Carlsberg A/S has said that Russians are shifting toward its premium beers, with branded goods helping bolster sales amid political turmoil and government regulation to curb drinking.
“Russians still, despite the crisis, like brands,” chief executive officer Jorgen Buhl Rasmussen said in a telephone interview after Carlsberg, the biggest brewer in Russia, reported increased share in the market. “They are tempted to buy into brands, whether it’s beer, food products or clothing.”
Russian demand for Carlsberg’s premium drinks such as the Baltika 7 and Brewer’s Collection helped offset the impact of a weakening ruble and government regulation on the world’s fourth-biggest brewer. Carlsberg’s share of the Russian market by volume improved to 37.9 per cent in the third quarter from 36.5 per cent in the preceding period, it said.
“I think we will see a positive mix, trading up, in the Russian market for the years to come,” Buhl Rasmussen said.
Shrinking Market
The Russian market shrank as much as 7 per cent in the first nine months of the year by volume, Carlsberg said. After government measures to reduce drinking weighed on sales for the last five years, brewers are now contending with consumer pessimism brought about by the recent political tensions between Russia and its Western trading partners.
Russia “will always be a very important market for Carlsberg,” he said. “It’s not like it’s unattractive to be in, it’s just been extremely challenging for the past few years.”
The Copenhagen-based brewer’s improvement was driven by new products, as well as continued sponsorship of sports teams, such as the Continental Hockey League, the CEO said. This year, Carlsberg also started filling some bottles with less beer to help limit price increases.
Bloomberg News, edited by ESM
