Cask ale heading for a premium future

While cask ale is experiencing welcome steady growth in volume, the premium category is doing particularly well. Adrian Tierney-Jones reports

As the Great British Beer Festival approaches there are welcoming indications that cask beer is holding its own, while the premium category is showing even better signs of good health.

Last autumn saw the start of the good news with Pete Brown's The Intelligent Choice making encouraging noises about the renaissance of cask ale. Despite a 5% decline in the total beer market, the report said that many cask-ale brewers were experiencing steady growth in their volumes, which meant cask ale was forecast to return to growth within the next few years.

This had a knock-on effect on the premium cask-ale category, which is 0.4% up in sales at the end of March 2008; this is according to recent information that industry data analyst AC Nielsen has collated using figures from several sources including themselves, the British Beer & Pub Association (BBPA), Society of Independent Brewers (Siba) and the Independent Family Brewers of Britain (IFBB). This may not seem much, but in the face of a continuing decline in beer sales, it is significant news.

"Premium ale seems to be holding up pretty well within the business," agrees Wadworth marketing manager Paul Sullivan. "We are seeing internal figures moving against a declining trend and, anecdotally, premium beer seems to be moving well at beer festivals and in sampling at our visitors' centre."

This positive view is echoed by St Austell head of marketing Jeremy Mitchell. "While we haven't seen overall growth of cask-ale sales this year within our 168-strong tied estate, the premium-cask category is performing much better than lagers and keg beers," he says. "Furthermore, the growth of the Tribute brand is still very strong, with volumes up

13% on 2007 at the end of May."

At the other end of the country in Yorkshire, Timothy Taylor managing director Charles Dent is also happy with things: "We are still enjoying growth — up 5% on the first six months of last year. While this is down on the previous year, given the difficult trading conditions that prevail today, we are very pleased that sales are still on the up."

The generally accepted industry definition of premium cask ale is any beer above 4.2% abv. This includes the likes of Marston's Pedigree, Draught Bass, Timothy Taylor's Landlord and Wadworth 6X. However, according to Nielsen's Graham Page: "There has grown a perception that the cut-off limit is 4.5% abv."

Enterprise Inns is one company that sees things this way. "To define premium we still talk about the alcohol by volume (abv) and would see premium cask ales as being above 4.5%," says its head of sales and marketing John Coe.

Talk with Fuller's managing director John Roberts, though, and you get a different perspective: "To me it's all about value and price. At 4.1% London Pride is technically in the standards category, but we would put it in the premium one. There are premium brands that are sold as cheap as chips, but if I take my dictionary and look up premium, it says, 'to be held in high esteem'. That would put London Pride in the category in my opinion."

Whatever the fine details of the definition, there's no doubt that the premium category is a success. Figures to the end of March 2008 had cask ale, in general, down 4% (with lager down 8%), but premium cask, which is about a third of the category, in growth. Justin Way, Marston's on-trade category manager says: "Recent trends show that we are seeing a revival, with movement away from lager into cask ale and stout. Premium cask ale is leading the charge as the only sector of the on-trade beer market in growth. This is driven by improved beer quality and genuine consumer demand for more variety, flavour and provenance in their beer."

This positive view is echoed by Campaign for Real Ale (Camra) chief executive Mike Benner, who said: "The market for premium cask ale is outperforming other sectors of the beer market, which is good news. With the overall market in decline, it's encouraging to see the decline of cask ale slowing and many people, including me, expect this to turn to growth sometime soon.

"Premium cask ale meets the needs of today's consumers who are sick of marketing-led global brands and more switched on by provenance, heritage, taste, natural products and localism. It is this, together with renewed interest in cask ale as a unique selling point for pubs, that will lead to growth."

What is driving this success? For a start, as Benner says, drinkers are showing more of an interest in where their pint comes from. Times are getting harder and people are drinking less. They want to know that what is in their glass is something special. A pint of a good premium cask ale costs between £2.50 and £3, while a decent bottle of wine in a pub can cost three times as much.

In many of the pubs where cask ale is sold, there is also a tempting element of choice. Drinkers quiz licensees about what guest ale is coming up next; cask-ale drinkers are less likely to treat their pint as just another commodity.

According to Paul Sullivan, the smoking ban has also played its part: "The drinking window for the current core drinker — male, affluent, 30-plus and likely to have a young family — is increasing due to the ban and the ability to access the pub with the family at the weekend." He also points out that a focus on local beer and a choice of flavours increases the appeal of premium cask ale.

"I put the growth down to consumers becoming more discerning," says Chris Lewis, director of marketing for Wells & Young's. "They are bored with run-of-the-mill standard lagers, and want to experiment with much more flavoursome beers. After all, why should a consumer pay £2.50 for a pint of standard lager in a pub when four cans of the same product can be purchased for the same price in the off-trade?

"This is where cask ale comes in — it can only be enjoyed in the on-trade, making it much more special and something to look forward to. Consumers also have more choice than they normally get with lager. For example, with refreshing golden ales such as Young's Kew Gold or Wells Bombardier Burning Gold, it opens up the market to women and those who previously only drank lager. It is giving them the choice to drink ale as an alternative at the bar."

The trend towards local produce, traceability, authenticity and taste is something that ticks all the right boxes for many drinkers. Benner says: "Cask-ale drinkers are also relatively well off — 78% are ABC1s and that group represents over half the UK population, so it is regarded as an upmarket product."

This is also something that is echoed in other commodities, as the success of farmers' markets clearly shows. There is a growing band of consumers that's becoming more discerning. In tourist areas, one of the first things visitors to the local pub ask is, "which is the local ale?" At the same time, regional beers such

as Pedigree, Adnams Broadside and Shepherd Neame's Spitfire have a cachet of good quality and taste.

"The appeal of cask ale is broadening out from the traditional picture of older drinkers and Camra enthusiasts to a more eclectic set of drinkers who include cask ale in their repertoire of drinking," says Justin Way. "This appeal is drawn by improved beer quality and consistency, and a trend in drinkers seeking to experiment with a variety of beer styles and flavours. This suits premium cask ale's craft-product credentials and natural-ingredient story."

According to Charles Dent new drinkers are emerging: "There is an increase in demand for Landlord among middle class 20 to 30-year-olds. These are young professionals looking for a more 'refined' taste. Could cask ale be the new lager?"

The last few years have seen brewers interacting with drinkers in a variety of ways. These include education, beer and food events, brewers touring their estates and consumers being allowed to taste before they buy. These things engage drinkers, drum up loya