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Music and beer make profitable bedfellows at Thai Asia Pacific Brewery Co,
the brewer of Heineken and Tiger Beer. When TAPB closes its books at the end
of September, expect the projected 7 percent sales growth to be fulfilled,
if not exceeded. The brewery expects sales of nearly 7.5 billion baht
(US$178.8 million) in the fiscal year, up from 7 billion baht (US$166.9
million) over 2004, which itself was a 6 percent increase from 2003. Looking
ahead, sales growth is expected to be between 5 percent and 10 percent for
fiscal 2006.
The steady sales increase will see Heineken's 88 percent market share in
the premium beer segment in 2004 increase to more than 90 percent this year,
strengthening its near-monopoly grip on the market.
Jeffery Kimble, commercial director of TAPB, explained that much of
Heineken's success rests on the company's knowledge of ``what'' to say to
consumers _ and that this year, it's being said with a 900 million baht
(US$21.5 million) advertising and promotional budget, 40 percent up from
2004, and largely because of the launch of Tiger Beer. Of that, between 15
percent and 20 percent was to promote music.
``We're not going to get people to drink Heineken every time they buy a
beer,'' said Mr Kimble. Instead, he ``engages'' the consumers through
``occasions'' and ``locations''.
``I can spend a lot of money to try to convince people to drink Heineken
at home or in the provinces. But that money probably won't do me any good,''
he said. ``It's for a party on Friday night, special occasions or to impress
someone.''
So Mr Kimble emphasises the importance of event marketing, which
associates Heineken with a successful lifestyle _ modern, positive and
connected. Heineken has been around since 1863, but according to Mr Kimble,
it has the personality of a mid-twenties professional, and the targeted
consumer is 20-35 years old.
Within this group, Mr Kimble uses terms such as ``emotionally
connected,'' ``personal relationship and ``shared interests'' to explain his
strategy. ``We want to engage. Heineken wants to know what you're doing. We
want to be connected to what's going on now,'' said Mr Kimble.
And ``what's going on'' is people enjoying the inseparable axis of music,
party and alcohol _ it always has been that way and always will be. In 2003,
TAPB organised the first
Hua Hin Jazz Festival. Mr Kimble explained that jazz was chosen for its
class, refinement and relaxed mood. ``We can do a pop music event like
Britney Spears,'' said Mr Kimble, ``but that's more Coke and Pepsi.''
The Hua Hin Jazz Festival organised earlier this month - headlined by
multiple Grammy winner John Pattitucci - welcomed some 30,000 visitors, up
from 20,000 last year. ``All I know is, the beach was so packed I couldn't
walk,'' he said.
TAPB also organises the
Bangkok
Jazz Festival and helps with Fat Festival, the indie music event created by
Fat Radio.
Asked if there might be confusion in brand identity, as these music
events associate Heineken with both the older, yuppie jazz crowd and the
younger, hippy indie crowd, Mr Kimble explained that the indie lifestyle is
about expression and passion, which is in line with Heineken's.
``It's having a beer, being out with music, celebrating counter culture
and celebrating the indie lifestyle once a year,'' he said. ``Besides, if
Heineken only equals jazz it's going to be worse.''
Other than local music events, on the corporate level there's Heineken's
Thirst DJ Competition, where deejays from 25 countries compete. ``We want to
identify and promote new, young deejays and give them a stage to perform.''
The Heineken Music Thirst Asia Final 2005 was held on May 28 at Queen
Sirikit National Convention Center's Retro Live Cafe. The Global Final will
be in South Africa.
By marrying Heineken to these music events and connecting with the
consumers through music, the brand is viewed as a hip, yuppie drink (modern,
successful) that can also be enjoyed by the younger crowd (hip, artistic).
``You don't just drink the beer, you drink the brand,'' said Mr Kimble.
Through 2006, Mr Kimble expects to continue with music activities, but
has no plans for any major additional events. He predicts sales for Heineken
will increase by 5-10 percent, driven by music events, the Heineken Golf
Championships and innovative commercial spots such as the ``digital sound
check'' ads in theatres. It's about visibility, being seen everywhere and
connected to things considered hip, modern and successful.
Thailand is the sixth
largest market for Heineken worldwide, with the largest brewery in the Asia
Pacific region producing two hundred million litres annually - the
equivalent of around 1,000,000 standard-sized bottles per day.
Premium brands in 2004 accounted for about 9 percent of the beer market,
worth 82 billion baht (US$2.0 billion) - 12 percent growth from 2003. It
should grow by 7-8 percent this year. Standard beers like Singha and Tiger
have 12 percent of the market; economy beers have 79 percent.
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