SAB Miller CEO Alan Clark admits that iconic beer brands often taste similar and says his firm is investing heavily in R&D on new styles and flavors to compete with cocktails, spirits and wine.
Speaking at the Consumer Analyst Group of New York (CAGNY) conference in Boca Raton, Florida on Tuesday, Clark told his audience that going back 100-120 years beer came in a very wide range of styles and flavors – often unique to the region of the world in which they were produced.
“Brewers of the world essentially perfected the most refreshing form of beer – called lager. And it’s therefore no accident that lager conquered the world,” he said.
“The consequence of that is that if you move around the world today these large, national iconic brands are often very similar in their taste profile,” Clark added.
“What innovation in this space is about is re-introducing the very wide range of flavors and experiences that are available from the natural raw materials within brewing,” he said, noting that levels of malts, hops, alcohol and bitterness could all be changed.
Muscling in on cocktails, spirits, wine...
“So for us thinking about how we’d take on cocktails or spirits, wine – it is in this area that we’re doing an extensive amount of R&D to understand how we could effectively brew beers to occupy those spaces. We’ll be launching a range of those in coming years,” Clark said.
During a later Q&A he expanded on his comments: “Fundamentally for us if we talk about the beer category, it is about going back to the brewhouse…with hops there’s been a convergence in terms of the hop varieties that have been used by ourselves and the world’s brewers over a long period.
“So the bitterness flavor and the bitterness you get from hops is actually very similar in many beers – but there’s a huge variety of hops out there. Plus of course you can develop new varieties over time that could bring very different flavors to beer,” he said.
“That doesn’t necessarily have to be an additional cost…the varieties of malt you source, the combinations of malt and cereal, the yeast you use, your fermentation regimes. All of those can be varied to change the nature of beer,” Clark added.
“This already exists today, if you visit the supermarket there’s a very wide variety. But for the most part they’ve not been actively marketed and targeted against particular occasions or spaces – but simply put out there.
“But as the major brewers begin to understand this space, you’ll see that develop more and more.”
Unpasteurized ‘fresh’ beer sent straight to pubs
Talking of SAB’s recent innovations in beer, Clark said the recent economic crisis in Europe had hit on premise volumes there. Consequently, his firm is working to refresh the category by improving the on premise experience (given higher margins than in off premise) and products themselves.
One example he gave – rolled-out in the UK last year – is an unpasteurized beer delivered straight from the brewery to the pub within a 24-hour period, then consumed within three days.
“What we would do in that environment is very specifically advertise the age of the beer and the fact it should be consumed within a short space of time – that resonates with consumers, and the whole notion of ultra-fresh beer,” Clark said.
“Within beer itself there’s lots of room to innovate, and then expanding the category beyond beer with a range of beers – moving from alcoholic to non-alcoholic beer, flavored versions, flavored alcoholic drinks or malt beverages to ciders or the African products [cassava, sorghum-based beers] I have spoken about.”