Beer in Israel
Euromonitor International's Beer in Israel market report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
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Tables: 60 | Publication date: Jul 2009
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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
Dark beer; Lager by origin; Lager by price platform; Low/non- alcohol beer; Stout
Executive summary
The beer drinking culture is under-developed in Israel in comparison to other Western countries, in terms of consumption per capita. Nevertheless, the Israeli public is becoming more involved and sophisticated in its knowledge of beer products and consumption of premium beers is rising accordingly.
Sales within the premium segment grew by 12% in volume terms and by 14% in value terms in 2008. Most of this growth came through the on-trade channel. As the general economic situation in Israel improves, the Israeli consumer has more money to spend on luxury, premium products, with this trend reflected in beer sales. Imported premium brands such Stella Artois (Israel Beer Breweries Ltd) and Samuel Adams (Tempo Beer Industries Ltd) are gaining in popularity, but have yet to substantially impact the mid-priced beers, currently the largest price band.
In the domestic premium category, several boutique breweries launched new types of beer during 2008. One of the largest boutique breweries is called The Dancing Camel Brewing Co Ltd, which produces the Dancing Camel brand. The main difference between this brewery and others is that in mid 2007, Dancing Camel became the first boutique beer sold via on-trade channels, outside of the brewery. The brand is currently sold in eight outlets in Tel Aviv and in three outside the city. The brewery produces four different types of beer on a regular basis and a few more seasonal flavours in limited editions. This development illustrates a growing trend for premium brands in beer consumption during 2008.
In 2008, non-alcoholic beer saw a decrease in both value and volume sales for the third consecutive year. Non-alcoholic beers in Israel are mainly malt-based drinks that saw strong growth in 2004 and 2005 when the two leading companies, Tempo Beer Industries Ltd and Israel Beer Breweries Ltd launched new brands, Malty and Nesher Malt (a veteran brand that was relaunched with a retro design and a promotional campaign) respectively. Sales in the category peaked in 2005, but since then the leading companies have stopped advertising, as the brands were not as profitable as expected. Non-alcoholic beer is perceived to be healthier than normal beer, with higher nutritional values. It is also considered to be a traditional family drink; therefore its marketing efforts were targeted towards families and pregnant women. The main competition for these products in Israel is not within the beer sector, but the rapidly developing soft drinks market. The recent boom in healthier non-alcoholic drinks, such as mineral water, flavoured bottled water and carbonates has led to a decrease in the consumption of non-alcoholic beer in Israel.
Despite previous expectations Goldstar Light, a new product launched in February 2007, did not win the share that its manufacturer had anticipated. Tempo Beer Industries Ltd launched this low-calorie format as a response to the global health and wellness trend and invested more than US$1.7 million in advertising. When it was launched in February 2007 it achieved an initial value share of over 1%, but lost half of its share in only three months. Growing health awareness and a shift of emphasis to target the female population has seen companies introduce low-calorie and low-fat products to the alcoholic drinks market. This trend remains strong in 2008, despite the relative lack of success of Goldstar Light.
The first Irish pub in Israel was opened in Tel Aviv in 2000. It was followed by several other very successful Irish pubs, reflecting a trend that is strengthening year-on-year. Irish pubs have become synonymous with a certain kind of establishment in Israel, thanks to their distinctive designs and the particular atmospheres they offer. The Irish pubs promote mainly stouts such as Guinness (Israel Beer Breweries Ltd) and Murphy’s (Tempo Beer Industries Ltd) as well as a large variety of whisk(e)y brands. The success of Irish pubs in Israel positively affected growth rates of stout beer in Israel during the review period.
The average unit price of beer increased by 3% in 2008. This is not exceptional growth and is mainly attributable to the rising costs of raw materials and distribution. The larger increases were seen mostly for imported products, across all price bands.
78% of all volume sales of beer in Israel were sold through the off-trade channel in 2008. The rest was sold via the on-trade channel, meaning mainly bars, pubs and restaurants. Since unit price in the on-trade channel is higher than the off-trade channel, the gap naturally narrows when referring to value sales – only 53% in favour of the off-trade channel. Consumption of beer through the on-trade channel has developed rapidly throughout the review period thus the gap between the channels in terms of volume sales is becoming smaller. This trend reflects the developing nightlife scene in Israel, which is witnessing increased consumption of beer.
