Beer in the United Kingdom

PROSPECTS

Premiumisation and craft beer reshaping the beer industry

Beer recorded a strong performance in 2018 with the high summer temperatures and the football World Cup finals stimulating consumption. Premium and craft beer are the main growth drivers in beer.

Flavour innovation

Beer drinkers are seeking to try different flavours, which is leading producers to play around with new flavour propositions. Craft brand Jubel has innovated by launching a premium peach and an elderflower lager to offer consumers differentiation in flavours.

Healthy lifestyle trend boosting demand for non/low alcohol beer

Non-alcoholic beer recorded the strongest volume growth within beer in 2018. Health and wellbeing is leading to an increasing number of health-conscious consumers moderating their alcohol consumption.

COMPETITIVE LANDSCAPE

Inbev UK Ltd increases its lead as most big players’ shares decline due to competition from craft brands

Inbev UK Ltd and Heineken UK Ltd remained the top beer players in 2018, with both having expanded their portfolio by launching alcohol-free variants to capitalise on the ongoing health and wellness trend. Apart from Inbev UK Ltd, which overtook Heineken UK Ltd as the biggest player in beer over the review period thanks to the strong performance of its products, the big players’ volume sales and shares were declining due to the challenge from craft brands, which, in an era when drinkers are demanding differentiation, are being experimental and innovative and supplying high-quality beer.

The number of pubs closing down is increasing

While beer experienced overall volume growth in 2018 and pubs recorded a modest volume increase due to the World Cup finals driving up pub visits, volume sales in pubs have generally been in decline. Pubs continue to face significant challenges and many are closing down, affected by high running costs and the shift in consumption from on-trade to off-trade.

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