Beer - UK - December 2014

INTRODUCTION
Definition
Abbreviations
EXECUTIVE SUMMARY
The market
Figure 1: Forecast of UK value sales of beer, 2009-19
Market factors
Alcohol consumption is in decline
End of the road for the beer escalator
Population changes entail threats and opportunities
The rise of craft brewers
Beer looks to become even more versatile
Companies, brands and innovation
Foster’s looks set to lose top spot in the off-trade beer market
Figure 2: Value sales of top-selling beer brands in the off-trade, 2013/14
Innovation and adspend continue to drive category visibility
The consumer
Lager remains the most popular type of beer
Figure 3: Usage of different types of beer within the past six months, September 2014
62% of beer drinkers drink beer at least once a week
The pub/bar is the most popular place to drink beer
Figure 4: Occasions for drinking beer, September 2014
High-quality ingredients are key to projecting a premium image
Glass bottles are still much more popular than cans
Figure 5: Beer preferences, September 2014
Beer can be a good fit in formal dining occasions
Figure 6: Attitudes towards beer, September 2014
What we think
ISSUES AND INSIGHTS
Older consumers could be key for the craft beer segment
The facts
The implications
Capitalising on Britain’s changing population
The facts
The implications
Leveraging beer and food matching
The facts
The implications
What could the removal of the beer tie mean for the industry?
The facts
The implications
TREND APPLICATION
Guiding Choice
Objectify
Brand Intervention
MARKET DRIVERS
Key points
Taxation rates level off
Figure 7: UK excise duty rates for selected alcoholic drinks, 2003-14
Figure 8: RPI indexed annual change for alcoholic drinks prices versus all items except housing, 2000-13
Figure 9: RPI indexed annual change for beer – on- and off-trade, 2000-13
Craft continues to flourish
Bridging occasions and the gender divide
Figure 10: Hours of sunshine in the UK, by month, 2009-14
Financial health recovers but remains fragile
Figure 11: Consumers’ financial health index, January 2009-July 2014
An ageing population poses threats to the beer market
Figure 12: Projected trends in the age structure of the UK population, 2014-19
The importance of C2s
COMPETITIVE CONTEXT
Key points
UK consumers continue to cut back on alcohol
Figure 13: Trends in UK per capita consumption of 100% alcohol, 2006-13
Figure 14: HM Treasury estimated changes in volume consumption of alcohol over 2014/15-2018/19 following changes to alcohol duty in Budget 2014
Figure 15: Value sales of selected alcoholic drinks categories, 2009-14
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
Heineken pushes the innovation envelope
Using social media and technology
Working in partnerships
Branded launches of note
Up-and-coming trends…
MARKET SIZE AND FORECAST
Key points
Beer volumes finally nudge back into growth
Figure 16: UK value and volume sales of beer, at current and constant prices, 2009-19
Figure 17: Forecast of UK value sales of beer, 2009-19
Figure 18: Forecast of UK volume sales of beer, 2009-19
Forecast methodology
SEGMENT PERFORMANCE
Key points
Lager drives the market back into volume growth
Figure 19: Total UK value and volume sales of lager, at current and constant prices, 2009-19
Figure 20: Forecast of UK value sales of lager, 2009-19
Ale shows robust value growth
Figure 21: Total UK value and volume sales of ale/bitter/ginger beer, at current and constant prices, 2009-19
Figure 22: Forecast of UK value sales of ale/bitter/ginger beer, 2009-19
Stout sales continue to slide
Figure 23: UK value and volume sales of stout, at current and constant prices, 2009-19
Figure 24: Forecast of UK value sales of stout, 2009-19
CHANNELS TO MARKET
Key points
Off-trade volumes prove to be more resolute than the on-trade
Figure 25: UK value and volume sales of beer in the off-trade, at current and constant prices, 2009-14
Figure 26: UK value and volume sales of beer in the on-trade, at current and constant prices, 2009-14
The multiple grocers remain dominant
MARKET SHARE
Key points
AB InBev remains the main player in the lager segment
Figure 27: Leading manufacturers’ value and volume shares of lager sales in the off-trade, 2013/14
Figure 28: Value sales of top-selling lager brands in the off-trade, 2012/13 and 2013/14
Figure 29: Volume sales of top-selling lager brands in the off-trade, 2012/13 and 2013/14
Foster’s poised to jump to the top of the pile
Contrasting fortunes for Carlsberg and Molson Coors
A changing of the guard in ale?
