The beverage business blog from Olly Wehring
If you would like to offer your comments, opinions, suggest topics or just have a good rant, please feel free to email: Olly Wehring.
A-B and Miller - will the bickering never stop?
05 May 2006 13:37
There are a few things guaranteed in life: death, taxes – and the odd spat between Anheuser-Busch and Miller Brewing, are certainly among them.
This week, Miller dismissed the ‘Here’s to Beer’ campaign – an industry-wide initiative led by A-B to promote the beer category as a whole – as only serving the interests of the Budweiser brewer. A-B had tried to garner industry support for the campaign, but has been left to handle the effort on its own as rival brewers opt to focus on their own brands.
Yesterday (4 May), St. Louis hit back, arguing that ‘Here’s to Beer’ had won industry-wide backing, pointing out that wholesalers and retailers around the country were supporting the campaign. Moreover, Bob Lachky, the A-B executive in charge of the campaign, was quick to point out that rival wholesalers were putting their weight behind the initiative and insisted the marketing drive did not need the endorsement of other brewers.
The campaign is a personal crusade for Lachky, the man behind many of A-B’s marketing successes in the past. He is adamant that ‘Here’s to Beer’ is working, with the domestic beer category up during the early part of this year and beer beginning to win back share of throat against wine and spirits in some US states.
A-B has been less bullish, however, about last week’s revelations in the Wall Street Journal that the brewer had changed the recipes to Budweiser and Bud Light in recent years. The WSJ – the second most read paper in the US – quoted A-B chairman August A. Busch as saying that he ordered more hops to be added to the beers. This admission comes after A-B had repeatedly denied Miller’s claims that it had changed the recipe for Budweiser and Bud Light.
Naturally, Miller was delighted at A-B’s ‘confession’ and the giddiness in Milwaukee must have reached record highs last week, as Miller sent a plane flying over A-B’s St. Louis HQ with a banner that read: “Sire, sire, pants on fire” (No, I didn’t get it either).
It was a stunt that left A-B employees scratching their heads in bewilderment but maybe Miller shouldn’t be so hasty in revelling in others’ discomfort. A-B saw domestic volumes rise 4.6% during the first quarter of the year, the first signs of a turnaround from last year’s disappointing performance. Meanwhile, Miller’s parent, SABMiller, revealed in a trading update last month that Miller sales-to-retailers were down 1% for the year to 31 March.
SABMiller reveals its full financial figures for the year on 18 May – only then will we really discover if it has been left with egg on its face.
Beer before wine, feel fine - wine before beer?
03 May 2006 16:21
My three-week adventure in Argentina came to an end last week, and no sooner do I get back than our friends in the brewing industry, who may have felt somewhat neglected during my wine exploits, give me something to write (home?) about.
The race to snap up Foster’s Asian brewing interests appeared to take an interesting turn last week, with Asia Pacific Breweries mooted to be the new front-runner. Industry sources told just-drinks that, while Scottish & Newcastle and SABMiller were the original favourites, APB seems prepared to stump up more cash for the assets.
In the US, meanwhile, the continuing backbiting between Anheuser-Busch and Miller saw the latter pull “I told you so” poses, with A-B admitting that it had changed the recipes of Budweiser and Bud Light, despite its dismissal of Miller’s claims late last year as “just another marketing ploy”.
And with Molson Coors set to announce its figures early this week, it looks like the brewers are set to hog the limelight for a little while longer.
Looming on the horizon, and itching to steal a share of the limelight, meanwhile, is the London International Wine & Spirit Fair. The event, which has become the seminal meeting point for the world’s wine companies, returns this month, and just-drinks has all the bases covered – not only will we be there in person, with our own stand where you can come and say hello and check your emails, but we’re also launching a preview diary today. Every day between now and 16 May, we’ll be running a page highlighting who’s doing what, when and where at ExCel.
To let us, and all our subscribers, know what your plans for the LIWSF are, drop me a line at email@example.com, and we’ll put you in our diary.
(Late) Postcard from Argentina
27 Apr 2006 15:30
As custom dictates, my postcard to you all from Argentina arrives after I return home. Back at the helm, I still had time last week to raise a dram to you, dear reader, in front of the Perito Moreno Glacier (ice from the glacier, of course).
Sincerest thanks to Wines of Argentina for making this photo possible.
