CEO of Carlton and United Breweries speaks with Drinks Trade Magazine’s Melissa Parker about CUB’s endeavours and ambitions in sustainability, innovation, pack-price architecture. And, of course, beer.
This is an excerpt from the full Viewpoint article to appear in the Spring Edition of Drinks Trade magazine out September.
Working towards a greener planet is so important to consumers now. What is CUB doing in the sustainability space?
What I love about Asahi is sustainability is engrained in the fabric. It's not only the right thing to do for the environment, but our consumers expect it. And the proof in the pudding is what you deliver.
Our Yatala Brewery Plant is one of the biggest solar projects in the country. We put 7000 solar panels on the roof over 15,000 square metres and can deliver 150 million bottles a year through a sustainable energy source. That was a considerable investment, it wasn't a direct payback, but it was done because it was the right thing to do.
We know that if we can stay anchored in that, consumers will observe it, and we'll feel good about it.
We've got a Linfox electric truck delivering our beers; again, less pollution in the marketplace. It's on trial but still delivers about one hundred thousand bottles /cans per week, but the intent is to scale up. If we can drive our logistics forward in a way that would put a solution out there, what a great outcome for our environment.
More broadly, for Asahi, and this is one thing Robert lervasi (CEO Asahi Beverages Oceania) led, which I think is really impressive, is the construction of the biggest recycled PET plant in the country, in a joint venture with other partners (Cleanaway, PACT and CCEP). It's got the ability to deliver a billion bottles of recycled products into the marketplace every year.
So, if you think about that, I mean a billion bottles that normally would go into landfill. Robert expects me to deliver against it and play a role in it. It's a genuine part of our strategy and one that we will continue to invest in and enhance every time we go to market.
Tell us what’s happening in the innovation pipeline for CUB?
We'll continue to focus on beer. Beer is our core product and to be honest, we think there's still significant opportunity in beer growth. People think it's mature, but we still believe there's opportunity through a number of different plays. There's a real premiumisation opportunity in innovation, and we see that play out in multiple categories, but we want it to play out in beer in a much more defined, deliberate way.
One of the avenues for us has been through craft beer, our craft partners and acquisitions. We've typically taken these acquisitions and tried very hard not to incorporate them into the CUB list. We've said, 'What you're really good at is craft'. People are prepared to pay for this proposition because it's really unique and shows up in a bespoke way. We are driving premiumisation through that end.
The other element of innovation we're looking at is what we call pack-price architecture and thinking about certain occasions we're trying to drive and how we bring the right pack-price architecture to an occasion. If it's just for me, do we have the right single offer? If it's for us, do I have the right 30-pack offer? Suppose it's for a couple of people. Do we have the right pairings with a particular product with a specific snack to ensure we're again showing up for the innovation agenda that connects itself to incrementality and innovations?
My team and I are less interested in the innovation that's duplicative and cannibalistic, or innovation that moves share from one supplier to the next because that's just a share shift. I'm hoping the industry shows up with the mindset of, 'How do we expand this category? How do we bring innovation to the table that truly creates new occasions?'
RTDs
One thing that works really well for us is our RTD portfolio. Cruiser continues to be a significant player. It's an amazing brand, had a long tenure, and is still thriving. Another brand that has come through our craft breweries is Brookvale Union. That's gone from strength to strength, whether it be Ginger Beer, or we've just launched the Pub Lemon Squash. It's a significant play for us. We'll be doing more in that space.
We're looking at innovation in the context of the core brands too. For quite some time, our innovation in the core brands has been - they're big, doing well, leave them alone. We're taking a different point of view on that now. We're thinking about how we expand more from a price-tiering perspective and how we bring more profile to expand the shelves.
The last space that is very interesting for us is cocktails and our work with Lexington Hill. We're seeing real opportunity there, especially in the on-premise but also in the off-premise. People want more accessible cocktails and the ability to have cocktails where it's easy to bring to life the liquid to create the occasion. What we're doing in the RTD space is exactly that, particularly in the on-premise environment with taps. They can just pour a cocktail, put a garnish on it, and deliver a high-quality liquid, a great product to the consumer, but an easy way to dispense for the bar owners.
Asahi Beverages is a Category One member of the Drinks Association.