Heineken credits increased marketing spend for sales rebound

Heineken says its decision to increase marketing spend helped return it to growth in Western European markets in the first quarter.

Brewer returns to growth in Western Europe with Heineken brand signalled out.

The brewer of Heineken, Strongbow, Amstel and Sol says like for like sales – from brands owned for a year or more and stripped of the impact of currency fluctuations – grew 1.8 per cent in the three months to 31 March.

The growth marks a turnaround for the company, which reported a 2.2 per cent dip in like for like sales from the region in 2013.

Heineken says the benefit of “higher marketing investments to drive brand development, innovation and improved outlet execution” helped it gain share in markets including Netherlands, France, Spain, Ireland and Portugal in the period.

The brewer announced plans to increase marketing and innovation investment to drive growth in February after seeing volume sales slump in key territories such as Western Europe.

The company has increased support for new products such as Foster’s Radler and Strongbow Gold after the share of sales from NPD grew ahead of target in 2013. It has also increased investment for its Radler beers in an attempt to appeal to women.

Its master Heineken brand was signalled out as the star performer in many Western European markets, enjoying 8 per cent year on year growth in the period across the world.

However, gains in those markets were partly offset by lower sales in the UK. The company did not strip out volume or revenue for the UK but blamed Easter falling outside the first quarter for the underperformance.

Globally, like for like sales grew 3.4 per cent.

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