The American folk song “99 Bottles of Beer on the Wall” that counts down from “99 bottles of beer on the wall, 99 bottles of beer, take one down, pass it around, 98 bottles of beer on the wall…” is a popular time-passer during long car rides. But while kids typically sing this ditty, multi-cultural consumers in the United States and around the world are singing the praises and reaching for HEINEKEN USA’s premium lagers and hard ciders like never before.
In 2014 alone, HEINEKEN International NV, parent company of White Plains, N.Y.-based HEINEKEN USA, generated sales of more than $23.3 billion.
HEINEKEN USA crafts and distributes dozens of SKUs, including its self-titled Heineken, Strongbow Hard Apple Ciders, Amstel Light, Newcastle Brown Ale and Red Stripe, along with Mexican imports in the Dos Equis and Tecate franchises as well as its Sol, Indio, Carta Blanca and Bohemia brands.
Noting that the United States is a land of immigrants, HEINEKEN USA’s Senior Vice President Ralph Rijks credits the company’s multi-cultural consumers — those who identify with more than one cultural or ethnic background, e.g., Mexican Americans, German Americans, Hispanic Americans, etc., — with having a major impact on its global success.
“Hispanic, and specifically Mexican, culture is having a profound effect on America, influencing everything from food and beverages to music, sports, film, fashion and more,” he says. “As this influence continues to grow, so, too, are Mexican beer brands, which have [a] strong appeal among young Hispanic/multi-cultural consumers — a demographic projected to account for a staggering 70 percent of future beer category growth.”
Additionally, Rijks estimates that 35 percent of the Heineken brand consumers are Hispanic and/or multi-cultural, which mirrors the entire premium import category.
The company’s portfolio of import beers, including Heineken, Dos Equis and Tecate, were among the Top 10 imported beers in U.S. multi-outlets, including supermarkets, drug stores, mass merchandisers, gas and convenience stores, military commissaries, and select club and dollar retail chains, for the 52 weeks ending Dec. 27, 2015, according to Chicago-based Information Resources Inc. (IRI).
With $728 million in sales, Heineken was the No. 3 imported beer, followed by Mexican import Dos Equis XX Lager Especial, with $327 million in sales, up
12.2 percent from a year ago, while Tecate, also a Mexican import, generated $150 million in sales and took the No. 7 spot on the list, IRI data notes.
“Last year , marked another strong year for all three brands,” says HEINEKEN USA’s Chief Marketing Officer Nuno Teles. “Heineken and Dos Equis posted solid gains, and while the Tecate franchise as a whole grew 6 percent, Tecate Light was on fire, growing 46 percent.
“Tecate Light appeals to our target consumer’s bi-cultural heritage and provides a full-flavored light beer versus the watered-down taste of some domestic lights,” he continues. “We are excited by these numbers and will continue to focus on our four priority brands, Heineken, Dos Equis, Tecate and Strongbow, to deliver the momentum we are seeing with new consumers. While our brands are found around the world, we at HEINEKEN USA are focused on bringing imports directly to our consumers in the United States.”
The new mainstream
To stay ahead of the curve, companies in the beverage industry are studying the impact of mainstream millennials and multi-cultural consumers on the country. The Hispanic Millennial Program, a joint study developed by cross-cultural advertising agency Sesis and market research firm ThinkNow Research, notes that multi-cultural trends are not tied to geography; they transcend race and ethnicity, impacting an entire country of young Americans, it explains.
With spending by multi-cultural consumers at $3.4 trillion, this “super consumer” group is having a tremendous impact on U.S. mainstream culture, according to New York-based Nielsen in its March 2015 report titled “The Multicultural Edge: Rising Super Consumers.” The report further identifies multi-cultural consumers as the most dynamic, fastest-growing segment of the United States economy.
“Multi-cultural ‘super consumers’ are at the Top 10 percent of households who drive at least 30 percent of sales, 40 percent of growth and 50 percent of profits of any consumer product category,” the reports states. “Multi-cultural consumers are younger, in their prime and already make up 38 percent of the U.S. population. [They are] expected to become the numerical majority by 2044, and 21 of the Top 25 most-populated counties in the United States are already more than 50 percent multi-cultural.”
Rijks and Teles express similar sentiments. “This consumer segment represents a critically important and growing opportunity for HEINEKEN USA,” Rijks says. “It is the fastest growing consumer segment, expanding its footprint and cultural influence throughout the United States.
“It is forecast to grow to 50 percent in the next five years, and this phenomenal growth is, and will continue to have, a profound effect on American culture,” he continues. “… Multi-cultural consumers drink beer on more occasions and are more likely to choose upscale import brands, including Heineken, Dos Equis and Strongbow.”
Within the beer category, the upscale beer segment, including imports, crafts, flavored malt beverages and hard ciders, is driving overall growth. “[The segment] is forecasted to continue growing at 10 to 12 percent over the next five years (compared to the projected flat growth of total beer),” Teles says.
Analyzing the upscale beer segment on a more granular level, Mexican imports appeal to young multi-cultural consumers and will continue to experience growth, Teles adds. “We believe the growth of Mexican beer will continue and [has] elevated both Dos Equis and Tecate to priority status within our portfolio,” he says.
Teles says that Dos Equis’ taste profile and appeal, along with consumers’ thirst for adventure, is what sets the beer apart from the competition.
“It is a German pilsner-style lager with rich Mexican cues and connects with both general market millennial and multi-cultural consumers,” he explains. “At the heart of Dos Equis’ consumer connection is the award-winning Most Interesting Man campaign, … which has become a cultural icon by inspiring consumers to ‘Stay Thirsty’ and lead more interesting lives.”
