Drinks giant Scottish & Newcastle UK is bound to feel optimistic after this year's favourable summer weather, tied in with World Cup football fanfare. But with changes in consumer drinking habits for both beer and cider in the past year, the brewer has had to give its portfolio a good shake-up.
S&N's overall profit is down from last year because of a number of factors, particularly the sale of the Miller Genuine Draft and Beck's brands. Its work to remove the 50%-free deal on plastic bottles of white cider, to support responsible drinking and add value to the cider market, is also likely to have contributed.
These are not the only changes it has implemented over the past year. In March, S&N announced its first bout of TV advertising for San Miguel as part of a £9m investment in the brand. With more consumer interest in imported beers, San Miguel has "fantastic potential," says head of customer marketing Craig Clarkson. "We will invest more. It stands in a category on its own - half premium and half speciality." Foster's, one of its key brands, also got a boost this year with the launch of a new brand extension. Foster's Twist reflects the current consumer interest in all things premium, and the citrus-flavoured lager was also aimed at pulling female drinkers into the sector. Despite very little year-on-year change in value in the total lager category, Foster's sales increased 3.1% in the 52 weeks ending 1 October 2005 [ACNielsen].
Similarly, while the total ale category went into decline, down 3.6% in value, leading brand John Smith's Extra Smooth grew 17% to £57m for the year.
But during the past year ,the brewer has probably been giving most of its attention to the cider side of its portfolio as the category continues to shine. Its Strongbow brand leads the category with sales of £109m for the year to 1 October 2005, up 17% on the year before. And last summer it brought out the premium Strongbow Sirrus, followed this year by Belgian-style fruit cider Jacques and the relaunch of Bulmers Original.n