Mark Bentley, On-Trade Category Controller at Molson Coors Beverage Company, assesses the rise in popularity of premium beers and the opportunities it can bring, but says it does not sound the death knell for classic favourites.
Premiumisation is a long-term trend in the lager category, but growth has really accelerated over the past eighteen months.With ‘going out’ occasions limited during this time, consumers have generally been more willing to treat themselves, which is a big factor in the recent rise in popularity.
Premium World Lagers in particular have proven popular. Its share growth has increased from less than 5% of draught lager in 20091 up to 29.8% now2, and almost two-thirds of venues (63.1%) now offer at least one World Lager option on tap3.This is up by 18.6 percentage points versus 4 years ago, the fastest distribution growth of any draught lager category4.
We recently teamed up with our La Sagra Brewery in Spain to create Madrí Excepcional, a crisp, clean and refreshing World Lager. Since launching in October 2020 it has already established itself as one of the top ten draught World Lager brands in the on-trade by sales value5, with the fourth-highest rate of sale in the category6.
While the trajectory of premium beer sales continues to rise, it is worth remembering that Core Standard Lager remains the driving force, accounting for 41.5% of draught lager sales volume in the on-trade7, so it’s important to include premium options as part of a balanced range alongside classic favourites such as Carling.
Premium and World Beer options are typically the biggest sellers when it comes to bottled and canned formats, accounting for more than 85% of packaged lager sales8. Craft beers in particular lend themselves more towards packaged formats, with eye-catching labels that can attract the attention of customers.
TAILOR TO YOUR AUDIENCE
It is important to make sure that you’re offering real breadth of range rather than depth – by this, we mean ensuring that there’s genuine choice for drinkers rather than variations on a theme. If the first World Lager
tap is a Modern European Lager – such as Madri Excepcional, Birra Moretti or Peroni – the second tap could offer a Heritage European Lager such as Staropramen or Pilsner Urquell, or a Craft Lager such as Offshore Pilsner or Brooklyn Lager. These brands have very different flavour and taste profiles, so you’re offering more choice for drinkers to explore.
The type of brands to choose will very much depend on the type of outlet, the occasions that it caters for and its guest profile, so really understanding these factors is key in order to be able to make the best range choices.
Premium beers are proportionately performing better in restaurants and bars than in pubs. Draught world lagers have a 51.9% distribution penetration in formal dining venues, an increase of more than 15 percentage points on four years ago, and have the highest penetration of any draught lager category in casual dining outlets9.That’s not to say they don’t have a role to play in wetled venues, where nine in ten venues currently offer a bottled world beer option, and 71% offer a world beer on tap10.
GETTING THE RIGHT BALANCE
Premiumisation gets a huge amount of airtime and it’s easy to see why – it’s exciting, it’s aspirational and it ultimately offers operators the opportunity to put more money in the till. But the everyday familiar favourites remain critically important – in the latest data, Core Standard Lager accounts for the biggest proportion of sales in the lager category11.
We’ve also got to consider the artificial environment we have found ourselves in during the pandemic and the impact this has had on beer sales. As consumer confidence builds, people start to travel more for work and leisure and as more spontaneous and big group occasions return, I fully expect to see a more balanced picture emerging.
Premiumisation is clearly a long-term trend, but there needs to be balance – don’t overlook the importance of the familiar favourites which are the go-to for so many drinkers on a wide variety of different occasions.
1 Molson Coors Insight based on BBPA data, 2009
2 CGA data for Total GB On Trade, 52 weeks ending 6/11/21 3 CGA OPM Data to P10 2021 (06/10/2021)
4 CGA OPM Data to P10 2021 (06/10/2021)
5 CGA data for Total GB On Trade, 52 weeks ending 6/11/21 6 CGA data for Total GB On Trade, 12 weeks ending 6/11/21 7 CGA data for Total GB On Trade, 52 weeks ending 6/11/21 8 CGA data for Total GB On Trade, 52 weeks ending 6/11/21 9 CGA OPM Data to P10 2021 (06/10/2021)
10 CGA OPM Data to P10 2021 (06/10/2021)
11 CGA data for Total GB On Trade, 52 weeks ending 6/11/21