Launched earlier this year, Heineken 0.0 - a zero alcohol lager with 69 calories per 33cl bottle - is now available in 16 markets across Europe.
Eyeing up a ‘promising’ future for the brand, Heineken says 0.0 is not cannibalizing its other beers, but is rather opening up new consumption occasions such as lunches, after sports, or when people need to drive.
Decrease in alcohol consumption
Heineken has identified the low-no alcohol category as a focus area for innovation. It saw double digit growth in the category over HY 2017 in Europe, with strong performances in Spain, Netherlands, Poland and Austria.
Jean-François van Boxmeer, CEO and chairman of the Executive Board, observes that the market in Europe has changed in recent years, with alcohol consumption per capita decreasing.
“For all good reasons, you don’t drink at lunch any more, you don’t drink when you drive, and you are more health conscious,” he said, speaking in yesterday's HY 2017 earnings call.
"“This is all good news for society but it has a business consequence. I think we have digested that and we will continue to digest that. And that’s also the reason why we invest a little more into non-alcoholic and low alcoholic variants to offer the choice to our consumers.”
Heineken’s green label has been turned blue on 0.0 – a color associated with the alcohol free category.
The beer is brewed from scratch (rather than removing alcohol from regular 5% Heineken), and uses the tagline ‘Open to All’.
It was launched at the Spanish Grand Prix in Barcelona in May.
The company says its ambition is to use Heineken 0.0 to ‘lead category development’ in markets where non-alcoholic beer is still small, but has growth potential, with a premium proposition.
New consumption occasions
In Europe, Heineken credits the ‘early success’ of Heineken 0.0 as one of the factors for 7% growth for the Heineken brand in HY2017.
Van Boxmeer said Heineken 0.0 is not cannibalizing other brands; rather, it is opening up new opportunities.
“It's about going after new occasions of consumption and one has to realize it's early days,” he said. “It's a good start, but it's not really very, very big volumes yet.
“It’s going for occasions where normally you would not drink alcoholic beer and it’s very much a free choice. I think about the lunch occasion, or just after sport, or when you have to drive.”
Heineken has learned a lot from Spain, where non-alcoholic beers have a more established following, he said.
"Spain has a tapas culture, people go out and they eat tapas after work with their colleagues and then they have to drive their car home. And as the Spanish authorities were having a very strict policy on don’t drink and drive, people switched quite easily to non-alcoholic beer because the bitter taste of beer goes very well with those tapas, it’s as easy as that.
“And you can think about these types of occasions in other countries too.
“It is not only for [brand] Heineken, but we do it with Heineken because Heineken being our flagship brand it also signals to the entire Group that going into and promoting more non-alcoholic products and variants of our existing brands is a good business case.
“It is premium and it opens market segment where we are not with alcoholic beer. And to show and lead by example we put our money where our mouth is and we have launched Heineken 0.0 for that.
“But again it’s early days, it had a good start, we received a lot of good critique about the taste essentially and that is what matters and we’ll see how it evolves. But we think there are a lot of new drinking opportunities to sell it through.”