Figure 30: Leading manufacturers’ value and volume shares of ale/bitter/ginger beer sales in the off-trade, 2013/14
Figure 31: Value sales of top-selling ale/bitter/ginger beer brands in the off-trade, 2012/13 and 2013/14
Figure 32: Volume sales of top-selling ale/bitter/ginger beer brands in the off-trade, 2012/13 and 2013/14
Guinness finally halts its decline
Figure 33: Leading manufacturers’ value and volume shares of stout sales in the off-trade, 2013/14
Figure 34: Value sales of top-selling stout brands in the off-trade, 2012/13 and 2013/14
Figure 35: Volume sales of top-selling stout brands in the off-trade, 2012/13 and 2013/14
COMPANIES AND PRODUCTS
AB InBev
Overview and product range
Recent activity and innovation
Carlsberg
Overview and product range
Recent activity and innovation
Diageo
Overview and product range
Recent activity and innovation
Heineken
Overview and product range
Recent activity and innovation
Molson Coors
Overview and product range
Recent activity and innovation
SABMiller (Miller Brands)
Overview and product range
Recent activity and innovation
BRAND COMMUNICATION AND PROMOTION
Key points
Beer adspend fell away in 2013
Figure 36: Above-the-line adspend in the UK beer market, 2011-14
Molson Coors and Heineken go head-to-head for the leading advertiser
Figure 37: Leading advertisers in the UK beer category, by company, 2013
Figure 38: Leading advertisers in the UK beer category, by company, 2011-14
Carling is the most advertised beer in the UK
Figure 39: Leading advertisers in the UK beer category, by brand, 2013
Figure 40: Leading advertisers in the UK beer category, by brand, 2011-14
TV is the preferred medium for beer advertisers
BRAND RESEARCH
Brand map
Figure 41: Attitudes towards and usage of brands in the beer sector, October 2014
Correspondence analysis
Brand attitudes
Figure 42: Attitudes, by beer brand, October 2014
Brand personality
Figure 43: Beer brand personality – Macro image, October 2014
Figure 44: Beer brand personality – Micro image, October 2014
Brand experience
Figure 45: Beer brand usage, October 2014
Figure 46: Satisfaction with various beer brands, October 2014
Figure 47: Consideration of beer brands, October 2014
Brand recommendation
Figure 48: Recommendation of selected beer brands, October 2014
THE CONSUMER – USAGE OF BEER
Key points
Lager remains the most popular type of beer
Figure 49: Usage of different types of beer within the past six months, September 2014
Figure 50: Usage of different types of beer within the past six months, by location, September 2014
Figure 51: Usage of different types of beer within the past six months, by gender and age, September 2014
Craft continues to flourish
36% of beer drinkers drink three or more types
Figure 52: Repertoire of usage of different types of beer, September 2014
THE CONSUMER – FREQUENCY OF DRINKING BEER
Key points
62% of beer drinkers do so at least once a week
Figure 53: Frequency of drinking beer, September 2014
THE CONSUMER – OCCASIONS FOR DRINKING BEER
Key points
The pub/bar is the most popular place to drink beer
Figure 54: Occasions for drinking beer, September 2014
Figure 55: Occasions for drinking beer – alone or with others, September 2014
Beer is also popular in other social occasions
Beer and food: a match made in heaven?
THE CONSUMER – ASSOCIATIONS WITH PREMIUM BEER
Key points
High-quality ingredients are key to projecting a premium image
Figure 56: Associations with premium beer (any ranking 1-5), September 2014
Figure 57: Associations with premium beer (rank 1), September 2014
Heritage/history can also be a strong premium cue
Branding is important for premiumisation
THE CONSUMER – BEER PREFERENCES
Key points
Glass bottles are still much more popular than cans
Figure 58: Beer preferences, September 2014
Figure 59: Preferences in beer bottle size, September 2014
Figure 60: Preferences in beer can size, September 2014
Lighter beers preferred to dark
Mainstream beers still preferred by the majority
Tradition still important in terms of flavour and carbonation
THE CONSUMER – ATTITUDES TOWARDS BEER
Key points
Summary of attitudes towards beer
Figure 61: Attitudes towards beer, September 2014
Beer can be a good fit in formal dining occasions
Figure 62: Attitudes towards food and beer, September 2014
Beer brands need to prove their credentials
Figure 63: Attitudes towards the taste of beer, September 2014
Craft beer continues to grow but does it need a definition?
Figure 64: Attitudes towards craft beer, September 2014
Potential for growth of lower-alcohol beers
Figure 65: Other attitudes towards beer, September 2014
THE CONSUMER – TARGET GROUPS
Key points
Four target groups
Figure 66: Target groups for beer, September 2014
Connoisseurs (28%)
Disengaged (26%)
Enthusiasts (23%)
Price-conscious (23%)
APPENDIX – MARKET SIZE AND FORECAST
Figure 67: Best- and worst-case forecasts for the UK beer market, by value, 2014-19
Figure 68: Best- and worst-case forecasts for the UK beer market, by volume, 2014-19
Figure 69: Best- and worst-case forecasts for the UK lager market, by value, 2014-19
Figure 70: Best- and worst-case forecasts for the UK lager market, by volume, 2014-19
Figure 71: Forecast of UK volume sales of lager, 2009-19
Figure 72: Best- and worst-case forecasts for the UK ale/bitter/ginger beer market, by value, 2014-19
Figure 73: Best- and worst-case forecasts for the UK ale/bitter/ginger beer market, by volume, 2014-19
Figure 74: Forecast of UK volume sales of ale/bitter/ginger beer, 2009-19
Figure 75: Best- and worst-case forecasts for the UK stout market, by value, 2014-19
Figure 76: Best- and worst-case forecasts for the UK stout market, by volume, 2014-19
Figure 77: Forecast of UK volume sales of stout, 2009-19