Heineken InternationalKody Harper Channing Renner Trevor Willis

Heineken Commercial

History

• Established in 1864– Gerard Adriaan Heineken– Amsterdam

• In the late 1800’s, became Europe’s top beer producer

• Publically traded in 1939– HINKF

• Revenue in 2008 of €14,701 million Euros

Current & Future Profile

• Current Profile– Substantial revenues in 2009– New online program for 12 students

• Future Profile– Economic downturn– Vague progress in certain countries

SWOT Analysis

• Strengths– Large Work Network• Over 70 countries and 125 breweries

– Alliance with UEFA• Union of European Football Associations

– Over 140 million viewers worldwide per game– Brand Awareness

– Strong and rounded brand portfolio• Over 200 beers within Heineken’s portfolio• Top brands: Heikenken and Amstel

SWOT Analysis

• Weaknesses– Profit Margins• Decreased profit margins• Increased start up costs

– Increased debt• 2007-08 $11 billion increased debt• Debt acquiring acquisitions

• Opportunities– Failing and smaller breweries• Start up costs• Brewery and Maltery

– Global Beer industry• Beer is good!!• 1.7% increase in market from 2008 to projected 2013

SWOT Analysis

SWOT Analysis

• Threats– Europeans…Drink more beer!!!• Slow growth rate, not coming close to estimates• Leading market for Heineken• Girly drinks

– Financial status• Law violations hindering finances

Global Market Expansion

• 2nd – 4th in the world beer market• Largest brewer in Europe– 125 breweries worldwide– 70 countries

• 5 geographical regions:– Central and Eastern Europe– Western Europe– Asia Pacific– The Americas– Africa and the Middle East

Heineken International Website

Global Market Expansion

• Central and Eastern Europe– Terrific market share in Austria, Bulgaria, Greece,

and Slovakia– Sold 53,300 liters worldwide in 2008

• Western Europe– Majority of profit– Large market share throughout multiple countries– New brewery in Spain

Central and Eastern Europe

25%

Western Europe51%

Asia Pacific2%

The Americas10% Africa and Middle East

11%

Heineken's Geographical Revenue, 2008

Global Market Expansion

• Asia Pacific– Main breweries in Malaysia, Thailand, Vietnam,

China, Singapore, Mongolia– 26.4 million gallons in Ho Chi Minh City in one year– Chinese Expansion• 3rd brewery in China

Global Market Expansion

• The Americas– Specialization in exports• Light beer only in America

– Multiple breweries• Latin America, Caribbean

– FEMSA Agreement

Global Market Expansion

• Africa and Middle East– Fastest growing segment• 35.3 percent from 2007-08

– Egypt brewery purchase

Competition

• Anheuser-Busch InBev

• SABMiller

• Carlsberg Group

• The Boston Beer Company

Competition

• Anheuser-Busch InBev – Largest competitor to Heineken International– Anheuser Co. dates back to 1366– 1987 Inbev was formed– In 2008, companies merged to form Anheuser-

Bush Inbev– Key Products• Beer & Soft drinks

Competition

• SABMiller– Second largest brewery– SAB originated in late 1900’s– In 2002 company merged with Miller– Key products are Beer and Soft drinks– Six of top 50 Beers

Competition

• Carlsberg Group– Fourth Largest Brewing company– Founded in 1868 in Malawi– Weak presence in US– Producing mineral water with Coca Cola

Competition

• The Boston Beer Company– US based independently owned company– Created in 1984 by Jim Koch– Won more awards than any international brewing

company– Many large companies have wanted to buy, but

will not sell

Anheuser-Busch Inbev Heineken International The Boston Beer Company

Carlsberg Group SABMiller0

5

10

15

20

25 $23.6

$21.0

$4.8

$11.8

$18.7

Company Revenues (In Millions), 2008

Anheuser-Busch InBev26%

SABMiller12%

Heineken7%

Other55%

Global Beer Market Share, 2008

Industry Analysis

• Global beer market– Grew by 2% in 2008– Slow growth– Standard lager maintains high market share

Standard Lager55%

Premium Lager28%

Specialty beer10%

Ales, Stouts & Bitters4% Low/No Alcohol

2%

Global Beer Market Segmentation, 2008

Industry Analysis

• Segmentation by geographical region– Europe – 50%– Americas – 29%– Asia-Pacific – 21%

Recommendations

• Short-term– New marketing strategy• Sales increase, finances increase• New forms of marketing

– Reduce acquisitions with debt• Acquiring negative assets • Stick to what they have

– Diversity• Increased product line= larger market share• More appealing brand

Recommendations

• Long-Term– Increased shelf space• The more customers see the more they will buy

– Portfolio increase: Financing smaller companies• Boston Brewing Company• Great brands with small finances

– Ethical and Law standards• Public image • Health awareness

Conclusion

• Top 5 beer company in the world

• Largest brewer in Europe

• Strong brand portfolio

• Substantial revenues in 2009