Budweiser, the “King of Beers” is growing more popular in China than in its home market USA. Beverage Daily reported today that “Budweiser sales finally flipped in China’s favor in the first half of 2018 and the trend is expected to continue,” without citing exact numbers.
While beer drinkers in the United States turn away from traditional brews like Budweiser (inside.beer, 8.7.2017), the same beer is seen in other countries like China as a premium product and shows an upswing. “Whether it is nostalgia for a beer drank back home or on holiday, or a longing for a product with authenticity, consumers see foreign beer as a premium product,” Francois Sonneville, senior beverages analyst at Rabobank is cited by Beverage Daily.
Increased migration across the globe is said to be the main reason for this trend. On the one hand people travelling abroad want to consume the products they know from home but upon returning home they try to revive the memories of their travels and holidays. Furthermore it’s a way to differentiate from others and to show a cosmopolitan spirit.
While Chinese go for American mainstream brands like Budweiser they turn away from their own traditional brands like Snow which might be in turn considered premium in other parts of the world.
Two weeks ago, Heineken announced to buy a 40% share in China’s leading brewer China Resources Beer Holding at a price of a $3.1 billion. As part of the strategic partnership Heineken will license the Heineken brand in China on a long-term basis to CR Beer which is lacking an international premium brand in its portfolio. The world’s second largest brewer will be CRE's exclusive partner for international premium lager beers in China and both partners will investigate which other premium brands from Heineken’s portfolio can be licensed to CR Beer in China. Heineken and CRE will also investigate if the Dutch brewer's global presence and marketing capabilities can be leveraged to support and accelerate the international growth of CR Beer’s Snow® brand and its other Chinese brands to become the Chinese beers of choice. (inside.beer, 3.8.2018)
China, the world’s largest beer market produced 440 million hectoliters of beer in 2017, more than twice as much as the USA with 217.8 million hectoliters, according to the latest Barth-Haas Report. Like in all maturing beer markets craft, specialty and import beers are gaining while domestic mainstream beers are losing market share. Figures released by RaboBank show that despite a more or less stable overall consumption of beer in the US between 2000 and 2017 the market share of craft and import beers has increased from 12.3% to 32.4% while domestic beers dropped from 87.7% to 67.6%.