The Once-Lowly Can Is Boosting the Beer Biz
The newest weapon in the battle for the beer drinkers' dollar is actually an old one. The once-maligned can is now taking the spotlight—and shelf space—from the bottle.
The can is becoming an increasing popular option for brewers looking to give consumers another reason to choose their product over another. Canned beer made up 53 percent of the market last year, versus 48 percent in 2006, according to industry trade group The Beer Institute.
The latest salvo in the can wars comes from Anheuser-Busch InBev's Bud Light brand, the best-selling beer in the U.S., which recently named Louisville, Ky., as the pilot market for a new 12-ounce Bud Light Vented Can.
The Bud Light Vented Can allows consumers to push down the tab in reverse motion after the can is opened, creating a vent to improve airflow when pouring or drinking the beer.
It's not the first time a brewer has hailed a vented can as a better beer drinking experience.
MillerCoors unveiled "The Punch Top" can in April 2012 and built a marketing campaign around consumers using creative ways to open the can's vent. For Anheuser-Busch officials, a key differentiator with the Bud Light Vented Can is the lack additional tools or objects needed to open the vent.
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"The beauty of the Bud Light Vented Can is in its simplicity," said Pat McGauley, vice president of innovation for Anheuser-Busch. "Our testing showed consumers naturally gravitated to the vented can thanks to its intuitive design and enhanced smoothness, and we expect similar feedback in Louisville."
It's been a busy year in Anheuser-Busch's innovation group. Earlier this year, Anheuser-Busch unveiled the Bowtie can for the Budweiser brand. The can is molded into the shape of the historic Budweiser bowtie.
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For Chris Furnari, the editor of beer industry website Brewbound.com, package innovation by large brewers is a way of life.
"By and large, the macro brewers tend to innovate more in packaging than they do in product simply because they can't do too much to a Bud or Miller Lite," he said. "They can create line extensions like a Lime-a-Rita or a Bud Light Lime, but in terms of Bud Light there's only so much they can do to draw consumer interest to the product."
Package innovation may be a necessity for large brewers, but brewers of all sizes are turning to cans more frequently. The number of craft brewers canning their beers has expanded from fewer than 50 in 2008 to 262 in 2012, according to CraftCans.com.
Boston Beer, the largest craft brewer as defined by the Brewers Association, released its first canned beer last month. The brewery said it spent two years and $1 million dollars to create custom-shaped cans designed to enhance the beer drinking experience. Known as the "Sam Can," it is currently being used for the flagship Samuel Adams Boston Lager and Samuel Adams Summer Ale brands.
The move to cans marked a major philosophical shift for Boston Beer founder Jim Koch, who for decades railed against beer in cans, even going so far as to place it in the brewery's "Beer Drinker's Bill of Rights" writing: "Beer shall be offered in bottles, not cans, so that no brew is jeopardized with the taste of metal."
If Koch's can conversion isn't enough proof that the canned-beer-taste stigma is gone, consumers need to look no further than a beer named Heady Topper brewed by The Alchemist Brewery in Waterbury, Vt. Heady Topper is consistently rated on beer review websites such as BeerAdvocate.com as one of the best beers in the world. Heady Topper sold only in cans, and each can contains explicit instructions on how to best enjoy the beer: "DRINK FROM THE CAN."
With the taste issue resolved, brewers are now left to promote the benefits of beer in a can, which include easier portability and storage, better protection from sunlight and oxygen, and the consumer's ability to bring cans to beaches and pools where bottles are often forbidden.
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So while 2012 may be remembered as the year canned beer crossed into the mainstream, consumers can expect that the number of breweries offering cans as an option will rise as more brewers hop on the can bandwagon.
"It's not a fad. You'll probably see a lot of the larger craft brewers, those who are in the top 50, start to add cans to their packaging," said Furnari. "Cans are here to stay."
—By CNBC's Tom Rotunno. Follow him on Twitter @TomRotunno.