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.
Senior politician puts future of PET in Russian beer market in doubt
Russian deputy Viktor Zvagelsky is introducing a bill that would ban sales of PET beer bottles by January 1, 2013.
As part of ongoing efforts to fight Russia’s alcohol problem, the bill aims to prevent sales of big volume bottles and is being accompanied by restrictions on high-strength beer and night time sales.
Nick Waite, head of market research at Pira, which has just published a study on PET in the beer market, said: “There is a good chance that the law will be passed.”
If the law does come into force, it is likely to have a major impact on the PET beer market globally as Russia is one of the biggest markets in the world.
Ironically PET had established such a major foothold in the country because of previous government policies to fight alcohol abuse.
Waite explained: “You had a significant reduction in glass bottle capacity in Russia at the time of Gorbachev's anti-alcohol crusade in the 1980s and the effect was that glass bottles were reused time and time again, sometimes showing signs of damage/staining, and the result was that glass lost some of its cachet and Russian consumers were a bit more open to the idea of PET.”
Despite the potential setback in Russia, Pira expects that PET will continue to become more popular in global markets as technical improvements make the packaging option more attractive. For example, oxygen scavenging closures can now be used to remove oxygen throughout the life of a product so a PET packaged beer can have a lower oxygen content on the shelf than it had when first filled.
Global growth forecast
Overall Pira predicts that global PET beer bottle consumption will grow at a compound annual growth rate of 5.3 per cent to reach 7.7 billion bottles by 2015.
PET has plenty of potential for growth as it currently holds just 2 per cent of the global beer packaging market. Asia had been tipped as the big driver for future growth but Pira said that recent growth in China has been less than what some had hoped for.
Waite said: “Consumers new to beer in China tend to prefer beer in glass as glass has the same kind of prestige status as in the west.”
He added that “the jury is out” on the potential of PET beer bottles in China but Pira is more optimistic about other markets. Brewers are preparing for a big PET push in India and so growth there is expected to be high.
And in mature markets PET is being used more and more to package beer. Waite said: “PET is increasingly used for the packaging of beer sold at outdoor events. PET is more suitable than glass here for safety reasons more than anything as it is unbreakable, but it is also easy to carry around. Safety and convenience elements may in time lead to PET bottles being used in nightclubs although to date it has not made significant inroads here.”
11 May. 2011