Cider makers ponder export possibilities
Buoyed by recent growth in the UK, cider producers are eyeing export opportunities but, writes David Robertson, they will be aware that international expansion has proved a difficult challenge for cider brands in the past.
Cider has been a popular tipple in the UK for about a thousand years but a recent surge in sales is encouraging drinks manufacturers to consider taking alcoholic apple juice to the rest of the world.
New premium ciders like Magners, produced by Irish drinks group C&C (formerly Cantrell & Cochrane), and Scottish & Newcastle's Bulmers Original have turned many consumers away from premium lagers and back to cider.
According to Mintel, British cider sales have grown by over 7% to 4.5m hectolitres in the past two years while beer sales have remained largely flat. This success is encouraging drinks companies to consider launching cider brands into foreign markets.
This is a far cry from the dark days of the last decade when farmers were ripping out orchards and Bulmers, which owns the Scrumpy Jack, Woodpecker and Strongbow brands, was struggling to survive, eventually being bought by Scottish & Newcastle (S&N) in 2003. Moreover, Bulmers' troubles were in part created by failed international expansion.
However, the current boom in the cider market and in particular the premium potential that Magners' success has demonstrated may make cider producers put those memories to one side and look optimistically towards the international market.
In the UK, it was the decision by C&C to introduce the premium cider Magners that saw the market really take off. Magners, which is served in attractive bottles and is poured over ice, has become a hit among more affluent consumers looking for a change after years of drinking premium lager brands.
In addition, a second group of consumers are the post alco-pop generation, twentysomethings who have grown out of sugary ready-to-drink (RTD) brands but still want a product that isn't beer.
Sales of Magners have grown by 130% in the last year and S&N, which controls about two-thirds of the GBP1bn UK cider market, has responded by introducing Bulmers Original in a similar format.
Simon Russell, a spokesman for the National Association of Cider Makers, said: "There are a number of factors that have led to cider's recovery including innovation in the premium sector. But drinks companies have also stopped discounting so heavily, which has led to more retailer support for brands, and consumers like the more natural ingredients of cider."
England is by far the largest cider consumer in the world but South Africa, France and Ireland are also familiar with the drink. Both S&N and C&C are understood to be looking at how they can replicate their UK successes in these countries. A spokeswoman for C&C said: "Magners is considering a move into other countries after its success in the UK although they have gone no further than saying that they are interested."
Russell goes further. He believes major drinks companies could look beyond markets where the product already has a following. "There are traditional cider drinking communities in Northern Spain and Brittany and also expat and tourist-related sales in Mediterranean resorts but there is now a real opportunity for the big players to attract interest in wider markets," Russell told just-drinks.
Drinks companies in Australia are understood to be interested in the "Magners on ice" concept and this could lead to copycat launches or joint ventures in the future.
However, introducing a new taste and new concept can be very difficult, and cider companies will be aware that Bulmers was in part undone by failed international expansion. But the current boom in the UK has injected new life and confidence into the category, and cider makers may feel they now have a golden opportunity to move into the international arena.
Buoyed by recent growth in the UK, cider producers are eyeing export opportunities but, writes David Robertson, they will be aware that international expansion has proved a difficult challenge for cid...
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