Beer - UK - December 2012

Report Length: 305 pages

1. Introduction

   • Definition
   • Abbreviations

2. Executive Summary

   • The market
   • • Figure 1: UK value sales of beer, by segment, 2007-12
   • Forecast
     • Figure 2: Forecast of UK value sales of beer, 2007-17
   • Market factors
   • Duty rises add greater pressures on brewers
     • Figure 3: RPI indexed annual change for all items and beer (on- and off-trade), 2000-12
   • Economic pressures shifting consumers’ drinking habits
   • A boom in craft brewers despite troubles of the wider market
     • Figure 4: Index of pub and brewery numbers, 2000-12
   • Low consumer confidence continues to hamper the market
   • Population changes pose threats and opportunities
   • Companies, brands and innovation
     • Figure 5: Leading brands’ market shares in value sales of beer in the off-trade, 2011
   • Innovation focuses on bringing the new to drinkers
   • Beer brands continue to invest heavily in advertising
   • The consumer
   • Lager remains a popular drink
     • Figure 6: Usage of different types of beer within the past six months, October 2012
   • Brand name is highly important for users when buying beer
   • Lager achieves a unisex image
     • Figure 7: Users’ attitudes towards beer, October 2012
   • Opportunities for craft beers, provided they can deliver high quality
     • Figure 8: Attitudes towards craft beer, October 2012
   • Perceptions of heaviness weigh ales/stouts down
   • What we think

3. Issues in the Market

   • How can the on-trade beer market better convey value for money to curb its decline?
   • Can lager soften its unhealthy associations?
   • Can craft brewers balance exclusivity with wider appeal?
   • Can British brewers follow the lead of cider and leverage regionality?

4. Trend Application

   • Factory Fear
   • Guiding Choice
   • 2015: Brand Intervention

5. Internal Market Environment

   • Key points
   • Duty rises driving up retail prices
     • Figure 9: Value and volume sales of the total UK alcoholic drinks market, 2007-12
   • • Figure 10: RPI indexed annual change for all items and beer (on- and off-trade), 2000-12
     • Figure 11: Most popular types of alcoholic drinks, in home and out of home, April 2012
   • • Figure 12: Agreement with statements on locations for drinking, 2008-12
   • Beer prices are becoming an escalating issue
   • • Figure 13: UK excise duty rates for beer, cider, wine and spirits, 2003-12
   • Barley prices add to upward pressure on beer price
   • Loyalty dips as consumers focus on price
     • Figure 14: Agreement with selected lifestyle statements, 2008-12
   • The ongoing growth of craft brewing
     • Figure 15: UK breweries, by number, 2000-12
   • Bridging the gender divide
     • Figure 16: Purchase of different types of beer, by gender, October 2012
   • • Figure 17: Agreement with statements on binge drinking, 2008-12
   • Beer seen as fit for purpose for a variety of occasions
     • Figure 18: Occasions for drinking in and out of the home, May 2012

6. Broader Market Environment

   • Key points
   • Consumer confidence remains low despite the recession ending
     • Figure 19: Consumer Confidence Index, monthly, January 2007-November 2012
   • • Figure 20: Hours of sunshine in the UK, by month, 2008-12
   • • Figure 21: Frequency of drinking in pubs/bars, May 2012
   • Do pubs still have a place in the community?
     • Figure 22: Index of pub and brewery numbers, 2000-12
   • Government focus on a healthier population
   • 25-34-year-olds to emerge as the saviour of the beer market…
     • Figure 23: Projected trends in the age structure of the UK population, 2012-17
   • …while C2s also hold the key to growth
     • Figure 24: Changes in the adult socio-economic structure of the UK population, 2012-17

7. Competitive Context

   • Key points
   • Usage of many alcoholic drinks in decline
   • • Figure 25: Usage of beer and competing drinks categories, in home and out of home, November 2012
   • Falling usage of beer both in and out of home
   • The UK is in fact a small player on the global market

8. Strengths and Weaknesses

   • Strengths
   • Weaknesses

9. Who’s Innovating?

   • Key points
   • Premium and seasonal lager innovation
   • Large brewers invest in world beers
   • Craft breweries’ bold experiments generate new styles and flavours
   • Celebrities are getting hands on with beer
   • Other UK launches of note
   • Global context: interesting beer launches from overseas in 2012
   • The US leads the way…
   • …selected examples from other countries

10. Market Size and Forecasts

    • Key points
    • Rising value sales disguise a market going flat
      • Figure 26: UK value and volume sales of beer, at current and constant prices, 2007-17
    • • Figure 27: Forecast of UK value sales of beer, 2007-17
    • Volume sales continue to slide, with little sign of change
    • • Figure 28: Forecast of UK volume sales of beer, 2007-17
    • Forecast methodology

