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Beer - UK - December 2017

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Beer volumes expected to bounce back and values forge ahead in 2017
Figure 1: Forecast of UK value sales of beer, 2012-22
Lager sales propped up by the off-trade
Ales, bitters and stouts also on the march
The off-trade passes the on-trade in volume sales of beer
Beer duty continues to rise
Many people are cutting back on alcoholic drinks such as beer
Companies and brands
AB InBev consolidating as it looks to further its leading position
Figure 2: UK retail value sales of the top 10 beer brands, 2016/17
Ale and stout are key battleground for craft brands
Craft NPD activity is widespread
Low- and non-alcoholic beer launches on the rise
Beer adspend falls away in 2016
Heineken is the leading beer advertiser since 2013
The consumer
62% of Brits drink beer
Figure 3: Usage of types of beer, September 2017
Relaxing at home and pub drinks are top beer occasions
Promotions/special offers and recommendations are the best way to encourage trialling
Glass bottles remain the most popular packaging type
Consumers define craft beer in a number of ways
Figure 4: Factors which define craft beer, September 2017
Almost half of beer drinkers want a certification for craft
Two in five beer drinkers would prefer ‘schooners’ to pints
Figure 5: Attitudes towards beer, September 2017
What we think
ISSUES AND INSIGHTS
Schooners could boost the appeal of on-trade
The facts
The implications
Craft’s ongoing growth now calls for greater structure
The facts
The implications
Lower-/non-alcoholic beers set to become bigger business
The facts
The implications
Online retailing provides an outlet for a competitive market
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Growth expected in beer volumes in 2017
Lager sales propped up by the off-trade
Ales, bitters and stouts are on the march
The off-trade passes the on-trade in volume sales of beer
Beer duty continues to rise
Many people are cutting back on alcoholic drinks such as beer
MARKET SIZE AND FORECAST
Beer volumes expected to bounce back and values forge ahead in 2017
Minor fluctuation in beer volumes over 2012-16
Inflation fuels value growth in 2017
Figure 6: Total value and volume sales of beer, at current and constant prices, 2012-22
Lager remains the dominant segment of the market
Beer values expected to continue rising
Figure 7: Forecast of UK value sales of beer, 2012-22
Figure 8: Forecast of UK volume sales of beer, 2012-22
MARKET SEGMENTATION 
Lager sales propped up by the off-trade
Minor fluctuations in total sales mask on-trade decline
Modest support from low-alcohol beers
Figure 9: Total value and volume sales of lager, at current and constant prices, 2012-22
2017 looks set to be a better year for lager
Figure 10: Forecast of UK value sales of lager, 2012-22
Ale/bitter sales benefiting from the craft boom
Figure 11: Total value and volume sales of ale/bitter, at current and constant prices, 2012-22
Figure 12: Forecast of UK value sales of ale/bitter, 2012-22
Stout/porter sales bounce back
Figure 13: Total value and volume sales of stout/porter, at current and constant prices, 2012-22
Figure 14: Forecast of UK value sales of stout/porter, 2012-22
CHANNELS TO MARKET
The off-trade passes the on-trade in volume sales of beer
Off-trade volume growth expected to continue
Figure 15: Value and volume sales of beer, by channel, 2012-17
MARKET DRIVERS
Beer duty continues to rise
Figure 16: UK excise duty rates for beer and other alcoholic drinks, 2007-17
Rising costs put pressure on producers and consumers
An embattled on-trade industry
Rising costs
Pubs put more focus on food
Many people are cutting back on alcoholic drinks
The continued rise of craft beer
Population changes could impact the market
Figure 17: Change in age structure of the UK population, 2012-17 and 2017-22
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
AB InBev consolidating as it looks to further its leading position
Mixed fortunes for Heineken, Carlsberg hit by delistings
Ale and stout are key battleground for craft brands
Craft NPD activity is widespread
Low- and non-alcoholic beer launches on the rise
Beer adspend falls away in 2016
MARKET SHARE
AB InBev consolidating as it looks to further its leading position
