By James Atkinson

Carlton & United Breweries maintains that the long-term prognosis is good for its Crown Lager and Victoria Bitter brands, despite both having shown volume declines in the last financial year, and negative reaction from some consumers to the new Crown Lager recipe.

In the months following the repositioning of Crown Lager and the move to an all-malt brew, TheShout was inundated with negative feedback about the new taste from consumers, in response to this article.

“Why do they stuff around with something that does not need to be touched?” was the question asked by one drinker and was the general gist of most of the criticism levelled at CUB.

But SABMiller said the fall in Crown Lager volumes for the full year to March 31 reflected “both a strong prior year comparative and price compression from imported brands”.

This view was reiterated by Victoria Bitter and Crown Lager general manager, Richard Oppy, who indicated his confidence that the decline cannot be attributed to consumers deserting the new formula.

Crown had previously achieved 10 per cent growth over a 12-month period (MAT) prior to the relaunch, but Oppy said several variables meant the two numbers could not be compared like-for-like.

“The slight decline in volume has been driven by our trading program and the brand has cycled over very aggressive pricing in the marketplace where Crown Lager was used as a foot traffic driver to drive shoppers into store,” Oppy commented. 

“It is also important to note that Crown Lager over-indexes over the Easter period and in F13 there were two Easter periods and as a result there was no Easter period in F14 which obviously impacted on Crown Lager’s volume,” he said. 

Industry sources suggested that consumers respond sharply to Crown Lager price adjustments and that CUB along with retailers have maintained a higher pricing strategy for the product last year, in contrast to the previous corresponding period.

Oppy told TheShout that market research conducted by CUB indicated Crown was “heading in the right direction” in terms of brand health metrics, which typically measure how premium consumers perceive a product to be both before and after a new marketing campaign. 

While one consumer proffered to TheShout that CUB had “stuffed VB now Crown”, Oppy stressed that the circumstances of the Crown Lager overhaul were very different. 

“This decision was made for the long term and increased the cost of producing Crown Lager, unlike decisions made in the past with Victoria Bitter when we dropped the ABV to improve the profitability of the brand,” he said.

VB to benefit from upcoming campaigns

In regards to Victoria Bitter, Oppy said that although the brand was down one per cent last year, “it performed better than the beer category and therefore actually grew share of Total Beer over that period”.

“We have some great promos for Victoria Bitter underway with the State of Origin promotion, giving consumers the chance to get their name in an Origin game as well as the Hard Yakka activity, giving away a $30 Hard Yakka voucher with every case of Victoria Bitter,” Oppy said.  

“Also, the recent Victoria Bitter ‘Live Scoreboard’ activity over summer was one of the most successful promotions we have ever run at CUB and we have a plan for this summer which we believe could top it.” 

“Taking Victoria Bitter back to the ‘Big Cold Beer’ was the right thing to do for the brand after a decade of double digit decline. We know this is a long term play in the classic category,” said Oppy.

Premium segment offsets classic beer’s decline

SABMiller last week reported that while CUB’s volumes declined three per cent in the year to March 31, this was offset by an improvement in the division’s ‘net producer revenue’ of three per cent per hectolitre, “driven predominantly by price increases, coupled with the execution of premium growth platforms along with more disciplined and performance-based discounting”.

Elsewhere in the core portfolio, SABMiller said Carlton Dry and Carlton Mid had achieved strong volume growth.

“Focus on premium growth platforms delivered ten per cent volume growth in the super premium portfolio, most notably Peroni Nastro Azzurro, and the craft brand Fat Yak,” the brewer said. 

“In addition, the launch of Kopparberg added an international premium cider to the portfolio.” 

CUB’s total reported volumes, including discontinued brands and disposals, were down nine per cent.

The Shout Team

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  1. CUB sales are down because their sales reps are rubbish. I’ve been trying to stock their products in my venue but they are disinterested.

  2. Idiots !!!! Hey cub here I’ll make it clear “the drop in sales is cause you changed the flavour of a drink !!!!! “Here’s a tip for free ! When a drink no longer taste the same it’s a different drink !!!!! What made a crown a crown was the taste change that and you have I different beer!

    How we’ll did that idea work for coke in the 1980’s ? Not hard to see changing the flavour is the dumbest business strategy ever and you should be fired !!!!

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