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Building a successful global beer brand: part 3
Having highlighted increasing levels of consolidation within the beer industry and the benefits of such a shift, Kos Apostolatos, David Atkinson and Joseph Poore from management consultancy firm Marakon, explore how to go about building a global beer brand.
Doing so is not obvious and requires a systematic approach and patience in your long-term investment. We have defined four key steps for getting there:
Step 1: Define the benefits of global brands to your organisation
In our discussions with leading brewers, we found inconsistencies within and across organisations about the benefits global brands bring. Based on our experience they are:
Leverage international media and advertising platforms: Only a global brand like Budweiser can take advantage of being the face of the FIFA World Cup.
Better route to market: Premium international imports like Heineken and Corona are musts in the on-trade and off-trade.
Consumer confidence: Being international makes you more credible; e.g., as Beck’s has expanded its footprint, it has also boosted awareness and credibility.
Economies of scale: AB InBev and Heineken are saving 50% or more by producing one high-quality Total Variable Cost (TVC) instead of different TVCs for multiple markets.
Repeatable and scalable model: Corona has expertly created a repeatable export model that takes into account each stage of a brand’s lifecycle in a country, so subsequent launches are increasingly effective.
| Exercise 1:Define the benefits of global brands to your organisation.Take the list above as a starting point and assess:
The benefits of global brands to your organisation The implications of moving toward a global brand-led strategy The timelines for your project |
We identified the top 10 global beer brands as indicated both by the revenue, volume generated across multiple markets and the intent to be global (i.e., advertisement on global media platforms).
Top 10 global beer brands
|
Countries with total revenue > €50m |
Countries with volume > 100thHL |
Advertise on global media platforms |
|
|
|
|
|
|
| Heineken |
32 |
37 |
✓ |
| Carlsberg |
22 |
23 |
✓ |
| Corona |
13 |
9 |
✓ |
| Guinness |
12 |
15 |
✓ |
| Budweiser |
11 |
13 |
✓ |
| Stella Artois |
11 |
11 |
✓ |
| Beck’s |
9 |
6 |
✓ |
| Miller Genuine Draft |
9 |
9 |
✓ |
| Amstel |
7 |
9 |
✓ |
| Foster’s |
5 |
4 |
✓ |
Defining what a global brand means to your organisation is the first step toward success. It helps you set the governing objective for the brand, communicate the benefits of the brand internally and break down the “local prejudice” barrier that is still prevalent in the beer industry today.
For further information, contact Kos Apostolatos +44 (0)7825 040 036, kapostolatos@marakon.com or David Atkinson +44(0)7809 779 829, datkinson@marakon.com
This is interesting. You could also see a global brand lowering group risk e.g. the recent issues Carlsberg has had by primarily participating in Russia could have been offset if it had focused more on its Asian business.
Yes, that’s a good point, but that benefit could also be generated using local brands. Further, and surprisingly, the Carlsberg brand is a small part of Carlsberg’s operations in Russia (the Carlsberg brand represents less than 1% of their 2011 Russian volume, yet Russia represents nearly 40% of group volume). In terms of risk, global brands to tend to be more resilient to adverse market conditions though, due to their established global brand equity, so there is most likely a benefit here.