Cider’s Craft Moment

National brands still lead in sales, but regional players are gaining.

Sonoma Cider (orchard pictured) estimates that about 75% of its audience is millennials.
Sonoma Cider (orchard pictured) estimates that about 75% of its audience is millennials.

At the Bushwhacker Cider pub in Portland, Oregon, co-owner Jeff Smith was once happy to stock the big domestic cider brands. Boston Beer Co.’s Angry Orchard, Anheuser-Busch InBev’s Johnny Appleseed, and later Stella Artois Cidre, MillerCoors’ Smith & Forge, and Heineken’s Strongbow were all part of his repertoire.

But tastes have changed at Bushwhacker, and today virtually every big domestic brand has been replaced by a dizzying array of more than 100 craft names like Apple Outlaw, Cider Riot, EZ Orchard, Dragon’s Head, and Grizzly Ciderworks. “My customers seem to be looking for the real thing,” Smith says. “People here are now far more educated about cider. They want to know about the farm that’s pressing the apples and the orchards where the fruit is grown, and they want to meet the cidermaker. Most of all, they now want the kind of dry cider that the big players rarely make.”

The craft/national brand divide is coming into sharper focus in the sales statistics. As the big brands piled into the category in 2013 and 2014, annual growth soared by 60% and more, according to Impact Databank. But in the 52 weeks ending December 30, 2017, the cider category was down 3% in value and 5% in volume, according to Nielsen data. Top brand Angry Orchard saw its sales fall 8% from the previous year. Woodchuck, owned by Ireland-based C&C Group, also lost ground and is ending its distribution partnership with Pabst Brewing Co. in the U.S., effective April 1-. Strongbow and Smith & Forge also declined. Although Angry Orchard, Strongbow, and Stella Artois Cidre still dominate cider volume, the fastest growth is now coming from smaller players like Bold Rock Hard Cider in Virginia, 2 Towns Ciderhouse in Oregon, and Ace Cider in Sonoma County, California.

“There’s no denying that local ciders now have a prominent place in the cider category and have had an impact on the larger national brands,” says Bridget Blacklock, director of marketing for Vermont Cider Co., which makes Woodchuck. “Just a few years ago we would have seen multiple SKU facings of Woodchuck on a shelf. As new brands came into the market and the local ciders emerged, some shelf space has been lost to other entrants into the category.”

Texas-based Austin Eastciders opened a new tasting room last November. The company shipped over 500,000 cases last year and has now expanded outside of the Lone Star State.
Texas-based Austin Eastciders opened a new tasting room last November. The company shipped over 500,000 cases last year and has now expanded outside of the Lone Star State. (Photo by David Hall)

Cidery Count Growing

Indeed, the proliferation of cider brands around the country has been startling. Michelle McGrath, executive director of the U.S. Association of Cider Makers, notes that there were just 146 registered cideries in the U.S. in 2010, compared to 820 today, with another 100 in the works. By comparison, the U.S. market has more than 5,000 breweries, and cider sales amount to just 2% of U.S. beer sales.

“The growth of the big national companies in cider a few years ago came very quickly, and an eventual decline was probably to be expected,” McGrath says. “Meanwhile, regional cider brands are doing well. We estimate that regional cider sales grew 30% in 2016 and another 30% last year, while the national brands mostly fell off. The regional brands today represent about a quarter of the market.”

Even that is hard to measure, considering that some of the smallest farmhouse cider facilities sell most of their inventory from their taprooms and at farmers’ markets—channels that Nielsen doesn’t track. At Bushwhacker, for example, Smith makes his own cider in a back room and calls it Forgotten Trail, selling it for $6 a pint on draft or $3.50 a 12-ounce bottle, with customers permitted to buy bottles for home consumption.

Another factor that’s hard to quantify has been the rise of hard sodas and hard seltzers in recent years. Brands like Not Your Father’s Root Beer typically are displayed adjacent to ciders and therefore compete for the same shelf space. “There’s definitely some significant retail real estate being devoted to hard sodas in stores,” says Alan Shapiro, the president and owner of SBS Imports in Seattle. “Many retailers still haven’t figured out how much space the cider category ought to have.” SBS sponsors big cider tastings around the country. The company’s Cider Summit event draws 3,500 people to Chicago’s Navy Pier each February, while Seattle’s Cider Summit brings in 2,800 attendees each September. “Our cider crowds were growing very quickly a few years ago,” Shapiro says. “Now we’re seeing a slower, more steady growth. But the category is still on the rise overall.”

Cider makers still show strong enthusiasm for their growth prospects. Andrew Blake, founder and co-owner of Blake’s Hard Cider Co. in Armada, Michigan, produced and sold 30,000 gallons of cider in 2013, his first year in business. That grew to 400,000 gallons in 2016 and to 630,000 gallons last year. He’s launching in three more states this winter—Georgia, Tennessee and South Carolina—to bring his total to 18, after a $2 million expansion doubled fermentation capacity. The farm and its tasting room and restaurants drew 800,000 visitors in 2017.

