presentation 2 beer in germany

8/4/2019 Presentation 2 Beer in Germany

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UB GROUP - UNITED BREWERIES LIMITED

(Kingfisher beer)

Presented byRaul Braganza - 09Jai Desai - 19Rohit Khemani - 43Viral Maniar - 51Sanket Medhekar - 53


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Industry Overview

Globally, over 133 billion litres of beer issold each year.

In comparison, the Indian beer Industrycontributes a meager 2% of the globalsales.


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UB Group

The UB GROUP wasfounded by Scottishgentleman ThomasLeishman in 1915.

The group startedmanufacturing beer from

south Indian based Britishbreweries and elected itsfirst Indian Director, Mr.Vittal Mallya in 1947.

Kingfisher the most visibleand modest brand made itsentry in 1960.

Later on Mr. Vijay Mallyabecame the chairman of UBGROUP.


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Major Products of Kingfisher Beer

Kingfisher Premium Lager beer.

Pack size: 650ml; Load ability: 24*650 ml

Kingfisher Strong beer.

Pack size: 650 ml; Load ability: 24*650 ml

Kingfisher Taj mahal beer.Pack size: 330ml; Load ability: 12*330 ml

Maharaja Premium Pilsner beer.

Pack size: 330ml; Load ability: 12*330 ml

Kingfisher Horse Royal Lager beer.

Pack size: 650ml; Load ability: 12*650ml.

Kalyani Black Label Strong Premium beer.

Pack size: 650ml; Load ability: 12*650ml.


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SWOT analysis of Kingfisher Beer

Strengths Weaknesses

Strong brand image Global presence Aggressive advertising Market leader Quality & innovation

Expensive brand Maintenance Relatively static market Long development

Demographic changes Changing societal behavior Attitude Consumer brand

New competitors Economic downturn Growth in substitutes Increasing buyer power

Opportunities Threats


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Beer Industry in Germany

C C di i f B


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Current Condition of Beer

Market

Germany is the largest beer market in Europe.

While, annual beer consumption in Germany is estimated at100,850,000 hectoliters (2,664,174,620 gallons), annual beerconsumption per capita is 115.8 liters (30.6 gallons).

In per capita consumption, Germans take the third place after

Czechs and Irish.

Around 1,300 breweries exist today in the country.

The industry in the northern part of Germany is weaker but morecentralized in comparison with the southern part of country.

Moreover, there is a huge variety in beer types and beer brands allover the country due to an old, well established beer culture. It isestimated that there are over 5,000 different brands on the marketshelves, bars, and pubs of Germany.

C C di i f B


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Current Condition of Beer

Market

German beer production is regulated by a law which is calledReinheitsgebot (order of purity). This law regulates ingredientrequirements of beer which has resulted in international fame ofGerman been for its high quality due to these ingredientrequirements.

An aging population is avoiding consuming as much beer as theyused to. Younger populations prefer to drink mixed beverages.

German beer companies are direct their strategies to new productlines including beer-mixed cocktails and beverages like lemon beer.

One success story is that of Bionade, an organic soft drinkfermented with natural ingredients like beer. This new product wasintroduced by the owners of a small brewery with declining salesand is now an international success


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Styles of Beers

Pils Light wheat beer Beer cellar Dark Bright

Dark Wheat Old Bock beer Dark beer Crystal Wheat

Klsch Doppelbock


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Top 5 Beer Brands in Germany

Brand 2010 2009 2006 1998

1 Oettinger 6.34 million 6.59 million 6.65 million 2.38 million

2 Krombacher 5.41 million 5.38 million 5.16 million 4.48 million

3 Bitburger 3.92 million 3.85 million 4.16 million 3.95 million

4 Warsteiner 2.8 million 2.85 million 3.33 million 4.67 million

5 Veltins 2.58 million 2.47 million 2.63 million 2.21 million

Commercial Segmentation of the German Beer Market


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Group Division Examples Distribution

Low Beers

(low cost,

low price,

low taste?)

About

25% of the market, growing

No Name (Contract Brewing)

Grafensteiner, Felskrone, Ratskrone,

Bergadler, Falkenfelser and other fantasy

names

Supermarkets

and discount

stores only

Branded

low beers

Oettinger(the only national

brand),Sternburg(East), Hansa,Grnfelder

,Paderborner

Supermarkets and

Getrnkemrkte

(GAMs)

Major Beers

National brands

Top 10 national Pils brands:

Krombacher, Bitburger, Warsteiner,

Beck's, Jever, Hasserder, Veltins, Knig,

Radeberger, Holsten.

