The Copenhagen Report

Morning delivery of draft beer in Copenhagen

Many mornings in Copenhagen, on my way to work, I cycle by a truck that always makes me laugh. It closely resembles the oil truck that used to come a couple times a year to the house I grew up in as a kid to fill up the oil tank in our basement (that fueled the furnace in the house). Except this truck here in Copenhagen carries no oil. In fact, it is a Carlsberg beer tanker!

For those without a working command of Danish, 'Fadøl' (as written on the side of the truck pictured below) means 'draft beer'.



And just as it was done with those old oil trucks (that are still around), a hose is pulled from the truck and is connected to the beer tanks located in the basement of the bar...



...via a little hole in the ground, in front of the bar. Just pull the hose!



...and voila, tasty beer will be flowing from the taps in no time! Needless to say, this is not exactly the quality kind that I have been writing about in previous posts...

Setting the story straight - The Remarkable Danish Beer Market (Part 3)

by Tim Anderson (timothyanderson2005@gmail.com)

I want to set the record straight. After writing a couple of articles about the Danish beer market which I published earlier (The Remarkable Danish Beer Market (Part 1) and Carlsberg Stikes Back - The Remarkable Danish Beer Market (Part 2)), there was one crucial issue I had not tackled – exactly who was responsible for importing all of these foreign beers to Denmark? Who was it that was able to so quickly convince so many shops and bars across Denmark to dedicate less space to Carlsberg/Tuborg products, and much more to relatively expensive foreign ones? I had this nagging suspicion that maybe, just maybe, Carlsberg still had a hand in these matters. It turns out my suspicions were not without merit.

Now if I had been charged with writing these previous two articles for a mainstream news outlet, I would never have been able to get away with such a glaring omission. Fortunately, I was not. So here it is, the last pieces of the previously incomplete puzzle.

The Danish beer market makes a remarkably fascinating study. First, an influx of quality foreign beers into Denmark, alongside drastic leap in foreign beer sales over the last four years demonstrated clear willingness for Danish consumers for such quality beers. Foreign beer consumption, which stood around 0.7 million litres back in 2000, exploded to nearly 9 million litres in 2004. Sensing a definitive consumer trend towards these tastier (and more expensive) beers, a number of Danish microbreweries have been springing back to life in recent months. The average beer drinker in Denmark is now faced an abundance of choice, at long last.



Yet, there is more to this story than first meets the eye.

Few are aware that it was a decision back in 2002 by the brewing-giant, Carlsberg, long the dominant force in the Danish beer market and possessor of a finely-honed selection of market strangulation tricks, that finally kicked the doors open to a wide range of quality beers. More on that shortly.

Back in 2000, when I first moved to Copenhagen from London, the picture looked radically different then it does today. Carlsberg and Tuborg flowed exclusively from all but a tiny handful of taps in the bars of Copenhagen. Supermarkets were no better selling primarily on Carlsberg and Tuborg, the similar-tasting discount beers produced by knock-off copycat brands like Harboe and Ceres and an extremely limited selection of highly overpriced and relatively uninteresting foreign ones – names such as Fosters and Heineken.

Denmark’s long brewing tradition was never evident from tasting the narrow range mass-market beers offered in bars and supermarkets a few short years ago. It seemed these bars and supermarkets had somehow never discovered that there was a world of beers beyond the limited range they stocked – albeit a range that was essentially foist upon them by Carlsberg.

Nonetheless, as foreign beers slowly began trickling into Denmark a few years back, Carlsberg opted to take matters into it’s own hands in a significant strategy shift. Perhaps recognising that it was unlikely to ever match many of these foreign beers in terms of depth of taste, Carlsberg found another way around the issue through the creation a wholly owned import company, House of Beer (www.house of beer.dk) in 2002. Carlsberg owned House of Beer quickly became the exclusive Danish importer for many foreign beers. Perhaps it was never likely that the giant of Danish brewing would graciously risk giving away all the cash from this significant (if minor) share of its the home market.

It is largely owing to these efforts that various Belgian, Czech and German beers such as Hoegaarden, Chimay, Leffe, Staropramen, Erdinger, Franzikaner, Urquel and Budvar, among others, have come to flow increasingly freely at bars across Copenhagen over the past three years and are now sold in all major supermarkets. House of Beer is responsible for supplying many (though not all) of these quality foreign beers, and sales of foreign beers have being going through the roof as Danish consumers increasingly embrace them. In 2002, House of Beer imported 4.2 million litres of beer, and this year it will import over 13 million litres – the sort of growth most companies only fantasise about.

These foreign beers are generally priced between double or triple Carlberg and Tuborgs mainstream beers (and four to six times those of the Danish copycat producers similar knock-offs), but have become enormously popular in spite of this price disadvantage. Some of the newer bars in Copenhagen are even opting to leave Carlsberg/Tuborg off the menu entirely, an idea virtually unimaginable only a few years back.