Flavors have played a major role in Blake’s growth. Its lineup of 22 ciders includes El Chavo, which is infused with mango and habanero peppers; Wakefire, made with cherries and orange peel; Black Phillip, which uses cranberries and blood orange; and Flannel Mouth, made from late season table and dessert apples. The 9% abv El Chapo is aged in Tequila barrels. Most of these ciders sell for $10 a 6-pack of 12-ounce cans, though the limited-edition El Chapo is offered in 500-ml. bottles for $9.

Blake's Cider offers 22 ciders, including Flannel Mouth, made from late season table and dessert apples. The company makes 630,000 gallons of cider annually and drew 800,000 visitors last year.
Blake's Cider offers 22 ciders, including Flannel Mouth, made from late season table and dessert apples. The company makes 630,000 gallons of cider annually and drew 800,000 visitors last year.

Explosion Of Flavors

Blake explains that the cornucopia of flavors is an authentic and natural extension for cider. “Here in Michigan we grow strawberries, peaches, plums, and raspberries, as well as apples, and it makes sense to incorporate them all into our ciders,” he says. His use of cans reflects a growing trend among cidermakers, many of whom are switching away from bottles, while his experimentation with higher-alcohol ciders may also be a harbinger. “People are enjoying both lower- and higher-alcohol ciders lately,” Blake adds. “We don’t have a strategy for higher-alcohol cider yet, but we’ll continue to explore it. There may be potential there.”

Cider makers continue to push the boundaries and develop new flavors and styles. In February, Woodchuck announced a new range of innovation-focused ciders called the Tank Series. The first limited offering, Pear Ginger, rolls out this month. Graft Cider, founded in New York’s Hudson River Valley in October 2016, now has 45 different ciders in its lineup. These include the Hot Tropic, a dry-hopped sour cider; Peaks & Valleys, made with birch bark, cinnamon, anise, and sea salt; and Endless Fields, which infuses grapefruit and lemon zests, elderflower, coriander, and pink sea salt (ciders are $12-$16 a 4-pack of 12-ounce cans). Graft produced and sold 2,500 barrels, the equivalent of 75,000 gallons, in 2017, its first full year on the market. Kyle Sherrer, a co-owner of Graft, says that the advent of sour beers motivated his desire to make sour ciders. “Our ciders have no sweetness at all,” he says. “We think this can be the next frontier in ciders, though consumers will need some education.”

Studies have shown that cider consumers are concentrated among one essential cohort: millennials aged 21-34. Dale Brown, proprietor of the research website, predicts that fruit and other flavors will only grow in importance in American cider. He also believes that hopped ciders like those found at Graft are strategically important. “One goal of cider makers is to draw beer drinkers to the category,” Brown says. “With hopped ciders, they can smooth the transition from beer to cider.”

David Cordtz, CEO and founder of Sonoma Cider, pegs millennials at about 75% of the cider audience. Younger women embraced the category early on, but Cordtz says the demographic has expanded to include younger men. “Guys in our tap room will start the evening with an IPA, then switch to cider and finish the evening with a stout,” he says. “It’s a fluid situation.” To draw the hardiest beer aficionados, Sonoma even offers an Imperial cider at 10.2% abv in 500-ml. bottles, retailing at $13.

The California Cider Co.’s Ace cider represents the new generation of craft ciders developing a national presence. The company sold 2 million gallons of cider in 2017, up from 1.6 million gallons in 2016, with availability in 46 states. Its 6-packs of 12-ounce bottles hit the right price points—$10-$11—and its flavors, ranging from pumpkin to pineapple, have found a ready following.

Vice president of production and operations Jason House estimates that Ace is the U.S. market’s seventh-largest cider brand. He notes the declines by many of the major brands ahead of Ace in the rankings, but thinks that may be a temporary lull as consumers cycle through hard sodas and eventually return to cider. “It was the advertising and marketing by companies like Boston Beer that got consumers thinking about cider in the first place,” he says. “They helped make the category what it is.”

Another rapidly growing regional cider player originated far outside of the traditional cider belt. Austin, Texas-based Austin Eastciders, founded in 2013, shipped over 500,000 cases last year and claims to be the No.-1 craft cider brand in the Lone Star State. In addition to Texas, Austin Eastciders is sold in Oklahoma, Philadelphia, New York, Tennessee, Virginia, Maryland, and Washington, D.C. Major accounts include H-E-B, Kroger, Target and Whole Foods. Although the company doesn’t have a national presence just yet, it’s moving steadily in that direction.

Austin Eastciders specializes in dry ciders with about two-thirds less sugar than their sweeter competitors and have no artificial flavors. The ciders are made using European cider apples, Washington state apples, and wine yeast. The Austin Eastciders portfolio offers six expressions, including Original Dry, Texas Honey, Hopped Cider, Blood Orange, Pineapple, and the new Ruby Red Grapefruit, in addition to some limited releases. The ciders are available in 6-packs ($10) and 12-packs ($17) of 12-ounce cans, and on draft in the on-premise. The company has also been developing its site as a destination and opened a new 2,000-square-foot tasting room at its Austin base last November.

