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Craft beer: penetrating a niche market

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Abstract:

Purpose ‐ The purpose of this paper is to examine the underexplored niche market potential of craft beer, especially as it may relate to independent food and beverage operations, as a means of gaining competitive advantage. Design/methodology/approach ‐ Data were collected through the distribution of a survey instrument to craft beer and home brewers, designed to assess the demographic profile, purchasing/restaurant selection, and decision behavior of this group and assess the likelihood of their future behavioral intentions toward continued participation in the craft beer segment. Findings ‐ The paper reveals that craft beer and micro brew pub success has been driven by the home brew movement and continues to gain market share at the expense of broad line food service and macro beer producers. The demographic profile of this group shows age range, income, and educational levels sufficient to drive continued growth. The high satisfaction and likelihood to recommend scores support this assessment. Research limitations/implications ‐ The sample is limited to members of the Brewers Association, the American Home Brewers Association, and craft beer enthusiasts known to members of the organization. Additionally, the survey was administered electronically limiting participation to people comfortable with this medium. Practical implications ‐ F&B operators who demonstrate commitment to craft beer through server education, beverage list commitment, and supporting events can achieve market differentiation and dominance within the niche; leading ultimately to competitive advantage. Originality/value ‐ This research sheds light on underexplored areas of craft beer and the opportunity for independent F&B operators to identify and penetrate an increasingly important niche market, which to date has been viewed primarily from the perspective of microbrew pubs.

Keywords: Beer; Competitive advantage; Craft beer; Differentiation; Food and beverage; Niche marketing; Niche markets

Document Type: Research Article

DOI: http://dx.doi.org/10.1108/00070701211241518

Publication date: June 29, 2012

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