| KN15344 |
| KEY NOTE Market Report Plus : Premium Lagers, Beers and Ciders : December 2004 |
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This report covers: premium, beers, lagers, ciders,
Companies covered include: Carlsberg UK,Coors Brewers, GreeneKing, Scottish & Newcastle, The Wolverhampton & Dudley Breweries,Budweiser, Diago, Heineken, Merrydown, SAB Miller, Thatcher Cider company,
| Executive Summary |
| 1. Market Definition |
| REPORT COVERAGE |
| MARKET SECTORS |
| Premium Lagers |
| Premium Beers |
| Premium Ciders |
| Market trends |
| The Decline of Session Drinking |
| Increase of Consumer Sophistication |
| Contraction of Market Share and its Influence |
| Competition from Other Drinks in the Youth Market |
| Growth of Wine and Drinks With Meals as An Alternative |
| ECONOMIC TRENDS |
| Population |
| Table 1: UK Resident Population Estimates by Sex (000), Mid-Years 1999-2003 |
| Gross Domestic Product |
| Table 2: UK Gross Domestic Product at Current and Annual Prices (£m), 1999-2003 |
| Inflation |
| Table 3: UK Rate of Inflation (%), 1999-2003 |
| Unemployment |
| Table 4: Actual Number of Unemployed Persons (million), 1999-2003 |
| Household Disposable Income |
| Table 5: Household Disposable Income Per Capita (£ and %), 1999-2003 |
| MARKET POSITION |
| UK Position |
| Table 6: Share of the Lager/Beer and Cider Market in the Total UK Alcoholic Drinks Market (£m and %), 2003 |
| Overseas Position |
| 2. Market Size |
| THE TOTAL MARKET |
| Table 7: The Total UK Premium Drinks Market by Value (£m at rsp and %), 1999-2003 |
| BY MARKET SECTOR |
| Premium Lagers |
| Table 8: Retail Price Indices for Lager/Beer by Distribution Channel (June each year), 2001-2004 |
| Premium Beers |
| Premium Ciders |
| 3. Industry Background |
| RECENT HISTORY |
| INDUSTRY SYNOPSIS |
| Table 9: Industry Synopsis for UK Brewers (£000 and %), 2003 |
| Number of Companies |
| Table 10: Number of UK VAT-Based Enterprises Engaged in Brewing, 1999-2003 |
| Employment |
| Table 11: Number of UK VAT-Based Local Units Engaged in Brewing by Employment Sizeband (number of employees), 2003 |
| REGIONAL VARIATIONS IN THE MARKETPLACE |
| DISTRIBUTION |
| Table 12: Retail Distribution Outlets for Premium Drinks by Value (%), 2003 |
| HOW ROBUST IS THE MARKET? |
| LEGISLATION |
| KEY TRADE ASSOCIATIONS |
| British Beer & Pubs Association |
| The National Association of Cidermakers |
| 4. Competitor Analysis |
| THE MARKETPLACE |
| Table 13: Market Share of Leading UK Brewers, Cider Makers and their Premium Brands by Value (%), 2004 |
| MARKET LEADERS |
| Scottish & Newcastle PLC |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Interbrew UK Ltd |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Coors Brewers Ltd |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Carlsberg UK Ltd |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Constellation Europe Ltd |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| OTHER COMPANIES |
| Budweiser |
| Diageo PLC |
| Greene King PLC |
| Heineken |
| Merrydown PLC |
| SABMiller |
| Thatcher Cider Company |
| Wolverhampton & Dudley Breweries PLC |
| OUTSIDE SUPPLIERS |
| Packaging |
| Raw Materials |
| MARKETING ACTIVITY |
| Media Advertising |
| Table 14: Main Media Advertising Expenditure on Premium and Other Beers and Cider (£000), Year to June 2004 |
| Other Marketing Activity |
| 5. Strengths, Weaknesses, Opportunities and Threats |
| Strengths |
| WEAKNESSES |
| Opportunities |
| THREATS |
| 6. Buying Behaviour |
| consumer PENETRATION |
| Table 15: Penetration of Selected Alcoholic Drinks (premium or other) (% adults), 1996, 2002 and 2004 |
| PENETRATION OF LEADING BRANDS |
| Table 16: Penetration of Major Drinks Brands by Sex, Age, Social Grade and Region (%), 2002 |
| 7. Current Issues |
| BRAND AND COMPANY DEVELOPMENTS |
| PRICING ISSUES |
| BINGE DRINKING AND THE NEW LICENSING REGIME |
| 8. The Global Market |
| INTERNATIONAL COMPARISONS |
| GLOBAL MERGERS |
| 9. Forecasts |
| INTRODUCTION |
| Population |
| Table 17: Forecast UK Resident Population by Sex (000), 2004-2008 |
| Gross Domestic Product |
| Table 18: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2004-2008 |
| Inflation |
| Table 19: Forecast UK Rate of Inflation (%), 2004-2008 |
| Unemployment |
| Table 20: Forecast Actual Number of Unemployed Persons (million), 2004-2008 |
| FORECASTS 2004 to 2008 |
| Table 21: The Forecast Total UKPremium Drinks Market by Value (£m and %), 2004-2008 |
| FUTURE TRENDS |
| 10. Company Profiles |
| Carlsberg Uk LTd |
| Coors Brewers Ltd |
| Greene King Plc |
| Scottish & Newcastle Plc |
| The Wolverhampton & Dudley Breweries PLC |
| 11. Further Sources |
| Associations |
| General Sources |
| Government Publications |
| Bonnier Information Sources |
| The rise of premium brands within the broader markets for beers and ciders has been a feature of the UK market for alcoholic beverages for nearly 20 years, dating back to the launches of numerous premium lagers in the 1980s. It is a trend that reflects the adaptation of UK drinkers to a more international style of drinking choosing lagers and ciders with quality ingredients and a higher alcohol content than the UK's traditional ales and ciders. |
| In 2003, the market for premium drinks was valued by Key Note to be worth £13.8bn, representing 69% of the total market for lagers, beers and ciders. This share has already risen from under 60% in the late 1990s, and is forecast to reach nearly 80% by 2008. Many standard-strength brands are struggling to survive, as consumer sophistication favours the premium brands, which are usually stronger in alcohol as well as being promoted on a quality platform. (Higher rates of taxation on the stronger drinks makes it inevitable that they carry a higher price-tag.) |
| Industry changes are contributing to the growth of premium brands, particularly in regard to lagers, where five brewers now account for over 90% of the UK market. Their enormous marketing budgets are concentrated on flagship brands such as Stella Artois (InBev, formerly known as Interbrew), Budweiser (Anheuser-Busch), Carlsberg Export, Heineken and Kronenbourg (Scottish & Newcastle PLC). These are all foreign brands of lager, although Scottish & Newcastle PLC owns Kronenbourg, originally from France. |
| Scottish & Newcastle PLC, the UK's largest brewer, added further to industry concentration in 2003 when it purchased Bulmers, the UK's top cider maker, with a market share of over 60%. |
| In contrast to the contracting number of major brands involved in premium lager and cider production, is the expanding distribution of premium beers, particularly the real ales from regional brewers such as Greene King PLC (Old Speckled Hen, Abbot Ale) and Fuller's (London Pride). These premium real ales will help to sustain interest in traditional brewing. |
| Cider is forecast to remain a cyclical market, and premium ciders along with some premium lagers and beers could benefit in the next few years from a consumer move away from the novelties popular during the early 2000s, such as ready-to-drink cocktails and `shots'. |
Text © 2004Key Note
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Last updated by Amanda Porteous January
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