On-premise sales returning: what will happen to packaging needs?

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As we start to see loosening of COVID-19 restrictions for in person gatherings, craft beer establishments are starting to re-open their doors to in-person consumption. This will certainly give a boost to breweries and tasting rooms, and is a welcome change to those who have missed being able to congregate with friends in an inviting space away from home to enjoy a delicious brew. One question is what impact this may have on off-premises sales and the packaging industry that ramped up to support the increasing demand last year. 

 

Eric Pitts and Katherine Witrick looked at the effects that the pandemic had on brewery’s packaging in the United States. They found that in an effort to help support off-premises consumption options, laws were changed across many states last year to allow beer to be sold curbside, to loosen restrictions on home delivery, and allow to-go sales of alcohol. Who hasn’t seen bars and restaurants with large signs advertising their to-go alcohol options? Alcohol mark-ups add strongly to a restaurant’s bottom line, so this loosening of laws to allow take out sales were welcomed and needed by many establishments at a time when revenues were hard hit.  Time will tell if these changes to laws will remain in place after COVID, but we would assume restaurants will want to continue to offer this with food take-out orders, and customers will continue to want this option. 

 

Packaging of craft beer and cider for at home enjoyment saw changes in the past year in response to the COVID pandemic. The packaging industry rallied to support craft breweries who struggled to find ways to provide products to consumers to enjoy at home. In the year leading up to the pandemic, off premises sales were stagnant. Jessica Jacobsen interviewed many people in the brewing and alcohol industry and found that during the pandemic shut downs, however, off premises sales saw a 14% increase. Jacobsen also spoke to the fact that brands that had established themselves prior to the pandemic, those with good name recognition and a devoted following, were in a good position to offset some of their on-premises losses with stronger off-premises sales. Will this trend continue or will off premise sales drop off as people start returning to retail establishments? The answer to this question is not yet known, but exploring some of the changes to packaging and the emerging trends may provide some insight. 

 

A couple options that were used for packaging during this time were growlers and crowlers, which are smaller options. Crowlers are single use, which made them particularly popular during the pandemic. Growlers are repeated use, which creates sanitation issues that made them a less sought after choice in 2020. Also, in response to the dramatic change in business model brought on by the pandemic shut downs, many tasting rooms were converted to packaging centers to package product for off-premises consumption as found by Pitts and Witrick in their research conducted about how the packaging economy has changed during covid and will continue to change post covid. In terms of packaging materials for longer term shelf life, aluminum cans have become the containers of choice. They are less heavy than glass and allow no UV light to penetrate the beer, which could cause deterioration. They also cost less than glass. This preference for aluminum cans led to the 2020 “Candemic,” which we wrote about in a previous article, where cans were increasingly hard to find due to high demand and supply issues. Thankfully, supply seems to be keeping up more recently. Will the packaging industry, which was called upon to ramp up production to meet the ever growing demands during 2020, see changes in demand for their services as on-premises sales return? They hope the demand will stay strong even as on-premises consumption grows, and some trends in packaging might help. 

 

One aspect that Shayne Tilley wrote about in his article on new ways to adapt packaging designs he mentions that there are several interesting design trends expected for 2021 in aluminum cans. These include using stories presenting comically rude or “irreverent” characters. Brewers have been using mascots on cans for a while, but adding stories is a newer twist that allows a brand to establish their own unique style. Another trend is to spotlight the name of the product, so the name is the primary feature displayed on the can. Finally, cans are featuring unusual color pairings, unique textures, novel shapes and detailed and precise drawings. According to an article by Shayne Tilley on key trends in package design that craft brewers should know about, it is becoming increasingly important for can design elements to be unique and noticeable , so anything a brewer can do to draw attention is considered good marketing.

 

We can’t completely answer the questions we posed at the beginning of this review, but we can predict many beer suppliers, packagers and consumers will want to continue to have access to a variety of off-premises consumption options and hope the loosened laws will remain in place to help facilitate this!


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