Arguably the most famous beer campaign in this country’s history was the one that declared it a central facet of our identity – as much as tuques and beavers, the love of a cold one said, “I am Canadian.”
So it would not seem a winning strategy in the Canadian market to mess with our brewski. Certainly not to make it taste fruitier, sweeter, less like beer.
But as patio season officially kicks off with the May “two-four” weekend – the battle for a place at backyard barbecues and on the arms of Muskoka chairs is on. And increasingly, beer makers are not just fighting this battle among themselves.
While beer is far and away the most-consumed alcoholic beverage in the country, its dominance has slipped somewhat in recent years. At the same time, sales of wines and spirits have increased.
That has led brewers to make more drinks that compete against wines, coolers and spritzers, adding a new twist to the tried-and-true brew.
For example, many Canadians who pick up a pack of Coors Light this weekend will get a bonus sampler of Coors Light Iced T, the new drink Molson Coors Brewing Co. launched in April. The brew, flavoured with tea and lemon, is the first new extension to the Coors Light brand.
“We’re thinking broadly about the drinkscape,” said Molson Coors’ chief commercial officer, Peter Nowlan. “We’ve expanded our frame of reference to include beer, but also other alcoholic beverages. … There is no such thing as just a beer consumer.”
While beer is still a dominant force, it is also a mature industry, and in recent years it began to struggle with declining market share. According to the Brewers Association of Canada, from 2008 to 2010, beer sales in Canada fell 2 per cent, and consumption fell in 2008 and 2009 (the most recent year where data were available.) Meanwhile, wines and spirits have both seen consumption rise.
Brewers have responded by trying to differentiate their products – and appeal to the types of consumers who might be thirsting for something else. The Iced T product follows Molson Coors’ launch last year of lemon-lime flavoured Molson Canadian 67 Sublime. Sales of the 67 product line (the flavoured Sublime and its regular low-calorie counterpart) are up 25 per cent compared with this time last year.
It’s not the only major brand to play with citrus flavours: Bud Light Lime came to Canada in 2009 following its U.S. launch a year earlier. Last week, Labatt Brewing Co. announced a further expansion of the product with the launch of Bud Light Lime Mojito, flavoured with mint and lime. Its national ad campaign kicked off on Monday.
Flavour in beer is nothing new, of course. Brewers have toyed with spices and fruits for years, and smaller craft breweries have been especially successful with more experimental flavours. That set them apart, said Kenrick Jordan, a senior economist with BMO Nesbitt Burns Inc., who released a report on the state of the industry last September. Their target consumers are partly those who want to feel plugged in to a smaller local business, but taste also plays a role.
“The smaller brewers were really making headway, although they’re not giants in the industry,” Mr. Jordan said. “… Some of [their popularity]has to do with the development of flavours.”
For the larger beer makers, whose sales tended to be flat or declining slightly, and whose products everybody knew, imitating that small-brewer trend of flavour experimentation provided a way to refresh their product lines and compete across the beverage spectrum.
“We’re looking to people who are non-beer users or occasional drinkers,” said Lisa Kittelsen, national marketing manager for Bud Light at Labatt. “We’re finding that there are more and more consumers now looking for variety in their beer choices, and gravitating toward sweeter tastes as well.”
That expanded taste profile opens beer up to a particularly valuable consumer segment: young women who may drink more mixed drinks, wine and cocktails. But beer makers are not the only ones who have noticed changing tastes. This type of marketing cuts both ways.
In April, 2011, Diageo Canada Inc. launched a campaign for its Smirnoff Ice vodka cooler drink. It encouraged drinkers to try the “Smirnoff Rocket,” which combined the cooler with beer. The idea was that if consumers – especially young men in their ’20s who are avid beer drinkers – could be enticed to sample the cocktail, they might then drink more Smirnoff Ice. The campaign led to a “significant” increase in sales last summer, according to Diageo. It is renewing the Rocket campaign this season, with TV and radio commercials, outdoor advertising, and sampling events.
“The Smirnoff Rocket has proven to be a key element to our Smirnoff Ice marketing strategy,” said Geoff Kosar, marketing director for beer at Diageo Canada.
Beer makers are starting to see wine and spirits makers as the competition. Molson Canadian 67 Sublime’s marketing materials reflect this new competitive landscape: The billboards that ran last summer featured the flavoured beer standing next to fruity cocktails that appeared to be frowning at the brown bottle. The tagline read, “Mixed Drinks, Beware.”
And the non-flavoured version of 67 light beer has also taken a swipe at other drinks with its award-winning TV campaign. The commercial shows club patrons holding minuscule glasses of wine and mixed drinks while the 67 drinkers get to have a full bottle – illustrating how small a drink would have to be to have the same number of calories as a 67.
“It was the first time we made a calorie claim versus wine,” Mr. Nowlan said. “We’ve found that is incredibly successful.”
But among the calorie-conscious, the latest bugaboo is sugar, not just fat, in weight control and overall health. So it would seem a strange time to veer into sweeter flavours. But beer makers insist this is where they have an advantage; because they already have consumer awareness as a light product. The flavoured light beers such as Iced T, Sublime and Lime Mojito all claim the same caloric profile as their regular light counterparts.
“All the mint and lime we’re using is natural flavouring. It’s less about making it sweet just by means of sugar,” Ms. Kittelsen said.
Meanwhile, sugary coolers have launched their own light products. Smirnoff Ice’s summer TV campaign currently includes separate spots for its Smirnoff Ice Light, which boasts fewer calories and a less sweet taste.
Seasonal consumption is particularly important for coolers and lighter beers. If this patio season goes well for flavoured beer products, they could boost sales meaningfully. The early arrival of warm weather, just in time for May two-four, therefore presents a marketing opportunity – as well as a challenge.
“Summer came a little bit early, so we’ve been scrambling to make sure the product is in place,” Mr. Nowlan said of the new Iced T cans and bottles. “We are brewing every little bit we can.”