Renovate or innovate? How Carlsberg is revitalising its ‘sleeping giants’

Carlsberg is making actor Mads Mikkelsen the global face of the brand as it follows up the success of its Carlsberg Export rebrand with new strategies for ‘sleeping giants’ including Tetley.

The brewer launched the £15m Carlsberg Export rebrand, which included a new marketing campaign and product redesign, last year, and it claims the revamp has dramatically improved consumer perceptions and boosted sales.

At a media briefing on Monday (26 March) the brewer revealed that the Export campaign drove sales across the on- and off-trade by 20% and has increased purchase consideration by 8% since its launch last April.

According to Millward Brown data cited by Carlsberg, 71% of consumers agree that Export is ‘good to be seen drinking’ and over the past 12 months there has been a 4% uplift in the number of people who thought that the beer ‘tasted better’, despite the fact the recipe remains the same.

While the campaign, ‘The Danish Way’, started  as a UK-only marketing platform , Carlsberg is now expanding it globally and across its brands.

Liam Newton, vice-president of marketing at Carlsberg Group, tells Marketing Week: “It started as a UK campaign for Export. It has been so well received around the world and because of the flexibility of the format we can now use it in a broader way then originally envisaged. The beauty of it is you can feature different Carlsberg products and change market by market with the needs. We have also signed up Mad Mikkelsen to be the face of future campaigns.”

The Carlsberg strategy: innovation vs renovation

When Newton joined the beer giant 18 months ago, revitalising the brand’s portfolio was his primary goal.

He explains: “I started trying to create a more compelling portfolio for the business. It was about looking at the full brand portfolio — where we should focus our energies, how should we invest against those priorities and which brands we support and which we don’t. We now have a much richer portfolio than we had before from revitalising our core brands and bringing some other brands into the mix.”

Carlsberg now structures itself around four teams focusing on core beer, world beer, craft beer, and innovation and insights. Newton explains that revitalising the portfolio starts with a decision about whether each brand needs “renovation or innovation”.

He explains: “We try to start with the overall category growth and where its coming from, then we look at where the brands are within that overall category story and then we decide is it renovation or innovation which is needed. We try to not get too myopic and to lift our heads above to look at the category as a whole.

Craft has been a force for good because it has injected new life into a category that was feeling a bit stagnant.

Liam Newton, Carlsberg Group

“For Export, we knew in blind taste tests everybody loves the beer but it was the brand that they didn’t like so there was no need to innovate and instead it was a renovation job.”

Newton says the next job is to focus on rejuvenating other core brands including “sleeping giant” Tetley. The ale has already been given a “bold change” with a new design and logo that is being released in the north of England to build organic interest ahead of a campaign.

“It’s a brand we probably haven’t done as much with as we should have and is a sleeping giant in our portfolio,” he says.

“For us its about getting the fundamentals right and gaining credibility in an organic way, which is why we will be pushing this in the north first, because that’s where the ale market predominately is.”

On innovation, Carlsberg is looking to its New York-based partner Brooklyn Brewery. It plans to bring its limited edition Korean-inspired Naranjito orange edition to the UK this summer.

Newton confirmed that there are also “exciting” projects in the pipeline for Carlsberg’s flagship lager as well.

How craft beer revitalised the sector

Newton feels that the rise in craft beer has forced the beer industry to innovate. He explains: “Craft has been a force for good because it has injected new life into a category that was feeling a bit stagnant.”

READ MORE: Global behemoths versus small brewers – The battle for the craft beer market

He adds: “The great thing about craft is that it has brought to the beer market a real focus on the product itself. If you look at some beer traditionally, it’s been more about the marketing than it’s been about the beer.”

Last year, Carlsberg bought and relaunched local brewer London Fields and Newton explains that the marketing for smaller craft beers is very different. “You don’t see traditionalmarketing, it operates to a different set of rules: more digital, more influencer marketing, more localised, more peer to peer.”

The future of sponsorship

Earlier this month, Carlsberg announced it was ending its 22-year sponsorship of the England team to focus on more music events, a decision Newton feels reflects the brand’s future.

He explains: “The decision comes from looking forward at where the market will go and what consumers want. From a recruitment point we’re looking at the 18-30 millennial audience and when you look at that Live Nation footprint they over-index massively in that audience.”

Carlsberg will be running six million on-pack promotions this year as part of its partnership with concert and festival promoter Live Nation. It will also be the official beer of festivals like Wireless and Latitude.

“Our partnership with Live Nation gives us more opportunity for a shared experience with consumers that we can activate all year round. We can activate before, during and after a concert in a way we couldn’t with sports — it felt like a richer area to explore,“ Newton says.

Carlsberg is also exploring opportunities in casual dining, creating a dedicated team for the growing sector and will be launching San Miguel in Gourmet Burger Kitchen as a trial this year.

“We’re making really good progress and focusing on the casual dining sector largely by asking what their needs are rather than what we want. This means talking to restaurants and asking them which brands they think will work for them,” Newton explains.

Despite the successes of the last 12 months, Newton wants to see faster results: “With those big brands they’re like massive oil tankers it’s going to take a while to turn them around.”