India: Mahou San Miguel stresses on creating a beer-loving culture in India
Entering the Indian market in August 2012 and taking a leap in the internationalisation strategy in 2014, the Mahou San Miguel established the first international subsidiary of the firm, today known as Mahou India. Internationalisation is one of the strategic cornerstones of Mahou San Miguel for the development of its business. The firm produces more than 70% of Spanish beer consumed worldwide, and has presence in 70 countries. HospitalityBizIndia reporter Kathryn B K spoke to Fernando Bustamante, recently appointed CEO of Mahou India to learn about how different is India market from Spain and what would be his approach towards this growing market.
A Spanish-owned family company and market leader in Spain with a production share of 34%, Mahou San Miguel’s history dates back to more than 125 years. India is a 100% subsidiary of this Spanish brewing major and is the first country for Mahou San Miguel where it has a fully owned subsidiary outside Spain. The company has its brewery located in Bhiwadi, Rajasthan and it is one of the eight breweries it operates in, seven of which are in Spain. It is headquartered in Gurgaon, Haryana.
Coming from Spain, Bustamante has been leading on and off trade business in Spain since 1991. Speaking about his journey with Mahou San Miguel, he says, “It’s been a great journey and I feel proud to be a part of Mahou San Miguel. Our strength in the Spanish market has been a result of our focus on embellishing the category, driving innovation and premium products. In this regard, 2016 saw the launch of a Client Collaboration Centre in Madrid, an innovative and multifunctional setting for joint projects for on-trade and off-trade clients throughout Spain to develop purchasing and consumption experiences of the future.”
Mahou San Miguel stresses on creating a beer-loving culture – enjoying beer in a responsible way. In Spain, beer is enjoyed in small glasses called “cañas” always accompanied by small bites of food called “tapas”. We want to create the same culture here in India as well, says Bustamante.
The Indian beer industry is very different from the Spanish one. With 29 states, each with its own set of regulations – taxation, distribution, labelling and so on, Bustamante feels that India is a diverse market. The diversity is also reflected in reception to beer in general. There are metro cities that are highly modernised where beer drinking is socially acceptable and is gender neutral and also where craft beers and microbreweries are gaining popularity (e.g. Gurgaon, Bengaluru, Pune, and Mumbai). There are also many more cities where the reception is very different, observed Bustamante. He calls India a market of markets.
In terms of market channels, Spain is primarily an on-trade country with more than 60% of the overall volume coming from this channel. India, on the other hand, is an off-trade country with 90% of the total volume coming from this channel, states Bustamante. However, in times to come, he sees India as a country full of opportunities for the growth of on-trade market and of the Spanish culture of enjoying beer and snacks with friends.
India is the second fastest growing beer market by value, growing in the past five years at the rate of 17.5% CAGR after Colombia; therefore there is an immense scope of growth for brands like us in this market, shares Bustamante.
Bustamante plans to approach the India market in a very different manner than he had in Spain. He says, “We are a young brand. We are introducing not only the taste of Mahou in India but also the culture associated with Mahou in Spain. Mahou has been globally associated with football – Mahou 5 star is the official sponsor of La Liga Spain and the coveted football clubs that compete in it such as – Real Madrid and Atlético de Madrid. In India, Mahou has tied up with La Liga India as well and we are working with them to promote football in India.”
Further elaborating about Mahou’s future plans in India, Bustamante says that, our vision for India is long term and we want to do it right. Therefore, we are focussing on quality and giving a premium experience to the Indian consumers. Mahou is currently present in 14 markets – Delhi, Rajasthan, Haryana, West Bengal, Uttar Pradesh, Uttarakhand, Himachal Pradesh, Chandigarh, Jammu and Kashmir, Assam, Punjab, Meghalaya, Mizoram and Odisha. There are some interesting things in the pipeline and we will share them when the time is right, Bustamante affirms.
01 September, 2017
