| Thu 17 Apr 2003, 9:15 | | Premium beer defined by image not quality |
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Premium beer defined by image not quality
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The growing number of discerning drinkers, who pay more to drink less, presents brewers new opportunities
Consumer Industries Editor
BEER drinking has ceased to be the sole preserve of the quantity consumer who identifies with a masculine, down-to-earth image.
The growth of a more choosy beer drinker, willing to pay more to drink less, is creating a host of new opportunities for brewers.
The premium-market segment in SA is growing at about 16% a year, according to AC Nielsen figures. While this is still an extremely small segment of SA's total beer market, it is attracting more than its share of marketing and corporate activity.
Recently there has been a realignment of brands between SA Breweries (SAB) and Namibian Breweries (Nambrew), with Nambrew taking over Heineken's distribution in SA from SAB. There have also been numerous new product launches in the premium market in the past two years, particularly of stouts and light beers.
Guinness, for example, has just launched Guinness Extra Stout, a bottled stout which is being marketed on the basis that it has a bolder taste "that the lager-swilling masses may find too much of a challenge", a release from its public relations company reports. The payoff line for its advertising campaign is "the less-preferred beer".
There are some differing views, though, on whether the premium market is defined by price, quality or image. SAB public affairs manager, Adrian Botha says it is definitely determined by price, and that is how AC Nielsen measures it.
Mitchell's Brewery of Knysna MD Dave McRae says premium beer is defined not by price but by quality. He classifies Amstel as a premium beer because its brewing process, under licence from Heineken, is different from a mass-market beer, not because it sells at a higher price than Castle Lager.
Birkenhead Brewery marketing manager Andy Mitchell says premium beer is defined by both price and quality. Castle Lager is a good-quality beer by international standards but from a flavour point of view it is quite bland compared to some of the other brands. It is brewed to appeal to a mass market. Amstel and Heineken are not that different in quality, but are perceived to be premium quality. Marketing also plays a role in determining premium beers, he says.
The size of the premium market is also a matter of some debate. According to AC Nielsen figures, it is 5,9% of the total beer market in SA. Other estimates range from 2% to 7% of SA's total beer market. The total volume of beer sold in SA last year by SAB and Nambrew was about 25-million hectolitres, which puts the size of the premium segment at between 500000 hectolitres and about 1,75-million hectolitres or, based on AC Nielsen's percentage, 1,475-million hectolitres.
Market share claims also vary. Nambrew's shares has been put at about 30% and SAB's at a similar level. Botha, though, says SAB's share of the premium segment is 72,4%, based on Nielsen figures.
Windhoek and Amstel are regarded as premium but not super premium brands. Other brands in the broadly-defined premium segment, some of whom may be super premium, include Bavaria Brau, Heineken, Beck's, Guinness and Stella Artois, as well as a number of local microbreweries. The only figures available for these other brands are that Heineken says it is selling about 100000 hectolitres in SA and Birkenhead's Mitchell estimates that the nine or so microbreweries in SA produce about 10000 hectolitres a month.
Distribution and marketing hurdles mean the microbreweries are unlikely to grow significantly, he says.
Apr 17 2003 07:20:20:000AM Charlotte Mathews Business Day 1st Edition
Thursday
17 April 2003
