thirst choice MAY 2014 INCLUDING THE CAN MAKERS UK MARKET REPORT INDIE BEER CAN FESTIVAL OPEN FOR ENTRIES

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1 MAY 2014 INCLUDING THE CAN MAKERS UK MARKET REPORT INDIE BEER CAN FESTIVAL OPEN FOR ENTRIES WORKING TOGETHER THE SOCIETY OF INDEPENDENT BREWERS INNOVATION ON CAN FEATURES DESIGNER APP CANCREATOR DESIGN TOOL THE CAN MAKERS UK MARKET REPORT 2013 thirst choice

2 INDIE BEER CAN FESTIVAL OPENS FOR ENTRIES The Can Makers have partnered with the Society of Independent Brewers (SIBA) to launch a very different type of competition. For the very first time independent UK brewers, regardless of current packaging format, are being offered the chance to showcase their beer in cans at the Indie Beer Can Festival. Now open for entries via the competition will find and celebrate the very best beers that the nation s independent brewers can offer. INDIE BEER CAN INDIE BEER CAN Whether large or small, independent brewers represent an increasingly important part of the UK beer market. Their beers appeal to a growing, typically younger, audience looking to experience new flavours as well as old styles reinvented. With ranges growing on supermarket shelves and the on-trade almost weekly, this is a perfect time to celebrate the developing potential of the independent beer sector. How it works Until 16th June 2014 any independent beer brewer who thinks their beer is a cut above the rest can submit entries via the website All written submissions will be whittled down by selected judges to 12 finalists. Finalists beer will then be canned by the Can Makers, if they aren t already, so that they are ready for the final judging day and event. Beer loves cans Cans are used by brewers all over the world to maintain beer s integrity. There are a wide range of benefits which, when combined, make drinks cans a unique pack. The drink is kept as fresh as possible, being sealed from light and air, is quick to chill and the great designs create stand out on shelf. Cans are also light, strong and easy to stack, which makes them perfect to carry away or transport in bulk. And, of course, consumers like cans! The can has strong environmental credentials too, as the metal used to make cans is a permanently available material, meaning it s 100% and infinitely recyclable with no loss of quality. This makes cans an environmentally friendly choice, too. The Indie Beer Can Festival in September will be attended by influential representatives from the British industry and media and showcase all the finalists entries in cans. A panel of judges including Tesco Beer Buyer, Chiara Nesbitt, industry experts Adrian Tierney-Jones and Jane Peyton, President of Cask Brewing Systems Inc, Peter Love and Graham Fenton, Chairman of the Can Makers, will select the winning canned beers in a closed judging session. The winners will then be revealed to all attendees at the event and everyone present will have a chance to sample all 12 canned beers. UK INDEPENDENTLY BREWED BEER IN NUMBERS In million hectolitres produced In million pints consumed There are now over 720 independent breweries in the UK, compared to just 88 in 1972 (Source: SIBA) WHY CANS? Keeps drinks fresh Impactful designs Quick and easy to chill Light and easy to transport and stack Uniquely sustainable Consumers like cans 2

3 WORKING TOGETHER Indie Beer Can Festival partner, the Society of Independent Brewers (SIBA), knows a thing or two about independent UK beers. A WORD FROM THE CHAIRMAN SIBA s beginnings go back to 1980, when it was formed by 20 British microbrewers. Almost 35 years on, the organisation has grown to represent the growing and vibrant group of independent brewers in the UK, both big and small. Today, there are more than 720 independent brewing members who between them produced an estimated 2.5 million hectolitres of beer in That s 30 million more pints than in 2012, showing there s real demand and market for independent beers. The Indie Beer Can Festival is a fantastic opportunity for independent brewers to showcase their offerings to influencers in the business and gain recognition. Quite a few beers are already in cans, and there are many more brewers keen to explore the potential for canning. Dear Reader, As the biggest beverage can market in Europe, we re pleased to report that 2013 was the most successful yet, with over 9.5bn cans supplied by UK drinks can manufacturers. Nick Stafford, Commercial Director at SIBA talks about why the Indie Beer Can Festival is good for British brewers. We are delighted to be partnering with the Can Makers for the Indie Beer Can Festival. Our latest figures show that in 2013, Britons quenched their thirst with 446 million pints of independently-brewed beer. Total SIBA Beer Production (hectolitres) 3,000,000 2,500,000 2,000,000 1,500,000 1,000, ,000 0 This competition ensures that any independently brewed beer, regardless of what packaging is used now, has a chance to win. We re really looking forward to see how the competition unfolds and can t wait for the Indie Beer Can Festival event in September. (Minimum estimate) This year marks the start of my second term as Chairman of the Can Makers and I d like to thank my predecessor, Geoff Courtney, for his hard work and dedication over the past three years. It s a great time to be involved in the drinks market. Recent successes for independent brewers and exciting new technological developments means that there s a lot to shout about in In the packaging world the Can Makers have recently launched the Indie Beer Can Festival in partnership with SIBA and the world s first free 3D drinks can creating app, in the autumn of We also continue to promote the can s sustainability credentials through a wide range of initiatives. You can read about these and much more in our latest issue of the Can Makers annual newsletter, Thirst Choice. We hope you enjoy the latest edition. Graham Fenton Chairman, the Can Makers 3

