“RECENT TRENDS IN THE ALCOHOLIC BEVERAGES INDUSTRY: REVIEW FROM A GLOBAL PERSPECTIVE, ”

Derrick Vijayan

HOW ATTRACTIVE ARE THE CUSTOMERS OF EACH MARKET?

MARKET SIZE BY VALUE

2005 2006 2007 2008 2009610

620

630

640

650

660

670

680

690

700

640.6

655.5

672.4

684.1

694.8

€ billion

€ billion

SEGMENTATION OF PRODUCTS

Beer, cider & flavoured alcoholic beverages

Wine

Distilled Spirits

THE OTHER PRODUCT!!! UNRECORDED& TRADITIONAL ALCOHOL

Smuggled, home made or traditionally made beverage.

Prevalent in developing countries, e.g. East African countries and former Soviet Republics

12L in Moldova, 10.7L in Uganda, 9L in Zimbabwe etc. per capita consumption

2/3, ½ & 1/3 of all alcohol consumption in the India, Africa, and in Eastern Europe respectively.

PERCENTAGE SHARE BY VALUE 2009: PRODUCTS

50.5%

27.4%

22.1%

% share

Beer, cider & FABWineSpirits

REGIONAL PREFERENCES

PER CAPITA ALCOHOL C0NSUMPTION

PERCENTAGE SHARE BY VALUE 2009: REGION

Europe; 50.9%

Americas; 27.8%

Asia-Pa-

cific ; 19.4%

Rest; 1.9%

REGIONAL TRENDS: 1990-2005

PORTER’S 5-FORCE ANALYSIS OF THE INDUSTY

Buyer Power

Degree of Rivalry

Threat of New EntrantsSubstitutes

Supplier Power

0

5

Source: Data Monitor

MAJOR PLAYERS

Anheuser-Busch InBev (AB InBev) SABMiller Heineken N.V. Diageo plc. Carlsberg. A/s Pernod Ricard SA

MARKET SHARE OF MAJOR PLAYERS

Anheuser-Busch InBev

20%

SABMiller10%

Heineken N.V.8%

Others 61%

Sales

COMMON TRENDS…

Merger, Acquisition and Joint Ventures. Buying brands that can exploit major

market and selling off plants that are in small markets

Major markets have Saturated=> Diversification.

BRIC economies will remain a critical growth driver in the coming decades

Wider opportunity in emerging economies

MERGER, ACQUISITION AND JOINT VENTURES

1960s: Involved Brewers and Wine makers of UK

1970s: Happened in Continental Europe 1980s:Motivated by the globalization of

markets=> Acquire distribution channels

2000s: Consolidation of Beer, Spirit and Wine Industries

DIVERSIFICATION

SABMiller engaged in the hotel and gaming sector

Carlton & United Breweries diversified into soft drinks.

Many Brewers moved into wine industry

SAB Miller does bottling for Pepsi-co

BRIC ECONOMY DRIVEN GROWTH

More than 40% of world population. All deemed to be at a similar stage of

newly advanced economic development.

Rapid Expansion of huge middle class with high purchasing power

Customers who favored traditional beverages becoming brand conscious.

SUMMARY

Considerable changes in last few years Changes in population of commercial

versus non-branded products Internationalization of brands

Yet most of the alcoholic beverages that are produced continues to largely unrecorded.

THE END!

QUESTIONS?

THANK YOU!