The beer market dynamics in Russia is approaching zero, yet major brewers are divided into those who developed considerably in 2017 and those who considerably reduced their volumes. For instance, company Efes has managed to substantially extend their sales due to restrained pricing policy and activity in the modern trade. Heineken has also demonstrated an excellent performance promoted by significant increase of advertisement budgets launching a non-alcohol sort of the title brand and unusual activity in the economy market segment. Carlsberg and AB InBev have been focusing on margins and lost a market share of their inexpensive brands. Serious dependence on PET package and mass enthusiasm about Zhigulevskoe have negatively impacted the most of big regional brewers, that have been for the first time pressed by the leaders in the key sales channels, especially in Volga and Central regions. In the small business there has been a noticeable slowdown in appearing of new restaurant breweries, yet the number of craft breweries has been growing rapidly. In 2018, the beer market is likely to grow a little, while the share of AB InBev Efes may decrease due to the integration. ...
“Catalogue of Russian Beer Producers 2018” includes 1070 businesses ranging from large subsidiaries of international companies to rather small restaurant and craft microbreweries.The catalogue includes 32 large breweries, 75 regional breweries, 693 industrial mini- and microbreweries as well as 270 restaurant breweries. ...
Global hop marketA local alternative to mass beer suggested by independent brewers has been successful and is now altering the global market. Beer is becoming more diversified, so transnational companies have to accept the new game rules and to switch focus to young and fast growing markets. All these processes increased the demand for aroma and bitter hop as well as their acreage expansion on two continents. However now there appeared a downward trend of alcohol consumption in the world, so even special sorts can soon turn to be sufficient. In this connection the dynamic American hop market is already facing some problems. EU hop producers have become more cautious, they are not racing to exceed the demand and look forward with more confidence, judging by the contract terms.
Hop Market in RussiaGermany still dominates the Russian market, yet over the recent two years one has been able observe a continuous success of Czech hop suppliers. Their expansion and growing popularity of hops from the United States became the drivers of supplies growth in 2016 despite the preceding modest harvest crop in the EU, as well as the factor of relative stability in 2017. In this connection, in 2017, the ratio of the varieties continued to shift towards the aroma ones, and the supplies of Magnum hop and other alpha varieties were reduced. However, the import of bitter hop pellets is partially replaced by extracts, especially from the major beer manufacturers. Total volumes of alpha acid supplies, according to our estimation, decreased by approximately 5% and returned to the level of 2015. Barth Haas Group continues dominating the hop products market; HVG also increased its weight. At the same time, Morris Hanbury significantly reduced the supplies in 2017.
just the Answer – Anheuser-Busch InBev’s UK President
just-drinks: What makes you confident of being able to take on established players in the cider category?
Stuart MacFarlane: When you're the nation's favourite alcohol brand, consumers have raised expectations of everything. We've worked hard to make sure that our cider is significantly ahead of the industry benchmark. It's crisp and refreshing but not overly sweet. You would expect us to raise the quality benchmark of cider. It was important that we had a cider that performed better than our competitors, both in core cider and premium cider.
j-d: Isn't there a risk that you will cannibalise sales of your lager brands?
SM: You know, when we launched Beck's Vier I was asked that question, when we launched Stella Black I was asked that question, when we launched Stella 4% I was asked that question. The cannibalisation of Stella 4% is only around 4% to 5%. I'm very happy to have 95-96% of sales on that brand that are incremental.
Stella Cidre can be the flywheel for cider category growth. We will bring more premium drinkers into cider than any other brands can do, because they don't transcend other categories like Stella does. The Stella Artois brand can do what none of the other brands can do. This is game-changing, we are the first beer brand to move into cider.
j-d: Why are you launching it now?
SM: Well, it's taken us just over a year to develop it. Our consumers told us the time was right and the cider category is still growing by between 5% and 10% year-on-year.
j-d: Who are you targeting? Are you looking to extend the Stella brand to more women, for example?
SM: No, women are not a particular target. We're targeting premium drinks consumers from 20-somethings and upwards. We're less concerned about different demographics.
j-d: In terms of pricing and positioning, where will Stella Cidre sit in relation to other ciders?
SM: We are very focused on the premium end in both the on- and off-trade. Bottles will be the primary format, rather than draught. In the off-trade, it's up to retailers to set the pricing, but we expect to be priced competitively with the other big brands in the category.
It's very important to us that this can be premium and accessible. Premium brands like your Aspalls and Westons are never going to be totally accessible everywhere in the country, but we can do that. We want it to be available for consumers to share over a meal in a restaurant or a gastropub, as well as in the boozers - the community pubs.
j-d: It's three years since you took over as president of A-B InBev UK, at a time when Stella Artois had experienced problems. How do you perceive Stella's reputation today?
SM: Three years ago a lot was perceived to be wrong with the brand. But, in fact, 95% of our brand was right. Our job was to accentuate those positives. Obviously things were written about certain names given to the brand, names which, by the way, I find offensive, truly offensive. Stella is a quality brand and it remains the biggest selling alcohol brand in the UK.
j-d: What specifically have you done to reinvigorate the brand?
SM: We went back to basics. We've emphasised the quality of the brand and made sure that we accentuated the positives, including aspects such as eco-marketing.
As a company, we are leading innovation in drinks. Actually, I could argue that A-B InBev is leading innovation in the entire FMCG sector. We've launched Beck's Vier, Stella 4% and Stella Black. Beck's Vier was awarded the most successful launch in the on-trade, Stella 4% was the most successful launch in the off-trade. Anheuser-Busch InBev has grown volumes in the UK over the last three years and Stella Artois has been growing share.
j-d: As well as innovation and focusing on quality, have you sought to reduce the amount of Stella Artois sold at discount in the off-trade?
SM: We don't have control over pricing in the retailers, it's their job to set the prices. It's our job to make sure we've got the right quality. Many, many consumers have reappraised the brand.
j-d: A-B InBev has a reputation for cutting costs, some might say ruthlessly. How have you balanced that against building brands?
SM: I sell beer for a living, it's the best job in the world. A-B InBev is the biggest brewer in the world and I have Beck's, Budweiser and Stella. Yes, we have been cutting costs, but we are good at cost cutting and top-line growth. We are good at both. That's what makes us a better beer company than the others.
j-d: Do you still intend to close the Stag Brewery near London?
SM: The brewery was originally supposed to close last year, but we said a year ago that we would keep it open an extra year. Basically, we were brewing too much Budweiser to close it. We'll update on our plans in May.
j-d: So, has Budweiser's momentum continued in the UK, albeit from a low base?
SM: Up to the end of the third quarter of last year, it was storming. I can't comment on its more recent performance, because the company is in a close period [ahead of full-year and fourth quarter results announcement].
j-d: We've just seen that beer sales shrank again in the UK last year. What's your assessment of the UK beer market going into 2011?
SM: We are way too pessimistic in our industry. There are opportunities in beer and opportunities in cider. If more companies sought to find opportunities and to innovate more, they'd be more optimistic. I urge the people in our industry to find that opportunity. Other brewers need to start acting more like FMCG companies.
The number one problem that we face is the Government and the unfair tax burden on the industry. If there's anything I could change, it would be the Government's approach to our industry.
4 Feb. 2011