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Heineken execs see opening for upscale light beer brand.

This week, Heineken executives invited reporters to the Heineken USA headquarters in White Plains, NY, for a briefing on the national roll-out of Heineken Light.

Andy Thomas, who took the post of HUSA president and CEO in October 2005, announced a two-pronged launch for the new brand. It will hit on-premise on March 1st, and go into the off-trade in April.

The company has prepared the ground with an intensive informational program for distributors. Thomas said that sales personnel at 850 wholesalers have already received a full-day briefing on the launch.

Heineken USA has a web-site up and running at www.heinekenlight.com, and will even have an illusionist performing in Times Square to coincide with the launch. That's not to mention the planned $50 million of spending on a barrage of internet, TV, radio, print and outdoor ads.

CEO Thomas said HUSA will avoid tactics that might encourage cannibalization. "We will not pull back on Amstel Light at all," he said. "If we are going to get two brands featured, we will ask the retailer to use Heineken and Amstel."

Will that be enough to avoid siphoning drinkers from the established HUSA brands? Philip Van Munching, a writer who once served as marketing director for Van Munching & Co., the original importer of Heineken, isn't so sure.

"Quick question," Mr. Van Munching asked rhetorically. "Which two brands will

Heineken Light pull the most consumers away from? If you answered 'Heineken and Amstel Light, HUSA's two flagships,' you're today's big winner."

But HUSA CEO Thomas assured reporters that the new brand had not shown a tendency to cannibalize Heineken or Amstel in test markets. "We saw no cannibalization of our brands," he said.

According to Thomas, the brand will be the standard bearer of a new "luxury light" beer category. "Consumers are trading up in every category, from chocolate to cars, seeking higher quality and higher image products," he said. "Light beer is now half the market, and is a real part of the beer category. If you cross that with the 'trading up' trend, you have the basis for 'luxury light.' We will be working to get light beer drinkers to trade up."

Thomas noted that premium products make up 8-12% of mature product categories. "If you look at the potential for 8-12% of light beer at premium, you can see the value across the chain," he said. "We can tell retailers that they won't have to sell one more case of beer, but they'll make more money and satisfy their customers."

Ken Kunze, vice president of marketing, said the launch has been carefully planned. "From a marketing perspective, we started with the trade mark, which is a great place to start, because it brings equity and quality," he said. "Second, we looked at 20 formulations, brewed to appeal to the U.S. light beer drinker."

The company settled on a crisp, all-malt formulation with 12 international bitterness units (IBU), designed for "easy consumability." In comparison, Heineken has 23 IBU, Amstel Light has 18 IBU and Michelob Ultra has 4.

The brand will be sold at the same price as Heineken, and the company does not plan to retreat from that price-point. "The trade-up story will compelling for consumers," said CEO Thomas.

The Heineken Light bottle is Heineken's traditional slope-shouldered green bottle, but with a vertical label. Kunze said the packaging will communicate Heineken attributes, "but with a distinctive look."

Mr. Kunze said the marketing campaign would proceed at all levels of the market. 'We'll have an internet blast, print ads in Maxim magazine, and the TV coming on line," he said. "We will be creating visibility and getting the message out.

"We will be tapping into luxury light," Kunze added. "People are satisfied with their light beers, but not in love with them. We want to challenge the status quo."
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Title Annotation:Heineken USA Inc. to launch Heineken Light
Publication:Modern Brewery Age
Geographic Code:1USA
Date:Feb 27, 2006
Words:641
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