4 INNOVATION S IN THE CAN Is an innovative new range or flavour enough for a drink to make its mark? Amongst the weekly rounds of launches, will the product stand out enough to catch the consumer s eye? Here s a roundup of just some of the Can Makers ideas which are being used by brands, many of which have already won awards and industry recognition, to tempt and inspire. Heineken s launch of its new flavoured cider, Strongbow Dark Fruit, was one of the major success stories of It premiered to market in 440ml cans and featured an exciting 360 degree matt finish. The can s striking look and bold colour choices have helped deliver a distinctive persona which has quickly become synonymous with the brand on shelf. The cider market now accounts for 22% of take-home beer and cider sales volumes, driven by NPD and sales of dark fruit products. of ice cold beer? A two-stage colour changing indicator printed within the Coors Light on-can design, made it easy for fans to see precisely when their beers reached the perfect Cold or Damme Cold drinking points. A quick glance at fan reviews on the internet will tell you that the colours change at exactly 9 and 5 degrees respectively, perfect for the cool Coors drinker. These same types of inks (known as thermochromics) can now also be printed on can ends. brand at a barbeque or summer party in the garden. For later in the evening and in clubs, the world s first glow in the dark drink cans are now available in Russia. Consumers can now also have a pack with a literal twist thanks to the new vented end. Two holes, rather than the traditional one, lend themselves to a smoother pour and more even flow for a brand s connoisseurs. The can is opened as usual and then the tab is simply twisted to the side to align with a second dimple. Pushing down on the tab again creates the second smaller air hole to create the perfect pour. They are ideal to show, for example, the perfect drinking temperature when cans are stacked in a fridge or, with the no colour to colour option, to print a secret message which is revealed on chilling. The launch of inks for cans which react to natural daylight (known as photochromics) opens a world of creative possibilities for brand owners and product designers alike. Layered designs, invisible inside, come alive when the can is taken outdoors. And who can forget a certain Belgian action hero, Jean Claude Van Damme, and his penchant for a particular brand 4 A great talking point for any drinks

5 In the soft drinks market, Pepsi s partnership with global superstar Beyoncé was showcased on pack using high definition printing on aluminium bottles. The limited edition run featured a striking headshot of Beyonce in intricate detail, showcasing the pin sharp resolution which stands out on pack. Last but by no means least, up to 24 different designs can now be delivered on a single pallet, creating more choices for brands and a more personal experience for their consumers. Thanks to a new technology within the manufacturing process, designs can mix text, high definition printing or exciting silhouettes on cans in the same production run. Designers app-solutely thrilled with CanCreator In September the Can Makers launched the world s first free online 3D drinks can design app, also downloadable to Mac and PC. CanCreator is an innovative app which allows designers and design agencies to quickly and easily bring their ideas to life and then share their creations. Hayley Barrett, Senior Designer at Design Bridge commented, This is a fab little app which is easy to use and quick to understand. At the end of the day packaging is never 2D, so this app is a great tool to see realistic results fast. In an increasingly fast-paced and competitive market, drinks can packaging helps brands catch consumers eyes on shelf. Whether it s the next big thing in soft drinks, an up and coming beer brand or something completely different, the app offers a variety of can sizes, colours, finishes and innovative printing techniques to let designers explore and showcase new looks. These can be saved locally or accessed online for full 360 degree demos. Designs can also be captured via screen shot to share in presentations or by . To try out CanCreator go to: The Can Makers Online The Can Makers website continues to go from strength to strength as a veritable treasure chest of industry information. The site is a comprehensive resource for the latest news, white papers, reports, market research and insights into the beverage can industry, from its beginnings to the present day. The photo bank provides visitors with a variety of eyecatching, downloadable images, showcasing beverage can innovation. You can also find out more about the industry s campaigns from designer apps, through to sustainability projects and the current Indie Beer Can Festival. Please do visit: 5

