For years Bud Light has held the top spot as the most consumed beer in the world. But the reign of terror for the King of Beers is now over. Behold the new #1 – Snow Beer.
According to a leading UK-based independent alcohol sales research group, Snow Beer outsold Bud Light in 2007 with 51.2 million hectoliters compared to BL’s 48.4 million hectoliters.
One of the most surprising things about this shift is that no one outside of China has ever really heard of Snow Beer. The name alone conjures horrible images of ‘eating yellow snow’. But its relative obscurity in the Western World is just another way of explaining China’s new economic might on the global scale.
Less than 6 years ago, Snow was a small regional brewery in China. But it soon began expanding a national distribution network and buying out other surrounding local breweries. Snow struck at exactly the right time, just as China’s growing middle class started to consumer beer in record numbers. Being middle class and consuming large amounts of beer -now they’re really living the American dream!
The Chinese drink less beer on average (pussies) than Americans and Europeans, but their sheer distribution numbers cannot be rivaled. Snow Beer is sold to so many more people and continues to grow each year. As the beer markets in America and Europe appear to be stagnant, relying on mergers and re-branding of old products (or potentially encouraging further binge drinking? Now there’s an advertising idea), the Chinese market in comparison continues to grow exponentially each year.
But here’s the kicker — Snow and other Chinese beers have razor thin profit margins. Due to their low cost which appeals most to Chinese consumers, the brands only make a $2 for every hectoliter sold. Compare that to the $50-$80 per hectoliter profit that most American and European beers make.
Don’t worry too much though, the Snow Beer coronation is still up for debate. Another separate British research group released a conflicting report saying that Bud Light still narrowing outsold Snow Beer in 2007, but did admit that it’s only a matter of time before the American/Belgian (remember InBev?) brand is overtaken.
Plus don’t forget, if you combine both Budweiser and Bug Light sales (which some consider the proper measurement of a ‘brand’), then the Buds have Snow beaten by a mile.
But if Snow Beer ever does take over the world, like it’s predicted to, will you be one of the people drinking it at your local bar? Interested in trying one or disgusted at the thought of a snow and beer combination? (Actually, there is no snow in it, but still, I’m sure it’s an assumption people initially make.)
WSJ: From China, A New Challenger For King Of Beers, September 11, 2008