Cider - UK - January 2013

INTRODUCTION
Definitions
Excluded
Abbreviations
EXECUTIVE SUMMARY
The market
Forecast
Figure 1: Forecast of UK value sales of cider, 2007-17
Market factors
Rising duty adds pressure on cider producers…
…although craft producers are growing in number
Low consumer confidence is a threat to the market…
…while there are also threats associated with population changes
Weather also plays a strong role in determining cider’s performance
Companies, brands and innovation
Strongbow still leads the way
Figure 2: Leading brands’ market shares in value sales of cider in the off-trade, 2012
The consumer
Apple cider under increasing pressure from pear
Figure 3: Usage of different types of cider within the past six months, November 2012
Brand name is the most important factor for users when buying cider
High levels of enthusiasm for new innovation in the cider market
Figure 4: Users’ attitudes towards cider, November 2012
Cider fares well on a number of positive associations
What we think
ISSUES IN THE MARKET
How can cider brands leverage product origin more effectively?
How can fruit-flavoured cider win over older users?
How much potential is there for boxed cider?
How can cider improve on areas of weakness in its image?
TREND APPLICATION
Premiumization & Indulgence
Fauxthenticity
2015: East Meets West
INTERNAL MARKET ENVIRONMENT
Key points
Duty rises driving up retail prices
Figure 5: Value and volume sales of the total UK alcoholic drinks market, 2007-12
Figure 6: Index of price rises for wine, spirits and cider – on-trade versus off-trade, 2000-12
Rising prices are becoming an escalating issue
Figure 7: UK excise duty rates for cider, beer, wine and spirits, 2003-12
Rising prices of apples add to upward pressure on the price of cider
Yet the craft cider market is in robust growth
Cider can tap into a variety of occasions
Figure 8: Occasions for drinking in and out of the home, May 2012
Figure 9: Trends in agreement with selected lifestyle statements, 2008-12
Brand loyalty falls as price pressures continue to bite
Figure 10: Trends in agreement with lifestyle statements regarding loyalty and pricing, 2008-12
BROADER MARKET ENVIRONMENT
Key points
Consumer confidence remains low despite the recession ending
Figure 11: Consumer Confidence Index, monthly, January 2007-December 2012
Figure 12: Hours of sunshine in the UK, by month, 2008-12
Figure 13: Frequency of drinking in pubs/bars, May 2012
Government focuses on a healthier population
An ageing population is a threat to the cider market
Figure 14: Projected trends in the age structure of the UK population, 2012-17
Growth in C2s set to be a major plus for the cider market
Figure 15: Changes in the adult socio-economic structure of the UK population, 2012-17
COMPETITIVE CONTEXT
Key points
Usage of many alcoholic drinks in decline
Figure 16: Usage of cider and competing drinks categories, in home and out of home, November 2012
In-home drinking appeals as a cost-effective option
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
Flavour innovation
Using packaging to boost shelf standout
Cider brands commemorate and celebrate historic events
NPD aims to create new occasions for drinking cider
Interesting examples of global innovation
MARKET SIZE AND FORECAST
Key points
Cider’s value growth slows a little in 2012
Figure 17: UK value and volume sales of cider, 2007-17
Figure 18: Forecast of UK value sales of cider, 2007-17
Volume sales hold up well
Figure 19: Forecast of UK volume sales of cider, 2007-17
Forecast methodology