The most popular alcohol content is in the 4.9%-5.2% range, as leading brands such as Goldstar and Heineken (Tempo Beer Industries Ltd) as well as Carlsberg (Israel Beer Breweries Ltd) fall into this category. The highest alcohol content to be found in beer in Israel is 8.5%, in Hoegaarden (Israel Beer Breweries Ltd for the InBev GBO) from the dark beer category. Mid-strength beers dominate sales and have been popular throughout the review period.
In 2000, a deposit system for glass bottles was established in Israel. The prices of all bottles were increased by NIS0.25 and the consumer can now receive his money back when he returns empty bottles to the store. The public’s awareness of recycling and caring for the environment is on the rise, representing the main factor driving the deposit system.
Production, Imports and Exports
Domestically manufactured brands dominate beer sales, including Goldstar, Heineken and Maccabee (Tempo Beer Industries Ltd) as well as Carlsberg and Tuborg Red Label (Israel Beer Breweries Ltd). These five brands alone account for approximately 56% of beer sales in Israel. The Israeli public tends to consume domestic beer brands since they are already familiar with their flavours and their unit price is generally lower. In addition, domestic beers are advertised in Israeli media far more than imported brands.
As for private consumption expenditure, according to official data from the CBS, only 15% of the expenditure is spent on imported beer, while the rest is spent on domestic products. These figures refer to value sales.
Table of contents
ALCOHOLIC DRINKS IN ISRAEL : MARKET INSIGHT
EXECUTIVE SUMMARY
Developing nightlife in Israel positively affects the alcoholic drinks market
Growing demand for premium products in all sectors
Highly concentrated market with relatively stagnant competitive environment
The off-trade channel continues to dominate, although the on-trade channel is seeing stronger growth
Forecast period growth is expected for all leading sectors
KEY TRENDS AND DEVELOPMENTS
Developing leisure culture boosts sales of alcohol drinks
Premiumisation develops as a defining trend in the alcoholic drinks market
New law banning smoking in public places comes into force
Competitive environment – domestic versus international manufacturers
Specialist Retailers
Summary 1 Leading Specialist Retailers 2007
Merger and Acquisition Activity
MARKET BACKGROUND
Legislation
TAXATION AND DUTY LEVIES
Table 1 Taxation and Duty Levies on Alcoholic Drinks 2007
Table 2 Typical Wholesaler and Retailer Off-trade Mark-ups by Selected Sectors 2008
Table 3 Selling Margin of a Typical Beer Brand 2008 - Goldstar
Table 4 Selling Margin of a Typical Wine Brand 2008 – Golan Cabernet Sauvignon
Table 5 Selling Margin of a Typical Spirits Brand 2008 – Absolut Vodka
OPERATING ENVIRONMENT
Contraband/Parallel Trade
Duty Free
Cross-border/Private imports
MARKET INDICATORS
Table 6 Retail Consumer Expenditure on Alcoholic Drinks 2003-2008
MARKET DATA
Table 7 Sales of Alcoholic Drinks by Sector: Total Volume 2003-2008
Table 8 Sales of Alcoholic Drinks by Sector: Total Value 2003-2008
Table 9 Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2003-2008
Table 10 Sales of Alcoholic Drinks by Sector: % Total Value Growth 2003-2008
Table 11 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Volume 2008
Table 12 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Value 2008
Table 13 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Volume 2008
Table 14 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Value 2008
Table 15 Company Shares of Alcoholic Drinks by Global Brand Owner 2004-2007
Table 16 Off-trade Sales of Alcoholic Drinks by Distribution Format: % Value Analysis 2008
