Case study - Cider: growth through innovation

Whilst the UK cider market represents over 50 per cent of all cider sold in the EU, cider is less than 10 per cent of total alcohol consumed in the UK. It is an important part of our UK portfolio as it creates a point of difference versus our competitors and, in 2008, grew by 6.5 per cent. This makes it the fastest-growing category in the UK alcohol market.

Cider has a rich history in the UK, (Bulmers was founded in 1887) and ciders sit alongside beer and are seen as part of the traditional UK pub offering.

In 2002, the UK cider industry had been struggling for around 10 years. Increased competition from alcopops and premium-packaged lagers had impacted sales and consumption. Reduced investment in the category by cider makers compounded the problem, resulting in a poor image and accelerating the category’s decline.

However, in 2002, successful discussions between the cider industry and the UK government resulted in a fairer duty burden for cider, improving confidence amongst cider makers and customers. This decision reflected the government’s recognition of the commitment to sustainability and the rural economy made by UK cider makers.

In 2003, S&N acquired Bulmers, the world’s largest cider maker. This resulted in an immediate increase in marketing investment for the major brand, Strongbow, driving improved consumer awareness and a much stronger brand performance.

With the improved environment for cider in the UK, the arrival of a number of imported cider brands created greater advertising and, in turn, consumer interest. One of the most obvious and popular changes was introducing the concept of drinking cider ‘over ice’. Together, these elements enabled the emergence of a premium cider segment.

S&N UK saw the opportunity to drive growth in both the category overall and in the premium segment through increased investment and, particularly through innovation. In just three years, Strongbow Extra Cold, Bulmers Original, Jacques, Bulmers Pear and Bulmers Light were launched. The result was the successful recruitment of new drinkers, with each brand successfully targeting different consumers in the critical 18-35 age range.

Today the UK cider market has outperformed the long alcoholic drinks sector consistently for the last five years. Strongbow, the clear market leader in the UK, continues to grow; Bulmers ciders have excellent distribution and outperformed their competitors; Jacques is positioned as a lighter alternative to wine. All in all, testament to the power of investment in innovation.