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.
Vietnam. 3 billion-liter beer market attracts more foreign breweries
A report from Kantar Worldpanel Vietnam, a market survey firm, showed that an annual two-digit growth rate has been maintained in the Vietnamese market for many years, which is much higher than the six percent growth rate of the fast moving consumer goods (FMCG) market.
More and more beer brands from Belgium and the Netherlands, Mexico and Germany, Italia and Japan, have appeared in Vietnam as the Lunar New Year nears.
Despite the high selling prices, import products have been selling well. Japanese Ashahi beer, for example, is sold for VND25,400 per can, Thai Hite VND24,400, German Oettingger VND32,500-42,700 and Belgium red Chimay VND110,000 per bottle.
Doan Dinh Hoang, a branding expert, noted that Vietnamese tend to drink more and more beer. “Foreign breweries must have realized that the Vietnamese market is very attractive and they have flocked here,” Hoang noted.
This is also the reason why the Japanese partner in Sapporo Vietnam has recently bought 29 percent of Sapporo Vietnam’s stake from Vinataba to become a 100 percent Japanese invested enterprise. Sapporo’s plant in Long An alone puts out 40 million liters of beer a year.
Mikio Masawaki, general director of Sapporo Vietnam, believes that the Vietnamese market is still strongly developing, predicting that the high-end market segment would grow by 70 percent by 2020 instead of 55 percent now.
He thinks that the biggest competition in the beer market next year will be in the high-end segment.
AB InBev, whose name has recently appeared in local newspapers as a party in the AB InBev – SAB Miller merger deal, is running a brewery in Binh Duong province which has the designed capacity of 50 million liters.
Nguyen Huy Hoang of Kantar Worldpanel Vietnam noted that foreign breweries have witnessed higher growth rates than domestic ones.
Hoang said taking over existing companies is a growing tendency in the market. Foreign groups, when entering Vietnam, would cooperate with domestic companies to take full advantage of the domestic companies’ network and good understanding about the market.
Later, they want to exploit the domestic market under their business strategies, and therefore, tend to turn joint ventures into wholly foreign owned companies.
Nguyen Van Viet, chair of the Vietnam Beverage Market, warned that Vietnamese breweries will have a difficult development period ahead as the competition in the market is getting stiffer.
“The luxury tax rate will be raised to 65 percent in 2016-2018 from the current 50 percent, which would bring bigger challenges to Vietnamese breweries,” he warned.
18 Dec. 2015