Monday, August 27, 2012

Rant: Are Beer Drinkers Cheap?

At the Beacon Hill Wine & Gourmet in Melrose, a large portion of customers purchase beer and I hear some of their comments on beer prices. Plus, I have spoken to a number of friends and others about beer prices. Based on their comments, it seems to me that beer drinkers may be cheaper than wine drinkers. I am very curious as to why this might be the case.

In a usual six-pack of beer, each bottle is about 12 ounces and thus a six-pack is the rough equivalent of three bottles of wine. Many six-packs cost under $10, and even most of the higher end bottles cost less than $20. That would mean the six-packs are equivalent in cost to wines that run from $2-$7 per bottle, quite a low figure. Yet a fair number of people complain about these prices, which are comparatively very low.

There are some single 750ml bottles of beer which often cost between $10-$15, yet those are not the norm and are often seen as quite expensive. Yet many wine drinkers don't see any problem buying a bottle of wine that costs $10-$15. There are few beers that cost over $15 per bottle, yet you will find plenty of wines that cost more than $15. Why are there so few beers over that price point? Are most beer drinkers just too cheap to pay more than that for a brew?

There are a few exceptionally priced beers, such as the Samuel Adams Utopia, which can cost about $150 per bottle. This seems to be very popular and they seem to have little problem selling this product. But who is buying it? Is it only a tiny segment of beer drinkers, and maybe those who also enjoy wine? What would make beer drinkers, who generally seem to prefer low cost beers, be willing to pay so much for a beer?

Are the price variations between beer and wine due to the different costs of production? That might contribute a bit to the price, but we also know that reputation inflates the price of a number of wines far above the actual costs of production. Does reputation count so much less for beer producers? Is beer just less complex than wine, and thus not often worth as much as wine?

I am not a beer drinker, because I dislike the taste of most beer, so maybe I am missing something. Can anyone enlighten me?  Are beer drinkers cheap, or am I missing something?


Jason Phelps said...

Making a comparison between beer and wine in price terms can take two different forks.

On pure dollars to alcohol ratio, macro brewed beer is about 25-30% the strength of wine by volume. You end up paying about $4.60 for six cans, if bought in a 30 pack, compared to $11 for the single bottle of wine with the same kick. The quality differential here is wide open depending on what wine you buy. Bitching about the beer price here does make you cheap. The macro brewed beers offer me nothing so I'd opt for the wine, and even the mass produced stuff just for the bump in enjoyment it gives.

The other fork is a certain commitment to beer brewed with traditional and high quality ingredients. For that you have to stray away from the macro brews. They might be cheap but they don't have the attention keeping character that other beers do.

Once you get into craft beer territory the price issues become more interesting.

22 oz bottles of quality craft beer will average around 7/8% ABV so still 50-60% the pure alcohol of a bottle of wine. The typical prices her can range form $7 to $12 and then you realize you are paying more for for the beer than the same wine purely based on the buzz you can get. But the expression of the beer and what it is made from may outpace the wine and require you to slot in a different wine at a higher price point, but not always. The everyday drinker isn't likely to do this and thus their perception of it being more expensive. If the beer is well made and deserving of the price then bitching about it is likely ignorance. If the beer sucks then it may well be overpriced.

Real beer geeks are much more informed here and will pay even high prices for a single 22oz bottle of beer, especially small productions, cult beers and those with specialty ingredients. Price conversations amongst my brew friends typically come down to lamentations on how demand is driving up prices and some of those buyers aren't really well positioned to appreciate the purchase or how some breweries are pricing high but don't have the quality to match. Such is the business in both beer and wine.


Jason Phelps said...

I forgot to respond to your trailing questions. No beer is not less complex than wine. There is plenty of beer made that rivals wine for complexity. Studying beer can take a lifetime just like wine.

And high quality beer is made by lots of producers, most of them small, just like it is for wine. Brewpubs are some of the best places to try small production high quality beers that never see a bottle of enjoyment beyond the building they are made in. This is not as typical for wine.

Reputation is absolutely paramount in beer. Not being a beer drinker I'll forgive you for not knowing this one. Most of the named of breweries and beers at the top of the craft beer food chain would be unknown to you just like the names of top tier wine producers would be to the mostly craft beer drinker. Your sake knowledge is a good analog here. You've sought out that information and can wield it. Being ignorant of that industry and its products could be mistaken and result in marginalization of it. That's why we all have to get out and drink!


Richard Auffrey said...

Thanks Jason for the detailed comments. It does seem that the higher end beers are a tiny percentage of what you find in the wine world. It seems maybe 10%, or even less, of beers cost more than $20 yet there are a vast number of wines over that price point. With like the Utopia, there is a market for such expensive beers, but seems much smaller than the wine world.