E-Malt.com News article: Australia: Foster’s to relaunch its Crown Lager brand

Foster's will relaunch its Crown Lager brand in Australia using new labelling and better hops to tighten the company's grip on the nation's premium beer sector, The Age reported on July, 17.

The first batch of the reformulated beer was brewed last week and it was expected to hit the shops soon. The price of Crown Lager would not change, said Ari Mervis, Foster's boss and CEO of SABMiller Asia Pacific.

The new Crown Lager complements a recent relaunch of Foster's flagship VB brand, which regained its position as Australia's biggest selling beer from rival XXXX after being returned to its historic alcohol strength.

Mr Mervis said the Crown makeover was a natural step for the company after fixing its ailing VB brand, which drinkers had been turning away from for a decade.

"Obviously we have been focused on VB but also now the dusting off and improvement that we have made to Crown Lager which is going into the market as we speak," Mr Mervis said as he prepared to address an annual SABMiller investor roadshow.

"We have done quite a lot of consumer research around Crown which is in a very good space, so it's not like VB which was broken.

Mr Mervis said Crown needed to be "dusted off" and consumers needed to be reminded why "it is Australia's finest beer."

"[W]e are now using only the first choice of the hops harvest which our brewers now have the choice of."

Mr Mervis said the company looked at 2000 barley farmers across Australia to "hand-pick the top three".

SABMiller maintained its guidance for Australia with annual volume growth expected to sit between 1 per cent and 3 per cent and margin expansion, before integration costs, seen rising between 0.6 and 0.8 percentage points a year. The brewer has tipped Australia, China and India will drive its Asia Pacific business in the next few years.

Foster's was purchased by international beer maker SABMiller for A$12.3 billion in 2011.

Turning to other parts of the Foster's brewing business, Mr Mervis said the company had "restored the core" of the business with the improvements to VB with the flagship brand now "paying the rent" as it was restored to growth.

He said VB had recorded its third successive quarter of volume growth since the repositioning of the brand in October. VB had a national market share of 25 per cent in 2000 but that declined every month for the next 10 years. In May 2012 Queensland beer XXXX Gold, owned by Lion, took the No.1 position as Australia's biggest selling beer.

Mr Mervis said Foster's Peroni Italian beer brand had grown recently by 33 per cent in volume and 47 per cent in value.

SABMiller had successfully implemented productivity improvements at its Australian breweries, lowering waste and increasing efficiency, with the international brewer hitting A$90 million in synergy savings since its takeover of Foster's against the forecast A$180 million in savings targeted after four years of ownership.

Mr Mervis said there were great opportunities for Foster's in Asia, with innovations in the Indian market to boost business including a new PET bottle. There was also some growth opportunities for VB in certain markets internationally, which could open up new export markets.


17 July, 2013