United Breweries Ltd (UBL) is focussing on expanding the presence of its fastest growing beer-brand Heineken to cash in on growing demand in smaller towns in the country.
The company also plans to better leverage its sports and entertainment properties, like the UEFA Champions League and Green Room in India to boost the popularity of its brand with its target audience.
However, Heineken will not be a part of Kingfisher Premium’s The Great Indian Octoberfest 2013 to be held in Bangalore this month, while the Kingfisher’s tie-up with the Indian Rugby Football Association will now be moved to Heineken.
Heineken, currently present in larger cities, has recently entered smaller cities like Nashik, Nagpur and Kolhapur. The company says its next stop is Kerala, one of the largest liquor markets in India, where it plans to move into smaller places like Kannur, Alappuzha, Thodupuzha and Pathanamthitta.
“So far, we had focussed on restricted distribution - in top retail chains, premium pubs, bars and restaurants, but now we are slowly expanding it,” UB’s Senior Vice President - Marketing, Samar S Sheikhawat said.
Demand for beer in India had been growing at a compounded annual growth rate of 13.5 per cent since 2007, but has slipped to growth of 9.3 per cent in 2012, according to research-firm IWSR. Analysts attribute more than half of this growth to that from smaller cities and towns.
“Heineken is our fastest growing brand for the year with a 100 per cent increase from the last year, with growth more or less equal from every market. These are still very early days and my estimate is it will take another 4-5 years for the growth to start coming down,” Sheikhawat said.
Heineken, owned by Dutch brewer Heineken International, has been domestically distributed by United Breweries in India since a year after it acquired a 37.4 per cent stake in Vijay Mallya-led beer company, United Breweries, in 2008.