Heineken i
Regional Review
Western Europe
entered into a licensing agreement with
US brewer Anheuser-Busch at the end
of 2003 for production and distribution of
the Budweiser brand, Heineken Italia now
has a balanced range of complementary
beer brands once again.
Marketing
The introduction of Heineken's aluminium
beer bottle was a success. A great deal of
publicity, including media attention, was
generated by the more than one thousand
Halloween parties held all over the
country. Heineken is increasingly profiling
itself as the driving force behind this
event. Sponsorship of music festivals, such
as the Heineken Jammin' Festival and the
Umbria Jazz Festival, still provides valuable
marketing support for the Heineken brand.
Birra Moretti continued its sponsorship of
soccer tournaments, including theTrofeo
Birra Moretti competition for the top
Italian clubs. Heineken Italia has expanded
Birra Moretti's marketing support in the
countries to which it exports, especially
the United States and United Kingdom
which are the most important markets.
Changes were made to the commercial
organisation in 2003 to improve customer-
management efficiency and effectiveness.
Partesa, Heineken Italia's wholesale
distribution organisation, reported higher
sales and an improved result, reflecting
both acquisitions and organic growth.
Partesa is integrating its businesses in
order to achieve critical mass and hence
greater efficiency at the operating level.
A start was made in late 2003 on increas
ing the capacity at the Massafra brewery
and making the modifications needed for
brewing Budweiser.
Greece
Stable share of a softer beer market
The Greek beer market was lower in 2003.
In line with the market, Athenian Brewery's
sales were down from 3.7 million hectolitres
to 3.4 million hectolitres, but its market
share remained stable.
In contrast to many other European
countries, Greece had a relatively poor
summer. Consumer spending and tourism
were down and inflation was above the
EU average, which depressed sales par
ticularly in the on-trade.
Athenian Breweries' result benefited
from price increases and an improved
sales mix.
Brands
The decrease in Heineken brand sales was
relatively small. The brand was supported
with new packaging variants, such as the
new international can and the Magnum
bottle, in 1.5-litre and 3-litre sizes, which
were launched in time for the December
holiday season. The XLN (Extra Long Neck)
bottle, which is proving very popular with
consumers, is helping the brand's penetra
tion in the on-trade and sales have grown
rapidly since its introduction in 2002.
As one of the 'grand sponsors' of the 2004
Olympic Games in Athens, Heineken has
already launched numerous marketing
and advertising campaigns in the media
and at point of sale. These are being
expanded in 2004, based around the cen
tral theme of celebration of this spectac
ular event.
Sales of both Amstel and Alfa, a Greek
brand, were significantly lower, in the case
of Amstel mainly due to stockpiling at the
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end of 2002. Amstel Big, a wide-necked
33-cl bottle, was successfully introduced at
a select group of on-trade outlets. Amstel,
which is market leader in the mainstream
segment, was supported by various
promotions in the take-home channel and
TV commercials based on the theme of
friendship.
Germany
Higher sales in a declining market
While the German beer market contracted
by 4%, under pressure from new govern
ment packaging regulations and a weak
economy, growth was reported by most of
the brands produced by the Paulaner and
Kulmbacher breweries, which are part of
Brau Holding International, our joint venture
with the Schörghuber group. Total sales
increased to 8.0 million hectolitres and the
result was sharply higher, helped by the
proportional consolidation with effect
from 1 January 2003 of the BrauHolding
International's 45% interest in Karlsberg
International Brand GmbH.
The mandatory introduction of a charge
on non-returnable packaging resulted
in a dramatic drop in sales of beer in cans
and one-way bottles which was not fully
compensated by higher sales of beer in
returnable bottles.
Home-market sales of Paulaner beer,
the eponymous brewery's leading brand,
were 1% higher. Paulaner Weissbier sales
advanced strongly, despite the decline in
canned-beer sales. Hacker-Pschorr and
Auerbrau were also able to increase their
sales volume in the contracting market.
Paulaner exports were up by over 5%, due
in part to utilisation of Heineken's existing
distribution channels. Paulaner has
embarked on a restructuring programme
with a view to improving its financial
performance.
The Kulmbacher brewery's sales turned
out 7% higher, with Mönchshof, Sternquell
HEINEKEN N.V. ANNUAL REPORT 2003
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