In Fine Form
Newly strengthened by its co-acquisition of Scottish & Newcastle, Heineken continues to regard travel-retail as an important pathway to international growth. David Davies finds out more
AS might be expected from a supplier that holds the number one position in the global premium beer segment, Heineken is a perpetual hive of activity, its brand imagery and commercial messages
virtually ever-present in both domestic and travel-retail. However, even by the industrious standards of
the Amsterdam-based beer giant, the last 12 months have been particularly eventful.
Arguably the most significant individual development took place at the end of April, when a consortium made up of Carlsberg and Heineken acquired Scottish & Newcastle – home to brands including
Foster’s, Strongbow, John Smith’s and Newcastle Brown Ale – after months of increasingly feverish expectation. A deal that heralded the end of the Edinburgh-based brewer’s independence after more than 250 years saw Carlsberg acquire S&N’s 50% of the BBH joint venture in the CIS, Brasseries Kronenbourg in France, Mythos in Greece, and S&N’s investments in Vietnam and China. Heineken, meanwhile, took ownership of S&N UK, Central de Cervejas in Portugal, Hartwall in Finland, Alken Maes in Belgium, the majority of S&N’s export markets, and the company’s investment in United Breweries in India.
There have also been several significant changes to the team at Heineken International, the division
that oversees the supplier’s duty-free and travel-retail business. Long-serving DF/TR global account manager airports, Melvin Broekaart, left the comp a n y last autumn, while DF/TR managing director Erik van de Ven moved on to become general manager Heineken T a i w a n . The ensuing TFWA World
E x h i b i t i o n served to publicise the arrival of Greg Graves as the new head of He i n e k e n ’ s t r a v e l - retail division – an oppor tuni t y that Graves utilised to discuss his plans for the channel, including v a r i o u s promotional activities and the continued support of TR-orientated products like BeerTender and
DraughtKeg.
With sales onboard cruise lines and airlines, and at airports remaining robust, it would be reasonable
to expect Heineken to be more than satisfied with the status of its travel-retail operation. Speaking to
Frontier in July, however, Graves outlined an ambitious vision for the channel based around a “focused
portfolio” and an enhanced distribution platform.
“We believe travel-retail is an important channel for connecting the Heineken brand with international
consumers,” he says. “By having a focused portfolio of premium brands that appeal to travel-retail consumers, we will better meet the needs of the travel-retail operators, providing a stronger distribution platform upon which we can continue to grow the Heineken brand long-term.”
The importance of innovation
As anyone familiar with special products like the 5L DraughtKeg container, BeerTender home draught
system and DAVID mobile draught system will know, product innovation has long been a pivotal part of
the company’s travel-retail offer. While Graves says that no further travel-retail exclusives are in prospect
for the rest of 2008, it is clear that the underlying emphasis on bringing something new, fresh and
unexpected to the channel will remain unaltered.
“Innovation in both packaging and draught beer systems will continue to be a focus for Heineken,” he confirms. “The 5L DraughtKeg which provides consumers with true draught quality beer is a great
example of an innovative product we have been able to use successfully in the retail environment in border shops, ferries and airport shops (where duty-free arrival shopping is allowed). Our Xtreme Draught system – a mobile, maintenance-free draught system – has been a great innovation for cruise lines and ferries as well.”
And while Graves does not disclose specific plans, it is clear that Heineken International has a keen interest in the potential of the newly acquired S&N offers, not least global number one cider brand Strongbow, leading UK ale brand John Smith’s and Newcastle Brown Ale, the last-named one of the fastest- growing speciality brands within the US market. Keen observers will doubtless be keeping an eye out for the company at this year’s TFWA World Exhibition, but for now, Graves is giving little away.
“Heineken will again have a major presence at Cannes,” he says. “While plans are still in development
we will be looking to introduce our expanded portfolio, which now includes the brands we have taken over from S&N.”
As for the long-term prosperity of the beer category within this retail channel, Graves is sounding as confident as you would expect from a prime mover at one of the industry’s most powerful and creative suppliers.
“We expect beer to continue to grow over time in line with the growth of the travel-retail industry,” he concludes.
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