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Heineken eyes leadership of alcohol-free market

News, 16 May 2017
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EUROPE: Heineken, the Dutch brewer, has launched a zero-alcohol version of its flagship lager product as the brand aims for a global leadership position in a fast-growing category.

Unlike rivals, who have non-alcoholic beers tailored to individual markets, the beverage giant launched Heineken 0.0 at the Spanish Grand Prix in Barcelona with plans to sell the product in 14 markets across Europe, Russia, and Israel.

Between 2010 and 2015, the European zero-alcohol beer market grew by roughly 5% a year, a market that Heineken intends to enter on the back of the apparent consumer interest for hangover-free beer.

For companies, alcohol-free beers offer higher margins, Reuters observed, as the taxation would be similar to that on soft drinks, a category potentially under threat as brewers become able to stress beer's natural credentials, and offer a healthier drink.

"You could expect 10 to 15 years down the road this would be more or less the global trend," said Gianluca Di Tondo, senior Heineken brand director. "We want to make Heineken the leading global beer brand in 0.0."

The trend is also apparent to AB InBev, the largest brewer in the world, which has said that it aims to make a fifth of its beer low (up to 3.5%) or zero alcohol by 2025.

Heineken 0.0 is the product of  a "virtuous learning cycle" that was outlined by Codruta Berbecaru, global customer management insights project manager at Heineken, at an ESOMAR Sensory Forum last year.

She was explaining the development of the company's Radler product (beer mixed with lemonade) that launched in 18 countries at once. The cycle, she said, allowed them to progress in "waves"; the first involved getting the European core market right; the second reduced mistakes in branding by delegating to local flavour teams.

The third wave sped up the processes, allowing the launch of different products, one of which, Berbecaru added, was a 0.0% alcohol product.

"What we had to do with consumers was first of all, in our innovation process, simply validate the concept," she explained. "We needed to make sure that the story we were intending to tell to these people was understood [and] was exciting them."

Data sourced from Reuters; additional content by WARC staff

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