Comment - Brewers Wake Up and Smell the (Cider) Apples
Stella Artois Cidre hit the US this week
It was always a case of when, not if: Anheuser-Busch InBev has finally launched its Stella Artois cider off-shoot, Cidre, into the US market this week.
The 4.6% abv brand will initially be available in 26 US states, with a possible roll-out to more states next year. But, can Cidre repeat the brand's level of success in the UK?
Since launching in February 2011, Cidre has been the main driver of growth in the UK's "premium mainstream" cider category, according to research group IRI. UK sales of the brand reached GBP50m (US$76.1m) in its year of launch, and GBP68m last year. Although the launch was not without its problems, the brand has succeeded in attracting new drinkers to the category, while enticing long-term cider drinkers to trade up. A pear variant was also released a year ago.
But, the US cider market is a different, less mature, beast.
Cider is still less than 1% of US beer consumption. This, despite, the category growing 110% in off-trade accounts and 70% in on-trade accounts. Plus, as has been widely acknowledged, cider continues to have an image problem in the States. A-B InBev alluded to this in its press release on the launch. But, the company claims, Cidre has the "potential" to change US drinkers's perceptions of cider, with its drier European-style taste, compared to sweet US hard ciders.
Who will drink Cidre in the US?
Instead of trying to compete with beer - as it might in Europe - Cidre is being aimed at white wine drinkers in the US. A-B InBev claims it will be a "refreshing alternative". In this respect, it seems that female drinkers will be a key target demographic. There's no mention, however, of Cidre trying to take share from craft brewers.
Ultimately, A-B Inbev seems keen to carve out its own niche with Cidre in the US. It's a tough ask, but, with doubtless a hefty marketing spend behind the brand, it will make a dent.
It may, however, want to steer clear of making too many claims around calorie counts for Cidre, a mistake it almost made with Michelob Ultra, its other US cider brand launched last year.
Bernstein analyst Trevor Stirling last year accused big brewers of being "asleep at the wheel" in the US for the past 20 years, in failing to capitalise on drinkers' growing taste for sweeter drinks.
Anheuser-Busch InBev (A-B InBev) is facing challenges in the mature US beer category by focusing on premium and craft beer. As the US Justice Department precluded A-B InBev from controlling the lucrat...
A-B InBev is the leading global brewer with 18% of global beer volumes, and the company is well placed to take advantage of expected volume growth in emerging markets, especially in Mexico following i...
Inbev will continue to focus on premiumisation, adding value and Increasing its channel coverage over the forecast period. The company will continue to invest heavily in marketing support and new prod...
InBev Italia’s strategy for the forecast period will be to continue its occasion-based marketing, and to promote its products. The company will concentrate its efforts on meeting consumers’ expectatio...
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