Alcoholic Drinks in Australia

Abstract

Why buy this report

• Get insight into trends in market performance
• Pinpoint growth sectors and identify factors driving change
• Identify market and brand leaders and understand the competitive environment

Product coverage

Beer; Cider/perry; RTDs/High-strength premixes; Spirits; Wine

Executive summary

Government Initiatives Fail to Curb Growth in Alcohol Consumption

Consumption of alcoholic drinks in Australia continued to increase in 2007. Both the federal government and state governments have been actively involved in highlighting the harmful sides of alcohol consumption, with particular focus on binge drinking and underage drinking. The enormous growth in RTDs, which are almost entirely spirits-based, and the known very strong bias of RTDs towards younger drinkers, is further evidence that a key plank in the government message -- that of responsible drinking and non-binge drinking by younger people -- is simply not being heeded. RTDs recorded the strongest growth of all the main alcoholic drinks categories in 2007. With higher average alcohol content than standard beer, it seems self-evident that instead of curtailing their alcohol intake the younger generation is actually consuming more alcohol.

Alcohol Content of Beer Reaches a New Low

Low-alcohol beer in Australia is being increasingly rejected because of apparent consumer dissatisfaction with its quality, especially the flavour profiles. However, several trends and initiatives have emerged as major drivers of lower alcohol consumption associated with beer drinking. Mid-strength beer, which was quite popular in Queensland but virtually unknown elsewhere, has made strong inroads on a national basis, led by Carlton Mid Strength and VB Midstrength.

Specialisation Diminishes in Favour of Total Beverage Perspective

The key feature of the competitive environment within the Australian alcoholic drinks market is the extent to which major competitors are moving beyond traditional boundaries and reconsidering their scope to include all alcoholic beverages and, in some cases, non-alcoholic beverages. This, with one notable example, is also happening in reverse. Coca-Cola Amatil Ltd has made a preliminary foray into alcoholic drinks with strategic alliances to manufacture and distribute SABMiller beer brands locally.

The Many Ways to Market Are Becoming Fewer

The two biggest retailers in Australia, Coles Group Ltd and Woolworths Ltd, have significantly increased their shares of total off-premises sales in Australia. This has been achieved through systemic growth, new chain developments and acquisitions. It is foreseeable that some rationalisation will be required because both companies are now running up to five different retail names (chains) across the retail packaged alcoholic drinks market.

Increased Consumer Repertoire Is the Keynote Heading into the Forecast Period

Over the forecast period, alcoholic drinks will experience even greater diversification as the trends that exist currently are predicted to continue. At the forefront of growth will be RTDs. Beer, which was once seen as iconic within the Australian social fabric, is increasingly becoming part of a repertoire rather than the sole alcoholic drink of choice. Furthermore, beer sales are becoming increasingly diverse through premiumisation, the influx of local craft beers and segmentation centring around alcohol content and carbohydrate count. The traditional beer brands are under increasing threat and the brand owners are looking to new horizons to achieve growth and desired levels of profitability.