11. Market Segmentation and Forecasts

    • Key points
    • Lager continues to dominate the beer market
      • Figure 29: Total value and volume sales of lager in the UK, at current and constant prices, 2007-17
    • • Figure 30: Forecast of UK value sales of lager, 2007-17
    • The rebirth of ale
      • Figure 31: Total value and volume sales of ale in the UK, at current and constant prices, 2007-17
    • • Figure 32: Forecast of UK value sales of ale, 2007-17
    • A dark future for stout
      • Figure 33: Total value and volume sales of stout in the UK, at current and constant prices, 2007-17
    • • Figure 34: Forecast of UK value sales of stout, 2007-17

12. Market Share

    • Key points
    • A golden performance for Foster’s in 2011
      • Figure 35: Market share, by value of top-selling beer brands in the off-trade, 2009-11
    • Carling also flexes its premium muscles…
    • …while Budweiser goes from strength to strength
    • Kronenbourg turns the corner while Beck’s continues to flounder
    • Guinness epitomises the woes of stout
    • A third of beer sales are accounted for by the long tail of smaller brands

13. Channels to Market

    • Key points
    • The off-trade closes the gap further in 2011…
      • Figure 36: UK value and volume sales of beer in the off-trade, at current and constant prices, 2007-12
      • Figure 37: UK value and volume sales of beer in the on-trade, at current and constant prices, 2007-12
    • • Figure 38: Volume sales of beer, by type, 2008-11
    • …as the multiple grocers tighten their grip
    • Pubs account for three quarters of on-trade sales

14. Companies and Products

    • AB InBev
    • Camden Town Brewery (A craft brewer)
    • Carlsberg
    • Diageo
    • Heineken
    • Molson Coors
    • SABMiller (Miller Brands)

15. Brand Research

    • Brand map
    • • Figure 39: Attitudes towards and usage of brands in the beer sector, September 2012
    • Correspondence analysis
    • Brand attitudes
      • Figure 40: Attitudes, by beer brand, September 2012
    • Brand personality
      • Figure 41: Beer brand personality – macro image, September 2012
    • • Figure 42: Beer brand personality – micro image, September 2012
    • Brand experience
      • Figure 43: Beer brand usage, September 2012
    • • Figure 44: Satisfaction with various beer brands, September 2012
      • Figure 45: Satisfaction with various beer brands, September 2012 (continued)
    • • Figure 46: Consideration of beer brands, September 2012
    • • Figure 47: Consumer perceptions of current beer brand performance, September 2012
    • • Figure 48: Beer brand recommendation – Net Promoter Score, September 2012
    • Brand index
      • Figure 49: Beer brand index, September 2012
      • Figure 50: Beer brand index vs. recommendation, September 2012
    • Target group analysis
      • Figure 51: Target groups, September 2012
    • • Figure 52: Beer brand usage, by target groups, September 2012
      • Figure 53: Beer brand usage, by target groups, September 2012 (continued)
    • Group One – Conformists
    • Group Two – Simply the Best
    • Group Three – Shelf Stalkers
    • Group Four – Habitual Shoppers
    • Group Five – Individualists

16. Brand Communication and Promotion

    • Key points
    • Adspend on beer remains high
      • Figure 54: Above-the-line adspend in the UK beer market, 2008-12
    • Lager dominates beer advertising
      • Figure 55: Advertising spending in the UK beer sector, by category, 2008-12
    • AB InBev continues to lead the way
      • Figure 56: Leading advertisers in the UK beer category, by company, 2011
      • Figure 57: Leading advertisers in the UK beer category, by company, 2009-12
    • Four brands making notable investments in advertising
      • Figure 58: Leading brands advertised in the UK beer category, 2011
      • Figure 59: Leading brands advertised in the UK beer category, 2009-12
    • TV is the preferred medium for beer advertisers
      • Figure 60: Advertising in the UK beer category, by media, 2008-12
    • Leveraging sports and heritage to market beer

17. Consumer – Trends in Usage

    • Key points
    • Beer consumption in decline
      • Figure 61: Types of beer consumed in the last 12 months, 2008-12
    • • Figure 62: Types of beer consumed in the last 12 months, by gender and age, 2012
    • Beer retains strong associations with social occasions
    • • Figure 63: In-home drinking occasions for beer/lager/ale/cider, 2012
    • • Figure 64: Out-of-home drinking occasions for beer/lager/ale/cider, 2012

