With alcoholic drinks prohibited under Islamic law, beer sales in the Saudi Arabian market are totally reliant on non alcoholic beer. The COVID-19 crisis led to a marked decline in non alcoholic beer sales in 2020.
The modern grocery retailers channel was already taking share away from traditional grocery retailers even before the outbreak of COVID-19 but the pandemic helped to push even more shoppers towards hypermarkets and supermarkets. In the immediate aftermath of the pandemic supermarkets and hypermarkets gained in significance as they were perceived to be a safer place to shop compared to the smaller stores associated with traditional grocery retailers.
Carlsberg A/S remains the dominant player in non alcoholic beer, the sole beer category in the Saudi Arabian market. The company’s pre-eminent position in the market can be attributed almost entirely to the enduring consumer appetite for its two well-known brands, Moussy and Holsten, which hold the first and third largest volume shares in non alcoholic beer.
With the introduction of a sugar tax in the region, consumers are becoming more conscious of the health credentials of many of the products that they purchase. This could encourage players to invest in new products with a low calorie/low carb positioning, as well as focusing on the use of natural ingredients and labelling products as sugar free.
Non-alcoholic beer is seen as a beverage to be enjoyed in the company of others in social gatherings be it a desert night trip, BBQ parties or amongst school and university students. Players will need to focus on developing sales by using these occasions in product marketing or by offering multipacks designed to be enjoyed at parties and with friends and family.
Carlsberg’s dominant position in non alcoholic beer may come under threat in Saudi Arabia over the forecast period. The sheer size of the country’s population and the first signs of cultural openness seen before the COVID-19 pandemic – allowing for regular parties and celebrations involving large numbers of people enjoying music in mixed company – raises the likelihood that new brands will be tempted to enter the market.
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Beer
An alcoholic drink usually brewed from malt, sugar, hops and water and fermented with yeast. Some beers are made by fermenting a cereal, especially barley, and therefore not flavoured by hops. Alcohol content for beer is varied – anything up to and over 14% ABV (alcohol by volume), although 3.5% to 5% is most common. Beer is the aggregation of lager, dark beer, stout and non/low alcohol beer.
See All of Our DefinitionsThis report originates from Passport, our Beer research and analysis database.
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