These Top 10 brands stand for about

30% of the German beer market

All types of outlets

and on tap in many

pubs

Others: Erdinger, Paulaner(Weizen), Augu

stiner(Helles),Flensburger(Pils), Kstritze

r(Schwarzbier),

Strong regional brands,

partly national distribution

Examples: Reissdorf(Kln), Licher(Hesse

), Rothaus(Badenia),Andechser(Bavaria),

Wernesgrner(East), Lbzer(North)

Other regional brands

About 300 to 400 regional brands, mostly

from mid-size breweries, starting from the

North Sea (Dithmarscher) to

Bavaria(Ayinger) and the Black

Forest(Waldhaus)

Commercial Segmentation of the German Beer Market


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Special Beers

Estimated market share

1% (by volume)

to 2% (by value)

Breweries

Special styles: Rauchbier

(likeSchlenkerla) and Doppelbock

(likeAventinus); and special brands

likeDucksteinand Uerige

Supermarkets

and GAMs in

the region of the

brewery

Handcrafted beerswith short shelf life

Direct sales at

the brewery andlocal grocery

stores

BrewpubsHandcrafted beers,

mostly not bottled

Syphons to take

out
http://www.bierbrauset.com/shop/bier-zapfen/bier-siphon.htmhttp://www.bierbrauset.com/shop/bier-zapfen/bier-siphon.htm


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Porters 5 Force model To Introduce

Kingfisher Beer in Germany

Industry competitors -Huge industry competition

due to presence of local brands

Barriers to entry -High set up cost,Customer loyalty,

Govt rules & regulations

Power of SupplierLow power

Power of Buyers -Power of buyers will be

high.

Substitutes -Changing preferences of youth


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Political Factors

The German government has supported thebeer industry with funding for industrialtraining programs and low excise tax for beerwhich keeps consumer prices inexpensive

domestically.In 2002, the German government stated that"There will be no increase in beer tax, inresponse to proposed EU tax on beer. Beerprices are a very emotional issue in Germany people expect it to be as inexpensive asother basic staples like eggs, bread andmilk,"


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Demand Condition

Germany has one of the world's highest per-capitaconsumption rates of beer (123 liters per person in 2003)and is the home to the beer purity law Reinheitsgebot.

Germany has one of the most sophisticated and

informed beer consumers in the world.

Consumers are consequently very knowledgeable anddiscerning about beer taste and quality, therefore will nottolerated bad quality beer.

Currently demand is changing as consumers are lookingfor beer alternatives including alcopops or alcoholicsoda popa kind of mixed drink.

S S d Ri l


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Strategy, Structure, and Rivalry

There are more breweries per capita inGermany than in any other country approx1300.

The industry is highly fragmented and has ahistory of collaborating when in theircollective best interests, which includesmergers and acquisitions.

German breweries, are strategicallypositioned in the center of the EU with theworlds greatest beer-consuming market.


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Socio Factors

Beer has had an important role in German history for almost1,000 years. The character of the drink reflects the characterof the people of that country.

Beer has become, through the years, a symbol of Germanculture and economic, social, and political life has been

affected by the industry that makes this popular drink

It is consider as good as staple food.

Save Water Drink Beer the slogan applies for People in

Germany

The Famous Beer Festival of Germany is known worldwide


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Brewing Styles & Beer Regions

Germans are very conscious of distinct beer styles. When they order a beer,they rarely ask for it by its brand name. Rather they order beer by its styledesignation, asking for a Pils, an Alt, a Klsch, a Weissbier, a Helles or aDunkel, for instance.

German beer making has taken different paths in different parts of the country.Broadly speaking, beers become maltier as you travel from north to south andhoppier as you travel in the reverse direction.

Among all the German regions, the southern-most state, Bavaria, clearly hasspawned the greatest variety of beer styles. They vary in shades of color andstrength. Some brews, like the Helles, are quaffing, or easy-drinking, beers,while others, like the Eisbock, are sipping beers.

Neighbouring Bohemia to the east of Bavaria has produced, under Bavarian

influence, the world's most popular style, the Pilsner, which is the mother of allmodern lagers, including the popular German Pils, the Dortmunder Export, andthe Bavarian Helles.

The northern regions, until the late Middle Ages hot-beds of ale brewing, havegiven us the dry, assertively hoppy Pils, the original Bock from Einbeck (whichwas an ale in the Middle Ages), and a light, acidic wheat beer called BerlinerWeisse.


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German Beer Labels

German breweries often use prefixes or adjectives in conjunction

with their style names to highlight a particular characteristic of theirbeer.

For instance, ungespundetmeans a low-effervescence beer thatwas fermented to the finish in an unpressurized fermenter. Thecarbon dioxide in the solution, therefore, is minimal and the beer

tastes only gently ptillant and very smooth.

