SABMiller's £583m acquisition of Royal Grolsch, which enters its final stages this month, will place the Dutch beer in the brewer's portfolio of premium lagers alongside brands such as Peroni and Pilsner Urquell.
The brewer, which has its headquarters in the UK, intends to boost Grolsch's global presence by developing the brand in markets such as Africa and Latin America as well as central Europe. However, SABMiller cannot have failed to notice that Grolsch's performance closer to home has been woeful of late.
Grolsch enjoyed iconic status in the UK in the late 80s, when its bottle's famous swing tops adorned the shoes of fans of boyband Bros across the UK. After a slump in the 90s, it bounced back in the early noughties with its 'Never rushed' advertising campaign.
However, after a strong performance in 2004, its sales plummeted 21% from £343m to £270m in 2006, according to Mintel. While Nielsen data for the year to October 2007 suggests it has arrested this alarming decline, its value sales remain 3% down.
Part of Grolsch's trouble has stemmed from a lack of investment in the brand between its UK distributor Grolsch UK, a joint venture by its Dutch parent and Carling-owner Coors. While its stablemate Carling was backed by a £7m advertising spend in the first 10 months of 2007, only £1.1m was put behind Grolsch's promotional activity over the same period. This compares with £6.2m in 2004, £4.8m in 2005 and £2.3m in 2006, according to Nielsen Media Research.
In the off-trade, Grolsch enjoys the same status as a brand such as Belgian beer Hoegaarden, which is often consumed on special occasions. However, it is not cheap enough to benefit from the discounting that the likes of fellow export lagers Stella and Heineken receive in supermarkets.
To make matters worse for Grolsch, entrants into the 'genuine export' lager sector such as Beck's Vier are succeeding at the expense of more premium brands.
Nonetheless, there are signs of investment in the brand. It has recently returned to TV with a £3m sponsorship of British comedy on Channel 4 and has launched a lower-strength 4% variant as well as a wheat beer.
We asked Clare Draper, brand manager at Fullers, and Stef Jones, creative partner at Big Al's Creative Emporium, to suggest a way forward for Grolsch.
DIAGNOSIS 1 - CLARE DRAPER, BRAND MANAGER, FULLERS
A lack of marketing direction has left the Grolsch brand tired and confused.
Its fresh, comedy-focused strategy is promising and must be made to work hard, particularly by driving through into the on-trade where the brand does not have enough stand-out at point-of-purchase.
The iconic swing-top fixture is a valuable brand asset, but has been diluted by a shift toward the draught product, and the sale of non-swing-top bottles at discount prices. Concentrating effort back onto it would create a real point of difference.
Customers are visiting pubs less often, but when they do, are increasingly prepared to trade up to more interesting brands. Bottle and font design must be eye-catching, and innovative merchandising and glassware adds value and wins customers.
Grolsch has a good brewing heritage and is an excellent product - great foundations which must be built on through the primary brand before brand extensions.
- Make the most of the comedy strategy by concentrating on building distribution and greater presence in on-trade outlets.
- Improve the standout of the draught font and introduce more innovative glassware.
- Try focusing the brand positioning on the swing-top design to create stand-out.
- Promote the primary brand before considering rolling out brand extensions.
- Capitalise on brewing history to qualify premium status.
DIAGNOSIS 2 - STEF JONES, CREATIVE PARTNER, BIG AL'S CREATIVE EMPORIUM
'When will I, will I be famous?' So sang Bros in 1987. And Luke, Matt and the other bloke found fame almost as quickly as Grolsch, with its pop-top bottle screaming from the shelves.
Then came the shoes. Good for Bros. Not so good for Grolsch. Once the band went flat, Grolsch had an albatross around its slim green neck.
By the early 90s, Grolsch was 'Extra sensory perfection'. The surreal, nonsensical ad made perfect sense of such a complex product. It felt like the start of a long-term idea for the brand.
But the once clear, golden waters of premium lager were getting cloudier. The Canadians, Japanese, Indians and Mexicans were filling the bars, and our thirst for the new and exotic was changing the sector. It was less about taste, and more about exclusivity.
After ditching 'Extra sensory perception', Grolsch flitted from idea to idea; 'It's not ready yet' and 'The green light district' being two more recent campaigns. No surprise then that some of us are a bit hazy about what Grolsch stands for.
- Put some money behind the brand and get it back on TV so that it can be considered a serious player again.
- Don't let relevance strangle the work. The Cadbury Gorilla isn't wasting its time making a profound statement about chocolate. People will thank the brand for it and may even drink it because of it.
- See if you can't get a pop-top into Amy Winehouse's lip. You never know, it might open up a younger audience.