Heineken aims to grow African market
IOL Business/ Reuters - May 14th, 08:05
Johannesburg - A thirst for beer among Africa's middle classes is driving the world's biggest brewers to invest on the continent, but getting women to drink the beverage is another matter.
One brewer, Heineken, is attempting to woo the elusive female African drinker with a sweeter, low-alcohol beer made from malt and lemon that it hopes will persuade them to try its other lagers.
Siep Hiemstra, head of Heineken's African operations, said beer consumption on the continent was still predominantly male, but the new drink, Radler, with a 2-3 percent alcohol content, could change women's perceptions.
“For female drinkers this is the first step towards the beer category,” Hiemstra told Reuters. “If that is the case it will probably also allow them to enter the beer category and taste a nice Heineken.”
The Dutch brewer, which operates in 20 African countries and competes with SABMiller and Diageo, introduced Radler in the Democratic Republic of Congo (DRC) last month and plans to launch it elsewhere in Africa and Western Europe this summer, Hiemstra said.
Heineken is not alone in trying to tap the market for women drinkers. Danish brewer Carlsberg, for example, has the Eve brand of lychee-flavoured lower alcohol beer.
However, some beer makers have struggled to make inroads, with Molson Coors axing its lower-alcohol, fruity Animee brand in Britain a little over a year after launch.
The rising spending power of Africa's middle classes has propelled the expansion of its beer market, which is forecast by some to grow 50 percent over the next ten years. By 2020, analysts at Plato Logic expect Africa to represent 7 percent of global beer sales, from around 6 percent now.
Hiemstra said Heineken, which has invested $2.2 billion in Africa since 2005, wants to focus on consumers trading up from home brews, bought by the majority of Africans, rather than competing with locally made beers.
Commercial brewers sell only one in five litres of beer on the continent but branded beers are growing in popularity.
“Our mission is to make sure that we are ready for people when they want to move on from beers made in home breweries,” Hiemstra said.
Markets such as Nigeria, Kenya, South Africa and Ethiopia, where Heineken bought two breweries in 2011 and is constructing a third, have been key drivers of its growth on the continent, he added.
Heineken, which opened its first African brewery in what is now the DRC in 1923, is also looking to develop new sources of raw materials in order to meet its target of getting 60 percent of supplies locally by 2020, from around 50 percent now.
It is in the process of setting up a supply chain to improve barley production in Ethiopia and is exploring how it can source cassava from Nigeria, the world's biggest producer of the tuber, Hiemstra said. - Reuters
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