Comment - Is Heineken a Match for AmBev in Brazil?

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With football's World Cup in Brazil less than 18 months away, the country's brewers are busy jostling for elbow-room ahead of what will be a huge marketing opportunity. 


The last, and only other, time Brazil hosted the tournament was in 1950, when none of the matches were televised. Rio will welcome the Olympics in 2016, but it is the World Cup where the opportunity for brewers appears strongest. 

Last week, Mintel's Latin America research director, Sebastian Concha, told just-drinks that AmBev is upping its focus on premium beers to protect its market share from the likes of Heineken and Kirin. It was a shot across the bows from a brewer that sees the upcoming tournament as a chance to consolidate it position as the dominant force in Brazil.

In fact, it is AmBev's huge market share - about 70% - and a few other idiosyncrasies that should make this World Cup marketing campaign unlike any other. 

To begin with, for only the second time since 1978 this will be a winter World Cup (the other being South Africa in 2010), for the host country, an off-peak time for beer sales. Last year, one of SABMiller's European bright spots was increased sales in Poland, which co-hosted Euro 2012 in the summer. 

Brazil is unlikely to see a similar spike in consumption during its winter, so brewers will have to think more about brand positioning than pushing volumes compared to previous World Cups.

Domestically, that positioning will be dominated by AmBev. The A-B InBev subsidiary occupies around 60% of the domestic lager sector with its Skol and Brahma brands, according to Mintel.

AmBev has the big bucks so you can expect to see a lot of marketing activity,” Concha said, adding that small-scale “guerilla marketing” could allow smaller players to twist the spotlight towards them.

But with the eyes of the world on the host nation, World Cup brewers know that brand positioning must look outwards as well as in. This is even more important in Brazil, where domestic consumption is already high, giving brewers more motivation to plug international labels. Furthermore, international brands are slowly gaining traction in a country where local brands take up about 90% of the market. 

This is where we see Heineken, a company that Concha describes as playing a “smart game” in its attempt to claw market share from AmBev.

When it comes to global branding, few do it better than Heineken, this comment would suggest. Look at the Dutch company's Be a Man of the World campaign. This initiative is cross-border and aspirational and ties neatly into its huge push alongside the latest James Bond movie, Skyfall. According to Concha, the marketing has played well with Brazil's emerging middle-class, and Heineken has used this leverage to place itself strongly in the premium category. 

So, while the stage is set in Brazil for the world's top national football teams, the country's brewers are also lined up for their own competition. Concha says this one should go with the favourite.

“The main thing for AmBev is that they capitalise on this big opportunity, internally with their local brands as well as globally with their international brands,” he said. But while the World Cup tends not to throw up a surprise winner, AmBev's rivals will be hoping that 2014 is the year the minnows come good.

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