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Growth in a Challenged Brewing Industry

16 September 2013

Some beer brands are currently demonstrating excellent growth in an otherwise financially challenged brewing industry. According to Canadean the answer lies in the market.

Growth in a Challenged Brewing Industry

The financial crisis has challenged the brewing industry across many countries in the last few years. As consumers across Europe and America have felt the squeeze, mainstream beer brands have omitted from shopping baskets, and visits to bars and restaurants have become less frequent. Whilst some discount and premium brands have done well, the traditional middle market has struggled.

Many emerging markets have been favourable for growth as the middle class swells and beer becomes an affordable option. The top 13 fastest growing brands worldwide, over the last three years, are all found in developing beer markets; China, Mexico, Brazil and South Africa.

China, in particular, has seen constant development. Canadean’s in-market local expert, Marina Zeng, details the plethora of brewery building, capacity expansion, acquisitions and alliances that have occurred in recent years. In the report ‘China Beer Market Insights 2013’, Zeng reports on three brewery expansion plans, the inauguration of a new brewery, and the announcement of plans for three more breweries just from A-BInBev for 2012 alone.

The top four fastest growing brands are all Chinese, and all of their growth stems from their domestic market. Only Tsingtao is available internationally, but over 99% of the brand’s volume is still sold in China, despite Canadean recording measurable volume growth for this brand in 15 other markets.

The top 14 fastest growing brands have all been driven by growth from their domestic market. According to Canadean, several factors make the performance of a beer brand in its domestic market extremely important. These include the traditional high degree of brand loyalty shown by beer drinkers, the longevity of beer brands, as well as the often strong links between a brand and national or regional culture. It is common to see a beer referred to as ‘the country’s national beer’ or as the ‘regional beer’ for a certain area.

However, not all the top performing brands have been driven by their domestic market. The Heineken brand has witnessed growth in several countries, with its performance in Vietnam being particularly notable. According to Canadean, the success in Vietnam can be attributed to the brand’s stylish image along with its distribution network and intensive marketing and promotional activities.

The beer brands exhibited the best growth have some factors in common. They all have success in their domestic market, a solid brand image, an appropriate price point, and an effective distribution. However, each beer market has its own specific dynamic and drivers. The performance of international brands has varied widely in recent years, due to market specific conditions.

Canadean’s Beer Market Insight reports cover more than 60 markets and give a detailed picture of each market and the drivers behind the performance of national and international brands.

For further information

Please contact the Canadean press office


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