Olly Wehring

Battle in Brazil - global brewers on the prowl?

By: Olly Wehring - 9 October 2006 14:33

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As I approach my third anniversary here at just-drinks, I am reminded by an analyst of one area I wrote heaps about during my first few months in the job.

Some of you may remember, in 2003, when the Brazilian beer industry provided interesting reading. The country’s second-largest brewer, Schincariol, stole a march on market leader AmBev almost overnight, with a marketing push that succeeded in eating away at AmBev’s dominance. With hindsight, AmBev concedes that it was “arrogant” and “slow” at the time.

In a note to clients today (9 October), industry analyst Bear Stearns is warning that a new battle is brewing in the South American country. This time, it looks like Kaiser, which Molson Coors sold to FEMSA at the beginning of this year, who is going to give AmBev a run for its money. The unit is poised to launch its own advertising blitz, which may lead to another round of market share grabbing.

While Kaiser has its work cut out, AmBev could take quite a body blow if the campaign proves effective. If the global brewers get wind of the preparedness of Brazil’s beer drinkers to chop and change, then what’s not to stop them paying the country a long, possibly permanent visit?

We’ll keep a close eye on how the situation pans out. But, for now, in the words of Bear Stearns: “Let's Get Ready to Rumble.”

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