Table 17 Off-trade Sales of Alcoholic Drinks by Sector and Distribution Format: % Volume Analysis 2008
Table 18 Forecast Sales of Alcoholic Drinks by Sector: Total Volume 2008-2013
Table 19 Forecast Sales of Alcoholic Drinks by Sector: Total Value 2008-2013
Table 20 Forecast Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2008-2013
Table 21 Forecast Sales of Alcoholic Drinks by Sector: % Total Value Growth 2008-2013
DEFINITIONS
Summary 2 Research Sources
LOCAL COMPANY PROFILES - ISRAEL
BARKAN WINE CELLARS LTD - ALCOHOLIC DRINKS - ISRAEL
STRATEGIC DIRECTION
KEY FACTS
Summary 3 Barkan Wine Cellars Ltd: Key Facts
Summary 4 Barkan Wine Cellars Ltd: Operational Indicators
COMPANY BACKGROUND
PRODUCTION
Summary 5 Barkan Wine Cellars Ltd: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 6 Barkan Wine Cellars Ltd: Competitive Position 2007
CARMEL MIZRACHI WINERIES LTD - ALCOHOLIC DRINKS - ISRAEL
STRATEGIC DIRECTION
KEY FACTS
Summary 7 Carmel Mizrachi Wineries Ltd: Key Facts
Summary 8 Carmel Mizrachi Wineries Ltd: Operational Indicators
COMPANY BACKGROUND
PRODUCTION
COMPETITIVE POSITIONING
Summary 9 Carmel Mizrachi Wineries Ltd: Competitive Position 2007
ISRAEL BEER BREWERIES LTD - ALCOHOLIC DRINKS - ISRAEL
STRATEGIC DIRECTION
KEY FACTS
Summary 10 Israel Beer Breweries Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION
Summary 11 Israel Beer Breweries Ltd: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 12 Israel Beer Breweries Ltd: Competitive Position 2007
M ACKERMAN LTD - ALCOHOLIC DRINKS - ISRAEL
STRATEGIC DIRECTION
KEY FACTS
Summary 13 M Ackerman Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION
COMPETITIVE POSITIONING
Summary 14 M Ackerman Ltd: Competitive Position 2007
TEMPO BEER INDUSTRIES LTD - ALCOHOLIC DRINKS - ISRAEL
STRATEGIC DIRECTION
KEY FACTS
Summary 15 Tempo Beer Industries Ltd: Key Facts
Summary 16 Tempo Beer Industries Ltd: Operational Indicators
COMPANY BACKGROUND
PRODUCTION
Summary 17 Tempo Beer Industries Ltd: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 18 Tempo Beer Industries Ltd: Competitive Position 2007
BEER IN ISRAEL
HEADLINES
TRENDS
Production, Imports and Exports
COMPETITIVE LANDSCAPE
PROSPECTS
SECTOR BACKGROUND
Lager price band methodology
Summary 19 Lager by Price Band 2008
Published data comparisons
SECTOR DATA
Table 22 Sales of Beer by Subsector: Total Volume 2003-2008
Table 23 Sales of Beer by Subsector: Total Value 2003-2008
Table 24 Sales of Beer by Subsector: % Total Volume Growth 2003-2008
Table 25 Sales of Beer by Subsector: % Total Value Growth 2003-2008
Table 26 Sales of Beer by On-trade vs Off-trade Split: Volume 2003-2008
Table 27 Sales of Beer by On-trade vs Off-trade Split: Value 2003-2008
Table 28 Sales of Beer by On-trade vs Off-trade Split: % Volume Growth 2003-2008
Table 29 Sales of Beer by On-trade vs Off-trade Split: % Value Growth 2003-2008
Table 30 Beer: Production, Imports and Exports: Total Volume 2002-2007
Table 31 Beer Exports by Country of Destination: Total Volume 2002-2007
Table 32 Beer Exports by Country of Destination: Total Value 2002-2007
Table 33 Beer Imports by Country of Origin: Total Volume 2002-2007
Table 34 Beer Imports by Country of Origin: Total Value 2002-2007
Table 35 Company Shares of Beer by National Brand Owner 2003-2007
Table 36 Company Shares of Beer by Global Brand Owner 2003-2007
Table 37 Brand Shares of Beer 2004-2007
Table 38 Forecast Sales of Beer by Subsector: Total Volume 2008-2013
Table 39 Forecast Sales of Beer by Subsector: Total Value 2008-2013
Table 40 Forecast Sales of Beer by Subsector: % Total Volume Growth 2008-2013
Table 41 Forecast Sales of Beer by Subsector: % Total Value Growth 2008-2013