Beer makers look to emerging markets

Cans of Tiger beer are displayed alongside others, including Dutch beer Heineken, at a convenience store in Singapore on July 27, 2012. D

Stacey Vanek Smith: Today, the Dutch beer giant, Heineken, says its facing sluggish growth because of lagging demand in Europe. Apparently, Europeans aren’t drinking away their sorrows in beer like they used to. So, beer makers are looking to emerging markets.

Christopher Werth has that story from London.

Christopher Werth: Let me introduce you to a new term. While some countries have a problem with over-drinking, others are experiencing what the beer industry has now dubbed “under-drinking”.

Trevor Stirling: "Under-drinking" is a new one for me.

Trevor Stirling is a beverage analyst at Sanford Bernstein. He says as beer sales in Europe and the U.S. stall, the likes of Heineken and Carlsberg are going after emerging markets where beer consumption is relatively low.

Stirling: They would like to drink more beer. And as incomes grow in those countries, so consumers are consuming more beer.

Heineken, for example, is in a fierce battle to gain control of the maker of Tiger beer in South East Asia, where beer consumption can be a quarter what it is in Europe.

Morten Imsgard, an analyst at Sydbank in Denmark, says it’s all about getting their beer into the hands of "under-drinkers."

Morten Imsgard: They’re all trying to educate the consumer that it is worth paying a bit more for a strong Western brand compared to a local beer.

But he says it may not be long before under-drinkers start to have one too many.

In London, I’m Christopher Werth for Marketplace.


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