This report covers the market for bottled lager sold in the UK for consumption in both the on- and off-trades. The off-trade lager market was last reported by Mintel in Market Intelligence, March 1999, while the on-trade sector was examined in Market Intelligence, January 1997. This is the second of a series of reports which segment the market into canned, bottled and draught. Canned Lager was published in January 2000 and the Draught Lager report is to be published in March 2000.

Introduction

Sales of lager, in volume, increased by 40% between 1994 and 1999 to reach an estimated 4.5 billion litres. The choice of lagers available is now prolific, especially from multiple retailers who are taking an increasing share of the market.

Overall consumer spending on all alcoholic beverages, as with beer, has also been in decline, reaching a ten-year low of 5.67% in 1998, although beer still accounts for about half of this figure. In the last five years, expenditure on beer has remained relatively stable allowing for inflation. Almost two thirds of the total beer market, by volume, is now accounted for by lager, double the proportion in 1980. Recent research by NOP, commissioned exclusively for Mintel, shows that just over 40% of the UK's adult population are now lager drinkers.

The growing number of consumer drinking opportunities, mainly in the off-trade, combined with the increasing influence of women and the substantial influx of stubbies from mainland Europe, have contributed to the growth of glass as a packaging format in the UK lager market, hence the contention that "far from debasing the branded lager market, stubbies have now provided new opportunities and new drinkers which will contribute to its overall growth."

Other Mintel reports of relevance include:

- Canned Lager, Market Intelligence, January 2000

- In-home Drinking, Market Intelligence, September 1999

- Off Licences, Retail Intelligence, May 1999

- Dark Spirits, Market Intelligence, April 1999

- Off-trade Lager, Market Intelligence, March 1999

- White Spirits, Market Intelligence, March 1999

- Fortified Wines, Market Intelligence, December 1998

- Cider, Market Intelligence, October 1998

- Alcoholic Soft Drinks, Market Intelligence, September 1998

- Champagne and Other Sparkling Wine, Market Intelligence, September 1998

- Alcoholic Mixables, Market Intelligence, July 1998

- Ales and Stouts, Market Intelligence, June 1998

- Liqueurs, Market Intelligence, June 1998

- RTD Alcoholic Drinks, Market Intelligence, April 1998

- Adult Soft Drinks, Market Intelligence, March 1998

- Low Alcohol and Alcohol-free Drinks, Market Intelligence, January 1998

And the forthcoming:

- Draught Lager, Market Intelligence, March 2000.

Definition

The word lager means "to store" and is of German origin, with the term originally used to describe bottom-fermented beer stored by the brewer at low temperatures in order to mature and enhance the flavour. Top-fermented beers are those traditionally regarded as British or Irish such as bitter and mild; these fall outside the scope of this report and are covered in Ales and Stouts, Market Intelligence, June 1998.

In generic terms, lager can broadly be described as a light/amber, clear, carbonated beer brewed with pale kilned malts which, after fermentation, is filtered, pasteurised and conditioned before being packaged in cans, bottles or kegs for sale in the off- and on-trade. This is, however, a very broad definition, and as consumers' tastes become more sophisticated, there is a growing interest in darker lagers using different malts (sometimes referred to as red and black lagers), organic beers and even fruit-flavoured products.

This report includes some reference to bootlegging/smuggling and personal importation, which have now become a significant force within the beer market. Definitions follow current industry classifications derived from the Brewers and Licensed Retailers Association (BLRA).

In terms of industry definitions for packaged lagers, Class I beers broadly relate to cheaper value or economy lager brands and have an alcohol content of 1.3-3.3% ABV, Class II to standard lagers of 3.4-4.2% ABV, Class III to premium lagers of 4.3-7.5% and Class IV to superstrength lagers of 7.6% ABV or above, for example, Carlsberg Special Brew.

NAB/LAB covers beers with either no alcohol (NAB) or with a content between 0.5% and 1.2% ABV (LAB).

The term "ice" is used to refer to beers which undergo a process of super-chilling during the brewing process, producing a taste that is claimed to be cleaner and more refreshing than standard lager.

Consumer research

In addition to the standard breaks, Mintel has analysed the consumer research in the following manner.

Lifestages are derived from analysis of the exclusive consumer research and are split into four main groups.

Pre-family	those aged under 35 who are not parents.
Family	those aged 15-54 with at least one child aged under 16 still at home.
Empty nesters	no family/empty nesters aged 35-54 with no children (aged under 16).
Post-family	post-family/retired those aged over 55/not working.

As part of an on-going policy to find new ways of analysing data, Mintel has created

Special Groups of consumers to typify consumer habits in the late 1990s. Unlike the lifestage groups, these groups represent only sections of the population and do not account for all adults.

Benefit dependents	Es aged 35+ - those who are reliant solely on state benefits (around 10% of the adult population).
Families on a tight budget	these are working C2Ds with at least one child aged under 16 in the household - the majority have limited incomes which must be spent on a relatively large household (around 10% of the adult population).
Better-off families	these are working ABC1s with at least one child aged under 16 in the household (around 9% of the population).
Better-off empty nesters	these are ABC1s aged 35-64 who are working with no children (aged under 16) living at home. They are, therefore, the classic no family/empty nesters with probably a high income that can be spent on themselves rather than on family (around 8% of the adult population).
Working managers	these are working ABs (around 9% of the population).
Working women	women in part or full time employment (around 21% of the adult population).

Value figures throughout this report are at retail selling prices unless otherwise stated.

Abbreviations

AB	Anheuser-Busch
ABV	Alcohol by Volume
BAA	British Airports Authority
BB	Beverage Brands
BLRA	Brewers and Licensed Retailers Association
BMRB	British Market Research Bureau
BOC	British Oxygen Company
CAMRA	Campaign for Real Ale
EDLP	Everyday Low Prices
EU	European Union
FA	Football Association
FIFA	Federation Internationale de Football Association
FTSE	Financial Times Stock Exchange
ICS	In-Can Systems
ID	Identification (cards)
ITC	Independent Television Commission
MAT	Moving Annual Total
MGD	Miller Genuine Draft
MMC	Monopolies & Mergers Commission
MMS	Multimedia System
msp	manufacturers selling price
NAB/LAB	No Alcohol Beer/Low Alcohol Beer
NEC	National Exhibition Centre
NOP	National Opinion Polls
NPD	New Product Development
NRB	Non-returnable bottle
OFT	Office of Fair Trading
OG	Original Gravity
ONS	Office for National Statistics
PET	Polyethylene Terephthalate
PPL	Premium Packaged Lagers
RPI	Retail Price Index
RRP	Recommended Retail Price
RTD	Ready to Drink
S&N	Scottish & Newcastle
SPSS	Statistical Package for the Social Sciences
TGI	Target Group Index. For further details concerning this information, including data regarding readership patterns of users/purchasers and details of brands, please contact Peter Shreeve at BMRB International on 020 8566 5000.
USP	Unique Selling Proposition
VAT	Value Added Tax
VW	Volkswagen
W&D	Wolverhampton and Dudley Breweries Ltd

02/2000