Beer - UK - December 2018

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Volume sales receive a boost in 2018
Figure 1: Forecast of UK value sales of beer, 2013-23
Lager continues to dominate the market, craft trend fuels rise in ale/bitter
Figure 2: UK value sales of beer, by segment, 2017-18
Off-trade volumes continue to surpass on-trade
Freeze on alcohol duties eases pressure on manufacturers
A sizeable minority are cutting back on alcohol
Companies and brands
AB InBev’s top brands Stella and Budweiser post strong growth
Figure 3: Leading brands’ shares in the UK lager market, by value, 2017/18*
Guinness leads ales and stouts
Figure 4: Leading brands’ shares in the UK ales and stouts market, by value, 2017/18*
Stella Artois launches gluten-free beer, joining a raft of others
Craft trend continues
Beer ad spend looks set to drop in 2018
Guinness stands out as unique, BrewDog is most fun and Budweiser leads on refreshment
The consumer
70% of UK adults drink beer, with men, the young and wealthy in the lead
Figure 5: Types of beer drunk in the last 3 months, October 2018
Price is the top factor influencing purchase, but only half prioritise it
Figure 6: Factors influencing purchasing of beer, October 2018
Sampling would encourage purchasing among 75%
Figure 7: Behaviours related to beer, October 2018
Environmental action chimes with 71% of beer drinkers
Figure 8: Attitudes towards beer, October 2018
Refreshment is a selling point for lager; authenticity for stout/porter and ale/bitter and quality credentials and trendiness apparent for craft
Figure 9: Correspondence Analysis of qualities associated with different types of beer, October 2018
What we think
ISSUES AND INSIGHTS
Environmental action chimes with beer drinkers
The facts
The implications
Beer enjoys a strong image as facilitating social connections
The facts
The implications
Sampling encourages purchasing
The facts
The implications
Low/no-alcohol beer helps the market to retain those cutting back on alcohol
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Volume sales receive a boost in 2018
Lager continues to dominate the market
Craft trend fuels rise in ale/bitter
Stout/porter volume sales see slight decline
Off-trade volumes continue to surpass on-trade
Freeze on alcohol duties eases pressure on manufacturers
A sizeable minority are cutting back on alcohol
MARKET SIZE AND FORECAST
Volume sales receive a boost in 2018
Inflation fuels value growth
Lager leads the market
Figure 10: Total value and volume sales of beer, UK, 2013-23
The future
Figure 11: Forecast of UK value sales of beer, 2013-23
Figure 12: Forecast of UK volume sales of beer, 2013-23
Forecast
MARKET SEGMENTATION 
Lager continues to dominate the market
Off-trade performance masks volume decline in the on-trade
Low-/no-alcohol beers provide small support
Rising prices and premiumisation to drive growth going forward
Figure 13: UK value and volume sales of lager, 2013-23
Figure 14: Forecast of UK value sales of lager, 2013-23
Craft trend fuels rise in ale/bitter
Figure 15: UK value and volume sales of ale/bitter, 2013-23
Figure 16: Forecast of UK value sales of ale/bitter, 2013-23
Stout/porter volume sales see slight decline
Figure 17: UK value and volume sales of stout/porter, 2013-23
Figure 18: Forecast of UK value sales of stout/porter, 2013-23
CHANNELS TO MARKET 
Rising prices fuel value growth in the on- and off-trade
Off-trade volumes continue to surpass on-trade
Figure 19: Value and volume sales of beer, by channel, 2013-18
MARKET DRIVERS
Multiple factors affect the price of beer
Freeze on alcohol duties eases pressure on manufacturers
Figure 20: UK excise duty rates for beer and other alcoholic drinks, 2008-18
Scotland introduces minimum unit pricing for alcohol, with Wales set to follow
Exchange rates and ‘Brexit’ deal will have an impact on beer
Rising costs in the on-trade
Barley shortage puts upwards price pressures on beer
A sizeable minority are cutting back on alcohol
Environmental concerns cause brands to take action
AB InBev launches fund for start-ups tackling sustainability…
…and announces 100% recyclable packaging by 2025 commitment
Fuller’s looks to sustainability
Stella focuses on water…
Figure 21: Stella Artois partners with Water.org to highlight global water crises with limited edition packs, 2018
…as does Brewgooder, helped by BrewDog
Figure 22: Brewgooder focuses on clean water, 2018
Demographic changes will put pressure on the market
Figure 23: Change in age structure of the UK population, 2013-18 and 2018-23
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
AB InBev’s top brands Stella and Budweiser post strong growth
Guinness leads ales and stouts
Stella Artois launches gluten-free beer, joining a raft of others
Craft trend continues
Beer spend looks set to drop in 2018
