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Imported Beer: Category Takes Flight

Posted on  | November 1, 2007   Bookmark and Share
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With consumers increasingly trading up to better quality imported beers, the category is just beginning to soar.

“We see a continued trend of more consumers for imported beer,” said Jeff Grindrod of Brand Action Team, a firm that conducts proprietary research in the beer category. “We found that 19-percent of beer drinkers are drinking more regular imports and eight percent are drinking more light imports. Overall, 30-percent more people have consumed imports so far this year than last year, and they’re willing to spend more,” he noted.

Grindrod and his team are so bullish on the imported beer category in the U.S. that they held a one-day conference on the subject in London in mid-October. The U.S. Drinks Conference was billed as an opportunity for “strategies for successful entry and growth in the U.S. drinks market.”

The light import category mentioned by Grindrod is becoming increasingly important, led by Heineken Premium Light, which sold 7.5 million cases in 2006.

“The real story of the import category is that the high-end is growing and will continue to grow,” said Bill Hackett, president of Crown Imports (Corona, Modelo, Pacifico, St. Pauli and Tsingtao). “There’s plenty of room to grow and the import light category is underdeveloped. I have to tip my hat to Heineken with their success with Heineken Premium Light.”

Mike Browne, marketing director of International Brands at Miller Brewing, said that he sees consumer trends showing premiumization and a trade-up by consumers in all drinks.

“The urban sophisticates, with higher incomes and educational levels, are all raising their choices in beverages,” Browne said. “Our tracking shows the consumer buying more, drinking less and spending more.”

A new fact about imported beer is that some brands, such as Corona and Heineken, the leading imports, are now considered mainstream beers by many consumers.

“The household penetration trends are valid and clear,” Browne said. “Imports have the same penetration rate as domestic brands, but not at the same quantity. The imports are well accepted by mainstream consumers of beer. There’s plenty upside for us to capture the share of growth to come — not to steal share.”

Jim Sloan, vice president, Star Brand Imports (many brands, led by Paulaner and Hacker-Pschorr), said that imports have developed fast and broad and will probably segment again. “Heineken and Corona have about 30-percent of the import segment,” Sloan said, “leaving 65-percent to about ten brands. The rest is fragmented. With Heineken and Corona being perceived by consumers as almost like mainstream brands, it’s up to the rest of us to make a beer drinking occasion a special occasion to order our beer.”

“This has been a good year for imports,” said Dan Tearno, senior vice president for corporate relations at Heineken USA. “It’s been a decade of cycle between craft beers and imports. Both these segments of above-premium beer have done well.”

The rise of craft beers has helped all imports, not just the large players. “We’ve always tracked with the big guys,” said Joe Lipa, national sales manager of Merchant du Vin, importers of high-end European beers since 1978. “There’s now a new dynamic with the crafts solidifying their position, and this makes our position deeper. Even the rise in spirits has helped us as consumers traded up to better drinks.”

One major drawback for beer importers was stated by John Lennon, president of International Beverage Holdings Ltd., which imports Chang Beer from Thailand, new in the U.S. this year. “It’s challenging for newer imports to find market access given the level of brewer and distributor consolidation. We see an opportunity in the U.S. for us with the 5,000 Thai and Southeast Asian restaurants.”

The Major Importers

Heineken USA
Heineken Lager, Heineken Dark Lager, Heineken Premium Light, Amstel Light and Buckler non-alcoholic brew are the Dutch brands. The company is also the exclusive importer, marketer and seller of the Mexican brands Dos Equis Lager and Amber, Tecate and Tecate Light, Sol, Carta Blanca and Bohemia.

Heineken sold 65 million cases last year. Heineken Premium Light continues to lead imported light beers. A new 12-ounce slim can was introduced for HPL this year, as well as a new package. Dos Equis, the only Mexican beer sold nationally as a draft beer, is being promoted with the “Most Interesting Man in the World” campaign.

The Heineken Draughtkeg debuted last June and the Heineken Premium Light Draughtkeg came out in August. These home keg systems keep beer fresh for 30 days, dispensing beer from the top of the keg utilizing an internal CO2 system.

Anheuser-Busch
A-B became a major player in the last several years with both acquisitions and alliances in the import beer category. A huge deal occurred this year when A-B was named the exclusive importer of the InBev brands, which include the Beck’s beers, Bass Pale Ale, Stella Artois, Hoegaarden, Boddingtons, the Leffe beers, Lowenbrau, Staropramen and Tennent’s Lager. Last year, A-B took on Grolsch, Tiger, Czechvar and Harbin (owned by A-B).

“We’re focusing on successfully integrating the InBev brands into the A-B portfolio,” said Marlene Coulis, vice-president of brand management. “We have a wide spectrum of beer flavors for different palates and we’re bringing awareness of these brands to our consumers.”

Some new marketing plans from A-B include the Grolsch swing-top campaign, a Christmas sampler with the InBev Belgian brands and a brand-new international website for Stella Artois.

Star Brands
A sister company to Heineken USA, Star Brands carries imports that are owned by Heineken worldwide, including Paulaner, Hacker-Pschorr, Moretti, Zywiec, Murphy’s, Affligem, Edelweiss, Starobrno, Fischer and Kalik.

Sloan of Star Brands said his company is looking to see “how broad and deep we need to be and how big with different styles and countries. Everybody wants into the U.S. market.”

Star Brands is now undertaking a soft roll-out of Kalik from the Bahamas, concentrating on beach markets up the East Coast. Affligem from Belgium has been on draft in the U.S. since 2006, and Affligem Noel will be on draft on the East Coast for the first time this season. Sloan said Star Brands will introduce more seasonal beers from its many breweries. Paulaner & Hacker-Pschorr may arrive in swing-top bottles, and Fischer Blonde has just rolled out.

Miller Brewing
The “World Beers” line from Miller includes Pilsner Urquell, Peroni, Aguila, Cristal, Cusquena and Tyskie. Additions may come in the future.

Pilsner Urquell is “pushing the upscale end of the category in grocery and retail,” Browne said. “Peroni is expanding its footprint in big cities and nightlife culture as a ‘style beer,’ and we’re introducing new markets for Peroni, as well as draft and a new 12-pack.”

Crown Imports
Along with the best selling imported beer in the U.S.—Corona—Crown Imports also has Modelo, Tsingtao, St. Pauli and Pacifico in its portfolio.

“As the domestic category is homogenized,” Hackett said, “it gives us a point of difference. In high-end category management, we ask retailers to put these beers in front of consumers and allocate space. The bottom line is value to the retailer. With even a small bit of training to the retail staff for up-selling these beers, it brings more dollars to the retailer or bar owner.”

Merchant du Vin
Although he carefully distinguishes his company from the “large players,” Lipa of Merchant du Vin has a formidable range of quality beers: Samuel Smiths, Ayinger, Westmalle, Orval, Rochefort, Lindemans, Melbourne, Greens Organic, Pinkus, Traquair and Zatec.

“It’s huge to the retailer to carry better beers,” Lipa said, “and also for on-premise with beer menus. This helps the import category immensely. The new consumer is not price-conscious, but is image and quality-conscious. For the retailer, it’s ‘How high can I sell it?’”


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