Digital IQ Index Beer 2014

The U.S. beer industry is a $247 billion dollar market. Digital marketing now accounts for 8% of all marketing expenditures—a four-fold increase since 2005. However, despite this reallocation, digital still trails spending on traditional media, promotional support to wholesalers and retailers, and sponsorships of sporting events and public entertainment. The battleground in beer is increasingly tied to the grocery war that is emerging online. Several online grocers are reaching critical mass, and retail giant Amazon is expanding its grocery efforts to 20 new markets in 2014. Although online represents only 3.3 percent of total grocery sales, analysts expect that share to explode to between 7% to 17% over the next decade. Furthermore, a recent survey reveals that 34% of consumers are willing to shop online for beer. To-date, digital has been the chaser to broadcast efforts, used to amplify and extend TV investments. However there are hints of change. Newcastle Brown Ales’ recent campaign demonstrates the potential for digital disruption. The Super Bowl web series, “the ad we didn’t make due to a lack of money, talent, and permission to advertise during the game” culminated in a viral hit registering nine million views—greater than 43 of 55 official game spots. The accompanying microsite attracted 100,000 unique visitors—approximately 35% of the online traffic driven to Budweiser.com and BudLight.com over the same time period. While big brands still have the biggest offline marketing arsenals, many craft brands are leveraging digital to punch above their weight class. Two of the five Geniuses in our 2nd annual Digital IQ Index: Beer are Craft Beers. New Belgium’s Grand Cru program uses gamification on site and mobile to reward users for engaging with the brand, and Sam Adams’ sophisticated site features seamless social integration, user generated content, a detailed retail locator, and online promotion of offline events. We may see a new cohort of brands emerge