Setting the story straight - The Remarkable Danish Beer Market (Part 3)
by Tim Anderson (firstname.lastname@example.org)
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.
Setting the story straight - The Remarkable Danish Beer Market (Part 3)