The FINANCIAL — Baltika’s sales volume was increased by 85% in 2007. The best selling brand is Baltika itself with 71%, while the second place is occupied by Arsenalnoe – 22%.
Brewery Baltika plans to strengthen its position in the premium segment by increasing its licence portfolio. Baltika will import the Australian brand Foster’s and Kronenbourg 1664. By the end of 2008 the company plans to import Japanese Beer Asahi super dry. The beer will be being produced and bottled by autumn in Saint Petersburg.
“We already invested USD 1.5 million in our marketing and promotional campaign and we are not going to slow our efforts as the Georgian market is a fast growing place for the beer business and this gives all participants the chance for sound development. Baltika is ready to compete not only with local beer producers but also with other foreign beer brands. Our priority is to offer high quality to the customers,” Dimitry Kistev, Director of Baltika Export Sales, declared to The FINANCIAL.
According to the terms of a recently signed license agreement, Asahi Breweries Ltd. gives Baltika Breweries the right to use its trademarks, know-how and technologies and also the exclusive right to produce, sell and promote Asahi Super Dry beer in the European part of Russia to the West of the 60 degrees East longitude and in CIS countries. The agreement will remain in force until 2012.
In 2007 Beer Baltika’s sales index was increased by 82%, while Arsenalnoe’s sales index showed 140% growth. Brand Nevskoes indexes were doubled. Baltika’s share at the market grew from 4.5% to 7.6%. Annually Georgians consume 11 litres of beer per capita.
The Georgian market is a priority for Brewery Baltika. On its side Baltika is the largest and the strongest importer of beer in Georgia.
Over the past three years, the licensed segment of the Russian beer market has grown at a pace well ahead of the market as a whole. At the end of Q4 2007, Baltika had a 27.62% market share in the licensed segment (according to data supplied by the agency Business Analytica), which allowed the company to become the leader in the segment.
The company Baltika has been importing beer in Georgia since 2002. Currently the whole line of Baltika products and other brands Arsenalnoe, Nevskoe and Carlsberg are represented in Georgia.
At the moment, Baltika Breweries has 4 licensed beer brands: Tuborg – the leader of the Russian licensed segment, Carlsberg, Foster’s and Kronenbourg 1664. Thanks to its successful 2007 marketing strategy, the company was able to ensure the growth of the brands without raising its advertising expenses and at the end of Q4 2007 it took first place in the licensed segment. In 2007, the Tuborg brand increased its share of the licensed segment to 17.8%, with growth of sales compared to the same period in 2006 amounting to +70%. The Carlsberg brand grew by +34%; Kronenbourg 1664, by +132%; and Foster’s, by +63% (data supplied by the agency Business Analytica).
According to Dimitry Ivolgin, Export Sales Manager of Baltika in Middle Asia and the North Caucasus, Baltika would not reach success in the Georgian market without a strong and reliable partner.
“Baltika’s official business partner is LTD CapitalPoint. With the help of Capital Point we are trying to increase distributional area throughout Georgia. Baltika decided to add new brands to the Georgian market. The entry into the portfolio of a new super-premium licensed brand will enable us to strengthen our position in the actively growing top-price part of the licensed segment,” Ivolgin noted.
Until now, Baltika was represented in this part of the segment only by the Kronenbourg 1664 brand, which, notwithstanding its small sales volume, is one of the most profitable entries in the portfolio. In 2008, we consider that Asahi Super Dry will grow at a quick pace, significantly outstripping the rate of growth of the licensed segment as a whole, basically thanks to growth in the large cities of the European part of Russia.
According to Baltika’s global site, beginning in June, Asahi Super Dry will be produced in Russia and brought to market in 0.44-litre bottles and 0.5-litre aluminium cans. Draught beer will enter production as early as April. The average retail price of packaged beer will be on the order of 45 roubles in Russia.
Russian consumers of Asahi Super Dry are men aged 25-35 who have a preference for expensive licensed and imported beer and are frequent visitors to good cafes, bars and restaurants. Therefore, promotional plans call for placing the main stress on the network of traditional Japanese restaurants.
By the end of the current year, arrangements will be finalized for deliveries to the countries of the CIS, starting with Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan and Uzbekistan; somewhat later, shipments will be made to Kazakhstan and the Ukraine.
Production of beer under license presupposes a multi-tiered system of quality control. Asahi Breweries plans to visit regularly the Baltika plant in St. Petersburg for this purpose. Moreover, detailed information and samples will be sent to Japan every month.
Asahi Super Dry (‘dry’ in Japanese is ‘karakuchi) first went on sale on March 17, 1987 and thanks to its unique taste it has been the number one brand in Japan in terms of sales for many years now. At present the beer is exported to more than 50 countries and is produced under license in China, Thailand, the Czech Republic, Great Britain and Canada.
The brand is brewed using a rare yeast culture, Asahi №318, which is not only effective in the fermentation process but also provides a complex aroma and elegant, fine taste – the pure and dry flavour characteristics of Super Dry. The malt barley used to produce Super Dry is selected in strict conformity with more than a hundred criteria, including the variety of the grain, its provenance and methods of green sprouting. In order to confer on the beer a sophisticated bitter note, expensive top quality varieties of hops are used.
According to data from Asahi Breweries Ltd, in 2007 some 19,000 hectolitres of Asahi beer were sold in all of Russia; of this amount, 2,700 hectolitres were sold in the European part of Russia.
Foster’s Lager is an internationally distributed Australian brand of filtered beer. It is also brewed under licence in many countries, including the USA, Canada and the People’s Republic of China.
In Australia until the end of the 1970's, Foster's Lager was a reasonably popular bottled and canned beer with a somewhat premium image.
Written by Natia Taktakishvili
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