Snow’s on the way. Not the fluffy white kind that slows the UK’s rail networks to a soul-destroying dawdle, though. Molson Coors announced this week it had cut a major deal to bring colossal Chinese lager brand Snow to the UK in the new year.
Molson Coors claims the launch will tap growing demand for world brews, which are trouncing mainstream lagers in the battle for British wallets. But is there really room in the increasingly crowded UK market for another posh foreign lager?
Snow’s a monster in the Chinese market, accounting for roughly a quarter of all beer sold across the country. But the British beer market is a different beast.
It’s far smaller, massively consolidated, and volumes are falling as shoppers drink smaller quantities of more premium products. And traditional thinking on pricing, marketing and the importance of big brands has been turned on its head by craft beer’s assault on the nation.
And while sales of world beers do consistently outperform the market, the term ‘world’, I daresay, has been applied a little loosely. More accurately, Brits are gagging for a specific type of world beer. Despite the impending Brexit, it is European brands that are selling like hotcakes.
The likes of Peroni, Amstel and Estrella Damm are flying off the shelves, but Asian lagers like Cobra, Singha and Tiger – the ranks of which Snow will join in the UK – are in decline, with value sales down 0.4%, 0.5% and 19% respectively [Nielsen 52 w/e 9 September 2017].
There are exceptions to this, of course. Asahi has upped its value by more than half (48.4%) to £6.5m, for instance. But Asahi has done a superb job of positioning itself as a cut above the rest with a higher price tag and, most likely, significant on-trade gains working in its favour. More generally, however, shoppers just aren’t buying Asian beer brands like they used to [Nielsen].
Playing up its provenance
Molson Coors’ decision to import Snow, rather than seek a deal to brew it here, may work in its favour. The price of a 330ml bottle is yet to be revealed, but I suspect it will be hard to justify anything other than a considerable premium given the distance the stuff will be travelling. Given Brits’ recent penchant for posher beer, this might help sell it – if Molson Coors can do a good enough job of playing up its provenance.
So far, it’s given Snow a swanky rebrand, covering it in Chinese characters. Concrete marketing plans are yet to be announced, though Molson Coors says it wants to build its reputation in the Asian restaurant sector, big up its foodie credentials and tap “the continued food revolution”.
It remains to be seen if its international reputation could hinder its positioning here. Snow is certainly what one could call “mainstream” in China.
But the likes of Estrella Damm and Peroni, both considered relatively mainstream in their home markets, have neatly cornered the top end of the market in Britain by partnering with chefs and limiting their on-trade presence to premium operators. This has translated into premium off-trade positioning and turned both into highly valuable brands.
Molson Coors will no doubt be studying these cases closely. And if it plays its cards right, Brits might get a serious feeling for Snow after all.
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