Thanks to the imports, ice beers
and the microbrews, however, the
American beer market has not expe
rienced any further rapid decline in
recent years. Ice beers are doing well
in the U.S. but Chris Vuyk does see a
risk of overkill. Millions of dollars are
being spent on advertising to sell the
products. "The U.S. consumer is
always willing to try new things, but
people prefer to discover things for
themselves. That enormous amount
of advertising might even turn out to
have a negative effect on ice beers."
The microbreweries have built up
a strong position in the American
market in a brief space of time. At
present the hundreds of "mini-brew
eries" together hold a share of some
2% of the total market. Most of the
microbreweries are located in the
states of Washington and Oregon, but
they are also mushrooming in the
vicinity of Boston. According to Chris
Vuyk, the success of the microbrews
is chiefly due to the trend towards
'small is beautiful'. Particularly the
products from the big local breweries
are perceived as "industrial beers".
According to Mr Vuyk, the emer
gence of the microbrews does not
have any direct consequences for the
position of Heineken Beer, which is in
a different, growing segment.
Quality
Van Munching does not seem to
be troubled by the negative factors
which are putting the local brands
under pressure, as the position of the
Heineken products has improved
strongly in recent years; both market
share and volume have increased.
Chris Vuyk says that the growing pop
ularity is attributable to three factors:
"Firstly, Heineken is imported from
Northern Europe and that equals
'quality'. Second, a product like
Heineken has more flavor than the
local beers. And, thirdly, Heineken
carries prestige."
Mr Vuyk describes Heineken as
the 'Mercedes Benz of the American
beer market'. "On the periphery of
the market there are consumers who
always want something new. At the
present time this is formed by the ice
beers and the microbrews which are
showing strong gains in popularity. In
the past Heineken always enjoyed
success by staying modern, keeping
up with its times. We have to continue
doing that. The 1994 Mercedes Benz
model looks completely different from
the 1970 version. But Mercedes Benz
retains its character, and so does
Heineken. You mustn't deny your
roots." One of the means of keeping a
brand modern and up-to-date is
advertising.
Big spenders
The American brewing industry is
one of the big spenders when it
comes to advertising. In 1993 the
advertising spend was as much as 704
million dollars; the two biggest brew
eries accounted for 74% of that
amount. Sports programs on the
nation-wide TV networks are popular
advertising vehicles for the brewing
industry. Fifty per cent of its advertis
ing expenditure is focused on the
coast-to-coast networks. The pre
mium brands take a different ap
proach to advertising. Seventy per
cent of their budget is spent on local
television commercials and outdoor
advertising. According to E.J.
Vongher, account manager of War
wick Baker Fiore Inc., the advertis
ing agency for Heineken and Amstel
Light in the U.S., it is not so surpris
ing that these brands (including the
imports) opt for local television: "The
budget for these brands is significant
ly lower than that for the mainstream
brands. That means that you have to
spend your advertising budget selec
tively. The target groups are easier to
define in local television. Heineken
sometimes advertises during televised
college football and basketball."
None the less, Heineken does not
concentrate solely on local television.
The highlights of the American sport
ing year (NBA basketball playoffs,
etc.) are broadcast via the nation
wide or local networks and Heineken
also uses these events to boost its visi
bility. But, here again, the rule is: be
selective and spend your advertising
budget as efficiently as possible.
At the moment three Heineken
commercials are being aired on
American television. In those com
mercials, with the tagline 'Just being
the best is enough', everyday situ
ations are depicted and everyday con
versations are held. Simultaneously, a
voice-over lets viewers know that
Heineken in the U.S. does not need
brash and noisy commercials to be
come and remain import brand num
ber one. According to E.J. Vongher,
the crucial point in devising the cam
paign was to find the right balance
and the right tone of voice. "You must
not be too upscale, as that puts
consumers off. So you have to find a
method in the execution which gives
the consumer the feeling that the
high price of Heineken is justified."
Consumer research showed that
consumers had really understood the
THE WORLD OF HEINEKEN