SEGMENT PERFORMANCE
Key points
Off-trade cider sales return to growth in 2012
Figure 20: UK value and volume sales of cider in the off-trade, 2007-17
Figure 21: Market size and forecast for the off-trade UK cider market, by value, 2007-17
Off-trade volume sales expected return to growth in 2012
On-trade gains share in the cider market in 2012
Figure 22: UK value and volume sales of cider in the on-trade, 2007-17
Figure 23: Market size and forecast for the on-trade UK cider market, by value, 2007-17
MARKET SHARE
Key points
Strongbow continues to dominate the off-trade landscape
Figure 24: Value market share of top-selling cider brands in the off-trade, 2010-12
Other Heineken brands enjoy mixed fortunes
Stella Cidre and Kopparberg are the shining lights in 2012…
…with Frosty Jack’s also showing robust growth
However, Magners finds its position under threat
Sales of Lambrini plateau
New wave of smaller brands flourishing
COMPANIES AND PRODUCTS
AB InBev
Aspall
C&C Group
Distell
Heineken
Kopparberg UK (Cider of Sweden Limited)
Rekorderlig (Chilli Marketing)
Westons Cider
BRAND RESEARCH
Brand map
Figure 25: Attitudes towards and usage of brands in the cider sector, October 2012
Correspondence analysis
Brand attitudes
Figure 26: Attitudes, by cider brand, October 2012
Brand personality
Figure 27: Cider brand personality – macro image, October 2012
Figure 28: Cider brand personality – micro image, October 2012
Brand experience
Figure 29: Cider brand usage, October 2012
Figure 30: Satisfaction with various cider brands, October 2012
Figure 31: Consideration of cider brands, October 2012
Figure 32: Consumer perceptions of current cider brand performance, October 2012
Figure 33: Cider brand recommendation – Net Promoter Score, October 2012
Brand index
Figure 34: Cider brand index, October 2012
Figure 35: Cider brand index vs. recommendation, October 2012
Target group analysis
Figure 36: Target groups, October 2012
Figure 37: Cider brand usage, by target groups, October 2012
Group One – Conformists
Group Two – Simply the Best
Group Three – Shelf Stalkers
Group Four – Habitual Shoppers
Group Five – Individualists
BRAND COMMUNICATION AND PROMOTION
Key points
Adspend increased in 2011 and in the first ten months of 2012
Figure 38: Total adspend in the UK cider and perry market, 2008-12
Figure 39: Total adspend for beer, lager and cider multi products, 2008-12
Responsible marketing is strictly enforced
Two large players dominate cider advertising in 2012
Figure 40: Top advertisers in the cider and perry category, January-October 2012
Figure 41: Leading advertisers in the UK cider category, 2009-12
Two brands dominate the adspend on cider in 2012
Figure 42: Leading brands advertised in the UK cider category, January-October 2012
Outdoor advertising encroaching on TV’s dominance
Figure 43: Advertising in the UK cider category, by media, 2009-12
Highlighting heritage and quality to support premium credentials
Music and festivals offer a route for brands to build identity
CHANNELS TO MARKET
Key points
Supermarkets remain the leading channel for cider sales…
Figure 44: Volume sales of cider, by on-trade and off-trade channels, 2009-11
...while the on-trade strikes back
CONSUMER – USAGE OF CIDER
Key points
Three in five adults are now active cider drinkers
Figure 45: Usage of different types of cider within the past six months, November 2012
Figure 46: Usage of different types of cider, in home vs out of home, November 2012
Apple cider still leads the way
Who drinks the different types of ciders?