Sonoma-based Ace Cider (co-owners Jeffrey House and Angela House pictured) is a leader in the new generation of large-scale craft ciders.
Sonoma-based Ace Cider (co-owners Jeffrey House and Angela House pictured) is a leader in the new generation of large-scale craft ciders.

Traditional Methods

As it is, the category has numerous product segments. There are still traditional cidermakers like Farnum Hill in Lebanon, New Hampshire, where co-owner Stephen Wood continues to make all his cider from the authentic bittersweet and bittersharp apples used in Europe. He has steadfastly refused to add fruit flavors or other additives and is happy to stay small, selling just 6,000 2.25-gallon cases last year. Wood earns more money growing rare apples such as Dabinett, Wickson and Yarlington Mill on his 100-acre property and selling them to other cidermakers who are seeking out authentic English-style tastes. However, he sees potential problems with some of the newer generation of cideries. “They’re putting things like hot peppers into their ciders,” Wood says. “That might make a splash initially, but I don’t think you build a cider-loving audience for the long term with additives like that.”

Still, the expansion of cider styles shows no signs of slowing down yet. One burgeoning trend that may have staying power is the introduction of rosé ciders. Some companies are making rosés from red-fleshed apples, while others are using flavorings. One of the more promising entrants is from MillerCoors’s Crispin brand, which unveiled its rosé offering in January. “We see a big opportunity for Crispin Rosé with female drinkers,” says Ashley Selman, vice president of brand marketing at MillerCoors. Strongbow also introduced a rosé apple cider in February.

Although ciders can do well in the on-premise, some dedicated cider establishments have struggled. The cider community was hit hard with the announcement in December that New York City cider pub Wassail was closing after a three-year run. Daniel Pucci, Wassail’s beverage director, believes that cider-dedicated pubs can continue to thrive elsewhere, though he thinks that most cideries will be investing in tasting rooms of their own. “You can make more profit selling through your own place than through the wholesale model,” Pucci says. “And if you get customers to spend a couple of hours eating and drinking at your venue, you can get them very engaged in your brand.”

Sometimes the pub versus tasting room distinction gets blurred. Two venues in Washington, D.C., Anxo and Supreme Core, are examples of that. Anxo makes its own cider, with volume expected to hit 30,000 gallons this year, up from 4,000 in 2017. Co-owner Sam Fitz has taken local sourcing to new limits by planting apple trees in neighbors’ yards around the city. “We want to make D.C. our orchard,” he declares. Over at Supreme Core, co-owner Kyle Crosby is content to source his apples from fruit growers in Virginia.

There are now over 800 cideries in the U.S., and regional brands make up about a quarter of the market. The Washington, D.C.-based cidery Anxo plans to produce 30,000 gallons this year.
There are now over 800 cideries in the U.S., and regional brands make up about a quarter of the market. The Washington, D.C.-based cidery Anxo plans to produce 30,000 gallons this year.

In the Chicago suburb of Evanston, Illinois, Farmhouse Restaurant offers a full menu of drinks, but the cider on draft is virtually all made from organic apples grown by co-owner T.J. Callahan at his farm near Mineral Point, Wisconsin. Priced at $8.50 a 10-ounce glass, the ciders come with obscure names from unfamiliar apple varieties, though Callahan says his urban audience is interested in such ciders. “This is a very affluent and sophisticated downtown crowd familiar with other sustainable restaurants in the neighborhood, and they buy into our mission,” he says.

Nearby at West Lakeview Liquors, a single-location retail shop with a broad assortment of ciders, buyer Erin Riley has deprioritized stocking national cider brands in favor of craft offerings and imports. She carries boysenberry- and elderberry-flavored ciders from Peckham’s Cidery in New Zealand ($13.50 a 500-ml.). That price might seem expensive, but Riley says it’s right in the middle for the store’s cider sales. “We’re seeing so many new flavors, and people are willing to pay for them,” Riley says. “It reminds me of where the craft brewing movement was five or 10 years ago, on a smaller scale.”

When craft beer began to enter the national arena, the big brewers responded by buying up small players. The same thing has already begun to happen in cider. MillerCoors acquired Crispin cider in 2012. More recently, the Agrial Group, a leading French agri-business cooperative, bought The Seattle Cider Co. in late 2016. This January, MillerCoors bought Aspall Cider, an English cidery that was owned by the same family for three centuries. Last fall, Anheuser-Busch InBev took full control of Michigan-based Virtue Cider after several years of owning a partial stake. “We wanted the full resources of Anheuser to help grow Virtue, and I think for them we filled a gap in their cider business,” says Virtue founder Greg Hall. “But they won’t let us grow too fast. We’re in just 15 states, with a focus on the Great Lakes and Mid-Atlantic regions. Virtue is still growing like a craft brand.”

Considering the recent sales trends, that seems to be cider’s sweet spot.