5
Beer in Spain
I
Computers
Umbrella
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Strong advertising support
New brand
Heineken
Emphasis on quality
People can see than Heineken is doing
its utmost to make El Aguila a
profitable brewery again as quickly as
possible.That major expenditure
programme is proof of this."
Another element in the El Aguila
organisation that needed to be tackled
as quickly as possible was the financial
and accounting system. A. Blüm,
financial director, tells how things
were in the past. And how the
situation is now. "El Aguila was a
typical example of an antiquated
Spanish company; there were few
foreign influences. We immediately
saw that working procedures were
outdated and so we quickly
introduced automation. After nine
months of study we bought five IBM
computers. Now we can not only keep
the whole financial accounting system
up to date, but we can also check on
budgets and make cost analyses." El
Aguila has 60 depots spread
throughout the country to supply part
of the retail trade. Since the beginning
of last year all those depots have been
equipped with a personal computer
which can be used to prepare invoices,
including VAT. The separate
specification of VATwas important
because Spain, being the latest EC
member, decided to introduceVATon
1st January 1986. That decision by the
Spanish government did not become
definitive until the beginning of
December 1985. "Within scarcely one
month's time we set up the new
invoicing system. All the people who
had to work with the personal
computer were brought to Madrid for
a day for instructions on its use",
explains Mr. Blüm.This example also
clearly shows that the Spanish
employees are flexible, are especially
quick at adapting, and show great
dedication. "They are the basis for El
Aguila's success", says Mr. Blüm.
As far as El Aguila's local brands are
PAIN
kettles have also been installed.
personnel. General manager R.
Strobos: "We decided that when we
closed down the breweries there
would be no compulsory dismissals.
The impact on the personnel has been
kept to a minimum. Some employees
were able to take early retirement,
others were transferred to another job
within the business and a number of
new jobs were also created within the
organisation. On the whole the
employees take a favourable view of
Heineken as their new employer.
There is a sense of gratitude, as they
no longer have any uncertainty about
the future. As Heineken we have
created a climate of confidence, both
within the business and outside.
concerned, there have been a great
many changes over the past eighteen
months. Formerly, the Aguila brand
served as a sort of umbrella for six
different types of bottled beer. The
standard product was Aguila Dorada;
with its 4.5% alcohol, this falls in the
light beer category. The other beers
marketed were Imperial, Reserva
Ligera, Reserva, Sin (alcohol-free
beer) and Niger (brown ale)All these
types of beers were marketed under
the name Aguila, a situation that
consumers found fairly confusing.
This confusion was aggravated when
El Aguila decided in the early 1980s to
couple the popular Imperial type with
the less-loved Dorada, in the hope of
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In Spain beer consumption amounts to 61 litres per head of the population
per year.That is quite high. Particularly over the past ten years beer has
gained a strong position in the drinks market. What does the structure of
the beer market look like in Spain?The table below gives a breakdown
based on types of beer and the brands marketed by El Aguila in each
segment
Type of beer
Alcohol
El Aguila brand
Corriente (lager)
4.5
Aguila
Especial
5.5
Adlerbrau
Extra
7.0
Reserva
Brown ale
7.0
Niger
Alcohol-free beer
-
Sin
Import
5.0
Heineken
The water purification plant at the Algete
brewery is being expanded. The closure
of three breweries meant a higher
brewing capacity in Algete, resulting in
more waste water.
boosting Dorada's popularity again.
In practice the opposite occurred:
"The consumer assumed that
Imperial had been given the same
quality as Dorada", says Mr. Bot.
Heineken knew from experience that
you should never use one brand name
(Aguila) for several types of product
in one and the same segment. It was
decided to replace the Dorada and
Imperial labels by one brand, simply
called Aguila and containing 4.5%
alcohol. Aguila was launched in April
last year and has been heavily
advertised by Spanish standards.
Particularly the TV commercials
caused amazement, notably amongst
competitors. Previously, in fact, it had
been very unusual for beer to be
advertised on television. Besides the
TVspots, El Aguila launched another
first: the glasses campaign. Customers
who bought a crate of Aguila received
a free drinking glass.The campaign
proved highly successful. With the aid
of its new Aguila brand the Spanish
brewery is seeking to improve the less
favourable reputation it had in the
area of bottled beer. "When you talk
to people about draught beer, you find
that Aguila is still extremely popular.
Some fifty per cent of our production
is for the draught market. Over the
years Aguila's bottled beer had got a
bad reputation. With this new brand
we aim to eliminate that adverse
image", says Mr. Bot.
In the sector for "normal" beer
(4.5%), known in Spanish as
"Corriente", El Aguila is therefore
once again becoming a force to be
reckoned with. This situation was
different in the "Especial" sector.
Beers in the "Especial" class have an
alcohol percentage of 5.5. Research
had shown that the big market for
Corriente beer was in the south.
Consumers in the north of Spain
preferred the slightly heavier and
more bitter Especial. In this segment,
too, El Aguila had to become active
again, particularly as Imperial was no
longer considered by the consumer to
be an "Especial" beer. El Aguila
decided to launch a completely new
brand: Adlerbrau. At the end of
October last year Adlerbrau was
presented to the wholesale trade and
first indications show that it will be a
great success. Adlerbrau has a taste
that the Spaniards like. An extensive
advertising campaign, which is going
very well, has also been started for
Adlerbrau.
Heineken beer has long been
represented on the Spanish beer
market. The lager is imported from
Holland and is classed in Spain's
"Extra" beer category. Until the
beginning of last year Heineken was
distributed by two different firms.
One handled the distribution of kegs,
whilst the other made sure that the
bottles and cans found their way all
over the country. With effect from 1st
January 1986 El Aguila itself has taken
charge of the distribution of
Heineken. It was a move that bore
fruit: "Last year we managed to book
a threefold increase in Heineken
sales", says Mr. Bot.
"El Aguila used to try to complete
with low prices and a widespread
distribution network. Since April last
year we have reversed this approach.
Our beers have become less price-
sensitive a great many of the old trade
discount arrangements have been
phased out and we are trying to win
the consumer's favour by placing
emphasis on the quality of the beer
and on the advertising. We have set
about things on a much more
consumer-orientated basis", says Mr.
Bot, who notes with satisfaction that
El Aguila is now present on the market
under three different brands (Aguila,
Adlerbrau and Heineken) and in
three different price classes. In the
development of Aguila and
Adlerbrau, the El Aguila
management received much support
from Heineken's Amsterdam head
office and from H.T.B. (Heineken
Technical Services) in Zoeterwoude.
"Without their help we would never
have been able to supply this quality"
assures Bot.