Cider appears to be undergoing something of a renaissance, as illustrated by C&C's strong financial results, which were buoyed by sales of its Magners and Bulmers brands. However, while the premiumization of C&C's cider offerings has contributed to the company's success in Ireland, it may still be some time before the UK market accepts the category as a valid alternative to wine and spirits.
Irish drinks and snacks company C&C said sales volumes of Magners premium cider, the international equivalent of the Irish brand Bulmers, more than doubled during the first half following a successful rollout in Greater London, and renewed growth in Northern Ireland and Scotland. The group's overall cider sales also jumped 28% to E144.5 million.
Bulmers holds an 81.2% share of Ireland's cider market, where it has been particularly successful in shaking off the category's previously mass market image. Advertising campaigns for Bulmers focus on its natural ingredients and traditional production processes, while its presentation in bars sets it aside from its draught competitors: the drink is served in a bottle with an accompanying glass full of ice.
C&C Group intends to take advantage of the robust performance of its cider brands by rolling out Magners across the UK, where the growth potential is extremely high. Datamonitor research predicts that the value of the UK cider market is set to grow at a compound annual rate of 7.4%, while the combined UK and Ireland cider market value, which stood at E2.4 billion last year, is expected to grow substantially to E3.4 billion by 2009.
Nevertheless, the UK per capita consumption of cider is still less than half that of Ireland, and C&C will have to work hard to overcome British perceptions of the drink as being high in alcohol, low in price and somewhat unsophisticated. In the past, cider sales have been mainly targeted for the off trade in the UK. C&C should therefore look to position Magners as an on-trade premium bottled brand and market it towards young adults as a stylish alternative to spirits and wine.
A cider revival has been on the cards for some time and C&C's financial results may well indicate that it has now begun. However, for the company to tap this potentially lucrative niche in the UK, it must still work to convince young adults that cider is a valid alternative to premium categories.