Why Tesco want a minimum price for beer

Tesco - Every little (piece of government intervention and price fixing) helps
Tesco - Every little (piece of government intervention and price fixing) helps

Maybe I’m being simplistic, but to me it seems pretty obvious why Tesco are campaigning, along with the government, for a minimum price for beer.

They’ve never behaved altruistically before, I hear you cry!

Well, they’re not now either.

It is pure self interest.

If there is minimum retail price for beer in the UK, do you honestly think that will affect their buying price in any way at all?

No me either.

With the huge growth of global beer brands such as AB InBev, who own the likes of Stella Artois (wifebeater), Budweiser (simply vile) and Becks (iced water), it will allow tesco to do even better deals and grow their buy/sell margin to an even greater level.

Yes, the smaller retailers will have some protection as they will still be able to get their £3 for a four pack, but they’ll be paying £2.40 to Tesco’s £1.20 from their supplier and yet again the little man is crushed.

Beer brands are going through a mad level of consolidation and whilst I have written many times before about a brand backlash and choosing guest ales over the mega brands when we visit our local, it seems that more casualties are coming.

With Bass, Boddingtons and Flowers all up for sale by AB InBev, it seems that we will have fewer and fewer big regionals and be left with globals at the top and tiny locals at the bottom.

This has to present the most amazing opportunity for a decent entrepreneur in the middle ground to buy up one of those three amazing beer brands and build them back up again.

I’d be happy to help with the branding! (and tasting if required)

Updated

It would appear that the Bass brand isn’t really up for sale. In this great article by Pete Brown in the Publican, he gets to the root of what is really for sale. What AB InBev are actually selling is the UK only rights to sell the beer as a draft product. No rights to the name, no rights to the International business and no real chance of anyone being interested in that particular offer. What a real shame for beer drinkers. I certainly didn’t know that Bass and the famous red triangle was the first trademark in the UK. Globalisation isn’t really a good thing is it? It just makes it easier for our historical brands to be destroyed internationally, ignoring all the years of heritage they have created.

How to kill a drinks brand

On the day when Liam Donaldson, the Uk’s Chief Medical Officer, announced that allowing children to drink under 15 is not just a bad idea, it’s dangerous, I thought it would be a good idea to look at Kids and drinking from a brand perspective.

I only need to look at various nieces and nephew’s Facebook pages to see how many of them are drinking well under the legal age. My dad ran a brewery, so we always had lots of beer in the house but I guess our generation has just grown up with far lower price points, far stronger drinks widely available and a far more liberal attitude to drinking at home than any generation before us.

I’m not one to lecture on this as I was smoking well under age with most of my peers, but almost all of them have given that up. It does seem that smoking early is perhaps inevitable as part of the ‘trying to be a grown up’ process but at least it’s one that most grow out of. Drinking isn’t though.

From a branding perspective, getting associated as a kids drink is very bad for their long term health. It always seem to kill them in the end.

Diamond White was (I think) the first of the premium bottled ciders and after a while, gradually started moving from 275ml bottles (ie a small and controllable amount) into 500ml cans and then eventually into 2litre PET bottles. In doing so, they cheapened the brand, killed it for ever as a premium product and ensured it’s demise.

It was also announced today that White Lightning, it’s spiritual successor is being withdrawn too as the brand owners are admitting it has become a problem for them.

Andy Dawson, in his brilliant article (here) reports on the decision by Heineken’s Marketing Manager in charge of the brand Mark Gerken,

‘He admitted that white cider “is a problem drink” for the booze industry because it tends to have negative connotations with “the park bench,” adding: “We’re trying to distance ourselves from the negative images that the old traditional category had. Cider is now much more about enjoyment, refreshment, sharing and over ice.”

In other words, it used to be for tramps and now it’s just for twats’

White Lighning as shown by some of their underage core audience enjoying a quiet parkside drink

Brilliant. They are attempting to relaunch cider upmarket again, which probably means it will drift down towards being a kids drink within the next few years.

And there’s Stella, or Wife Beater to it’s friends. It used to be reassuringly expensive, now it’s worryingly cheap. Partly because they changed the recipe to allow them to hit new price points, so they could chase market share. In doing so, they took away one of the key differentiators of the brand – which was that it was far more flavoursome and better quality than other similar beers – and made it accessible to kids.

There has to be another generational change to make drinking a social occasion rather than an ‘all the time’ occasion, or there will be far more teenage alcoholics, dying kids and lots more dying beer brands.

Adults and beer brands shouldn't really try to get down there with the kids

Beer brands, like most adults, shouldn’t try to get down there with the kids, it will kill all of them in the end.