The campaign has generated a lot of exposure for the brand and recently was named as one of the top campaigns of the 21st century by Advertising Age, he notes.
Created a decade ago, the company’s Most Interesting Man campaign features different takes on the same character and its most recent iteration, which began airing in March, sends its title character, actor Jonathan Goldsmith, on a one-way mission to Mars.
Yet, Teles notes that the Most Interesting Man in the World will continue to grow and endure, much like the title character in the James Bond franchise, as the character’s story is much bigger than any one individual.
“‘Stay Thirsty’ isn’t just a tagline — it’s a mindset [that] Dos Equis embraces daily to connect with our consumers and [it] inspires everything we do,” he says. “Recent research indicates that 83 percent of our targeted audience wants to live an even more interesting life, which further reinforces our belief that the time is right to evolve the campaign … to keep it fresh and relevant for the consumer.” A new spokesperson and 360-degree integrated marketing campaign will launch in September, he adds.
Additionally, the Heineken brand kicked off another campaign in March. There’s More Behind the Star features Academy award-winning actor Benicio Del Toro in three comedic TV spots comparing his “star” status to various stories behind the legendary Heineken brand, Rijks says. Scheduled to air through 2017, the spots are running globally in English and Spanish in more than 70 markets, he adds.
Beyond actor and celebrity partnerships, sports-integrated marketing campaigns, including the World Cup and Major League Soccer (MLS) and boxing, are among some of the ways HEINEKEN USA connects with its multi-cultural consumers,
the company says.
For example, boxing superstar Canelo Alvarez is Tecate’s brand ambassador for its Born Bold campaign, which captures the spirit, pride and inner drive of bi-cultural consumers, according to Teles.
“The campaign scores well with high effectiveness and high recall and excelled in social media around soccer and boxing matches — our consumers’ favorite sporting events,” Teles says. “Our goal is to continue the strong momentum via increased investment in Born Bold and Tecate’s Taste of Triumph, [which] centers [on] our boxing and soccer sponsorships.
“We also are partnering with Mexican soccer team Chivas de Guadalajara to have a strong presence at all Chivas soccer matches — the most watched by our bi-cultural target,” he continues. “Our efforts are supported by in-market programming and heavy up-sampling activations that showcase the superior quality and taste of Tecate.”
Additionally, in 2015, HEINEKEN USA expanded its reach to the United States, where the popularity of soccer is exploding, Rijks notes. “Multi-culturals, whose population is expected to triple by 2050, rank soccer as their favorite sport,” he says. “Heineken is the No. 1 selling European beer among U.S. soccer fans and the most popular brand among both UCL [United Champions League] and MLS fans.”
Strengthening digital connections
Rijks and Teles note that helping multi-cultural consumers emotionally connect through traditional and digital activations also plays an important role in the success of all of the company’s brands.
“Today’s consumers sort through information at the speed of light on their phones, tablets and computers,” Rijks says. “To influence these consumers, we need to reach them online where they are most active.
“Through online channels, we are able to leverage the conversation with our target audience more efficiently and effectively,” he continues, “[and] deliver proprietary experiences that tap into our target consumer’s passion points — music, sports, art, food, digital — providing entertaining content that creates emotional connections with our brands, keep our brands top-of-mind at the point of purchase and continue the conversation post-shop to build loyalty.”
For example, in Heineken’s Soccer is Here, Get Me in There program, consumers are taken on a trip across the nation and invited into a soccer-supported culture in different cities, Rijks notes.
“Social platforms — Facebook, Twitter, YouTube — were employed to proactively reach soccer fans with content that supports UCL, MLS and Soccer is Here platforms,” he says. “Through social activation, we were able to drive traffic to our online Social Hub, an interactive digital experience for fans to share photos, receive customized retail offers and view additional content. Heineken also integrated this platform with key media partners: ESPN, Fox, Univision and MLS.”
Additionally, HEINEKEN USA’s brands have a strong social media presence; Heineken currently has 20.6 million Facebook fans, while Dos Equis has 3.8 million fans and Tecate has 2.7 million fans, Rijks adds.
In addition to connecting with consumers on social media, HEINEKEN USA is using packaging innovation and variety packs to reach new consumers. In late March, it announced the return of its Beers of Mexico variety pack, which features a limited-edition Dos Equis Azul, a blend of signature golden wheat lager and blue agave, that is joining Dos Equis Lager, Tecate and Sol, to create a medley of taste experiences for social gatherings and party occasions, the company says.
In a crowded beer space with increasingly connected consumers shopping online and using social media, HEINEKEN USA’s Rijks says the company must continue to provide fewer, bigger and better programs streamlined around big ideas to maintain its success.
“We have to be effective at cutting through the clutter to connect with consumers and influence their purchase decisions,” Rijks says. “At the core of our strategy, digital shopper marketing will allow us to efficiently and effectively connect with consumers at every point along their path to purchase.”
Additionally, an unwavering commitment to quality, taste, and maintaining consistent excellence and continuity in its products is core to HEINEKEN USA’s mission. “The craftsmanship and expertise of Heineken’s Brew Masters are second to none,” Rijks says. “Their philosophy is that every drop that goes into a bottle of Heineken must be brewed to perfection.”
“Our purpose is that ‘we brew experiences that inspire legendary lives,’” Teles adds. “We are a proud family with a rich heritage and history. We are passionate about the beer and cider that we sell.
“We create value for our customers through our dynamic portfolio of upscale international brands,” he continues. “Brands that are all about substance rather than status, social rather than exclusive, personalized rather than the mass. We connect people by creating meaningful experiences and memorable moments.”