The word hellor hellesmeans "light," but, unlike in North America,this designation refers to color only, not to the beer's calories oralcoholic strength.

If a beer features the prefix uror urtyp, which mean "original" or"original type," the brewery tries to emphasize the authenticity of itsbeverage.


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Government Taxation

German breweries pay taxes by the "heaviness" of their sweet wort(which is the run-off from the malted grain in the mash tun, i.e.,unfermented beer).

Wort heaviness is measured as the percentage of non-watersubstancesmostly fermentable malt sugarsdissolved in the wort.

Most German beers contain around 88% water and 12% extract. Asa rough rule, depending on the fermentation method used, oneextract point contributes about 0.3 to 0.4% alcohol by volume to thefinished beer.

The higher the extract level of the unfermented beer, the more taxthe government collects on the brew, regardless of the final alcoholcontent of the beer that results.


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By law, a Vollbier(literally "full" or "entire" beer) contains 11 to 14%

extract. This category holds about 99% market share in Germany.

A completely fermented Vollbier usually has between 3 and 5.3% alcoholby volume. Pils, Helles and Weissbier (Hefeweizen) belong in thiscategory.

Three other beer categories occupy the remaining 1% of the market:Einfachbier(literally "simple" or "plain" beer) has about 0.1% marketshare.

It is defined by a taxable extract value of 2 to 5.5% and generally has nomore than 0.5 to 1.5% alcohol by volume.

Schankbier (literally "tap" or "draft" beer) has a 0.2% market share. Itsextract value is 7 to 8%, and its alcohol by volume level tends to bebetween 0.5 and 2.6%. Berliner Weisse, for instance, falls into thiscategory.

Finally, Starkbier(literally "strong" beer) has a 0.7% market share. Allbeers with an extract value exceeding 16% are Starkbiers. Their alcohollevel is invariable above 5% and usually no more than 10%. All Bockbiers,Doppelbocks, and Eisbocks belong in this category.

Government Taxation


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From Brewery to Consumers

Germany lacks the stringent alcoholic beverage regulations.

There are no state-run or province-run beverage stores, nor is therea three-tier system that rigidly separates licensed producers fromlicensed distributors, and both from on- and off-premise retailers.

Instead, anybody in the beer trading chain including breweriesand wholesalerscan sell beer directly to the public and many beerdistributors make "house calls."

In Germany, beer is just another food commodity. It is readilyavailable just about anywhere, any time, including on Sundays, at

convenience stores, supermarkets, department stores, newspaperkiosks, gas stations, company cafeterias, and even vendingmachines.


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Every brewerynational or localmakesseveral beer styles, and a brand is a brewery'sparticular interpretation of a style.

Stores carry more than one brewery's brands,

pubs and restaurants tend to be tied to just one,often local, brewery and serve only thatsupplier's brands.

The brewery, in turn, supplies all theestablishment's glasses, taps, trays, and neons,and often even the pub's or restaurant's entirefurnishings.

From Brewery to Consumers


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Entering German Markets

Entering market with a local Name ofEisvogel(Kingfisher in German) to connect with local

people

Tagline for Advertising- Aus Knig zu Fischer alle

whlen zu trinken Eisvogel (From King to Fisherman allchoose to drink Kingfisher)

Adhere to Local Requirements to meet Order of Purity

Acquisition / Merger of Local Breweries for entry in Local

Market and Save Distribution CostAcquisition / Merger with a intent to utilize Strategic

Value of Brewery


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Launch to time with Beer Fest so thatMaximum Attention can be sought

Use the existing relationship with Scottish

& Newcastle to have an effectiveDistribution Network in Germany

Leverage our present style of Pilsner to

target the market for pils in Germanywhich has market share of 67 %



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Market different styles of beer in different parts of thecountry

Use prefixes or adjectives in conjunction with their stylenames to highlight a particular characteristic of theirbeer.

Kingfisher Blue will be called Eisvogel ungespundet, asungespundet tastes only gently ptillant and is verysmooth.

Kingfisher Premium will be called Eisvogel helles, ashelles means light

Likewise Strong beer will be called Strak Prefix ur Original while Advertising and also in brand

name- Ur Eisvogel Strak Focus on Innovation on Mixed Brands to meet the

expectation and target the Youth Population of Germany



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Promotional Activities

Promotional offers Free beersSponsor Famous Pubs in all Major Cities

making them exclusive outlets to sell our

beerFreebies such as Music CDs with a Carton

of beer

Tie Ups with Local Football Clubs for salespromotion

To make house calls for the population

to sample Eisvogel

presentation 2 beer in germany

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