Professional Documents
Culture Documents
2,000
2021 DEVELOPMENTS
San Miguel comes out fighting as beer sets out on the path to recovery 1,500
Beer suffered heavy losses in total volume terms in 2020 as the COVID-19 pandemic and 1,000
resulting containment measures limited access to beer. Not only were on-trade outlets
forced to close for a large part of the year but there was also a ban on the sale of
alcoholic drinks for a significant portion of the year. Thanks to the resumption of 500
economic activities in 2021 and the rollout of the country’s vaccination programme,
beer registered a return to growth in 2021. 0
2007 2021 2026
Looking to benefit from the more favourable economic environment, San Miguel
Brewery Inc maintained its commitment to cost-containment strategies which enabled
it to keep its pricing stable. The company also invested in both above-the-line and
below-the-line strategies to encourage consumers to start buying its beer again. For Sales Performance of Beer
example, aside from maintaining strong availability in the key retail channels, San % Y-O-Y Total Volume Growth 2007-2026
Miguel Brewery launched a promotion – Gcash Panalo Promo – in which consumers had
the opportunity to win monetary prizes by finding a prize-winning metal screw cap on
their bottle. The company was also active in supporting the fight against COVID-19 with
11.3% Forecast
20%
it allowing access to its well-established distribution network for the dispersal of
goods, as well as providing resources to front-line workers and local communities.
10%
Retail sales remain key to growth in 2021
While there was a concerted effort to driver stronger sales through the on-trade with 0%
the easing of restrictions in 2021, off-trade sales remained the main growth driver in
2021. Despite the increased mobility in 2021, the focus on at-home entertainment
remained relevant for beer drinkers, with the leading players looking to support beer -10%
consumption in the home. For example, AB Heineken and San Miguel Brewery both
have online platforms that enable consumers to order beer cases and kegs and have
them delivered to their home. Other efforts to drive retail sales of beer in 2021 -20%
included offering multipacks in modern grocery retailers, with this strategy being
deployed for sales of brands including Asahi, Brew Kettle, and Tiger in the case of AB
Heineken. -30%
2007 2021 2026
AB Heineken Philippines also attempted to attract consumers through the extension of
its Brew Kettle brand with the launch of Brew Kettle Radler in 2021, which is a lemon-
flavoured wheat beer. This new product also has a lower ABV which taps into the trend
towards drinks with a lower alcohol content. Nonetheless, in terms of growth in 2021, Sales of Beer by Category
wheat beer was outpaced by domestic lager, which reflects the wider availability of the Total Volume - million litres - 2021 Growth Performance
latter. Similarly, San Miguel Brewery launched San Mig Free 0.0 in early January 2021 to
appeal to consumers who want the hoppy and malty notes of beer without the alcohol Dark Beer
content. 1.9
Lager
Premium products see slower recovery 2,041.5
Non/Low Alcohol Beer
Premium products were the hardest hit by the COVID-19 restrictions in 2020 and they 4.6
have seen a slower pace of recovery in 2021. More expensive products such as craft Stout
beer, dark beer and premium lager have a much stronger reliance on on-trade sales and 0.7
are more likely to be consumed at social gatherings rather than on an everyday basis. -15% 0% 15%
Craft beer is particularly dependent on small specialist bars and restaurants, with
tourists being a key consumer base for these products and other premium options. BEER 2,048.7 CURRENT % CAGR % CAGR
YEAR % 2016-2021 2021-2026
Given foodservice establishments continued to face some restrictions during 2021, GROWTH
there were fewer opportunities for consumers to purchase craft beer. Furthermore, the
pandemic continued to have an impact on the local economy, which pushed consumers
towards cheaper options.
Bright outlook for beer as players eye expansion opportunities AB Heineken Philippines ... 5.4%
Building on the recovery and growth momentum seen in 2021, beer looks set to have a Others 6.7%
positive future. The country’s vaccination programme has enabled it to lift its
restrictions with the Philippines even reopening to international tourists in early 2022.
This is set to benefit both off-trade and on-trade volume sales over the forecast period
as more consumers start to spend less time at home and more time socialising and
eating and drinking in bars and restaurants. A more relaxed environment will benefit Brand Shares of Beer
sales, while leading players such as AB Heineken and San Miguel Brewery are % Share (LBN) - Total Volume - 2021
anticipated to maintain their consistent approach to brand building activities, be it
through above-the-line or below-the-line marketing efforts. This should support the Red Horse 59.4%
recovery of beer during the forecast period, with these and other players also expected
San Miguel Pale Pilsen 11.6%
to continue launching new products and varieties to add interest and excitement to the
category. In terms of distribution, e-commerce will likely see further development San Mig Light 6.5%
despite its limited share, with players looking to address hygiene concerns and the
Gold Eagle 5.5%
consumer preference for convenience.
San Miguel Flavored Beer 4.6%
Retail will generate more volume in the forecast period Beer na Beer 2.8%
While the on-trade channel is projected to see dynamic growth over the forecast Colt 45 2.4%
period as the hospitality industry recovers, in actual volume terms the off-trade
channel will remain the dominant force in terms of beer sales. The leading players are San Miguel Zero 0.2%
investing in expanding their availability and trade merchandising efforts in various Others 6.9%
territories, which will continue to drive healthy demand for standard lager, as well as
flavoured/mixed lager. In particular, domestic mid-priced lager and economy lager will 5-Year Trend
Increasing share Decreasing share No change
likely remain key growth drivers through the off-trade because of increased
penetration in territories such as Visayas and Mindanao.
In an effort to drive on-trade volume growth, category players are likely to increase
their promotional activities and partnership efforts in bars and restaurants. For
example, AB Heineken Philippines and San Miguel Brewery are focused on increasing
the presence of branded beer taps in selected bars and offering merchandise such as
branded buckets and bottle openers. Also, as part of increasing its branded material in
bars and restaurants, AB Heineken Philippines has also invested in a partnership with
Verde, a Heineken concept bar at the heart of Makati. AB Heineken Philippines and San
Miguel Brewery, which together account for nearly all sales of beer in the Philippines,
will continue to expand their distribution nationwide as they look to drive
consumption of beer products in more parts of the country.
CATEGORY BACKGROUND
Source: Euromonitor Interna tiona l from officia l s ta tis tics , tra de a s s ocia tions , tra de pres s , compa ny
res ea rch, s tore checks , tra de interviews , tra de s ources
Note: Price ba nds for la ger a re ba s ed prima rily on price, but pos itioning a nd pa cka ging a re other
fa ctors tha t a re cons idered in cla s s ifica tion