Heineken repackages for an ale-ing economy
JAN-KEES NIEMAN loves Heineken. So much so he has spent HK$20 million on it.
Well, on marketing it anyway.
Mr Nieman - as the general manager of Heineken Hong Kong - has headed up the launch of a new packaging campaign to tackle stiff competition.
He hopes the innovative long-neck bottle and the new can design will help the company become the biggest beer company in Hong Kong.
Q: Why did the company spend HK$20 million to promote the beer amid an economic downturn?
A: The money we are talking about is not so relevant. This is as much about our belief that this is the right initiative. We sincerely think it is a right step based on many reasons. Primarily, Heineken Hong Kong researched the market last year in terms of packaging and size in the beer industry. The research specified these two packages are extremely positive.
Q: Was the marketing campaign initiated because of intensive advertisements by your competitors, such as San Miguel and Carlsberg?
A: At the end of the day, that is part of the reason. But I think it is much more important to look at how we want to position ourself in Hong Kong, how to communicate our value to consumers.
We have to be much more appealing and much more engaging with the consumers. This new packaging is doing that exactly.
Q: Does the company set a business target after launching such a big campaign?
A: Of course. Obviously it is our policy not to talk about figures to the outside world. But yes, at the end of the day, we want to make a profit. If you look at the vision of Heineken Hong Kong and Heineken in the world, we say we want to be the most valuable beer brand in the world. The value is a combination of how many cans do you sell and how much money do you earn per can.
In three years, we want to be the most valuable beer company in Hong Kong. We are not the biggest right now.
Q: The Hong Kong economy is down on its luck. How does it affect your company's business?
A: Yes. If you look at the beer market in Hong Kong, you can say it is a mature market. You do not see very big growth in terms of volume. It is a very mature, very competitive market.
If you look at the market share of premium brands in the beer category in Hong Kong, it is relatively high compared with a lot of other markets in the world.
You could say that the premium segment in total is declining. The low segment of the market has been increasing in the last two years. (Premium brands are described as those priced at HK$8 and above per can in a supermarket.)
Q: Is it a difficult period for a premium beer operator like Heineken to market its products?
A: It is difficult. On the other hand, it is a very challenging period. Under this environment, this is a completely different game. Hong Kong becomes a marketing game. It is not anymore a trading game and not a distribution game.
With this packaging, what we are really offering is something to the consumers that they appreciate, something that they are willing to pay extra for. We do not have to lower the tactical price in the market.
Q: What is your favourite brand, apart from Heineken?
A: I don't have one.
Q: A growing number of Chinese beers are coming into Hong Kong. How do they affect your company's business?
A: Indirectly. Of course it is going to be a threat. A few years ago, we only had Tsingtao. We now have Kingway, Yangjing and Harbin.
But we position ourselves in a completely different market segment to Chinese beer brands. They mainly sell their volume in segments such as Dai Pai Dongs in which we are not traditionally strong.
Q: Have you tried the Chinese brands? How is the quality?
A: Yes, of course. What I want to say about Chinese beer brands is their quality is much better than they used to be.
Some people suggest Harbin tastes like Heineken.
Q: There is speculation that Heineken will co-operate with Harbin to expand on the mainland. Is that true?
A: Everybody knows that all big international companies are looking at China. I am not part of the (China) operation. There is no story leak I can give you.