TRENDS
Beer sales
Canada's suds makers duke it out in summer beer wars
Last Updated: Friday, July 17, 2009 | 3:17 PM ET
By Philip Demont, CBC News
Beer sales in Canada have been relatively flat in recent years. (istockphoto.com) It is summertime. But, with apologies to songwriter George Gershwin, the living is anything but easy — at least if you're a Canadian beer maker.
As the thermometer rises across the country, so does the heat in Canada's beer industry as suds players once again battle it out for hearts — and stomachs — of barley pop drinkers from St. John's, N.L., to Queen Charlotte City, B.C.
"There's nothing that sells beer better than hot sunny weather," said Jeff Newton, president of Canada's National Brewers, an organization which represents the country's biggest beer companies.
While a growing patio population in this country usually leads to more seasonal quaffing of suds, however, producers also know that Canada's beer wars will inevitably turn into a hammer-and-tongs fight to win over a bigger percentage of the same number of drinkers.
"It is fair to say the beer market is pretty flat. So, what we ask ourselves is how can we gain market share and how can we grow the overall market," said Richard Musson, vice-president of marketing for Labatt Breweries of Canada, one of the country's biggest domestic beer producers.
In a market that is growing annually by between one and one and a half per cent a year, according to industry estimates, answering the first question is usually easier than puzzling through the second.
Glacial growth
Canada's beer market has grown over the past decade, but at a pace that might resemble that of a snail.
"Mainstream beer sales have been stagnant or falling for years," said Stephen Beaumont, a well-known beer writer and industry expert.
Indeed.
According to the latest figures from Statistics Canada, the country's beer stores and agencies sold $8.6 billion worth of the hop-based beverage in fiscal 2007-08.
That was up 2.4 per cent compared to one year earlier, but also included beer price increases.
Gauging activity by volume, Canadian beer sales fell by one per cent in April 2009, versus the same month one year earlier, according to the Brewers Association of Canada.
Even more problematic, beer compromised 53 per cent of all alcohol sales in 1993; by 2008, that percentage had slipped to 46 per cent.
Finally, in terms of annual beer consumption per Canadian, the country topped out at 68.3 litres, 19th in the world, as ranked by Kirin Holdings, a Japanese beer and pharmaceutical company.
Canada ranked ahead of Portugal but well behind the globe's top suds consumer, the Czech Republic, where the population puts away a hefty 156.9 litres of beer per-person each year, according to the same study.
By contrast, Canada has seen its annual per-person beer consumption fall by 27 per cent between 1976 and 2008, says Statistics Canada.
The plunging intake is partially reflected in less interest in older concoctions, like Molson Coors' Brador, among younger people.
"A number of people want a beer that is less bitter," said Labatt's Musson.
Imported push
But, Canada's slow-growing market does not appear to have led to somnambulistic beer companies content to just sit on their hands and let their competitors alone.
Foreign beer companies have been crowding into Canada's suds market over the past decade or so, forcing Canuck brewers to fight for market share.
A 2006 study completed by Statistics Canada noted that imported beers comprised approximately nine per cent of Canadian sales in 2002. That figure was three times what it was a decade earlier.
In past decades, the Danish beer Carlsberg was considered exotic. Now, Canadians can buy anything from Kenya's Tusker beer to Milton, Delaware's Dogfish Head Ale to Slavutych beer from the Ukraine.
Summer salvos
The opening shot in the 2009 version of Canada's 100-years beer war was Brick Brewing Co. Ltd.'s June 15 announcement that the Waterloo-based beer producer was cutting the price of a six-pack of Laker and Laker Lite brew.
Brick said the reduction — from $12.35 to $7.35 — was to garner goodwill among its customers and maybe get a few drinkers of Labatt's Blue or the Canadian offering of the Molson Coors Brewing Company.
"Brick continues to appreciate our loyal drinkers and we are grateful for their support over the years. We believe this offer will generate trial amongst new consumers," said Brick president and chief executive officer George Croft.
Brick's temporary suds sale was designed to raise the company's presence in the so-called "value" segment of the beer market, where a lower price is a bigger factor than taste in gaining customers.
Labatt also has moved in the industry's multi-player summer chess game, introducing Budweiser Lite Lime, a citrus flavoured beverage that has proven distinctly popular among the country's quaffers.
That brew, which Musson likens to a new drink rather than a flavoured beer, has been hard to keep on store shelves.
"Bud Lite Lime enjoyed a very successful launch in Ontario and many other parts of the country and we are all working hard to replenish our shelves," said Ted Moroz, vice-president of retail for The Beer Store, Ontario's main beer sales outlet.
Indeed, Bud Lite Lime and less-hoppy brews, like the growing number of wheat beers, have brewery people believing the industry actually can begin to win back drinkers who have abandoned the segment altogether.
"It is about winning the alcohol share of stomach," said Kevin Meens, chief operating officer of Cool Brewery, a small Toronto-based beer producer.
Cool wants to try to win back Canadians by offering beer in smaller bottles, to appeal to lighter beer drinkers, and different packaging, such as beers in four packs.
Share Tools
Top News Headlines
- U.S. bank reforms could hurt Canadians, Flaherty fears
- Canada's finance minister and the governor of the Bank of Canada have formally complained to their American counterparts that proposed banking reforms could harm Canadian banks, business, investors and the government itself. more »
- CBC digital music service launches today

- CBC is diving into the world of online music with the goal of providing listeners access to their favourite tunes, and a way to discover new artists and connect with fellow music fans. more »
- Whitney Houston death shows no signs of trauma
- Whitney Houston's life of glorious song and unnerving self-destruction apparently ended on Grammy weekend, but it could be weeks before investigators know exactly why she died. more »
- Organ donation rates go flat
- Organ donation rates have stagnated in Canada since 2006, according to a new report. more »
Latest Business Headlines
- Chinese iPhone, iPad factories inspected
- Chinese factories where Apple devices are assembled are undergoing voluntary audits of their working conditions by an independent workers' rights watchdog that the company recently joined. more »
- Wheat prices steady despite record high stocks
- Wheat prices rose Monday after falling almost five per cent last week and despite estimates world wheat stocks are at all-time highs. more »
- Obama unveils $3.8T budget proposal
- U.S. President Barack Obama unveiled a $3.8 trillion spending plan on Monday for 2013 that seeks to achieve $4 trillion in deficit reduction over the next decade. more »
- Housing market to stay stable, says CMHC
- Canada Mortgage and Housing Corp. is predicting the Canadian housing market will remain fairly stable this year and next, with little change from 2011 in prices, new home construction and sales of existing homes. more »
Lang & O'Leary Exchange
Markets
| Index | Last Trade | Change |
|---|---|---|
| TSX COMPOSITE | 12404.91 | 15.49 |
| DOW | 12875.89 | 74.66 |
| NASDAQ | 2929.5 | 25.62 |
| SP 500 | 1351.91 | 9.27 |
| NYSE COMPOSITE | 8058.44 | 66.39 |
| AMEX | 2431.78 | 13.8 |
| TSX-VENTURE | 1653.11 | -0.44 |
The data on this site is informational only and may be delayed; it is not intended as trading or investment advice and you should not rely on it as such.
Business Features
- 'Disgusting' court backlog may free hit and run accused
- Adele wins best album, best record Grammys
- Whitney Houston autopsy results withheld
- Whitney Houston death shows no signs of trauma
- Ice road closed after 2 incidents
- Quebec town 'heartbroken' after killing of woman, sisters
- CBC digital music service launches today
- Manitoba wants ER death lawsuit thrown out
- Greece cleans up after anti-austerity riots

