Turning challenges into opportunities – The beer duty malaise
For many the response to the Spring Budget alcohol duty announcement is ‘dazed and confused’ – dazed by ever increasing complications required of the industry and confused about the future implications for their business. It seems to be a symptom of the more-for-less (more effort, less return) world that we are living through.
One of the most significant implications is the increase in duty on packaged beer, which has been in continued growth. Conventional retailing wisdom tends to be to decrease scale when retail prices go up – have you noticed that your favourite chocolate bar has got smaller over the years? However, premiumisation has been the order of the day in recent years and according to predictions, 70% of total beer consumption will be in the premium or super-premium category by 2025. There is always an opportunity to enhance your high-end positioning to make your pricing appear even greater value. You need to make design your most powerful selling weapon and build real equity – the consumer mindset has shifted to quality over quantity and authenticity over artifice.
Other strategies that can be built into brand building are:
/ If ABVs are reduced, create more flavour cues, richness, and emotion to your graphics – after all, we eat and drink with our eyes.
/ New product development (NPD) and innovation will also help maintain and justify price – this has sustained the craft beer rise to fame over the last decade and long may it continue.
/ Super premiumisation is yet another route to price nirvana – look at the price comparisons between 75cl bottles and standard 500ml bottles
Most of all, in our fast-overheating planet, where sustainability has to be everyone’s priority (29% of consumers say they would pay a premium) and draft has a fantastic message:
/ Returnable and reusable packaging
/ All natural ingredients
/ Reusable by products from animal feed to compost to Marmite and supplements, even wastewater can become part of a managed ecosystem (check out Purity Brewing).
Whilst cask has the strongest eco message of all, it is even dispensed manually, it should be the drink of choice for all those environmentalists out there and even more so the preferred drink for the new generation of sustainability conscious drinkers. Cask is the perfect candidate for our circular economy.
Wake up and smell the hops…
In this highly competitive and crowded world of brewing, your brand is your most powerful differentiator and your most effective means to engage your customers – from the trade who put their trust in your ability to build sales, to your loyal drinker who puts his money where their mouth is. Meaningful brands drive sales and deliver growth.
When the market gets tough, the tough get branding…
WPA Pinfold have unrivalled experience in the brewing sector, more than any other brand consultancy in the UK. More than 40 years creating over 100 drinks brands and winning over 150 global design awards.
In an overcrowded and disrupted market we can ensure that you have the competitive edge.
Please contact us here.