Tuesday, 30 March 2021

Death of the Premium Bottled Ale?

Westerham Brewery have recently announced that they are progressively switching all their packaged beer from bottles to cans. They say that “The future is bright, the future is refreshing beer in cans” and that “that the days of the ‘Premium Bottled Ale’ are dead.” However, from what I can see it appears very much alive and kicking, occupying a substantial section of the supermarket beer aisle and seeing a steady trickle of new product launches.

Their statement that the sector has been “de-premiumised” also misses the point about how it came about in the first place. In the 1980s, the vast majority of off-trade packaged beer was in cans, typically brands such as Stones, Tetley’s and Younger’s Tartan. Premium Bottled Ales were launched to distinguish the product from that category and gve drinkers something they would more readily associate with the beers they found in the pub. And, initially at least, it mostly encompassed what were considered “premium”, i.e., stronger beers such as Abbot Ale and Directors rather than ordinary bitters. There remains a strong overlap between the drinkers of premium bottled ales, and the drinkers of cask in the pub, and indeed the PBAs are often colloquially referred to as “real ales” even though the CAMRA purists would insist that they aren’t.

There is price pressure within the sector, as there is in every other competitive market, but that is nothing new. It is certainly true that brewers need to produce something that can be sold in a 4 for £6 offer, but quite a number of the smaller new-generation brewers are quite happy to sell what to my mind are very good beers through this channel. The same is true of Timothy Taylor’s with the bottled version of Landlord, the one widely-distributed cask ale that really can command a price premium. And the 7.3% McEwan’s Champion also happily exists there, so higher strength alone is no barrier.

They are, of course, correct to say that cans are more environmentally friendly, being lighter, more compact and more easily recyclable than bottles. They are also significantly cheaper. But there is a lingering belief that bottled beer is superior to that in cans, which goes back to days when cans were associated with Skol and Tartan, not to mention Long Life, “the beer specially brewed for the can”. Some of the more popular premium bottled ales such as Abbot Ale and Pedigree are also sold in cans, but they always come in four-packs and there really is no move to introduce individual cans into the sector (which also opens up the minefield of selling beers at price points that appeal to problem drinkers). I also haven’t noticed any increase in the shelf space given over to cans rather than bottles and, if anything, the growth area seems to be in multipack boxes of bottles along the lines of “Classic Golden Ales”.

On the other hand, over the past few years the switch in the craft sector from bottles to cans has been very marked, and cans now dominate the craft section of the beer aisle. Part of the motivation for this has to been to create a point of difference from the premium bottled ales. This was why, a few years back, many craft brewers switched from 500ml to 330ml bottles. Thornbridge were perhaps the most prominent to do this, but more recently their star seems very much to have faded. It often seems that the British craft beer movement seems to define itself by doing things differently from the established family brewers rather than the industry giants. And note that those 330ml craft cans in the photo are also in a 4 for £6 offer.

But, in switching from bottles to cans, Westerham are not just changing the method of packaging, they are changing how they want their beer to be perceived. And, if they define themselves as “craft”, there will be an expectation that they will in some way be modern and innovative. If they, or other brewers, are putting beers in traditional British styles into cans they may find few takers.

Another problem with cans is that they are opaque, so that if beers are “can-conditioned” it is impossible to determine when they have settled clear or to pour them so that none of the sediment goes into the glass, whereas that isn’t difficult with a bottle-conditioned beer. I know that “murky beer is good” has become a high-status opinion nowadays, but the vast majority of drinkers still want their beer to be clear, so that is an obvious limiting factor.

In fact, Westerham’s true motivation in going for cans is probably that they believe that, by shifting to a different market sector, they will be able to gain a higher margin. This is similar to brewers contemplating a shift from cask to craft keg, as I discussed recently in considering the threat of Covid to cask. However, the higher margins are only obtainable because the beers are in a more specialist and niche sector which, over time, is vulnerable to attack. I wonder how long it will be before we see the first single cans of “premium canned ale” appear, and drinkers might start to wonder whether it’s worth paying twice as much for something with a fancy graphic of a spaceman.

