Bass in limbo as McBride bows out

This week’s departure of Bass Brewers’ marketing director, Sémus McBride, comes at a crucial time for the company’s beer division. It completes the dissolution of a marketing team that was responsible for launching two new sectors in the UK drinks market – cream ales and alcopops – and raises the question of why Bass has let such a successful marketer leave. McBride returns to Colgate-Palmolive, the company he left to take up the Bass post four years ago (MW October 9 1993) – at the time, the top beer marketing job in the UK. He has already taken up the Colgate post as vice-president of marketing Europe, based in Paris. But he leaves behind a brewer uncertain about its future after the rollercoaster ride of last year. And he leaves it in the hands of Mark Hunter, promoted to marketing director from the position of director of brands. Last year was a watershed for Bass’s brewing arm. The division spent half the year concentrating on “project B” – how it would manage the acquisition of the Carlsberg-Tetley brands, only to see the acquisition halted at the last moment. The UK beer market has been in suspended animation since President of the Board of Trade Margaret Beckett knocked back Bass’s plan to take over C-T. Bass is running out of options for building its beer business in the UK. Bass’s major innovations of recent years – the alcopop Hooper’s Hooch and “creamflow ale” Caffrey’s – opened new sectors in the alcoholic drinks market, but ran out of steam last year. Hooch was hit by the fall off in alcopops, which suddenly seemed rather childish in comparison with the new sophisticated spirits mixers such as Westbay-owned Metz. Hooch’s sales fell 13 per cent overall, though last summer’s sales were perhaps as much as 30 per cent down on the previous year. Caffrey’s is also thought to have stopped in its tracks after a highly promising start. The company’s pre-Christmas results statement says Caffrey’s Irish Ale volume was “marginally higher” than the previous year, with sales at 220m. But it admits there was “some substitution by Bass Brewers’ own standard ales in a creamflow format”. So whatever advantage Caffrey’s had when it was launched, as the first such creamy headed ale in the market, it has dissipated through rival launches, and competition from Bass’s own brands such as Worthington Draught Bitter. Bass says its market share of the cream ales sector stands at 13.5 per cent – a market, that is, which it created. The development of Carling Premier was seen as a shrewd way of extending the Carling brand and giving the brewer what it so badly needs – a premium lager. But it is unlikely to become established as a major brand to take on the likes of Stella Artois as, so far, it has achieved a market share in the premium lager sector of about only three per cent by volume. The lacklustre performance of these once shining stars of alcohol branding – Premier, Caffrey’s and Hooch – has coincided with the departure from Bass Brewers’ marketing department of the executives who pioneered them – all in the past 12 months. Dave Carruthers, who was responsible for lager brand Carling, left after five years to join South African Breweries as head of brand marketing (MW January 31 1997). He was followed by Steve Langan, the ales director who left to join Coke in Brazil. In the run-up to the decision on the C-T merger, three more senior marketers moved on – new product development manager Jenny Ayres, Carling senior brand manager Maurice Newton and Simon Curry, brand manager for Caffrey’s. Observers were surprised that McBride has stayed in his position for so long. Insiders say he was promised a senior post within Bass, if he made a success of the marketing role. He failed to secure the top position at Bass Brewers in 1996, when the post went to Iain Napier, chief executive of the Leisure division. Observers say Napier and McBride never really “spoke the same language”. Napier is said to have an accountant’s approach to business. This contrasts with McBride’s more cerebral, intellectual views on marketing. They did not understand each other. According to one source, when marketers spoke in a language Napier did not understand, he would say: “You’ve been taking Sémus’ pills!” Another source, close to the company, says: “The message has come from the plc that Bass Brewers is to be a traditional brewing company rather than a go-ahead marketing concern. They want Bass Brewers to balance the books, not to create waves.” However, Napier will have to deal with Hunter, who is a marketer very much in the high-falutin’ McBride mould. Neither McBride nor Bass would make any comment. Next year Bass may seek to acquire a premium lager. It could buy out the Grolsch brand, which it already distributes in the UK and Ireland through a joint venture with the brewer. Apart from that, its options are limited, unless it can develop some new ground-breaking lager brand. Another route is for Bass to extend some of its themed pubs, such as the O’Neills Irish bars, into Europe and the US to build distribution for Caffrey’s and Bass Ale. Bass plc is about to hand back 850m to Bass’s shareholders after a rash of sell-offs which has left the company cash rich. First went Gala bingo clubs to a management buyout for 250m. A few days later, a consortium of restaurateurs acquired 1,190 of Bass’s leased pubs and 238 managed pubs for 563.7m. On top of this comes the proposed 375.5m sale of the Coral betting chain to Ladbroke, competition authorities willing. Bass has the money, and the inclination to make major acquisitions – analysts say it could gather a war chest of up to 2bn. The company will spend the money as soon as it finds something worth splashing out on. The favourite is a major hotel purchase in the Far East while the economic crisis’ in Asia depresses property prices. Bass’s Holiday Inn chain spent 47m on four Australian hotels this week. Bass also has opportunities to expand its brewing business through acquisitions, and Bass Brewers certainly needs a shot in the arm. Chairman Sir Ian Prosser says Bass is committed to building “higher growth brands”, but it will need to regain the edge in its beer marketing. The acquisition, or development of a premium lager brand, will be a key factor in achieving this.

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