22 in fact, Taiwan and Hong Kong serve
as showcases. For them, everything
that happens in these markets more
or less sets the standard. The influen
ce of businessmen from Hong Kong
and Taiwan who order a Heineken
Beer in China should not be under
estimated, feels Eric Nelissen. The
mainland Chinese see the product
and associate it with success and
style. Precisely the image that
Heineken has all over the world and
is now also seeking to build up in
China.
Pattern of
consumption
The Chinese beer market had
already grown by 1994 to become the
world's number two in size, second
only to the United States. Annually
some 135 million hectolitres of beer
are consumed, though per capita con
sumption is still low: around ten to
eleven litres. Compared to five years
ago, however, consumption has al
most doubled.
This strong increase stems not
only from economic growth and
greater purchasing power. The chan
ged pattern of consumption has also
had an impact. In the North of China
mao-tai was a popular drink. In 1995
this rice wine with a high alcohol per
centage is mainly still popular
amongst the older section of the pop
ulation. Younger people see beer as a
good alternative; it is cheaper and
they perceive it as healthier than
mao-tai. In the South of China tea was
the traditional popular beverage.
There, too, beer has grown in popula
rity, but this is partly due to the local
climate.
The fact that it is mainly young
people who are switching to beer
means an enormous future potential
for the brewing industry, since a
quarter of the total population are
currently younger than 18 years.
One step ahead
The beer market in China has a
different segmentation structure than
in other countries. At the moment, as
consumers see it, there are two types
THE WORLD OF HEINEKEN
of beer on the market: local beers and
international brands. Those interna
tional brands are in turn subdivided
into the beers brewed by joint ven
tures (in which a foreign company
has acquired a participation in a
Chinese brewery) and the imported
beers. The joint venture beers are
regarded by consumers as better than
the local beers. The import beers in
turn are one step ahead of the joint
venture beers. In 1994 the imported
beers segment grew by 15 to 20%. A
substantial proportion of that growth
benefited Heineken. Research has
shown that Heineken is regarded by
Chinese consumers as one of the best
beers in the world. What's more,
Heineken is one of the most-sold
import beers in China.
Last year, says Eric Nelissen, a
start was made with TV advertising:
"We invested in commercials in
Shanghai and Guangzhou last year.
and planning work a bit more diffi
cult. Besides, no exact figures are
available about the viewing habits of
our target group or the reach of the
commercial."
Canned beer is highly popular in
China. The local beers are mostly sold
in big bottles and the same also
applies to many joint venture beers.
That was needed so as to push the
awareness of the brand name and
build up the beer credentials for
Heineken. The commercial is the
same as the one used in Hong Kong,
but has been adapted to the Chinese
market in several respects. The most
attractive time to air Heineken com
mercials on TV is between seven and
nine at night; in China that is prime
time. After that time a lot of people go
out, looking for entertainment. We
plan to have the commercial broad
cast during those hours, but you can
never get one hundred per cent cer
tainty. It may happen that your com
mercial is suddenly not aired at the
agreed time. Though we do receive
compensation in the event of such an
error, it certainly makes our forecast
The Heineken Promo Team in Shanghai.
