Brewers put their faith in World Cup pulling power

WITH the start of the World Cup just a few days away, brewers such as Bass and Scottish & Newcastle are splashing out on advertising and wide-screen televisions to recreate the atmosphere of the terraces in their pubs.

If it's anything like the Euro 96 football tournament, when many beer brands posted double-digit growth, sales will surge during the World Cup. Beer sales are otherwise sluggish, with only "premium" brews posting strong growth.

"Every single brewer in the market place seems to be going for the World Cup, and the pub operators too," said Fraser Ramzan, an analyst at Lehman Brothers. "It may increase sales but there will be no one winner and [the increased sales] will come with the expense of promotions. The market as a whole is declining."

Recent comments from brewers including Greenalls Group and Whitbread suggest consumers are feeling the impact of six increases in interest rates and a manufacturing slowdown.

Brewers have been on the defensive for years. Government figures show beer consumption dropped 19 per cent between 1977 and 1996, as wine consumption quadrupled and cider more than doubled. Marketers are now looking to football to lift sales in the pounds 2.8bn a year take-home beer market and the pounds 22bn pub trade.

"It may well be the injection of interest that brewers need at this time of the year," said Peter Rowe, an analyst at Granville. "But it's one month out of 12."

Since England's 1990 World Cup foray, writers like Nick Hornby have made the sport fashionable and it's more popular than ever with women. During Euro 96, Victoria Wine's weekly sales rose 17 per cent, with most of the increase coming from lager and beer.

Carlsberg-Tetley, the official sponsor of the England team, is hoping sales growth will match the 400 per cent volume increase it experienced in the May/June period of Euro 96 from the previous two months. And Scottish Courage, the Scottish & Newcastle-owned maker of John Smith's and Tartan Special, is putting hundreds of thousands of pounds into the event, having seen sales of some brands rise by 10 to 20 per cent during Euro 96.

"A lot comes down to how the brand puts itself about," said marketing manager Steve Boland. "People may put themselves in a pub environment more than usual but they're every bit as brand conscious."

One of its more elaborate marketing stunts is the Glasgow Tartan Tent. At least until the second round matches, Scottish Courage will fund a tent accommodating 4,000 fans, with four large screens, 45 metres of bars and entertainment from stars including Del Amitri.

In addition, Scottish & Newcastle's retail division and its suppliers are spending pounds 500,000

on promotions and extra staff and services in its 2,600 pubs.

Bass's Carling, Britain's biggest-selling lager, has tied in its relaunch with the World Cup. The company has spent pounds 24m on removing the beer's "Black Label" epithet, running a simultaneous TV advertising campaign and promotions with the tag "Vive le Football'.

And on a smaller scale, Fuller, Smith & Turner, the maker of London Pride, has set aside at least pounds 500,000 - almost half its annual advertising budget. The company enlisted Bobby Charlton, the former England star, for a series of TV ads featuring the works of Rudyard Kipling and William Shakespeare.

The adverts will be aired during ITV's News at Ten, a cheaper slot than during the games. "We know we can't outspend our competitors but we can outsmart them," said marketing director John Roberts. "Half of the budget is ready for action and we may spend more."

So what if you're not a fan and you want to escape the hype? Not all pub operators have been bitten by the soccer bug. JD Wetherspoon has declared itself a World Cup-free zone. "We have always had a policy of no TVs in our pubs and we aren't going to change the way we run the business for four weeks every four years," said John Hutson, managing director. "We're aware there might be a short-term loss but we think there'll also be customers who won't want to be surrounded by people watching football."

Copyright IOS & Bloomberg.

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