As just-drinks publishes its latest on-trend report, which focuses on the craft beer sub-category, Larry Nelson ponders the future for the segment in its biggest market, the US.

This story begins, as so many promising stories do, in a pub. One nestled in a village in the Home Counties that surround London, far enough away to be leafy and green, yet close enough to watch the aeroplanes begin their final descents into Heathrow and Gatwick. 

Enter family, stage left, on a weekend outing – it’s Mothering Sunday, Britain’s equivalent of Mother’s Day. Father, to collected family members: “They have that American craft beer here, Blue Moon. Do you fancy one?”

Besides happily illustrating that important journalist work can be undertaken simply by clutching a pint in a sleepy rural pub, this moment anecdotally cuts to the heart of the question that will determine the immediate future of the American brewing industry.

What the hell, exactly, is craft beer?

More on that in a moment, but first things first: Let us consider the economic potential of craft beer in the US. Bullishness is the order of the day. Essentially, there are two probable outcomes – one is very good; the other is very, very good.

The numbers support both possibilities. The latest market data from the Brewers Association, the trade organisation for America’s craft brewers, readily lends itself to rosy interpretations. Its member’s volumes rose by an incredible 18% during 2013, taking craft beer’s share of the US beer market to a record 7.8%. As has been the pattern, value rose by a greater percentage, fully 20%. Craft beer’s value is now estimated at US$14.3bn, up from $11.9bn in 2012.

It’s hard to imagine that these figures represent the lesser of two outcomes – yet they do. The Brewers Association has set an ‘aspirational’ goal for its members of a 20% market share for craft beer by 2020.

To achieve this in the next seven years double-digit volume growth of around 14% to 15% annually would have to be sustained. Such an outcome is not out of the realm of possibility; indeed, we’re three years and counting on that fast track.

Of course, there are alternative, more conservative, projections. As just-drink’s newly-published report on craft beer notes, Nomura has craft beer accounting for 10% of the market by 2017. It’d still be a record for market share and a result one suspects would be cause for celebration in the craft brewing community.

Either outcome means that for some brewers and brand owners it represents very, very bad news. Yes, that means you, Anheuser-Busch and especially you, Miller Coors. While consumers may not know exactly which brands are craft beers – at least according to the strict, three-part Brewers Association definition – they can certainly identify what craft beer isn’t.

The top of this short list includes the mainstream stalwarts – ABI’s Budweiser and Bud Light, and Miller Coors’ Miller Lite and Coors Light. These were brands all of which were in decline in 2013, according to their respective brand owner’s year-end reports.

But, what is happening in the beer market isn’t a straight swap of your parent’s mainstream industrial scale suds for your peer’s depths of the garage craft excitements. Despite the success of the craft brewing brethren, total beer volumes in the US declined in 2013. The excitements of craft beer aren’t happening in isolation. Both wine and spirits continue to notch consecutive quarterly gains with impressive consistency.

Again, though, it is mainstream light lagers that are taking it on the chin. While craft is in growth, imported beer volumes by and large have remained static for the past five years. 

For America’s giant brewing duo, the numbers aren’t all grim. They, too, have horses in the craft beer sweepstakes. For Miller Coors, Blue Moon is defined by most of its drinkers as a craft beer brand, albeit one approaching sales of 2m barrels. For Anheuser-Busch, it has added New York’s Blue Point Brewing to its interests in craft beer producers, notably Goose Island. It also brews Shock Top, its Belgian-style wheat beer that is its competitive response to Blue Moon’s success. Given their success to date, and that of others, increased participation in the craft beer sector seems a given.

Accept for a moment a broad consumer-based definition, one which includes the national duopoly’s offerings, then the numbers are simply amazing. Ed McBrien, president of sales & distributor operations at Miller Coors, suggested in a recent interview with just-drinks that craft volumes grew last year by 30%.

The somewhat trite answer to what constitutes craft beer is that beauty is in the eye of the beholder: One’s perspective matters and, ultimately, that of the end user - the beer drinker - matters the most. If they think Blue Moon, Shock Top or any Goose Island product is craft beer then, by gum, it is craft beer. 

Having the consumer decide what is and what isn’t craft is surprisingly a stance that the Brewers Association has embraced of late. Lost amidst the shouting about 2013’s top line figures was the largely-unnoticed decision made in early-March by the BA’s board of directors to alter its mission statement. Its purpose was refocused, ‘to promote and protect America’s craft brewers,’ while deleting a reference to craft beer.

Gary Fish, chair of the BA board as well as president of Deschutes Brewery, explained the change in emphasis: “In spirit and action, our purpose remains unchanged,” he said in a statement. “Removing the previous reference to ‘craft beers’ – which the Brewers Association does not define, but rather leaves to the beer enthusiast – allows the focus to remain on the craft brewers the BA works to promote and protect.” 

It’s certainly a change from three years ago, when a then-angered BA briefly published the short list of breweries that weren’t producers of craft and when it briefly mulled over having some sort of seal or stamp that could be used on packaging to ensure the authenticity of craft beer. Such a system would have been costly and difficult to implement.

It appears that it’s now up to the devices of individual brewers who feel strongly about the issue to take the lead in educating consumers. 

Honestly, it’s difficult to see what, if anything, that could go wrong for craft beer in the short and medium term. Opinions will differ as to what, exactly, it is, yet consumers are fast becoming wise as to what constitutes authentic craft beer, that from smaller independent producers working with traditional and innovative ingredients.

In final analysis, it is the fortunes of the national brewers, Anheuser-Busch and Miller Coors, that are most at risk.