Heineken’s new brand extension, Heineken 0.0, has been “very well received” and is now available in 38 markets worldwide, according to the company’s latest annual report.
“The growth of the low- and no-alcohol segment is expected to continue and our ambition is to be the leader in this space,” the brewer noted. “We aim to do so by being at the forefront of taste innovation and leveraging the cultural shift towards a healthy, balanced lifestyle.”
Further expansion of the alcohol-free beer is planned this year, as well as in other products that contain low- or no-alcohol. Heineken also said that in 69 markets around the world it dedicated at least 10% of media spend to responsible drinking campaigns.
The rise in demand for low- or no-alcohol beers was recently featured in the Financial Times. The paper noted how Carlsberg’s non-alcoholic brews grew by a third in Europe last year, whilst AB InBev is also “thirsty for growth” in the category. The latter has even appointed a chief non-alcoholic beverages officer.
“Not only can rising sales of low-alcohol beers offset falling sales elsewhere, they can also boost margins,” the FT noted. “Brewers often charge as much for an alcohol-free beer as the traditional version. It costs a bit more to produce and there are launch costs, but that is offset by savings on excise duty. In western Europe, the gross profit margin is “more than 1.75 times higher than conventional brews”, according to one company.
Quality of the brews has also improved. Brewers are also branching out into fruit juices and energy drinks. “If they can find new ways to appeal to younger, health-conscious drinkers, the opportunities are as clear as a well-brewed Pilsner,” the FT noted.
According to GlobalData, 25-34 year-olds and 16-24 year-olds have the UK’s highest per capita consumption rates for low and non-alcoholic beer.
Heineken’s annual report, combining financial and sustainability performance, is available here.