Radina Shkutova (watch that ‘k’) has been Heineken Ireland’s Marketing Director for about 12 months, so I thought now might be a good time to ask her about her impressions of the Irish on-trade market compared to that of her native Bulgaria where she began commercial life as a Junior Brand Manager with Heineken Bulgaria and left as Marketing Director for the company. Radina had been working with Heineken Bulgaria for 11 years and jumped at the opportunity to head up the marketing team at Heineken Ireland.
“Heineken are very supportive of moves between ‘OpCos’, recognising that we all learn so much from different markets,” she explains, “When you move to a new market you bring a different experience and give a new and fresh perspective to the team.”
It was a big change for her family and initially she was worried about how her daughter Marina would feel in her new school. But she needn’t have worried.
“Thanks to all the people we’ve met (who‘ve been really nice, open and warm and have made us all feel welcome) Marina settled in school smoothly, enjoyed learning English and we all feel right at home now,” she says.
Every market has its challenges. The Bulgarian beer market is quite competitive and her challenge there was to continue Heineken Bulgaria’s growth in a sustainable manner when the market overall was showing limited growth potential. Sound familiar?
The company also entered the cider market during her time as Marketing Director there.
“The challenge then was to learn about the new category, help educate our consumers and customers and ensure we built sustainable brands with long-term ambitions,” she states.
“Ireland has quite a unique market structure with a strong pub culture. The on-trade accounts for more than 60% of the market here in Ireland, contrary to most of Europe, in which the off-trade accounts for the majority of alcohol sales.”
The company’s challenge in Bulgaria was to counter the continually declining on-trade sector which was driven by the recent economic crisis.
Gradually, the market there shifted to a point where the off-trade accounted for more than 70%.
“This resulted in implications for the business in terms of different pack-type development and our route to market,” she explains.
She must have got the marketing about right because she was twice awarded the ‘Advertiser of the Year’ Award in Bulgaria – in 2014 and again in 2016.
“I believe the magic formula always lies in our people and in our brands,” she says modestly, “We’d a very strong and passionate marketing team in Bulgaria and I had the privilege of working with brilliant creative and media partners. Translating strong consumer insights into brilliant communications was the fun and rewarding part and we were delighted that we were awarded the ‘Advertiser of the Year’ twice in such a short timeframe.
In fact, she sees a lot of comparisons between the Bulgarian marketing team and the Irish one.
“Both teams have an immense talent and passion for our brands. Here too, we’ve built an iconic brand portfolio and continue to drive breakthrough innovations and communications based on deeply relevant consumer insights. The Irish team well deserved their win in 2015 when they won the Irish Marketing Team of the Year.”
Last year, Heineken Ireland grew its own share of a growing Long Alcoholic Drinks market by 0.8%.
“In Heineken Ireland, we’ve aligned our entire business behind a customer-/consumer-centric vision, with innovation both in terms of product and our ways of doing things,” she says, “Importantly, we always have quality at the centre of everything we do because quality is the most important thing consumers look for: the correct glass, the freshness of the beer, the right temperature and the way the beer is poured, all contribute to the perfect drinking experience.
“We’re committed to surprising and delighting our consumers with our portfolio,” she continues, “Heineken Light is a clear example of our forward-thinking approach. We were first to the market in building a moderation category with a lower ABV and lower calorie proposition, both of which appeal to consumers. Our new advertising campaign, Sometimes Lighter is Better, is critical in further communicating our messages.”
Orchard Thieves is a further example of innovation, she claims.
“The launch challenged the status quo with the brand’s bold, urban attitude. Two years after its launch, the cider market is back in growth with innovation now playing a key role in the category.”
H41, another new product for Heineken Ireland, is a limited-edition lager brewed using a rare mother yeast discovered in Patagonia in 2010. The discovery inspired Heineken to explore the possibilities of this newly-discovered yeast and unlock a spectrum of new flavours. A new lager was created and the result was so good that Heineken decided to launch it in Dublin “in selected on-trade outlets” earlier this year.
On-trade strategy this Autumn
With the evenings closing in, Heineken Ireland brands will be very busy in the run-up to the key Halloween and Christmas trading periods.
“The launch of the new rugby season in September is important for Heineken, given the brand’s long-term association with rugby through the Champions Cup and Rugby World Cup sponsorships,” she says, “Over the coming period the Heineken Rugby Club will continue to enhance consumers’ matchday experience in pubs.
“Over the Summer months, Heineken Light’s TV ad, ‘Sometimes lighter is better’, clearly set out the brand benefits of lower calories and lower ABV. This new communication will also be visible in pubs over the Autumn months as Heineken continues to build the moderation segment.
“Sampling among consumers is crucially important to the development of the Orchard Thieves brand and the Orchard Thieves Hip Hop Chip Van will be out on the streets of Waterford, Maynooth, Swords and Wexford over the coming months,” she says.
“In recent months, we’ve also introduced draught Desperados on trial in a number of accounts and we’ll continue to support this exciting development for Desperados in a select number of late night venues.
“It’s important for outlets to understand who their target consumer is and what occasions they should focus on,” she concludes, “In Heineken Ireland, we’ve a clear development programme for our brands including new brands and brand extensions. Securing customer support and interest in these will be important to the development of our business and that of our customers in the future.”
On-trade on the up
Unlike Bulgaria, Heineken Ireland’s on-trade appears to be undergoing something of a revival. Following a 0.6% decline in 2015, volumes were up 1.3% last year. But there were similarities.
“The on-trade beer market in Ireland has, in recent years, seen overall declines on the back of the economic downturn,” she reflects before adding, “However in the past year it has started to see some positive green shoots coming through. This growth is being achieved on the back of ongoing investment by suppliers in introducing new brands, which is helping to make the pub an even more interesting and exciting place for consumers.
“The on-trade channel in Ireland is significant, which is in contrast to most of Europe,” she explains, “Draught beer is also more prominent here than in other markets and there’s a lot going on in the category. There’s a real dedication and passion for quality in the on-trade in Ireland.
“The on-trade delivers a great consumer experience in their outlets, which is one of the key reasons for their return to growth.
“Spending time with friends, family and colleagues over a pint is one of life’s great pleasures,” she believes, “Irish pubs excel at making this experience special. The pubs, hotels and restaurants throughout the country – many of which are family-run – are well-run businesses who put the customer at the centre at everything they do.”
“The Irish pub is a cornerstone of Irish social life and to maintain this position it needs to be supported, invested in and encouraged to develop by increasing and diversifying the consumer offering including the range of products, food and activities.”