Our operating context
Over the past 37 years, New Zealand beer consumption has fallen by 2% a year on average. At the same time, off-premise craft beer sales have risen 42% between 2014 and 2015. Alcohol consumption in New Zealand is now in the middle of the range of OECD countries. However, the misuse of alcohol continues to result in costs to New Zealand society through crime, road trauma and health impacts.
Globally, the volume of alcoholic beverages drunk in 2015 fell by 0.7% and this has been reported to be the first decline since 2001. Moderation is one, among other key driving forces. Hazardous drinking has also declined since 2006/2007 particularly among younger drinkers who are increasingly moderating their drinking behaviour. Millennial consumers, aged 18-29, are seeking to limit their alcohol consumption on nights out and this is at least partly fuelled by concerns about social media and control of self-image. At the same time, regulatory change is also playing a role such as the introduction in New Zealand in 2014 of a lower legal blood alcohol limit for drivers from 80mg to 50mg per millilitre of blood. This was a factor in increasing the supermarket sales of low alcohol beer by up to 60% in the following year.
While the majority of adults are moving toward moderation and can include alcohol consumption as part of a healthy lifestyle, this is not a uniform trend for all social groups. For some specific demographic groups, hazardous drinking behaviours remain a challenge.
Why responsible consumption is important to DB Breweries
Driving responsible consumption is a serious issue for our business, the wider industry and to New Zealand society as a whole. Simply drinking more alcohol is not in the best interests of our consumers, our wider stakeholders, or our business. DB and HEINEKEN have a long history of encouraging responsible consumption and acknowledge that while the majority of adults enjoy our products in moderation there is still a decreasing number of individuals who consume too much alcohol, putting themselves and those around them at risk. Good health and well-being is also a crucial UN Sustainable Development Goal in which DB Breweries can make a significant contribution both in New Zealand and in other key markets.
Innovation in lower alcohol is one part of the solution and offers opportunities for commercial growth in New Zealand if consumption follows a similar trend to that experienced in Australia in recent years. More than that is to make responsible consumption an aspiration, changing culture itself.
Excerpt from UN Sustainable Development Goals
DB Breweries’ key priorities for responsible consumption are based on four pillars:
- Build partnerships. We are committed to creating meaningful and measureable partnerships in responsible consumption.
- Advocate responsible consumption through our brands. We aim to keep consumers informed through product labelling and ensure that a minimum of 10% of our media spend for HEINEKEN brands is in supporting our dedicated responsible consumption campaign.
- Take action at industry level. We drive behavioural change initiatives and awareness campaigns working at an industry level with other companies and stakeholders primarily the Cheers! initiative and The Tomorrow Project.
- Innovation in low ABV. We continue to develop new, high quality and innovative products with low and zero ABV to provide alternatives for consumers and improve access to those products.
DB Breweries is committed to the development and implementation of meaningful partnerships in responsible consumption. HEINEKEN also aims for every one of their markets to pursue partnerships aimed at reducing alcohol related harm every year. Last year we highlighted our work with the Auckland Philharmonia Orchestra (APO) and their Remix the Orchestra programme which targeted at risk youth. This year, our StudentCard partnership targeted tertiary students with the message of enjoying responsibly to have a Summer to Remember.
|HEINEKEN N.V’s global target by 2020||DB Breweries – annual objective||What DB Breweries has done in 2016|
|Every market in scope has a partnership to address alcohol related harm. All partnerships meet HEINEKEN’s seven-point criteria.||Activate a partnership to address alcohol related harm.||Met HEINEKEN’s seven-point criteria in the partnership with StudentCard – A Summer to Remember.|
To be considered successful by HEINEKEN, such partnerships need to meet seven key criteria:
- Addressed a relevant issue
- Activated with a credible and effective partner
- Provided more than funding
- Agreed and documented objectives, actions, measures and targets
- Conducted a sound evaluation on delivery, improvements and impact
- Set a measurement process to evidence value
- Communicated outcomes to stakeholders
OUR ACTIONS 2016
Advocating through our brands
We strive to ensure that all marketing communications are conducted in a responsible way and use our flagship brands to convey this message. We invest 10% of the Heineken brands’ media spend in New Zealand on dedicated responsible consumption campaigns.