Guinness stands out as unique, BrewDog is most fun, while Budweiser leads on refreshment
MARKET SHARE
AB InBev’s top brands post strong growth in retail
Stella continues to lead
Budweiser overtakes Foster’s
Heineken sees mixed fortunes
Foster’s sales drop hampered by delistings
Heineken brand performs well
Premium lagers blaze a trail
Estrella Damm sees strong growth
Birra Moretti is Heineken’s fastest-growing brand
Peroni undergoes makeover
Molson Coors sees flat sales
Figure 24: UK retail value and volume sales of the leading lager brands, 2015/16-2017/18
Guinness leads ales and stouts
BrewDog continues extraordinary growth
Other brands see mixed fortunes
Fuller's acquires Dark Star Brewing
Figure 25: UK retail value and volume sales of the leading ales and stouts brands, 2015/16-2017/18
LAUNCH ACTIVITY AND INNOVATION
Stella Artois launches gluten-free beer, joining a raft of others
Figure 26: Beer brands tap into gluten-free market, 2016-18
Figure 27: Perception map of attribute performance of Gluten-free Stella Artois in comparison to standard Stella Artois, UK, April 2018-November 2018
Craft trend continues
Retailers continue to build their craft brew ranges
BrewDog continues to innovate…
…seeking to drive sour beer
Figure 28: BrewDog launches a sour beer, 2018
Fuller’s launches limited-run craft beers from pilot brewery…
…and rebrands its craft Frontier line as a premium lager
Alcohol-free launches continue
St Peter's Brewery launches organic alcohol-free beer
Peroni poised to launch a non-alcoholic beer in 2019
Collaborations are increasingly seen in beer
Collaborations among brewers…
…and beyond
Beers look to ethical innovation
Packaging innovation
Budweiser taps into World Cup fever with new bottles and themed packs…
Figure 29: Budweiser launches limited edition aluminium bottles, 2018
…as well as light-up, interactive glasses
BrewDog repackages Punk IPA for International Women's Day
Fruit-infused beer brand Jubel changes look to target craft segment
Fridge-ready pack launches
Figure 30: Brands launch fridge-ready packs, 2018
ADVERTISING AND MARKETING ACTIVITY
Beer spend looks set to drop in 2018
Figure 31: Total above-the line, online display and direct mail advertising expenditure on beer, 2014-18
Heineken is the leading advertiser
Figure 32: Total above-the line, online display and direct mail advertising expenditure on beer, by top 10 advertisers (sorted by 2018), 2014-18
Taking a light-hearted approach with the ‘That’s Heineken’ campaign
Pushing continental associations for Amstel
Celebrating Foster’s roots with cricket
Figure 33: Foster’s launches on-pack promotion to win a trip to Australia, 2018
Birra Moretti focuses on relationships with Pull Together ad
Maltsmiths debuts TV ad
AB InBev cuts back on spend
Stella celebrates joy with Joie de Biere campaign…
…and continues sports sponsorship
Budweiser pushes football ties with sponsorship of World Cup…
…and succeeds Carlsberg as official England football team beer
Estrella Damn is the biggest spending brand with long-form ad
Figure 34: Total above-the line, online display and direct mail advertising expenditure on beer, by top 10 brands (sorted by 2018), 2014-18
Low-/no-alcohol brands see significant ad support
Budweiser supports Bud Light with Dilly Dilly campaign
Heineken unveils £6 million campaign for alcohol-free beer
Budweiser uses 'dry January' to promote Prohibition beer
Guinness continues Made of More campaign
Carlsberg focuses on Danish simplicity with Export
Molson Coors supports Carling…
…while boss blasts ad performance of Coors Light
Greene King looks to modernise Old Speckled Hen
BrewDog continues to invest in traditional media
…and launches one million sampling activation
…and charters a Boeing 767
Tiny Rebel develops mobile video game app
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 35: Attitudes towards and usage of selected brands, October 2018
Key brand metrics
Figure 36: Key metrics for selected brands, October 2018
Brand attitudes: BrewDog stands out as being the most innovative
Figure 37: Attitudes, by brand, October 2018
Brand personality: Carling and Foster’s suffer a more boring image
Figure 38: Brand personality – Macro image, October 2018
Guinness stands out as authentic and traditional
Figure 39: Brand personality – Micro image, October 2018
Brand analysis
BrewDog leads on fun
Figure 40: User profile of BrewDog, October 2018
Estrella Damm solicits positive endorsements among a low user base
Figure 41: User profile of Estrella Damm, October 2018
Guinness enjoys a winning image of being unique and of high quality
Figure 42: User profile of Guinness, October 2018
Stella Artois is seen most widely as a favourite brand
Figure 43: User profile of Stella Artois, October 2018
Budweiser is strong on refreshment
Figure 44: User profile of Budweiser, October 2018
Foster’s is most accessible, offering good value
