Archive for January 24th, 2008

Bologna, anyone?

You were not very helpful when it came to beery places in Riga, ladies and gentlemen. Perhaps you know more about Bologna?

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There is some interesting research being done on the various beer markets, but it usually comes with a hefty price tag. Take the reports from Minte, who have recently published an overview of imported beer in the US market.

On their web page you’ll find just the table of contents and an outline, with a few items that caught my eye:

  • Why domestic craft beer threatens market sales and what its popularity can teach imported beer manufacturers
  • Beer energy drinks – the rise of a new segment (Son of low carb? Ed.)

To read the rest, I would have to fork out $ 3500, money I would rather spend on beer.

Luckily, there are publications writing about reports like these, and I found some coverage in the Marketing Daily.

Between 2001 and 2006, imported beer’s market share increased by 2.3%, which the consultancy says is the highest market share gain among all alcoholic beverages.

Mintel says imported-beer sales in the U.S. will grow 5.9% through 2012. A full 26% of beer drinkers imbibe imported beer.

The firm says import beers are benefiting from consumers’ upgrading to brands like Stella Artois, and “consumer inclination to try new and small [import] brands.” The firm says that Chinese brand Tsingtao, Czech brand Pilsner Urquell, German brands Hacker-Pschorr and Paulaner Biers, Italian brands Moretti and Peroni, Japanese brand Sapporo, Dutch brand Grolsch, and British brand Newcastle Brown Ale all have boosted U.S. sales and market share since 2002.

Mintel says the up-grade trend is being driven–as in other CPG, appliance, and auto market segments–by the expansion of higher-income households in the U.S. The firm notes that from 1999-2006, the number of households pulling in over $75,000 increased by 50%, or nearly 12 million.

The consultancy also says import-beer growth is being spurred by demographic diversity in the U.S., with Hispanic and Asian populations “considerably more likely than the average” to call for a beer from their country.

Mintel says four Mexican brands–Corona, Carta Blanca, Modelo Especial, and Tecate–contributed 41 million cases, or 55% of the total growth of 76 million cases, during 2002-06.

The challenges to import beers and domestic mass-market brands come from spirits and wine, and from the proliferation over the past decade of microbrewery “craft beers” like Magic Hat, Brooklyn Breweries, Sierra and others. Mintel quotes the Brewers Association’s stats saying craft beer volume sales grew 12% in 2006.

Mintel says craft beers attract both beer drinkers and wine and spirits drinkers because of the broad–sometimes wild–array of flavors and types, sophistication, full-bodied taste and higher-than-average alcohol content.

Interesting. To give my interpretation of this, it means that there is a part of the market that want beers similar to the ones they know. They want a B** with a foreign label, and Tsingtao, Moretti, Peroni and Sapporo can do that nicely. No flavour or aroma to offend anyone. To a certain extent you can charge higher prices for what is believed to be premium as well.

But to face the challenge from the domestic craft beers, some of the players have to look to European craft beers, too. Sure, there are small importers who focus on this, and there are Belgian beers widely available. But there is a potential here for real premium beers from Europe. For some brewers I think it is a question of taking the risk of scaling up their operation.  If they want to, now is probably the time to do it.

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