Figure 47: Usage of the leading types of cider, by gender and age, November 2012
Apple cider
Pear cider
Other fruit-flavoured ciders
25-34-year-olds are the key usage groups for other types of cider
Three in ten adults drink three or more types of cider
Figure 48: Repertoire of purchase of different types of cider, November 2012
CONSUMER – BARRIERS TO USAGE
Key points
Cider needs to become more ‘top of mind’
Figure 49: Barriers to usage among cider users, November 2012
Summer associations may be holding the market back
Taste also serves as a barrier to usage
Lack of front of mind awareness and notable sweetness are the main deterrents for non-users
Figure 50: Barriers to usage among cider non-users, November 2012
CONSUMER – CHOICE FACTORS
Key points
Branding leads the way when consumers buy cider
Figure 51: Choice factors when buying cider, November 2012
Figure 52: Choice factors when buying cider and beer, October/November 2012
Price is the other main influence for cider drinkers
Cider drinkers opening up to foreign brands
Recommendations play a role in driving purchase for women and 18-24s
Over-55s the most likely group to consider the cider producer
CONSUMER – ATTITUDES TOWARDS CIDER
Key points
High levels of enthusiasm for new innovation in the cider market
Figure 53: Users’ attitudes towards cider, November 2012
Potential for cider in a keg/box to grow
Figure 54: Users’ attitudes towards the packaging/format of cider, November 2012
Draught cider no longer equates to better quality for the majority
Strong enthusiasm for ciders with adventurous flavours
Figure 55: Users’ attitudes towards range/flavour of cider, November 2012
Opportunities for mulled cider to grow in popularity
Half of cider drinkers think that British is best
Figure 56: Users’ attitudes towards quality comparisons of cider, November 2012
CONSUMER – CHARACTERISTICS OF CIDER
Key points
Cider leads the way for refreshment and natural associations
Figure 57: Characteristics associated with cider and other drinks, November 2012
Cider performs strongly on a handful of other characteristics…
…but struggles on a handful of other associations
CONSUMER – TARGET GROUPS
Key points
Four target groups
Figure 58: Target groups for cider, November 2012
Explorers (32%)
Disengaged (25%)
Enthusiasts (24%)
Unadventurous (19%)
APPENDIX – INTERNAL MARKET ENVIRONMENT
Figure 59: Agreement with lifestyle statements, by demographics, 2012
Figure 60: Agreement with lifestyle statements, by demographics, 2012 (continued)
APPENDIX – BROADER MARKET ENVIRONMENT
Figure 61: Usage of alcoholic drinks in the past 12 months, by demographics, 2012
APPENDIX – MARKET SIZE
Figure 62: Best- and worst-case forecasts for the total cider market, by value, 2012-17
Figure 63: Best- and worst-case forecasts for the total cider market, by volume, 2012-17
APPENDIX – SEGMENT PERFORMANCE
Figure 64: Best- and worst-case forecasts for the off-trade cider market, by value, 2012-17
Figure 65: Best- and worst-case forecasts for the off-trade cider market, by volume, 2012-17
Figure 66: UK off-trade volume sales of cider, 2007-17
Figure 67: Best- and worst-case forecasts for the on-trade cider market, by value, 2012-17
Figure 68: Best- and worst-case forecasts for the on-trade cider market, by volume, 2012-17
Figure 69: UK on-trade volume sales of cider, 2007-17
APPENDIX – BRAND RESEARCH
Figure 70: Brand usage, October 2012
Figure 71: Brand commitment, October 2012
Figure 72: Brand momentum, October 2012
Figure 73: Brand diversity, October 2012
Figure 74: Brand satisfaction, October 2012
Figure 75: Brand recommendation, October 2012
Figure 76: Brand attitude, October 2012
Figure 77: Brand image – macro image, October 2012
Figure 78: Brand image – micro image, October 2012
Figure 79: Profile of target groups, by demographics, October 2012
Figure 80: Psychographic segmentation, by target groups, October 2012
Figure 81: Brand usage, by target groups, October 2012
Figure 82: Brand index, October 2012
APPENDIX – CONSUMER – USAGE OF CIDER
Figure 83: Usage of any cider, by demographics, November 2012
Figure 84: Usage of apple cider, by demographics, November 2012
Figure 85: Usage of pear cider, by demographics, November 2012
Figure 86: Usage of any other fruit-flavoured cider, by demographics, November 2012
Figure 87: Usage of any low/non-alcoholic cider, by demographics, November 2012
Figure 88: Usage of mulled/warm cider, by demographics, November 2012
Figure 89: Usage of cider in a box and perry, by demographics, November 2012
Figure 90: Usage of any craft cider (made by a small producer), by demographics, November 2012
Figure 91: Usage of any other cider, by demographics, November 2012