Stella Artois grows despite delistings
Budweiser leaps ahead
Corona and Becks see mixed fortunes
Figure 18: UK retail value and volume sales of the leading lager brands, 2014/15-2016/17
Mixed fortunes for Heineken
Foster’s struggles under range reviews
Mixed performances from world beers
Tough times for Carlsberg
Molson Coors enjoys strong sales growth
Growth among other brands reflects the rise of craft
Ale and stout are key battleground for craft brands
A fragmented segment
Revival in fortunes for Guinness
Figure 19: UK retail value and volume sales of the leading ale and stout brands, 2014/15-2016/17
Mixed fortunes among the other ale and stout brands
LAUNCH ACTIVITY AND INNOVATION
Craft NPD activity is widespread
BrewDog and Fullers look to collaboration
Innis & Gunn explores new approaches to barrel-ageing
Traditional operators move with the times
Large conglomerates look to tap into craft
Larger brands look to pack redesigns
Carlsberg updates Export
Limited edition packs highlighted origin and seasonal events
Carling and Heineken look to stronger variants
Global beer activity
New variants for Italian brands
Low-alcohol/alcohol-free launches come to the fore
Heineken goes 0.0%
Budweiser launches Prohibition and Light
Smaller operators also look to tap into the trend
Scope for lower-calorie beers
Beer advent calendars tap into seasonality
Can the off-trade steal further from the on-trade?
ADVERTISING AND MARKETING ACTIVITY
Beer adspend falls away in 2016
Figure 20: Total above-the-line, online display and mail advertising spend on beer, 2013-17
Figure 21: Total above-the-line, online display and mail advertising spend on beer, by quarterly share of annual total, 2013-16
Figure 22: Total above-the-line, online display and mail advertising spend on beer, by media type, 2013-17*
Heineken is the leading beer advertiser since 2013
AB InBev has spent the most on beer ads in the past two years
Figure 23: Total above-the-line, online display and mail advertising spend on beer, by leading advertisers (sorted by total spend over period), 2013-17*
Figure 24: Total above-the-line, online display and direct mail advertising expenditure on beer, by top 20 brands (sorted by total spend over the full period), 2013-17*
Other leading campaigns in 2017
Budweiser supports Bud Light
Carlsberg focuses on Export
BrewDog and Camden Town
Selected other campaigns
There’s a Beer for That continues to push food matching
Carling helps fund community projects
Calling back to the past
Linking with entertainment and leisure
Doom Bar and Stella Artois tie up with sports
Hobgoblin and Red Stripe link to music
Estrella Damm continues short films
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 25: Attitudes towards and usage of selected brands, October 2017
Key brand metrics
Figure 26: Key metrics for selected beer brands, October 2017
Brand attitudes: BrewDog is seen as an industry innovator
Figure 27: Attitudes, by brand, October 2017
Brand personality: Carling has the strongest associations with boring
Figure 28: Brand personality – Macro image, October 2017
Hobgoblin enjoys favourable links to authenticity and being special
Figure 29: Brand personality – Micro image, October 2017
Brand analysis
BrewDog leads the way in the craft segment
Figure 30: User profile of BrewDog, October 2017
Corona’s cool image makes many beer drinkers proud to be associated with it
Figure 31: User profile of Corona, October 2017
Hobgoblin evokes many craft associations
Figure 32: User profile of Hobgoblin, October 2017
Kronenbourg balances a premium and accessible position
Figure 33: User profile of Kronenbourg, October 2017
Amstel seen as a similar brand to Kronenbourg
Figure 34: User profile of Amstel, October 2017
Carlsberg faces some notable challenges
Figure 35: User profile of Carlsberg, October 2017
Carling leverages its cheap price to forge a value position
Figure 36: User profile of Carling, October 2017
THE CONSUMER – WHAT YOU NEED TO KNOW
62% of Brits drink beer
Relaxing at home and pub drinks are top beer occasions
Promotions/special offers and recommendations foster trialling
Glass bottles remain the most popular packaging type
Consumers define craft beer in a number of ways
Almost half of beer drinkers want a certification for craft