19 Apr 2006 10:36
A warm welcome back to all of you after what was – hopefully – a relaxing break over Easter. Easter is a time when thoughts turn to new life and last week we saw one of the industry’s major players taking a decisive step in refreshing and revitalising its business.
Australia’s Foster’s Group tied up one of the loose ends of its flagging international brewing business with the sale of the rights to the Foster’s brand in Europe, Russia and parts of the CIS. And with the sale of its brewing assets in Asia likely to follow in the coming months, Foster’s, under the steady command of president and CEO Trevor O’Hoy, is moving to reposition itself as a global premium wine producer.
The deal was the first sign that Foster’s had accepted the end of its dream to be a key player in the global brewing industry. The company had invested heavily in the world’s emerging beer markets but returns from their operations in markets like India, China and Vietnam were not good enough – and Foster’s found it nigh on impossible to compete with the brewing giants of InBev, SABMiller and Heineken.
Nevertheless, last week’s sale of the rights to Foster’s in Europe is likely to leave the company in a stronger position in an ever-consolidating wine industry. Foster’s is likely to have taken more than a passing interest in Constellation Brands’ recent acquisition of Vincor International, a deal that strengthened the US group’s position as the largest winemaker on the planet. Foster’s now has a considerably stronger balance sheet and is in a better position to expand via acquisitions or invest more cash behind marketing its stable of wine brands, investment that is growing all the more necessary in the wine industry with the growing power of retailers around the world.
For more on a brighter future at Foster’s, check out our Hot Topics section: http://www.just-drinks.com/topic.aspx?ID=21
And for those who have scoffed one too many Easter eggs over the last few days, check out our look at the rise of ‘wellness’ products. http://www.just-drinks.com/topic.aspx?ID=20
Some of the language used by soft drinks producers to promote their expanding range of ‘functional’ or ‘nutraceutical’ wares may be a little clumsy but I’m sure some of you will find some solace that there are healthy options on offer after gorging yourselves on chocolate over the weekend.
The future of wine tourism
11 Apr 2006 12:09
One final point from me, before I disappear into the Argentinean sunset for a couple of weeks...
Naturally, I’ve been spoilt rotten over here, with flagons of wine, enough steak to floor the most vociferous of carnivores, and overnights in hotels that I wouldn’t normally be able to afford in a month of Sundays.
One of these hotels got me thinking, though. This one located in the north-west of Argentina, is part of the El Esteco winery, whom I was a guest of last week.
Now, don’t get me wrong, this is not an advert – it’s just that, with so many winemakers in stunning parts of the world struggling a little (yes, Monsieur France and Matey Australia, I mean you), what better way of opening another revenue stream by opening a hotel? My esteemed peer and travelling partner, wine writer Simon Woods, noted on the trip that New Zealand has some pretty good hostelries attached to wineries, and I can attest to the superb set-up at the Fetzer winery in Hopland, California.
The arrangement at El Esteco, however, is that the winemaker has rented a chunk of its buildings to Starwood Hotels & Resorts, to run and maintain.
Although our hosts wouldn’t go into figures, this feels to me like the ideal path for wine tourism to take in what, for some, are troubled times.
Old master of the New World
10 Apr 2006 14:04
A warm, slightly gloating welcome to the beginning of your week from Mendoza in Argentina. I’ve been dragged, kicking and screaming, to this staggering country by its wine trade body, Wines of Argentina. If they pull anything like this again, I’m telling my dad.
It’s been an eye-opening few days. Having spent the last two-and-a-half years writing about the country’s wine exploits, it’s been a pleasure to put faces to names. In fact, it’s been one pleasant surprise after another.
One surprise – to me at least – is the heritage Argentina’s wine industry can boast of, that flies in the face of its New World moniker. Having been making wine for around 150 years, and boasting a per capita wine consumption at one point of around 90 litres, the term New World looks like an oxymoron to me – and indeed to them.
The country’s winemakers take great pride in the legacy their country carries, and having been on the international stage for only nine years, the fifth-largest wine producing nation could be perfectly poised to exploit Old World dramas and Australian crises.
With apologies for this wine-soaked missive, last week’s big story was the eventual sale of Vincor International to Constellation Brands. Of course, hindsight is a wonderful thing, but, like many, I could never see the US wine giant take Vincor’s initial snub last year so quietly. For further musings on the first big wine buy of the year, check our Hot Topics section.