Over the past months, the transformation has continued as a number of Danish microbreweries (brewing quality beers) have re-entered the fray. The products of Danish microbreweries such as Fur, Skand, Bryghus and Thisted now command significant shelf space on supermarket shelves, overwhelming Carlsberg’s long-neglected Semper Ardens range of quality beers which typically stand nearby (a range of specialty beers Carlsberg has long-ignored, having focussed its marketing efforts exclusively on its mainstream beers, while allocating no budget to its specialty products such as Semper). Priced similarly to the quality foreign beers now available, these small-time Danish brands appear to be succeeding.

Not to be outdone, and sensing a neglected market segment quickly being filled by these Danish microbreweries, Carlsberg recently responded by introducing another line of quality beers (beyond it’s Semper Ardens range) specifically for the Danish market. Under the name Jacobsen, these beers (Bramley Wit, Brown Ale, Dark Lager and Saaz Blonde) are marketed as ‘microbrewery’ beers and brewed at a small, purpose-built brewhouse, symbolically located beside the company’s Copenhagen headquarters. (See my previous article Carlsberg Stikes Back - The Remarkable Danish Beer Market (Part 2) for more on these.)

Thanks to all of this change, in Danish supermarkets an entire aisle can be found stocked with various quality beers from Denmark and around the world – an aisle that did not exist a few short years ago. Furthermore, in many of the supermarkets, the mainstream beers of Carlsberg and Tuborg are being relegated a lesser area of space then the quality foreign and domestic beers now occupy. It’s about time.

It is doubtful that even Carlsberg could have anticipated the far-reaching transformation being set in motion as it began importing beers back in 2002 – a transformation that continues unabated today.

It seems the days when an extremely limited range of quality foreign beers and quality domestic alternatives were virtually unavailable in any supermarkets are now long-gone, once and for all. I myself never imagined when I first arrived in Denmark five years ago that things would unfold in such a dramatic manner as they have. How refreshing it has been.

by Tim Anderson (timothyanderson2005@gmail.com)

Apparently invigorated by the influx of foreign beers into Denmark over the last four years that has seen consumption of quality (generally foreign) beers skyrocket over the past years, Carlsberg has taken its first steps in response. Virtually at the same moment I hit the ’publish’ button for the last article I wrote regarding the Danish beer market (The Remarkable Danish Beer Market), Carlsberg announced the introduction of a new line of exclusive, upmarket beers, to be brewed under the name ‘Jacobsen’ (after J.C. Jacobsen, who founded Carlsberg in 1847) in a microbrewery located beside Carlsberg’s Copenhagen headquarters. The Jacobsen line of beers consists of Bramley Wit, Brown Ale, Dark Lager and Saaz Blonde.

This is an excellent sign, from my perspective. The trend towards quality, upmarket beers entering the Danish market is apparently more than a ‘blip’ on the radar screen. Unlike four years ago, when Carlsberg’s market domination of the beer market in Denmark was so comprehensive that the company's half-hearted attempt to revitalise its product range involved offering four new beers, quickly withdrawing three of them (keeping the 'best') and promptly ending all marketing and promotional efforts geared towards bringing this new offering into the mainstream beer market. But time does bring change.

So although this influx of foreign beers into Denmark may have had little financial impact on Carlsberg’s Danish operations – Carlsberg continues to dominate the market – the change is now visibly apparent when visiting bars and shops across Copenhagen, making Carlsberg’s domination seem not nearly as overwhelming as it once was. Choice has returned to the pubs and bars across the city.

Unfortunately, in terms of taste, the new Jacobsen beers, similar to it's 'Hvede' beer introduced a few years ago, do not offer a depth of taste comparable to that many of the foreign beers that are available. After enjoying a Jacobsen Dark Brown, and taking a few sips of the Jacobsen Saaz Blonde a friend was drinking, I was left with the clear impression that neither was bad at all – they were both decent beers with a fair amount of taste. And they were certainly infinitely more interesting than the typical Carlberg or Tuborg pilsner. However, I was nonetheless left with the overwhelming desire for something more. The Saaz Blonde simply did not possess the depth of flavour I have come to expect in a good wheat beer. The Hoegaarden I subsequently ordered did the trick in satisfying this urge. So Jacobsen is a nice addition to the Carlsberg beer family, no doubt, but Carlsberg hasn’t been able to cross over that invisible line that will allow it seriously challenge the more established foreign beers in the area of taste.

So the risk in all of this is that Carlsberg will reach into it’s old bag of market domination tricks, ones that have served it so well over the years, in order to try and convince significant numbers of Danish bars that may be considering adding one or two taps for more upmarket offerings, to opt for Jacobsen over those tasty foreign beers. I am the first to admit that whatever the outcome, all of this is better than no choice at all, which is how it was not that long ago.

There's more! Read on, Setting the record straight - The remarkable Danish beer market (Part 3).