USAGE OF BEER
62% of Brits drink beer
Figure 37: Profile of beer drinkers, by gender, age and socio-economic group, September 2017
Lager remains Brits’ beer of choice
Figure 38: Usage of types of beer, September 2017
Ales and stouts are less popular
Few people report drinking craft beer
Stout remains divisive
Other types of beer remain more niche
Almost half of beer drinkers stick to one type
Figure 39: Repertoire of usage of types of beer, September 2017
OCCASIONS FOR DRINKING BEER
Relaxing at home and pub drinks are top beer occasions
Figure 40: Occasions for drinking beer, September 2017
Rising out-of-home costs have fostered pre-loading
Festival and events usage peaks among young adults
Beer enjoys strong usage on food-led occasions
FACTORS ENCOURAGING TRIALLING OF NEW BEERS
Promotions/special offers are the best way to encourage trialling
Figure 41: Factors which have encouraged people to try a new beer, September 2017
Recommendations can also be influential…
…as can advertising via social media and traditional channels
New tastes and new variants from trusted brands can also resonate
Packaging can help create standout
BEER PREFERENCES
Glass bottles remain the most popular packaging type
Figure 42: Beer preferences relating to packaging and serving size, September 2017
Lighter beers are comfortably more popular than darker ones
Figure 43: Beer preferences relating to type and strength, September 2017
A higher share of beer drinkers prefers the familiar…
…and well-known brands
Figure 44: Beer preferences relating to brands, September 2017
DEFINING CRAFT BEER
Craft beer lacks a definition in the UK
Certification of craft beer widely welcomed
Figure 45: SIBA’s Assured Independent British craft brewer logo, 2017
Consumers define craft beer in disparate ways
Figure 46: Factors which define craft beer, September 2017
Under-35s give more weight to unique flavour, over-45s to tradition
High quality ingredients and scale of production spark limited interest
Packaging and human input appear to be more peripheral indicators
ATTITUDES TOWARDS BEER
Almost half of beer drinkers want more guidance when buying craft
Tailored online subscriptions appeal to one in three
Figure 47: Attitudes towards craft and quality in beer, September 2017
Paying a premium for craft splits beer drinkers
Transparency is a watchword in craft
Cloudy beers appeal to two in five
58% of beer drinkers are interested in beer as part of meal deals
Figure 48: Attitudes towards beer and food, September 2017
Sharing bottles hold further potential
Two in five beer drinkers would prefer ‘schooners’ to pints
Figure 49: Small bar’s beer boards, Cardiff, October 2017
High interest in smaller servings among women
Figure 50: Attitudes towards the size of beer servings, September 2017
Standards are seen to be improving in the low-/non-alcoholic segment
Government drinking guidelines also spark mixed responses
Figure 51: Attitudes towards the size of beer servings, September 2017
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology
Best- and worst-case forecast data
Figure 52: Total UK value sales of beer, best- and worst-case forecast, 2017-22
Figure 53: Total UK volume sales of beer, best- and worst-case forecast, 2017-22
APPENDIX – MARKET SEGMENTATION
Lager
Figure 54: Total UK value sales of lager, best- and worst-case forecast, 2017-22
Figure 55: Total UK volume sales of lager, best- and worst-case forecast, 2017-22
Figure 56: Forecast of UK volume sales of lager, 2012-22
Ale/Bitter
Figure 57: Total UK value sales of ale/bitter, best- and worst-case forecast, 2017-22
Figure 58: Total UK volume sales of ale/bitter, best- and worst-case forecast, 2017-22
Figure 59: Forecast of UK volume sales of ale/bitter, 2012-22
Stout/Porter
Figure 60: Total UK value sales of stout/porter, best- and worst-case forecast, 2017-22
Figure 61: Total UK volume sales of stout/porter, best- and worst-case forecast, 2017-22
Figure 62: Forecast of UK volume sales of stout/porter, 2012-22
APPENDIX – MARKET SHARE
Figure 63: UK retail value and volume sales of the leading lager manufacturers, 2014/15-2016/17
Figure 64: UK retail value and volume sales of the leading ale and stout manufacturers, 2014/15-2016/17

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