Carlsberg credits early Euro 2016 competition marketing for brand sales lift
Carlsberg has attributed “strong” sales for its flagship beer to its decision to promote its backing of the 2016 European Championships early.
The beer brewer used this year’s World Cup to launch a long-term football platform that will stretch to its sponsorship of the pan-European tournament in two years time. Since the start of the club season in August, Carlsberg has exploited buzz around the championships qualifying matches to drive preference of its top beer.
The tactic is paying dividends already with value sales of Carlsberg beer up 3% in the three months to September. While much of its football activity has focused on England, the company said growth had mainly flowed from markets where the beer has a premium positioning, namely India, China and France.
The performance pushed sales up 4% to 18.12bn kroner (£1.9bn) in the quarter with the brewer also benefiting from double-digit growth of premium brands Tuborg (23%), Kronenbourg (10%) and Somersby (43%). Organic revenue, which excludes, currency effects, was also up 2%.
Carlsberg’s improved value sales masked the impact of volume decline in the period, which fell to 37.6 million hl from 38.6 hl a year ago due to a drop in consumption in Eastern Europe.
Increased marketing spend in other markets to offset the drop period contributed to higher costs. Operating costs grew organically 6%.
The company says priorities in its strongest Western Europe markets are to improve profitability, cash flow and returns alongside bolstering its premium brands. At the same time, cost savings are planned to “increase efficiencies across the business and simplify its business model”.
Elsewhere, Carlsberg plans to invest more in branded content as well as launch digital tools to extend its reach to more consumers. The brewer is currently centralising social media for its brands around responsive sites in order to access behavioural data faster.
Jørgen Buhl Rasmussen, chief executive of Carlsberg, says the brewer’s commercial plan remains unchanged. “Our innovation agenda is a key priority and included the further roll-out of brands, concepts and innovations.
Carlsberg’s volume woes come as the UK’s beer industry unites to show there is a perfect style of brew whatever the occasion. While focused on creating a stronger premium positioning for the category, the campaign hopes to lift volume sales in the long-term by presenting beer as a more flexible drink.