Figure 92: Repertoire of usage of different types of cider, by demographics, November 2012
Figure 93: Usage of different types of cider, by repertoire of ciders used, November 2012
APPENDIX – BARRIERS TO USAGE
Figure 94: Barriers to usage among cider users, November 2012
Figure 95: Most popular barriers to usage among cider users, by demographics, November 2012
Figure 96: Next most popular barriers to usage among cider users, by demographics, November 2012
Figure 97: Barriers to usage among cider non-users, November 2012
Figure 98: Barriers to usage among cider non-users, by demographics, November 2012
APPENDIX – CONSUMER – CHOICE FACTORS
Figure 99: Most popular choice factors when buying cider, by demographics, November 2012
Figure 100: Next most popular choice factors when buying cider, by demographics, November 2012
APPENDIX – CONSUMER – ATTITUDES TOWARDS CIDER
Figure 101: Users' attitudes towards cider, November 2012
Figure 102: Agreement with the statements ‘I like to try many different brands and flavours of ciders’ and ‘I am open to drinking no/low-alcohol ciders’, by demographics, November 2012
Figure 103: Agreement with the statements ‘I think that draught ciders taste better than bottled ones’ and ‘Own-label ciders taste as good as branded varieties’, by demographics, November 2012
Figure 104: Agreement with the statements ‘I would like to see a better range of craft ciders in supermarkets and pubs/restaurants’ and ‘I would like to see more mulled ciders available’, by demographics, November 2012
Figure 105: Agreement with the statements ‘I expect bottled ciders to taste better than those in a can’ and ‘I am happy to pay more for premium ciders’, by demographics, November 2012
Figure 106: Agreement with the statements ‘I would be open to trying ciders with more adventurous flavours’ and ‘I think that British ciders taste better than foreign varieties’, by demographics, November 2012
Figure 107: Agreement with the statements ‘I would be interested in trying cider from a box/keg if it was of high quality’ and ‘I prefer fizzy ciders to still/cloudy varieties’, by demographics, November 2012
Figure 108: Users' attitudes towards cider, by purchase of any cider, November 2012
Figure 109: Users' attitudes towards cider, by most popular choice factors when buying cider, November 2012
Figure 110: Users' attitudes towards cider, by next most popular choice factors when buying cider, November 2012
APPENDIX – CONSUMER – CHARACTERISTICS OF CIDER
Figure 111: Characteristics associated with cider, November 2012
Figure 112: Main characteristics associated with cider, lager, wine and RTDs among cider drinkers, November 2012
Figure 113: Association of ‘Refreshing’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 114: Association of ‘Summer drink’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 115: Association of ‘Sophisticated’ with cider, lager, wine and RTDs, by demographics, November 2012,
Figure 116: Association of ‘Fashionable’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 117: Association of ‘Natural’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 118: Association of ‘Easy to drink’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 119: Association of ‘Suitable for men and women’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 120: Association of ‘Traditional’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 121: Association of ‘Innovative’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 122: Association of ‘Worth paying more for’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 123: Association of ‘Overrated’ with cider, lager, wine and RTDs, by demographics, November 2012
Figure 124: Characteristics associated with alcoholic drinks, by purchase of any cider, apple cider and pear cider, November 2012
Figure 125: Characteristics associated with alcoholic drinks, by purchase of any other fruit-flavoured cider, any low/non-alcoholic cider and mulled/warm cider, November 2012
Figure 126: Characteristics associated with alcoholic drinks, by purchase of cider in a box, perry and any craft cider, November 2012
APPENDIX – CONSUMER – TARGET GROUPS
Figure 127: Target groups, by demographics, November 2012
Figure 128: Purchase of different types of cider and other alcoholic drinks, by target groups, November 2012
Figure 129: Choice factors when buying cider, by target groups, November 2012
Figure 130: Users' attitudes towards cider, by target groups, November 2012
Figure 131: Main characteristics associated with cider and other alcoholic drinks, by target groups, November 2012
Figure 132: Barriers to usage among cider users, by target groups, November 2012