Alcoholic Drinks in Norway

Abstract

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• 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

Alcoholic drinks sales still growing

Sales of alcoholic drinks continued to grow dynamically during 2007 to reach a new record level. Vinmonopolet' s continuous opening of new stores during the year and the continued conversion from over-the-counter service to self-service outlets were major contributory factors to increased sales. Prices of wine and spirits only increased marginally, whereas beer prices remained stable. This factor also provided impetus for higher sales of alcoholic drinks in Norway.

Low-carb products enjoy success in the Norwegian market

Several launches of new low-carb drinks became more and more popular. Ringnes launched two low-carbohydrate beers -- Ringnes Lite and Tuborg Lite (with 30% fewer calories and 70% fewer carbohydrates). Another recent entrant, Hansa Ultra Lavkarbo, has 20% fewer calories and 60% fewer carbohydrates. Other breweries also rapidly made some changes to their packaging design, but they have not yet launched any low-carbohydrate beer like Ringnes Lite. Arcus launched Vikingfjord Icebreaker Lavkarbo, which is a low-carb spirit-based RTD. According to Arcus, Vikingfjord Icebreaker Lavkarbo is the first diet RTD in the world.

Domestic companies the major players

Ringnes and Hansa Borg are the leading companies in beer in Norway. Ringnes is the clear leader and Hansa Borg Bryggerier the number two player. Hansa Borg had a focus on product development, while Ringnes had a focus on new products during the review period. Arcus is the largest distributor of alcoholic drinks through Vinmonopolet and it is the only domestic player that produces its own wine and spirit brands. Arcus focuses on meeting the demands and expectations of the Norwegians who enjoy alcoholic drinks. In cider Hansa Borg Bryggerier is the leader with mainly Swedish-produced ciders. Arcus is the main competitor of Ringnes in RTDs. Although Ringnes is owned by Carlsberg and Arcus by a Swedish venture capitalist they both have a long history and manufacturing in Norway and are therefore perceived as domestic companies by consumers.

Weather and seasons important for sales

Norway' s position on the European map means cold winters and warm summers. Therefore, the weather and the seasons are two very important determinants of the sales of alcoholic drinks. Rosé wine performed impressively well as more focus from Vinmonopolet and greater media attention helped to boost sales. Red wine was very popular during the autumn and winter when white wine sales were very low. Spirits sales were popular all year round, but there is a trend towards higher consumption per capita in the north of Norway, as it has long, cold and dark days for the whole winter.

High purchasing power among Norwegians

Over the review period Norway enjoyed promising economic growth with a sharp rise in per capita GDP. This growth and stable economy was propelled mainly by major fuel exports. Norway has about 50% of Western Europe' s oil and gas reserves. The unemployment rate has been very stable in Norway as a result of the good economy. The rise in affluence allowed consumers to spend more in the pursuit of a more comfortable lifestyle.

Sales of alcoholic drinks are expected to continue to grow at a dynamic rate over the forecast period. The strong interest among consumers in purchasing quality drinks, often in combination with food, will boost future growth. Vinmonopolet will continue to meet the demands of the public by opening new stores and offering self-service in almost all its outlets. It will also provide valuable information on alcoholic drinks so as to increase consumer knowledge. The growth will also be underpinned by strong growth during the warm summer months, but also through a more cultivated consumption pattern, which means that Norwegians will more frequently enjoy a drink on weekdays and at home for pleasure or for socialising.