Nostradouglas' 2024 Predictions 🔮 (#7-12)
Hopping Forward
If you missed Part One, Nostradouglas’ first six industry predictions were shared while barely mentioning IPA. Hard to believe, I know, but it’s time get real for Part Two because the industry’s dominant style and all it’s offspring represent over 60% of the dollars. A healthy and engaged IPA landscape means strong legs for many to stand on and more flexibility to take risks and branch out. The challenge lies in how to evolve and continue creating excitement around a beer style that rode a euphoric high and pushed the limits for so long, always having something new to introduce. Nostradouglas sees a familiar theme coming for 2024, but doesn’t necessarily like the pickle that may leave us in…
1. Flagships Flying High
As the price of craft beer has ticked upward in price, it should come as no surprise that the market has shown softness in response. The type of IPA that’s exhibited the most resilience in this slumping market has not been the latest and greatest innovation. Instead, the Flagship IPA has begun carrying even more so. Despite not always having a shiny new coat of paint, these recipes have seen the most repetition, consistency, and are the most trusted and well-known. Those realities have born out in sales trends.
In 2024, Nostradouglas sees breweries with packaged beer in the market spending more of their time, energy, and resources on programming, support and focus for the backbone of their portfolio (what’s working) and less on development on new for the sake of new (what’s not so much). Breweries will always want to have new beers to showcase the season and their creativity, but their 5th and 6th priority beers on shelves are showing less upside than ever, compared to doubling down their efforts on #1.
2. The Imperial Flag
The Imperial IPA category predictably grew big in 2023, up 28%, and there’s different ways to react. On one hand, you could say that the growth is driven by behemoths like New Belgium’s Voodoo Ranger, and to a lesser extent Lagunitas’ Maximums and Sierra Nevada’s Atomic Torpedo. With that being the case, why should you care?
For starters, consumers have to start somewhere. A meaningful subset then move on, explore, and trade up. So it’s worth paying attention to what people are drinking because these Imperial IPA buyers could become your customers someday. That doesn’t mean small breweries should figure out how to make a 10% ABV IPAs in a 19.2 can with 2 for $5.00 deals for convenience stores, but it’s certainly worth thinking about flavor and intensity as a niche opportunity to appeal to what is clearly a massive population who will likely to find themselves at their local brewery one day. A lot of us were drinking Blue Moon and Hoegarden before we were drinking Allagash White and expensive Hazy IPAs. Most beer journeys do not begin with a one-off release at the local brewery, they begin at the grocery or convenience store.
3. THC-Infused
Craft breweries have been leaning into weed puns for many years now. At one point, everything was “citrusy”, then we moved to “tropical”. When COVID times came, the nostalgia kicked in for 2012’s flavor palate again and “dank” joined the pantheon of official descriptors, even on a national level. Combine that with the Venn diagram of craft brewery employees having strong overlap with enjoyers of cannabis, and you’ve got an industry who doesn’t need much convincing to associate themselves with THC.
Now that THC beverages have become not necessarily legal, but less explicitly illegal, they’ve become an exciting potential vehicle for craft breweries to find future growth. With that cultural crossover between craft breweries, hops, and cannabis, Nostradouglas sees local standing a decent chance against all the incumbent CPG brands who don’t have a community, any brand recognition, or physical presence. But he also warns that this industry will be rocked by controversies over regulation, customer education gaps, inaccurate dosing rates, and overall poor quality measures before it gets itself organized with much needed guardrails.
4. The Terpene IPA
The “dank” puns provided another way for IPA to feel new and cool, but lacked any substantive connection to cannabis. Another evolution is needed and with THC beverages on their way to being all the rage, Nostradouglas sees the next one-off IPA style trend being the Terpene IPA. Terpenes are the primary constituents of essential oils and are responsible for the aroma characteristics of cannabis. Unlike THC, terpenes don’t in themselves get you high and thus can be used as a flavor compound in alcoholic beverages. They’re being marketed heavily to craft breweries right now as a new means of enhancing the dank flavors and aromas in IPAs.
5. Hop Waters
Much of the forward-looking opportunity presented by THC beverages stems from a pullback in alcohol consumption. For craft breweries, this restraint from their consumers is likely the result of an aging core audience who still loves beer, but can’t hang as much or as often as they used to. On a small scale, Sparkling Hop Waters have begun to pick up steam as a product to market toward IPA fans looking to take time off from drinking, break up their alcoholic drinks, or simply combine their love of hop flavor with an every day sparkling water. Nostradouglas anticipates a number of breweries releasing their first Hop Water in 2024, while those already in the game begin to release new flavors built off additional hop varieties, fruit flavors or, lets bring this full circle, terpenes!
6. THC Confused
Back when THC wasn’t used in beverages, leaning into the dank puns made perfect sense given the relationship between hops and cannabis on the family tree. But now that THC is in fact being used in beverages, which will be sold in the same stores as beer, and perhaps under a local brewery’s name, Nostradouglas predicts that by the end of 2024 craft breweries will begin questioning whether all these cannabis references on beer makes sense anymore, given that they don’t (and can’t) contain THC. If consumers can mistake Hard Mountain Dew for regular Mountain Dew, they’re going to understandably confuse a weed-themed beer for a beverage actually having THC in it.
IPA is still a massive category by all stretches of the imagination, but the opportunity within it has really gotten tight. Customers are becoming more likely to grab established year round options at reasonable prices, where they know what they’re getting, and feel less compelled to roll the dice on the next new thing. That next new thing is THC and it’s driving parallel to the latest flavors in IPA, perhaps a little too close for comfort?