18. Consumer – Usage of Types of Beer

    • Key points
    • Lager retains its popularity, particularly for in-home drinking
      • Figure 65: Usage of different types of beer within the past six months, October 2012
    • • Figure 66: Usage of different types of beer in the last six months, in and out of home, October 2012
    • Usage of ales/stouts continues to be heavily driven by men
    • Craft beer on the rise
    • Ginger beer also showing rapid growth
    • Niche interest in other types of beers
    • • Figure 67: Selected attitudes towards drinking low-alcohol drinks in the on-trade, August 2012
    • Over a quarter of adults drink four or more types of beer
      • Figure 68: Repertoire of different types of beer drunk, October 2012

19. Consumer – Choice Factors

    • Key points
    • Branding is an essential feature in the beer market
      • Figure 69: Choice factors when buying beer, October 2012
    • Low price an important choice factor for half of beer drinkers
    • Opportunities exist to tap into demand for adventurous and unique beers

20. Consumer – Attitudes Towards Lager

    • Key points
    • Lager enjoys unisex appeal
      • Figure 70: Users’ attitudes towards beer, October 2012
    • Three quarters of beer drinkers think it is suitable for men and women
      • Figure 71: Users’ attitudes towards the positioning of beer, October 2012
    • Price is a worry for the majority of beer drinkers
      • Figure 72: Users’ attitudes towards the consumption of beer, October 2012
    • Draught beer remains the leading format for quality
      • Figure 73: Users’ attitudes towards the taste of different types of beer, October 2012
    • Branded/Tailored glassware can add value to beer
    • Opportunities for gluten-free beer operators
    • Scope for growth for lower-alcohol beers
      • Figure 74: Users’ attitudes towards the alcoholic content of beer, October 2012
    • A third of beer drinkers exhibit connoisseurial attitudes
      • Figure 75: Users’ attitudes towards understanding more about beer, October 2012

21. Consumer – Attitudes Towards Craft Beer

    • Key points
    • Opportunities for craft beers, provided they can deliver high quality
      • Figure 76: Attitudes towards craft beer, October 2012
    • • Figure 77: Attitudes towards craft beer: users vs non-users, by agreement with statements, October 2012
    • Over half of beer drinkers expect craft beer to deliver higher quality…
      • Figure 78: Attitudes towards the quality of craft beer, October 2012
    • …while over half of users also want to see more craft beers available
      • Figure 79: Users’ attitudes towards the range and image of craft beer, October 2012
    • Independence is an important feature of the craft landscape
      • Figure 80: Users’ attitudes towards the management of craft beer brands, October 2012
    • Balancing exclusivity and accessibility is a challenge for craft brands
      • Figure 81: Users’ attitudes towards the price of craft beer, October 2012
    • Craft beer in the US market
      • Figure 82: Agreement with selected statements on craft beer in the US, August 2012

22. Consumer – Attitudes Towards Ales/Stouts

    • Key points
    • Perceptions of heaviness weigh ales/stouts down
      • Figure 83: Attitudes towards ales/stouts, October 2012
    • • Figure 84: Users’ attitudes towards ales/stouts, October 2012
    • Two in five beer drinkers think that ales/stouts are heavier than lager
      • Figure 85: Attitudes towards ales/stouts compared to lager, October 2012
    • Ales/Stouts make progress in appealing to women
      • Figure 86: Attitudes towards the image of ales/stouts, October 2012
    • A third of beer drinkers prefer draught ales/stouts to bottles/cans
      • Figure 87: Attitudes towards the taste of ales/stouts, October 2012
    • Guest ales/stouts can drive interest
      • Figure 88: Attitudes towards the range/availability of ales/stouts, October 2012

23. Consumer – Target Groups

    • Key points
    • Four target groups
      • Figure 89: Target groups for beer, October 2012
    • Explorers (33%)
    • Disengaged (25%)
    • Unadventurous (23%)
    • Craft Lovers (19%)

24. Appendix – Internal Market Environment

    • • Figure 90: Names and locations of craft breweries in London, 2012
      • Figure 91: Agreement with selected statements, by demographics, 2012
    • • Figure 92: Agreement with selected statements, by demographics, 2012 (continued)

25. Appendix – Broader Market Environment

    • • Figure 93: Usage of alcoholic drinks in the last 12 months, by demographics, 2012

26. Appendix – Competitive Context

    • • Figure 94: Type of alcoholic drinks consumed in the last 12 months, by demographics, 2012
      • Figure 95: Type of alcoholic drinks consumed in the last 12 months, by demographics, 2012 (continued)
    • • Figure 96: Type of alcoholic drinks consumed in the last 12 months, by demographics, 2012 (continued)