6 The Can Makers UK Market Report 2013 Overview In 2013 UK deliveries of drinks cans exceeded 9,590 million for the first time. This was an increase of 2.2% on These figures mask strong growth of almost 5% for beer and cider and a marginal increase in can deliveries for Carbonated Soft Drinks (CSDs). This is a creditable performance in a year that was affected by variable weather conditions and recession. Market for drinks cans - UK and Eire Empty can shipments for alcoholic and soft drinks ( millions of cans) ,150 4,441 5,147 4,235 5,118 4,331 4,845 4,554 4,315 4, ,000 4,000 6,000 8,000 soft drinks alcoholic drinks source: BCME and Canadean In a year which saw the warmest, driest and sunniest summer since 2006 and despite the coldest spring since 1962 according to the Met Office, both the CSD and beer and cider markets grew in These categories performed ahead of the market in comparison with many others in food and drinks. In the case of CSDs 5,150 million cans were delivered, a marginal increase on According to Nielsen, 50cl cans continued to grow faster than the category as a whole, up 22% on led by energy drinks. For beer and cider, empty can deliveries were up by almost 5% bringing the total to 4,441 million, with particularly strong growth in small sized cans - up 7% on This performance was a particular achievement in a year that lacked the stimulus of big sporting events and where the UK economy was still suffering tough times. The overall market was no doubt influenced by the good summer weather which gave it a much needed lift, bringing the opportunity for people to enjoy picnics, barbeques and other occasions where cans of drinks are consumed. European can market Almost 60 billion drinks cans were delivered across Europe in 9,591 9,382 9,449 9,399 8, , an increase of 3% on 2012 and the fourth year of successive growth across the region. The increase was driven by strong performance in Eastern European markets where can deliveries grew by 4.8% and by 2.5% in the more mature Western European countries. Cans dispatched for soft drinks increased by 3.6% led by the Nordic countries, Turkey and Eastern Europe. Deliveries for beer and other alcoholic drinks increased by 2.3% led by Western Europe, in contrast to a 3% decline in overall packaged beer consumption across the region. 6 Soft Drinks UK Soft drinks market Soft drinks market performance 52 weeks to by value millions % change YoY Cola 1, % Pure juice Energy drinks 1, % 6.8% Juice drinks Plain water Fruit carbonates Squashes % 13.1% 2.4% 3.8% Water plus Non fruit CSDs Sports drinks Lemonade Smoothies % 2.1% -2.6% 0.4% -4.1% Mixers % The soft drinks market was worth 7,036 million at retail prices in Growth in 2013 was led by water at 13%, juice drinks at 11%, water plus by 8% and energy drinks, sold mainly in cans - by 7%. Sports drinks have continued to decline as have smoothies and pure juice. Pack shares Carbonated soft drinks - share of market by pack type (volume) 27% Cans PET bottles <599ml PET bottles >600ml There have been small changes in market shares in 2013, with cans declining 1% to 27%. Within this total, 50cl cans grew by 22%, driven by energy drinks. In the PET sector there was some movement in shares among the different small bottle sizes and the highest growth in 1.5 litre bottles. Multipack shares 13% 60%