37 comments:

  1. Marston's is playing a blinder with their 500ml bottled range, although I find the pedigree (bottle conditioned) a bit inconsistent. Their EPA is pretty good, and the 'Honest Graft' range in ASDA good value for money. And of course Bass is still just £1.10 in Asda (Scotland) which is the mup.

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    1. Only £1 in England, although I never normally go to ASDA.

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    2. ASDA is pretty good for bottled beer as is Morries. Tesco and Sainsburys tend to have a smaller range at a higher price.

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  2. One other potential consequence is that similar to Adnams Ghost Ship, cans are 440ml as opposed to 500ml bottles.

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  3. Cans are 440ml? I think not. The cans I buy (such as Abbot, for example) are 500ml - and I've had a can of Arbor C Bomb quite recently which came in a one imperial pint can.
    I can't say I've tried many can-conditioned beers, such as those which Moor do, but I can't honestly say that I can tell the difference between canned and bottled Abbot.
    Canned beers have come a long way since the 1980s - and they're probably more environmentally friendly than bottles too. Certainly, being lighter, they'll cost less to ship and are easier to carry home from the supermarket. (On another note entirely, some years ago I can remember seeing Greene King IPA in PET bottles. I wonder what happened to that idea?)

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    1. Quite a few of the canned equivalents of PBAs are 440ml, such as the aforementioned McEwan's Champion. I don't like them - they're neither one thing nor the other. And a lot of the craft cans are 440ml too.

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    2. Had a look in Tesco this morning - quite a few canned "premium" ales are in 440s, including Doom Bar. And there were a number of "craft" 440s at £3 each, so you can see why Westerham are looking with envious eyes.

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  4. Ghost Ship cans are indeed 440ml.

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  5. Supermarkets will drive any demise of mass produced premium bottled beers. If Tesco tells the big guys that they want, say, Pedigree in a fancy can, that’s it for glass. I can’t see brewers complaining either. The only reason most still use glass is that quality perception. Cans are easier to handle, cheaper, lighter, better for the product, especially from the more industrial canning lines, and offer plenty of real estate for marketing. Retailers can also stock more lines per square foot of shelving.

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    1. I'm surprised it's shown no signs of coming yet, but obviously that attachment to bottles is very strong. I'd be quite happy to mix'n'match amongst four cans, but I'm not generally keen to buy four cans of one of the duller beers in the sector.

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  6. Interesting post, Mudge. I have some thoughts of my own on this subject, that I will post, when I have a little more time.

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  7. The association with bottles being a premium product is fading along with the old school of drinkers and will sooner probably than later become a niche product. I have been more than happy drinking from cans over the last year, admittedly at the craft end of the scale. The exception has been The Kernel suppling beer in 330ml bottles and very much a premium product.

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    1. It's the cans that are now the premium product, although that certainly doesn't apply in the lager sector.

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    2. Indeed it is the cans that are marketed as premium but they're kept well away on the shelves from slabs of Lout and John Smiths.I'd say the premium craft can distinction is the main reason why supermarkets are reluctant to replace the bottled products with cans as it would remove much of the justification for the differential pricing between premium 'craft' and ordinary 'real ale' type beers. At some point they'll get round it though.

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    1. Bottle-conditioned, and wouldn't be able to be called champagne if the process was altered from the appellation rules. There are more and more higher end wines ending up in cans but I can't see Champagne ever being one.

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    2. But the lees are removed from champagne bottles before they are released for sale, so it's not directly analogous to bottle-conditioned beers.

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    3. Still not going in a can though, is it, as it has to remain in the same bottle as it was conditioned in. I didn’t say it was directly analogous, but champagne is bottle conditioned.

