists, painters, writers, musicians and entrepreneurs to allow the locals to get to know their beer. In turn, Brooklyn gets to know the locals. Watt and the BrewDog crew are taking a similar approach in Ohio, making appearances to get familiar with the area and its people long before opening.

A big benefit to Brooklyn’s tactics is the halo effect created by social media. 

“Thirty years ago, I would do a beer tasting or a beer dinner at a restaurant and I’d think, ‘Wow, [we] touched 50 people today.’ Now, you do an event with 50 people and 15 of them are taking selfies with you and tweeting it all over the place,” he says. “Social media magnifies all those efforts. That’s our primary vehicle for marketing here in the U.S. and around the world.”

After an event with the press in Seoul, Hindy says Brooklyn had 30 new online posts about them by the end of the day, in addition to a piece on Seoul’s local TV news. “Loopholes” around standard marketing and advertising like these create good public relations for companies, Forsyth says. It gets brands noticed in markets where they may otherwise be ignored.

“I guess that comes back to the point of building up presence in bars,” Forsyth says. “The bartenders become gatekeepers. They can really help you recruit people.”

The Future of International Beer

If it seems like there’s a greater opportunity for breweries to create new markets and brand internationally, that’s because there is. 

“Not to sound hyperbolic, but there is only room to grow,” Simpsons says, “There’s always room for introduction of good beer to the marketplace. If it’s good, it’s welcome. … If it’s not, it will fizzle out just like a lot of small American craft brewers who aren’t making good products.”

According to Allied Market Research, the global beer market is expected to increase 6% annually until 2020 when it is predicted to reach $688.4 billion. The Asia-Pacific region will likely see the most growth at 7.28% per year. Watson cites Mexico as an “untapped opportunity” for export-minded U.S. brewers due to its proximity and relaxed trade barriers. 

Creating a new market will mean a lot of leg work, which calls for renewed marketing and branding efforts. Many parts of the world are simply not attuned to what the U.S. craft beer market has to offer, Simpson says. Presenting a country like Thailand or China with a unique craft beer, however, has a huge upside for success. 

“The craft beer revolution is definitely spreading around the world,” Hindy says. “There is demand for craft beer. As with domestic markets in the U.S., the real question is going to be, ‘Who can get it there fresh, and who can support it to ensure that people are getting the freshest possible beer?’”

Even with the growing world market, Watson says local beer will always reign supreme. After all, beer is mostly water, water is heavy and heavy things cost a lot of money to ship. Breweries of the present and future will need to consider whether their beer has a value high enough to be successful in new markets.

For Hindy, the international value proposition has always made sense. However, many people have been critical of his decision to ship across the world, he says, asking, “Isn’t this supposed to be a local thing?” 

Is it supposed to be local? Is local a better way to work for most? Hindy briefly pauses, considering his response. 

“When you start a beer company, you follow your brand,” he says. “This wasn’t our strategy in the beginning, but it just happened. You go where your brand takes you. Our brand happens to be poised to [become] the international craft brand. That’s a pretty good spot.”




Author Bio:

https://auth.ama.org/publishingimages/halheadshotcolorcorr.jpg
Hal Conick
Hal Conick is a staff writer for the AMA’s magazines and e-newsletters. He can be reached at hconick@ama.org or on Twitter at @HalConick.
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Displaying 1 Comments
Ellen Novar
October 24, 2017

Great article! I am using this in my International Marketing class. Thanks for all of the detail you provided.

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