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.
Champion Breweries notifies NSE of Consolidated Breweries’ acquisition bid
Consolidated Breweries plc, a subsidiary of Heineken NV Champion Breweries, said that the discussions, “if successful, could lead to a transaction that will be subject to the relevant legal and regulatory approvals, and will notify The Exchange as it becomes aware of further details.”
It will be recalled that The Netherlands-based brewer, Heineken NV, had announced in January 2011 that it bought a controlling interest in five breweries in Nigeria, a move that most analysts see as a strategy to quickly expand its presence in Nigeria - considered one of the world’s biggest beer markets yet to be fully explored.
The acquisitions, according to agency reports, raise Heineken’s market share in Nigeria to approximately 68 percent, giving it a capacity of close to 16 million hectoliters.
Though Heineken did not provide an estimate of the value of the deal when it was announced in January, a report in the Washington-based Wall Street Journal had quoted an analyst at SNS Securities Richard Withagen as saying it was worth more than $649 million or N101 billion. Company spokesman John Clark said Heineken acquired the breweries through a competitive auction process.
Heineken already owns the Star and Goldberg brands in Nigeria, where its main rival is SABMiller plc. SABMiller and Diageo plc, which markets its Guinness stout in the country, couldn’t immediately be reached to comment on whether they were involved in the auction.
Nigeria’s beer market, in a country with a population of about 150 million, has grown nine percent annually for the past 10 years. Heineken estimated that the total size of the Nigerian beer market was 16.5 million hectoliters in 2009. The five breweries will increase Heineken’s capacity by 3.7 million hectoliters.
ING analyst Gerard Rijk said the purchase is a good move as it will reduce Heineken’s competition and enable the company to expand in a highly profitable market. Mr. Rijk estimates Nigeria is responsible for around two thirds of Heineken’s profit in Africa.
Heineken plans to consolidate the newly acquired breweries into its existing Nigerian business structure in 2011. Heineken already own majority stake in Nigerian Breweries Plc.
19 Apr. 2011