Rekorderlig is owned by AB Abro Bryggeri

Rekorderlig is owned by AB Abro Bryggeri

Not many business empires begin with a holiday to Peru. But that was the genesis of Chilli Marketing, which last week sold the UK rights of Swedish cider brand Rekorderlig to Molson Coors.

The Manchester-based marketing firm was started by a group of friends fresh out of marketing school in Huddersfield. While travelling in Peru, one of them discovered the local beer Cusqueña and decided it could be a hit back home. The newly-formed Chilli Marketing secured the UK rights to it, and Cusqueña was soon turning over a couple of million pounds.

But the company's real story began in 2008 when its owners - Gareth Whittle and brothers Kieron and Christian Barton - convinced the Swedish brewery AB Abro Bryggeri to sell them the global distribution and marketing rights to Rekorderlig.

AB Abro had launched the fruit cider range domestically in 1999 and it had already gained good recognition among younger consumers. But Chilli Marketing took it to the next level, and in a just a handful of years established it as one of the top-selling premium ciders in the UK, and no.1 in Australia.

That success has now been underlined by Molson Coors' acquisition (Chilli Marketing retains the rights in the rest of the world, except for Sweden, where they are controlled by AB Abro).

But what is the North American company getting for its money?

Rekorderlig is more expensive than comparable premium ciders in the UK, allowing Chilli to extract strong margins.

It has been aided by some very canny marketing. Chilli has successfully played up the brand's Swedish heritage, which for today's consumer manages to convey a modern, forward-thinking image connected to an idea of a pure and natural product.

This allows the ciders to hit the sweet spot in terms of demographics, with the target consumer in the 18-35 range. The gender split is also very attractive - according to Chilli, there's roughly a 50/50 splice between males and females, and Rekorderlig's fruit-forward taste profile (or, to put it another way - sweet products) allow it to appeal to both beer and cider drinkers. It also bridges over into the cocktail and spirits world, particularly in the on-trade.

The problem is, though, that last week's deal is confined to the UK, Rekorderlig's most mature market. If you assume Molson Coors is looking to grow the brand in the UK, then it will have to do so within the confines of a very competitive landscape.

Also - though there is an argument that Rekorderlig breaches the boundaries of the category - it's worth noting that the world's main cider growth no longer occurs in the UK, but has instead been ceded elsewhere.

According to a Canadean report last month, the UK's cider market share is expected to decline from 41% this year to 33% in 2020, losing most of it to the US, Australia and South Africa.

It is no coincidence that these are the markets Chilli Marketing has been focusing on for the past few years. The Molson Coors deal now frees it up to spend more resources mining the potential of ciders exciting new frontiers, particularly in the US, where the company launched Rekorderlig in 2013.

Back then, and working from its base in Manhattan, Chilli Marketing was in just on just three states: New York, New Jersey and Florida. Now it has branched out to more east coast regions and is busy setting up operations on the west coast. In Central Park this year, the company invested in its biggest State-side marketing campaign so far - sponsoring the SummerStage arts festival, which brings a range of music and theatre performances to the heart of New York.

The hard work appears to be paying off. According to Chilli Marketing, Q1 sales in New York state were up 115% despite a snafu with a distribution company that affected a number of alcohol producers in the region. In New Jersey, sales jumped by 139% in the same period, while in Florida they were up by 281%.

These are growth figures - albeit from a smaller base - that Molson Coors won't find in the UK, no matter how much it invests. And then there's the further growth inhibitor in the shape of Rekorderlig's production.

Currently, all of the cider (except for the 0.5% of total volumes made in Australia and New Zealand) is made at AB Abro's brewery in the small Swedish town of Vimmerby, using the local spring water.

That's great for marketing purposes, but not so good logistically. If Molson Coors wants to up production considerably, it may not be able to do so while maintaining Rekorderlig's Swedish base.

But would Molson Coors risk moving a much-loved brand away from the region is it most associated with?

Most definitely, is the answer, as it has already done exactly that with Doom Bar, the Cornish ale that the company took over through the acquisition of Sharp's Brewery in 2011.

Molson Coors has said it wants to "preserve the unique culture and special appeal" of Rekorderlig, suggesting that it intends to keep production in Sweden. But then it made the same reassuring noises when it took over Doom Bar.

Let's hope that if the company decides to transplant Rekorderlig, it will at least have the sense to inform consumers first.