27. Appendix – Market Size and Forecasts

    • • Figure 97: Best- and worst-case forecasts for the total beer market, by value, 2012-17
      • Figure 98: Best- and worst-case forecasts for the total beer market, by volume, 2012-17

28. Appendix – Market Segmentation and Forecasts

    • • Figure 99: Best- and worst-case forecasts for the lager market, by value, 2012-17
      • Figure 100: Best- and worst-case forecasts for the lager market, by volume, 2012-17
      • Figure 101: UK volume sales of lager, 2007-17
      • Figure 102: Best- and worst-case forecasts for the ale market, by value, 2012-17
    • • Figure 103: Best- and worst-case forecasts for the ale market, by volume, 2012-17
      • Figure 104: UK volume sales of ale, 2007-17
      • Figure 105: Best- and worst-case forecasts for the stout market, by value, 2012-17
      • Figure 106: Best- and worst-case forecasts for the stout market, by volume, 2012-17
    • • Figure 107: UK volume sales of stout, 2007-17

29. Appendix – Brand Research

    • • Figure 108: Brand usage, September 2012
      • Figure 109: Brand commitment, September 2012
    • • Figure 110: Brand momentum, September 2012
      • Figure 111: Brand diversity, September 2012
    • • Figure 112: Brand satisfaction, September 2012
      • Figure 113: Brand recommendation, September 2012
    • • Figure 114: Brand attitude, September 2012
      • Figure 115: Brand image – macro image, September 2012
    • • Figure 116: Brand image – micro image, September 2012
      • Figure 117: Profile of target groups, by demographics, September 2012
    • • Figure 118: Psychographic segmentation, by target groups, September 2012
      • Figure 119: Brand usage, by target groups, September 2012
    • Brand index
      • Figure 120: Brand index, September 2012

30. Appendix – Consumer – Trends in Usage

    • • Figure 121: Types of beer consumed in the last 12 months, by demographics, 2012
    • • Figure 122: Drinking occasions for beer/lager/ale/cider in home, by demographics, 2012
    • • Figure 123: Drinking occasions for beer/lager/ale/cider in home, by demographics, 2012 (continued)
    • • Figure 124: Drinking occasions for beer/lager/ale/cider out of home, by demographics, 2012
    • • Figure 125: Drinking occasions for beer/lager/ale/cider out of home, by demographics, 2012 (continued)

31. Appendix – Consumer – Usage of Types of Beer

    • • Figure 126: Types of beer drunk in home, October 2012
    • • Figure 127: Most popular types of beer drunk in home, by demographics, October 2012
    • • Figure 128: Next most popular purchase of beer drunk in home, by demographics, October 2012
    • • Figure 129: Types of beer drunk out of home, October 2012
    • • Figure 130: Most popular types of beer drunk out of home, by demographics, October 2012
    • • Figure 131: Next most popular types of beer drunk out of home, by demographics, October 2012
    • • Figure 132: Non-usage of different types of beer within the past six months, October 2012
    • • Figure 133: Non-usage of different types of beer within the past six months, by demographics, October 2012
    • • Figure 134: Non-usage of different types of beer within the past six months, by demographics, October 2012 (continued)
    • • Figure 135: Types of beer drunk, by repertoire of types of beer drunk, October 2012
    • • Figure 136: Repertoire of types of beer drunk, by demographics, October 2012

32. Appendix – Consumer – Choice Factors

    • • Figure 137: Most popular choice factors when buying beer, by demographics, October 2012
    • • Figure 138: Next most popular choice factors when buying beer, by demographics, October 2012
    • • Figure 139: Other choice factors when buying beer, by demographics, October 2012
    • • Figure 140: Choice factors when buying beer, by most popular types of beer drunk in home, October 2012
    • • Figure 141: Choice factors when buying beer, by next most popular purchase of different types of beer drunk in home, October 2012
    • • Figure 142: Choice factors when buying beer, by most popular types of beer drunk out of home, October 2012
    • • Figure 143: Choice factors when buying beer, by next most popular purchase of different types of beer drunk out of home, October 2012

