Sales of beer declined substantially over the course of 2020 as the entire category was heavily negatively impacted by the COVID-19 pandemic. Major sales declines were registered in both the off-trade and on-trade during the year as consumers avoided purchasing beer wherever possible due to the adverse economic situation that unfolded over the course of the year as the COVID-19 pandemic interrupted commercial activity in key sectors of the Indonesian economy.
The online sale of alcoholic drinks channel has always been a grey area in Indonesia’s legal system. Indeed, subsisting regulations do not specify in any kind of detail what types of online sales are expressly prohibited.
Despite demand for beer having being hit strongly by the COVID-19 pandemic in 2020, there were still numerous new product launches registered in the category during the year, notably Guinness Smooth by Multi Bintang Indonesia Tbk PT. However, the marketing for these new products has been quite limited, while the distribution of the new launches has not been as wide as products launched in previous years by the same companies.
Beer is expected to register a strong sales recovery during the forecast period and underpinning this buoyant performance is set to be widespread promotional activity, including bundling promotions and price discounts in the off-trade and happy hour promotions in the on-trade. Such promotional activity is expected to become more common from 2021 onwards as beer brands seek to stimulate demand and promote a robust and sustainable recovery for sales of beer in both the on-trade and off-trade channels.
One of the most interesting trends to have emerged from the COVID-19 pandemic for sales of beer in Indonesia is that many consumers have discovered the joys of drinking at home. The requirement to avoid social contact wherever possible during 2020 led many Indonesian people to consume more beer at home, either on their own or with friends and family, resulting in increases being seen in the numbers of consumers who are interested in at-home beer consumption.
The forecast period is expected to see the leading players in beer turn to innovation in an effort to support sales and capture expanding demand in a recovering category of alcoholic drinks. With sales of beer expected to stabilise and begin increasing once again as soon as consumers feel able to spend freely and safe to socialise outside of the home once again, huge opportunities are likely to emerge for beer brands to appeal to consumers with innovative new products that capture the convivial general mood that is expected to emerge once the influence of the COVID-19 pandemic starts to wane.
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Understand the latest market trends and future growth opportunities for the Beer industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Beer research and analysis database.
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