Figure 45: User profile of Foster’s, October 2018
Carling suffers from a boring brand image
Figure 46: User profile of Carling, October 2018
THE CONSUMER – WHAT YOU NEED TO KNOW
70% of UK adults drink beer, with men, the young and wealthy in the lead
Lager is the most popular type
Price is the top factor influencing purchase, but only half prioritise it
Sampling would encourage purchasing among 75%
Exploration is important, with 73% enjoying try new beers
Environmental action chimes with 71% of beer drinkers
Refreshment is a selling point for lager, authenticity for stout/porter and ale/bitter, while craft enjoys quality credentials and trendiness
USAGE OF BEER
70% of UK adults drink beer, with men, the young and wealthy in the lead
Figure 47: Beer drinking in the last 3 months, by gender, age and socio-economic status, October 2018
Lager is the most popular type
Figure 48: Types of beer drunk in the last 3 months, October 2018
Ale/stout usage is biased towards the young
Craft beer is drunk by 37%
Figure 49: Varieties of beer drunk in the last three months, October 2018
Low/no alcohol variants are drunk by a sizeable one in five beer drinkers
35% drink just one type
Figure 50: Repertoire of types of beer drunk, October 2018
FACTORS INFLUENCING CHOICE 
Price is the top factor influencing purchase, but only half prioritise it
Potential to compete on added value, as half don’t deem price a top factor
Stout/ale’s competitive on-trade price warrants more focus
Figure 51: Factors influencing purchasing of beer, October 2018
Special offers/promotions appeal to just 24%
Distinct flavour appeals to 42%
Craft drinkers take a keen interest in distinct flavour
Lager can do more to play on flavour
Figure 52: BrewDog references taste of pilsner beer, 2018
BEHAVIOURS RELATED TO BEER 
Sampling would encourage purchasing among 75%
Figure 53: Behaviours related to beer, October 2018
Elevating sampling: tasting events
Sampling should help low-alcohol beer to tackle bland image
Exploration is important, with 73% enjoying try new beers
Craft brands cater to exploration with experimental ranges
Premium appeals over craft for 46%
A sizeable minority are cutting back on beer or drinking more low/no alcohol variants
30% agree drinking low-alcohol beers means you can drink more
ATTITUDES TOWARDS BEER 
Environmental action chimes with 71% of beer drinkers
Figure 54: Attitudes towards beer, October 2018
47% show interest in refill schemes
Beer is a good way to bond with friends for 67%; rising to 76% among men aged 18-34
Social interaction gains focus
Beer enjoys a strong image as facilitating social connections
46% express interest in collaborative brews; rising to 63% of 18-34-year-old men
QUALITIES ASSOCIATED WITH BEER
Refreshment is a selling point for lager
Perception of blandness is a potential barrier for low/no alcohol beer
Authenticity stands out for stout/porter and ale/bitter
Quality credentials and trendiness apparent for craft
Figure 55: Correspondence Analysis of beer, October 2018
Figure 56: Qualities associated with different types of beer, October 2018
Methodology
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology
Figure 57: UK value sales of beer, best- and worst-case forecast, 2018-23
Figure 58: UK volume sales of beer, best- and worst-case forecast, 2018-23
Figure 59: UK value sales of lager, best- and worst-case forecast, 2018-23
Figure 60: UK volume sales of lager, best- and worst-case forecast, 2018-23
Figure 61: Forecast of UK volume sales of lager, 2013-23
Figure 62: UK value sales of ale/bitter, best- and worst-case forecast, 2018-23
Figure 63: UK volume sales of ale/bitter, best- and worst-case forecast, 2018-23
Figure 64: Forecast of UK volume sales of ale/bitter, 2013-23
Figure 15: UK value sales of stout/porter, best- and worst-case forecast, 2018-23
Figure 65: UK volume sales of stout/porter, best- and worst-case forecast, 2018-23
Figure 66: Forecast of UK volume sales of stout/porter, 2013-23
APPENDIX – MARKET SHARE
Figure 67: UK retail value and volume sales of the leading lager manufacturers, 2015/16-2017/18
Figure 68: UK retail value and volume sales of the leading ales and stouts manufacturers, 2015/16-2017/18
APPENDIX – LAUNCH ACTIVITY AND INNOVATION
Figure 69: Attribute performance of gluten-free Stella Artois in comparison to standard Stella Artois, UK, April 2017-November 2018
APPENDIX – ADVERTISING AND MARKETING ACTIVITY
Figure 70: Total above-the line, online display and direct mail advertising expenditure on beer, by category, 2014-18
Figure 71: Total above-the line, online display and direct mail advertising expenditure on beer, by media type, 2014-18
Figure 72: Sports sponsorship advertising expenditure on beer, by advertiser, 2014-18 (sorted by total)
Figure 73: Sports sponsorship advertising expenditure on beer, by advertiser and brand, 2014-18 (sorted by total)