33. Appendix – Consumer – Attitudes Towards Lager

    • • Figure 144: Users' attitudes towards beer, October 2012
    • • Figure 145: Agreement with the statements ‘I would cut back on the amount of beer/lager I drink if the price continues to rise’ and ‘I would drink gluten-free beers if they tasted as good as standard varieties’, by demographics, October 2012
    • • Figure 146: Agreement with the statements ‘I would be more likely to drink lager in pubs/restaurants than at home’ and ‘I would drink lower-alcohol beers if they tasted as good as standard varieties’, by demographics, October 2012
    • • Figure 147: Agreement with the statements ‘I prefer the taste of flavoured or ‘golden’ beers to standard beers’ and ‘I would like information on how to match beers/lagers with different types of food’, by demographics, October 2012
    • • Figure 148: Agreement with the statements ‘I would like to understand more about beer/lager’ and ‘I prefer beers/lagers to be served in glasses which are branded/specific to them’, by demographics, October 2012
    • • Figure 149: Agreement with the statements ‘Lager is a drink which is suitable for both men and women’ and ‘Lager is more refreshing than other alcoholic drinks’, by demographics, October 2012
    • • Figure 150: Agreement with the statements ‘Draught beer tastes better than beer in bottles/cans’ and ‘I prefer lagers with an ABV (alcohol content) of 5% or more to those with a lower ABV’, by demographics, October 2012
    • • Figure 151: Users' attitudes towards beer, by most popular types of beer drunk in home, October 2012
    • • Figure 152: Users' attitudes towards beer, by next most popular types of beer drunk in home, October 2012
    • • Figure 153: Users' attitudes towards beer, by most popular types of beer drunk out of home, October 2012
    • • Figure 154: Users' attitudes towards beer, by next most popular types of beer drunk out of home, October 2012
    • • Figure 155: Users' attitudes towards beer, by attitudes towards craft beer, October 2012
    • • Figure 156: Users' attitudes towards beer, by attitudes towards craft beer, October 2012 (continued)
    • • Figure 157: Users' attitudes towards beer, by attitudes towards craft beer, October 2012 (continued)

34. Appendix – Consumer – Attitudes Towards Craft Beer

    • • Figure 158: Attitudes towards craft beer, October 2012
    • • Figure 159: Users' attitudes towards craft beer, October 2012
    • • Figure 160: Agreement with the statements ‘I would try more craft/micro-brew beer if I knew more about them’ and ‘Craft beer is too expensive’, by demographics, October 2012
    • • Figure 161: Agreement with the statements ‘I expect/would expect craft beers to taste better than non-craft beers’ and ‘I am prepared to pay more for craft beers’, by demographics, October 2012
    • • Figure 162: Agreement with the statements ‘It is important for craft beer producers to be independently owned’ and ‘I would expect craft beers to be better for drinking with food than non-craft beers’, by demographics, October 2012
    • • Figure 163: Agreement with the statements ‘I would like to see a better range of craft beers in supermarkets and pubs/restaurants’ and ‘The wide variety of flavours of craft beers is appealing’, by demographics, October 2012
    • • Figure 164: Agreement with the statements ‘I am less likely to try a craft-style beer from a larger beer manufacturer’ and ‘I am more likely to identify with craft beer than popular brands’, by demographics, October 2012
    • • Figure 165: Agreement with the statements ‘I like to drink beers which are less widely drunk’ and ‘I prefer to drink regional beers to support local producers’, by demographics, October 2012
    • • Figure 166: Attitudes towards craft beer, by choice factors when buying beer, October 2012
    • • Figure 167: Attitudes towards craft beer, by choice factors when buying beer, October 2012 (continued)

35. Appendix – Consumer – Attitudes Towards Ales/ Stouts

    • • Figure 168: Attitudes towards ales/stouts, October 2012
    • • Figure 169: Attitudes towards ales/stouts, by demographics, October 2012
    • • Figure 170: Attitudes towards ales/stouts, by demographics, October 2012 (continued)
    • • Figure 171: Users' attitudes towards ales/stouts, October 2012
    • • Figure 172: Users' attitudes towards ales/stouts, by demographics, October 2012
    • • Figure 173: Users' attitudes towards ales/stouts, by demographics, October 2012 (continued)
    • • Figure 174: Attitudes towards ales/stouts, by choice factors when buying beer, October 2012
    • • Figure 175: Attitudes towards ales/stouts, by choice factors when buying beer, October 2012 (continued)

36. Appendix – Consumer – Target Groups

    • • Figure 176: Target groups, by demographics, October 2012
    • • Figure 177: Types of beer drunk, by target groups, October 2012
    • • Figure 178: Choice factors when buying beer, by target groups, October 2012
    • • Figure 179: Attitudes towards beer (any agreement with statements), by target groups, October 2012
    • • Figure 180: Attitudes towards craft beer (any agreement with statements), by target groups, October 2012
    • • Figure 181: Attitudes towards ales/stouts, by target groups, October 2012