10+1 trends of Russian beer market 2015-2017Despite of the moderately negative prognoses for 2017, the beer market can be stabilized soon. Yet the years of the negative dynamics have resulted in marketing being limited just to “optimization” and the art of balancing between price and volumes. Bigger supermarkets share means stronger trade marketing. These processes are connected to the majority of the described trends. At the same time, the federal brands inflation leads to searching for new tastes, sales channels and contact formats that expand the product range and diversify the beer market, but do not imply a substantial volume increase. Let us enumerate and further discuss the ten trends of the beer market we can see in 2015-2017 as well as the major event of 2017.
Beer market of Ukraine 2017In the first half of 2017, the Ukrainian beer market goes on decreasing slowly. Yet, the companies manage to compensate their lost volumes by raising prices and improving the sales structures. This results in the mid price market segment reduction while the sales of premium brands are rising. These processes are connected to position strengthening of companies Carlsberg Group and Oasis and the market share reduction of Obolon. Most of the novelties by the market leaders belong to craft or hard lemon categories.
Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Cheers to the Asian beer market
Mr Soren Ravn, managing director, Carlsberg, explained: "We are coming with a brand new communication so we can help fuel the (market) growth in Singapore."
The Danish brewer acknowledges that Singapore is one of its key markets for the Carlsberg branded beer, with the high number of expatriates here who know about international beer brands and the different beer types.
But analysts say markets like Singapore are just part of an Asian regional strategy in which brewers are actually looking further north at China, which consumes 40 billion litres of beer annually, or about one quarter of global beer consumption.
Research firm Spire Research & Consulting says China's beer consumption is set to expand at a compounded rate of 5 to 10 per cent over the next three to five years.
The country's economic growth is overflowing into a booming beer industry as its growing middle class and increasing discretionary income makes it the biggest consumer of beer in Asia and the fastest rising.
"China is very much a localised beer market, so conditions differ very much by locality and barriers to entry differ according to locality as well," said Mr Leon Perera, group managing director at Spire.
"Very often access to distribution, to retail outlets, tends to be influenced by local authorities, by local companies. That's why the preferred entry route for any foreign companies is through acquisition," he added.
Experts also point to other growing markets in the region like Vietnam and India. That is reflected in companies' expectations, like Carlsberg, which hopes Asia will account for up to one quarter of its group global revenue in five years' time.
That is up from the 5 to 10 per cent that Asia contributed last year to the company's US$11 billion (S$13.8 billion) sales.
But Mr Perera cautioned that the outlook just might not be so bubbly.
"The headwind or the obstacle that this growth might encounter … is really health consciousness, across all F&B research, as an economy matures, health consciousness increases to the point that it becomes an absolutely critical factor, affecting purchasing decisions by consumers," he said.
11 Apr. 2011