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  9. During lockdown i've had to drink bottled beer from our quality brewers, i.e. not grapefruit juice from so called craft brewers.However it is no substitute for cask ale from Bathams, Holdens, Enville, Taylors etc.
    Beer in a can - i don't think so ! Baked beans come in a can.

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    1. What do you think would be the difference between, say, a bottle of Landlord, and a hypothetical can of the same? Must admit your comment had me drooling at the thought of a cool pint of Bathams Bitter, but I am something of a fan of 'so called' craft beers, many of which are far from grapefruit flavoured!

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  10. I can't use empty cans for my premium home brew.

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    1. Good point. Old Tom bottles are good for home brew; nice and heavy.

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  11. I'm a bottled beer lover but have to admit that for some beers the canned variety is better; Old Speckled Hen is one such. The East Didsbury Tesco had McEwans Champion and Theakstons Old Peculier in cans recently - the first time I'd ever seen those beers in cans. They were underwhelming compared to the bottled versions.

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    1. Both of those are in 440ml cans. Someone said he preferred the McEwan's to the bottles because the carbonation was a little softer. I've never been convinced by Old Peculier in bottles - I find the Black Sheep equivalent Riggwelter much preferable.

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  12. Regrettably, Salopian Brewery seem to have switched their "Black" craft ale range from 500ml bottles to 440ml cans too.

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  13. Tesco are selling 4x440ml cans of McEwan's Champion (7.3%) for £5.50, or £1.375 per can. They are also selling 440ml craft cans of similar strength for £3 each. The duty on the craft cans will be identical, or less if the brewers benefit from small brewers' relief. And even if the ingredients cost 50% more, there's still a much fatter margin on the craft can. So you can see why Westerham want to get a slice of that.

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    1. There’s precious little slice of any margin to be had from a small independent selling to Tesco, or any supermarket. They do it for volume to generate improved economy of scale and to get finance for expansion and new equipment. Obviously they’ll make some extra cash but margins are very slim.

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    2. If they're not making a decent margin at £3 a can they must be brewing it from otters' tears and using PhDs to clean out the mash tun.

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    3. A small brewer will be lucky to be clearing 20p on a 3 quid can. Once you’ve taken cost of production, packaging, distribution, Tesco’s margin, duty and VAT off.

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    4. I'm sure this could form the basis of an interesting discussion in the pub, so I really don't want to turn it into a tit-for-tat argument. But I am able to buy the excellent Weetwood Eastgate Ale (4.2%) in my local Morrisons for £6 for 4, or £1.50 a bottle. I doubt whether they're making much profit on that, but they wouldn't do it if they were making a loss. Any discussions on cost structure have to begin with what the consumer is willing to pay for the end product, not with how much it costs to make.

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    5. That’s certainly the case. Price point, spec and volume then work back. Brewers have the option not to play.

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  14. I am convinced the 330ml Pilsner Urquell doesn't taste as good as its 500ml bottle equivalent.

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    1. Drinking it as we speak and I think you're right.

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    2. Somebody really ought to organise a bottle vs can blind tasting of beers that are available in both formats. But don't look to CAMRA, as we're not talking about "real ales".

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    3. That would be interesting and no doubt dispel the odd myth or two. I’m always under the impression that canned beer has less carbonation than the same beer in a bottle, even when I know that it hasn’t, and even when poured into a glass.

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  15. I wonder if the 440ml can is purely a marketing thing - you see a largeish can and associate with a 500ml can without realising it's actually 7/8 of the size? Incidentally, I can buy a certain premium bottled beer from Tescos for £1.50 - or buy a case of 12 of them direct from my local brewery at £2.58 a bottle. Figure that one out.

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    1. 440ml cans predated 500ml ones in Britain. I've asked about their origin before, as it's neither a standard metric size or the equivalent of an Imperial one. But I'm told the reason is that a 440ml can plus its contents weighs almost exactly a pound.

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