7 Carbonated soft drinks - share of pack - % of volume sold Single cans 4-packs 6-packs 8-packs 10-packs 12-packs packs 24-packs Other The main changes in 2013, compared to the previous year, were an increase of 1% in the share of single cans and a reduction in the share of 8 packs - they both accounted for 28% of volume. Single cans have also performed well in multiple grocers, no doubt a reflection of hard times for many consumers. Alcohol UK Alcoholic drinks market 28% 4% 19% 28% 4% 8% 3% 4% 2% Alcoholic drinks - take-home sales, GB off trade, 52 weeks to by value 36% 24% 24% 6% 3% 2% 2% 2% bn Take-home beer - by pack type Take-home beer and cider - by pack type % of volume sold Volume 64% 30% 6% Cans Glass bottles PET bottles In 2013 glass bottles increased share of volume by 1%, at the expense of PET bottles, which declined most markedly in the lager sector. Cans held share at 64% with continued growth in smaller sized cans, where economy is a driver for cost conscious consumers. Within the lager and ale sectors of the market, cans saw slight erosion of share to glass bottles, but there was some growth in cans for traditional ale brands. Cider cans increased their share to 44% of volume, an increase of 2.5% on Cider packs for immediate consumption (packs less than 1 litre), grew by 10.3% driven by brands moving into cans and NPD. Multipacks Light wine Spirits Beer Cider Sparkling Champagne Fortified wine RTDs other (1%) The market for alcoholic drinks in the take-home sector increased by 556 million or 3.4% in The relative shares by type remained fairly constant, with beer at 24% and cider at 6%. Take-home beer and cider - share of pack - % of volume sold % 42% 14% 11% 5% 5% 14% 1% 4% >1% Single cans 4-packs 6-packs 8-packs 10-packs 12-packs 15-packs 18-packs 24-packs others Multipacks continue together with price as the main marketing tools for take-home beer, with 42% of the beer in cans sold in 4 packs. Within the other sizes there have been winners and losers as different price points were promoted. In 2013, 15 and 18 packs grew strongly, with reductions in sales of 8s, 12s and 24 packs - which diminished in importance - except for Christmas. Take-home beer and cider - by type Sales of take-home beer and cider - by type Volume 67% 22% 9% 2% Lager Cider Ale Stout In volume terms the take-home beer market was static in Whilst lager continues to dominate the sector and did particularly well in the summer of 2013, its share declined by 1% in It was taken up by cider which now accounts for 22% of take-home sales volume, driven by NPD and sales of dark fruit products. Outlook The resilient performance of the drinks can market last year provides encouragement for 2014, now that there are clear signs that the economy is picking up and should benefit both CSD and beer sales. The World Cup football and the timing of many matches late at night should also encourage sales of take-home beer rather than the on-trade. This will be helped by prices for beer being lower due to duty reductions and the lower ABV of many lager products, keeping prices down. copyright the Can Makers

8 The UK produces over nine and a half billion drinks cans every year and the metal that they are made from is a valuable resource. It s also a permanently available material, meaning it s 100% and infinitely recyclable with no loss of quality, so recycling is vital. The metal industries continue to lead the way in recycling with two innovative partnership programmes which aim to increase drinks can and metal packaging recycling in and out of the home. Every Can Counts Every Can Counts, of which the Can Makers is a funding partner, is now in its sixth successful year. The programme focuses on improving drinks can recycling out of the home with a range of communication materials and branded collection points and is free to join. Recognising that there is no one size fits all way to improve recycling, Every Can Counts is flexible and can be tailored to suit anywhere that drinks in cans are consumed, whether at work or on the go. In 2013, the number of branded Every Can Counts collection points across the UK reached 9,200 and a third major drinks brand, Carlsberg UK, joined the programme as a funding partner. Further recognition of the programme s success was highlighted with the Award for Best Sustainability Communications Campaign at the 2013 Energy and Environment Awards. In workplaces, Every Can Counts has recruited over 1,260 organisations which now run the programme across 3,500 sites, from small businesses and retail centres to factories and government organisations. Early adopters of the programme, including ASDA and Jaguar Land Rover, continue to see good recycling results from employees. In retail centres, Every Can Counts partnerships have successfully targeted shoppers, on top of employee engagement, with the addition of the major Milton Keynes shopping centre, thecentre:mk, and Freshney Place in Grimsby. The programme is targeting the retail sector as a focus for recruitment and marketing support in In Scotland, Every Can Counts has been helping organisations prepare for the new Waste (Scotland) Regulations, which came into force in January. The programme has so far helped more than 330 Scottish organisations across over 350 sites to recycle more drinks cans. The future looks bright for Every Can Counts. Alongside success in the UK, the programme is now in seven European countries including France, Austria and Romania, with more to come in MetalMatters MetalMatters has so far reached over 2.4 million households through its work with over 30 local authorities across the UK in just four years. The innovative kerbside recycling communications programme has led to increased metal capture rates and created long-lasting recycling behaviour change from the home, through cost effective education. The latest MetalMatters figures show the lasting impact that the campaign has had on the amount of metal packaging collected by local authorities. For example, Sefton Council now collects 700 tonnes more metal packaging than before implementing the programme. One year on from the first campaign in Scotland, Aberdeenshire Council has seen metal collection increase by an impressive 12%. As well as providing a cost-effective way of educating households on recycling benefits, the programme generates a lasting return on investment. For example, revenue from the increased collection of valuable metal packaging by Sefton Council in just three months covered the cost of their entire campaign. The Kent Waste Partnership campaign across all 12 authorities saw a return on investment within five months. The Can Makers 10 Frith Street, Soho, London, W1D 3JF copy: onechocolate communications +44 (0) canmakers@onechocolatecomms.co.uk design: jamessenior.net