One of the things that has defined the Discount Beer experience for me is the increasingly obvious point that there is a large segment of the market that isn’t drinking beer for flavour. You would think that given 60 products of varying quality that all cost the same amount of money at a 24 bottle volume, that there would be a handful that would rise to the top based on their merits and the decision of rational actors as consumers. You would be entirely justified in thinking that and every fibre of your being would call out for this supposition to be proven correct, but you’d be wrong.

There are some odd things at play in the Discount sector of the market. It seems to me that many of the brands in the category wouldn’t exist without a significant amount of brand loyalty. It has proven to be a sort of island of misfit brands from Canadian history. Take Old Vienna, for example. I would have assumed that no one would be up in arms about its continued existence, but if you look at the comment section on The Beer Store’s website you get:

“It has a reputation of its own. It’s that old man beer that strikes a conversation every time you’re at a bar. It’s the “I learned how to drink beer stealing these from my dads beer fridge” OV is in a league of its own, its a great old man beer that doesn’t get enough respect. LONG LIVE OV!”

I have, while looking through the comments on The Beer Store’s website, wondered if there are brewery representatives splashing the pot in the comments section. I have concluded that there are probably just people who feel this strongly about cheap beer. (For a laugh, try picking out which comment about Boxer Lager I think is supplied by a brewery representative.)

So there’s a Canadiana element to the sector. People are protective of brands they grew up with. Just yesterday a reader pointed out that I really shouldn’t call Upper Canada Lager a discount brand. He didn’t think it fit in the category. Maybe it doesn’t fit conceptually, but it sits on the same shelves and costs the same amount.

There are some all malt products in the discount section, and they tend to be objectively more flavourful. Look at something like Trailhead, brewed by Wellington. It would, I think, be completely acceptable to just about anyone. It’s a well made Vienna Lager that happens to cost a very small amount of money. You’d think they’d have a stranglehold on the market.

It makes no sense to me, but I suspect that it has to do with the amount of choice. If you’re faced with 60 brands, you can hardly taste test all of them without spending a lot of time doing it. They all cost approximately the same amount of money (I don’t believe anyone is debating this seriously on the basis of a nickel per 24) and they all contain approximately the same amount of alcohol (I do believe some people are opting for the 6.0% option on that basis).

This rules out selection being explicatory on the basis of flavour, price and alcohol content. I think that what we’re looking at is the dying vestiges of brand loyalty. You’ve got to admit, even as a craft beer drinker, that there’s a certain joy in being able to choose a product, being able to know that it will always be the same and that it will always be available. You’ve just removed one decision from your life. A good design is really important for many things like business, find the best Brand Agency to improve how everyone sees your work!

As it stands now, craft beer is always focused on the new thing. New Style! New Ingredient! New Format! New Brewery! It’s an entirely different market segment with more adventurous and better informed consumers. You’d be amazed at the dearth of information available online for some of the Discount brands, whereas a quick google will usually get you a clone recipe for a famous craft beer. You want to torture a craft beer drinker? Make them choose one beer to drink for a year to the exclusion of all others and then make them actually do it.

That said, here are some takeaways from the month:

1) Even if they’re drinking beer that you think is terrible, the people buying Discount Beer are human beings and not some kind of hideous morlocks. I don’t think that you can afford to give up on people just because they drink cheap beer. If the craft beer market is going to continue to grow, those consumers need to come from somewhere. Don’t evangelize to them. Don’t condescend to them. They probably like beer just as much as you do. They just haven’t tried the stuff you have. Might want to focus on the younger folks who just don’t know any better.

2) There are actually some quite decent things in the Discount Beer Section. Trailhead is good. Upper Canada Lager is good. I’d be reasonably happy to be served a Trailhead anywhere.

3) There is some really horrible dreck in the Discount Beer Section. I’m not naming names, but I certainly dry heaved while drain pouring a couple of these.

4) Some people drink those beers by choice, which leads me to remind everyone that the primary reason that we drink beer isn’t flavour. We all like alcohol. That’s fine. We’re adults. Flavour is wonderful. Flavour is fabulous. I’m a believer. I’m doing research into Monoterpenes and Maillard reactions for food pairing knowledge, for God’s sake. It’s just disingenuous to claim that it is the main reason it’s enjoyed.

5) If you drink very simple lagers for a month and then come back to craft beer, things you thought were mild will knock you on your ass.

Finally, I have an observation about the next few years:

Lakeport started in 1993 with about 3% of the market and the big guys felt obligated to compete on their terms. Over the next several years, the discount section of the market grew significantly. The competition was a powerful force for growth and by the time Labatt bought Lakeport out in 2007, they had something like 15% of the market in Ontario.

Craft brewers in Ontario reportedly have between 5-8% of the market. I think the figure depends on who you include based on production and taxation levels as specified by the ministry of finance. I would probably discount Brick, who are small enough to be considered craft but seem to make up most of their volume on Laker products. That’s not a slight against them, incidentally. Let’s call it about 5% and rising relatively quickly. All of the major brewers are now competing on the terms of the craft brewers. Keith’s Hop Series IPAs is taking a stab at the market in a very serious way. Creemore is expanding.

The Discount Section is the only historical model we have in Ontario for this kind of competition. If the model holds, I think the competition from Molson and Labatt is going to cause market segment expansion above anyone’s predictions for the next two years.