Our local research into the drinking attitudes of millennial consumers in New Zealand (aged 18-29) has found that for Kiwi millennials, the key to a great night out is spending time with friends, and 82% say they look to limit the amount of alcohol they drink on nights out. The majority of Kiwis surveyed think that moderating drinking is “cool” (67%) and respect others when they moderate their drinking (80%). This study shows moderation is becoming an active choice for an image-conscious generation of Kiwis who want to stay in control on nights out and find drunkenness unattractive.
This work complements Heineken’s own global research into drinking attitudes of millennial consumers which has revealed that self-awareness and staying in control are the motivating factors for moderating alcohol consumption during a night out. The popularity and reach of social media among this age group means that control of their self-image is paramount and 75% of millennials limit how much alcohol they drink on the majority of their nights out. The research polled 5,000 21-35 year-old premium beer drinkers in five countries and was commissioned to provide insight into the Heineken brand campaign, ‘Moderate Drinkers Wanted’ - aimed at boosting a growing trend of moderation and responsible consumption.
DB Breweries is also committed to complying with applicable marketing communication laws, regulations and voluntary codes. In the past year, five complaints were made to the Advertising Standards Authority regarding marketing materials produced by or on behalf of DB Breweries. No complaints resulted in warnings, fines or penalties for non-compliance.
|Year||Complaints made to the Advertising Standards Authority||Referrals to Advertising Standards Complaints Board||Warnings, fines or penalties for non-compliance|
Packaging offers us an opportunity to communicate directly at the point of consumption, helping consumers to make informed decisions. In 2013 HEINEKEN undertook an exercise to apply a set of easily understood symbols or equivalent words to discourage drinking and driving and consumption by pregnant women globally. Today 100% of our primary packaging includes these logos.
We also comply with New Zealand legislation and disclose the alcohol content in each of our products. All local products include a standard drink equivalent on the label which is also detailed on our website, alongside information regarding nutritional content. HEINEKEN has committed to provide ingredients and nutrition information on packs for all of its beer brands brewed and sold in the EU. DB Breweries also believes that consumers should be able to make fair comparisons between different beverages. Recently we commenced a campaign through the Brewers Association to voluntarily roll out nutrition content labels on our beer products. These will detail information on energy, carbohydrate content including sugars, dietary fibre, protein and sodium content.
Action at industry level
Our parent company, HEINEKEN, is a signatory to the collective Commitments to Reduce Harmful Drinking which aim to contribute to the World Health Organisation target, of at least a 10% relative reduction in the harmful use of alcohol by 2025. This is managed by the International Alliance for Responsible Drinking (IARD). Locally, DB Breweries is an active and integral member of the Brewers Association and a founding partner of The Tomorrow Project – a social change initiative led by beer, wine and spirit producers in New Zealand. Through the consumer-facing brand, Cheers!, the project supports New Zealanders in making informed choices. It educates consumers on the drivers and effects of harmful drinking behaviours and the importance of staying safe and sociable.
Innovation in low ABV
While we have been producing low alcohol beers since the mid-1980s, providing innovative low alcohol alternatives is now more important than ever. Increasing trends towards health and well-being, more responsible consumption and changes to legislation, including lowering of the drink drive limit in New Zealand, make the ongoing development of low alcohol products a key part of our future business. Growing the low alcohol beer and cider category represents benefits to our consumers and broader society in New Zealand as well as making good business sense.
After launching products such as DB Export Citrus Grapefruit (2.0% ABV) and DB Export Citrus (2.0% ABV) we achieved the highest innovation rate across the HEINEKEN Asia Pacific region in 2014. By 2015 we achieved a leading position in low ABV in New Zealand with around 70% share of the market. We now have low or zero alcohol product offerings in all of our segments. In 2015, we launched DB Export 0.0 Citrus (0.0% ABV), Tui 2.5 (2.5% ABV) Monteith’s Mid (3% ABV) and a world first Heineken Light (2.5% ABV) for the New Zealand market. In 2016, we launched our DB Export Citrus, Lime & Ginger (2.0% ABV) and became the first HEINEKEN company to offer DB Export Citrus on tap for the on premise market.
DB Breweries believes New Zealanders should be able to see low and non-alcoholic beer stocked alongside full strength beer in supermarkets to provide options and encourage safe and responsible consumption of alcohol as well as responsible host behaviour. After discussions with the industry in 2016, the New Zealand government amended The Sale and Supply of Alcohol Act 2012 to clarify that no and low alcohol (0-1.15% ABV) beer and cider could be displayed and sold in the single area of a supermarket.