Euromonitor: 2014 beer market 2% decline
Euromonitor’s category briefing on Beer in Ireland also claimed that an earlier sharper decline was due to the impact of the economic downturn, adding that as economic conditions continue to improve and consumer confidence rises, spending on beer is being bolstered to an extent.
However decline is continuing as consumption patterns change and evolve, with this linked to an increasing consumer focus on health and wellness as well as the impact of high levels of excise duties on unit prices, it stated.
Price
Beer’s total unit price increased by 2% in current value terms in 2014 with the majority of this increase being a result of excise duty increases imposed by the government in October 2013. No further increases were made in October 2014 which came as a welcome relief to operators and consumers alike. However, unit prices remain high in Ireland due to high levels of taxation, with VAT and excise duties together making up approximately 30% of the cost of the average pint of beer to consumers.
Flavoured/mixed lagers
Flavoured/mixed lager saw the strongest growth performance in 2014, recording total volume growth of 26%, with the majority of this growth seen in the off-trade, according to Euromonitor.
Growth was, however, from a low base. Growth earlier in the review period (2009 to 2014) was due to the ongoing emergence of brands such as Desperados.
But growth in 2014 was boosted by the launch of Heineken’s Radler which saw a strong Summer marketing campaign and achieved an impressive 30% total volume share of flavoured/mixed lager in its first year.
Euromonitor expects that the flavoured/mixed lager category will continue to see the strongest total volume performance in the period 2009 to 2014, with 8% CAGR. This follows on from a strong 16% CAGR. However total volume sales are expected to remain low, at below half a percentage point of overall beer, with limited consumer interest in these products.
Explaining its figures and the seeming discrepancy between its beer consumption figures and those of the Brewers of Europe, Euromonitor told Drinks Industry Ireland, “The 2015 alcoholic drinks research was undertaken in Q4 of 2014. Therefore our 2014 figures have been calculated based on the performance of the beer market up till summer 2014 and a projection until the end of that year.
“Our analysis at the time did lead us to give a negative forecast of consumption of Beer in Ireland in 2014, given the significant increase in the excise duty in 2013 (+42% in the beer market in Ireland and by a further increase by 10 cent in 2014) and comments we received from main players in the beer market.
“It is also important to bear in mind that information published by trade associations such as the Brewers of Europe – which the Mintel research has based its figures on – also heavily relies on data supplied by producers and members of the association.
“Therefore there is the potential for the published data to include ‘sell in’ data, which might not correlate with actual final consumer consumption.
“Another point to consider that may lead to the discrepancy in our figures is Ireland as a market. While data published focuses on the republic of Ireland; some manufacturers consider Northern Ireland and the Republic as one market in their shipment analysis. This has the potential to create conflicting data. At Euromonitor we consider the Republic of Ireland separate from Northern Ireland – which is included in Great Britain.”