Meanwhile, all this fun has got me quite exhausted, so I’m off for a fortnight’s holiday around the rest of Argentina. Recommendations of what to do and where to go are all gratefully received at the usual address.
Times are a-changing
04 Apr 2006 16:14
Well, it’s the end of week one of the new-look just-drinks.com, and – bar a few technical glitches – the rebirth has gone startlingly smoothly. Many thanks to all of you who gave me your feedback on the new design and layout – the majority gave us a resounding thumbs-up, and the glitches brought to our attention should be ironed out within the next few days.
A couple of interesting issues caught my eye last week, meanwhile. The first were the results of a UK consumer survey, which concluded that less than half of the UK population trusts the nutritional claims made by food and drinks companies.
The survey drew similar conclusions about European and US consumers, so no-one appears safe in the trust-stakes. Naturally, this situation should worry everyone in the drinks industry – consumer perception is something that takes years to cultivate, and just as long to get back. And, more’s the point – if consumers don’t trust nutritional claims, does that not stretch to all other claims made by companies?
Secondly, I was in London last Tuesday (28 March) for a briefing by premium soft drinks brand Shloer. The company, bought by the SHS Group last year, has spent time looking at its target consumers and how best to get more of them drinking its product (sound familiar to any of you, by any chance?).
Recent research told Shloer that the use of celebrity to market a product was no longer believable. This could have worrying repercussions for some drinks companies out there, who pour millions of dollars in the direction of the famous and fabulous.
Are the times a-changing? Or has our new look just made me obsessed with change?
A quick shout out too for our Hot Topics this week, which have looked at the Britvic Soft Drinks Report (http://just-drinks.com/topic.aspx?ID=14), the perils, pitfalls and potential of trading in China (http://just-drinks.com/topic.aspx?ID=15) and what lies ahead for Foster’s in Asia (http://just-drinks.com/topic.aspx?ID=16).
Now, you’ll forgive me for leaving you in the capable hands of news editor Dean Best, while I nip to Argentina to see how they make wine. Updates as and when I can get away.
A new born just-drinks, a new born Brook Carter
29 Mar 2006 13:25
It gives me tremendous pleasure to announce a new addition to the just-drinks family... of sorts.
This morning, at 0800 our esteemed former editor - and now group news editor - Chris Brook Carter, and his wife, Abby, welcomed baby Jack into the world.
At 8lb 15oz, Jack is probably set to follow his father on the rugby field, although if someone can make a laptop small enough, there's nothing to say he couldn't help out on this esteemed organ some time soon.
Congratulations to you both, Abby & Chris, from the just-drinks team.
A new dawn
27 Mar 2006 12:08
Well, here it is, folks. The new just-drinks site has landed and I hope you'll agree that it has been worth both the wait (for you) and the effort (for us).
Feel free to take a few minutes and scout around the new site. We'd welcome your comments, both good and bad, on the redesign. Also, if we've missed anything you would like to see, then please let us know. You can email me direct at firstname.lastname@example.org.
Now, let the new adventure begin.
Coming Soon... to a computer screen near you
22 Mar 2006 15:56
Some of you, particularly those with functioning memories (unlike me) will remember hearing a distant fanfare being trumpeted by the former editor of just-drinks, Chris Brook-Carter, on his move upstairs last year.
CBC promised you, dear reader, so much more from just-drinks in the future, but at the time was conservative with the detail. Well, having made the hot-seat here at just-drinks well and truly mine in the last six months – I’ve even stencilled my name on the back – I am now able to give you just a little bit more info.
This month will see the unveiling of a brand new look for the Website you know and love. Our technical team have been working all hours to produce what I can safely say is a stunning looking site that will help you get to the information you need faster, easier, and happier.
The new design will still have the same quality - and quantity - of global news coverage, but with added comment and analysis from those that are in the know. Our columnists will sift through the PR spin and give you what’s what, while our run of high-up interviewees will continue to deliver the personalities you want to hear from. We’ll be introducing factsheets, a new, improved search facility and news and features by category. There’ll also be a redesigned daily newsletter, which will allow you to choose what sort of news you want to get and when you want to get it.
So, forgive the excitement here, and watch this space, as soon you will see the fruits of our labours. I’m sure that you will agree it has been worth the wait (and the fanfare).