Fresh fruit or a rotten idea from Holsten?

Holsten is trying to jump on the flavoured alcoholic beverage bandwagon by launching a fruit-flavoured lager. Omens are mixed, says Mike Addelman

Holsten UK has turned alchemist in an attempt to capitalise on the success of flavoured alcoholic beverages (FABs), sales of which grew by 33 per cent to £282m in 2000. It hopes that, by adding fruit, it can turn base lager into gold. The resulting fruit-flavoured bottled lager is expected to be called Holsten Fusion (MW last week).

Holsten UK will test-market the product, which will be available in three flavours – apple, citrus and blackcurrant – in pubs and bars and in supermarkets from May, before committing to an advertising campaign.

It hopes to aim the product, priced at £4.50 for four bottles, at 18to 27-year-olds of both sexes.

The company, a subsidiary of Holsten-Brauerei, Germany’s largest brewer, markets premium lager Holsten Pils in bottled, draught and canned formats; Holsten Export in cans and on draught; and bottled beer Duckstein.

Sales of Holsten Pils in off-licences and major multiples fell by 16 per cent to £21.3m in 2000, according to AC Nielsen, while rivals Stella Artois, Becks Bier and Kronenbourg 1664 all saw sales rise. However, Holsten UK claims volume sales of bottled Holsten Pils grew by 6.9 per cent last year for the onand off-trades together. Sales in the premium packaged lager (PPL) market rose last year from £919m to £943m in the on-trade and from £964m to £1bn in the off-trade.

Holsten UK marketing director Andy Edge is keen to avoid the hybrid product being labelled an “alcopop lager”, preferring a closer association with the premium packaged spirits (PPS) market, which has spawned Bacardi Breezer and Smirnoff Ice.

He says: “This product is an authentic lager which gives the customer a choice of flavours, in the same way that Bacardi Breezer gives different choices. The brand’s competition will come from other PPLs or PPSs.”

Edge says the product was developed after consumer research by 2CV identified a gap in the lager market for a lighter, sweeter-tasting drink.

The research showed that, after a few pints of premium lager, consumers are sometimes left with a bitter taste in their mouths and that they may switch to a sweeter drink to counteract the effect.

Edge adds: “Research shows that the market is ripe for an evolution of the lager category. Holsten’s new product will have the qualities of lager, but with a twist of flavour to make it more refreshing.”

A market analyst from stockbroker Charles Stanley sees the logic behind Holsten’s move. He says: “PPSs such as Smirnoff Ice and Bacardi Breezer have experienced massive growth in recent years. Why not try to do the same thing in the lager market?”

Guinness UDV commercial PR manager Paul Flanagan points out that PPS Smirnoff Ice helps to promote parent brand Smirnoff Red. Similarly, Holsten Fusion could help drive sales of other Holsten products.

Flanagan claims that Smirnoff Ice sales grew 71 per cent by volume last year, while Smirnoff Red grew by three per cent in the same period.

On the downside, HP Bulmer has already attempted to apply the same logic to the cider market, with last year’s launch of Strongbow Spice flavoured with apples, cinammon and juniper. The company admitted last month that its alcopop cider failed to achieve predicted sales levels.

In any case, fruit beers are nothing new. Belgians have been drinking so-called Lambic beers, such as Interbrew’s Belle-Vue, for about 300 years.

Specialist beer seller Steve Christopher, who manages the Beer Shop in central London, says: “Fruit-flavoured beers have been in the UK for about 18 years, but they are still a niche product. I can’t see them growing by very much.

“Holsten’s idea dilutes the concept. The company is missing the point – Lambics are a unique style and are made in a particular way.”

But Edge claims the drink is not meant to be a fruit beer like the Lambics, but a flavoured beer, which he claims is a new concept.

He says: “The Belgian-style fruit beers are a speciality product. This will be a mainstream brand which appeals to both sexes – a very different thing.”

But a supermarket drinks buyer predicts that Holsten’s hybrid lager will disappear without trace because the company has decided to introduce the brand simultaneously in the onand off-trades, rather than concentrating its initial launch activity in bars, clubs and pubs.

He says: “You don’t launch a brand in supermarkets. The on-trade is where brands succeed, because the choice is much more limited in pubs and customers are forced to try new brands.

“HP Bulmer tried a similar thing with Strongbow Spice, but it failed because it was launched in the off-trade.”

Holsten’s PPL rivals will be watching with interest to see if an injection of fruit will help lift sales and mirror the success of Bacardi Breezer and Smirnoff Ice.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3703 or email customerservices@marketingweek.com

If you are looking for our Jobs site, please click here