Breaking News on Food, Beverage & Supplement Development - Asia PacificEU edition | US edition

Headlines > Markets

Better, stronger VB arrests decade-long decline

By RJ Whitehead , 24-Jan-2013

Victoria Bitter’s heartfelt apology last year is likely behind the beer’s turnaround in the Australian market, after the SABMiller brand showed its first quarter of growth in over 10 years of steady 10% declines.

In its trading update for the group's third quarter ended December 31, SABMiller reported VB growth at 2% in the face of a decline of its overall lager volumes in the Asia-Pacific region outside Australia by 1%.

In Australia, the multinational claimed to have halted an 8% slump over the previous six months with sales for the quarter at 4% below the prior year after having terminated some expensive licenced brands, like Corona and Stella Artois, from its portfolio after the purchase of Foster’s in late 2011.

Brand restoration

SABMiller attributed to VB’s success to “benefiting from the brand restoration programme and improved retail engagment,” adding that its “integration programme” in Australia remaining ahead of schedule.

In September, VB’s local parent, Carlton United Breweries set out to arrest a decade of decline through a A$10m investment and a charm offensive designed to make Australian lager drinkers feel like their criticisms had been heard.

A few years ago, we made several changes to the recipe of your favourite beer. We altered the brewing process and we got it wrong,” CUB chef executive Ari Mervis wrote in an advertisement published in newspapers across a number of Australian metro cities. “But we’ve listened to you – our loyal customers – and now we are determined to make it right.”

Richard Oppy, VB’s general manager of marketing told the press at the time that VB fans “didn’t like it when we tinkered with their brew”.

Road to recovery

The change came into effect in October last year, and since then the beer has been taken back to its traditional 4.9% strength with its old recipe restored. Almost 21m more VB stubbies were sold over the next three months compared to the same period in 2011.

Notwithstanding, VB still has a long way to go before it can once again claim to be Australia’s top-selling beer—the brand had dominated the title for 19 years until it was knocked off its pedestal by arch-rival XXXX Gold, which is owned by Lion, the local subsidiary of Japanese conglomerate Kirin.

Elsewhere in the Asia-Pacific region, sales of SABMiller’s lager products in China declined by 3% due mainly to an exceptionally cold and wet winter across the country. India, meanwhile, saw volume growth of 18% with continued strong growth across the portfolio.

Have your say: If you are a VB drinker, how did the brand's apology make you feel? Are you one of the many drinkers who have returned to the brand. Let us know in the comments below.

Key Industry Events

 

Access all events listing

Our events, Events from partners...