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Old 08-05-2009, 12:07 PM
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Default Will you drink beer in a box?

http://blogs.moneycentral.msn.com/to...-in-a-box.aspx

Will you drink beer in a box?
Posted Jul 29 2009, 01:31 PM by James Dlugosch Rating:
Filed under: Molson Coors Brewing, James Dlugosch

Imagine kicking back in the shade on a hot day and popping open an ice-cold box of beer.

Yes, you read that right: box.

The Wall Street Journal reports to that MillerCoors is testing beer in a box in several cities.

Now, like many people during this economic crisis, my wife and I are doing some personal belt-tightening of our own in order to save money. But there are some things I just won't do, including buying wine in a box.

Now, with beer, the box might be less objectionable since, in my opinion, the quality issue is not really in play. Despite what the microbrewers will tell you, all beer is pretty much the same. Consumers who pay a premium do so more for the experience than the taste.

But for me, the issue is the bottle. I like drinking my suds from a cold bottle. Period.

Put it in a glass, and the experience just isn't the same. And no matter how cheap they make it, I just can't see myself drinking beer from a box. (The current boxes deliver draft beer; you don't drink from them. But box wines started this way, and you can now buy merlot by the six-box pack.)

Of course, I'm not the target market, and there are many who will see value in this product. The big brewers are under pressure from consumers trading down to cut-rate brands, and in this economy, getting more for less is going to be a selling point for the foreseeable future.

With sales volumes dropping, this "buy more at point of sale" model could be just the tonic for beer companies. Even though, the Journal says, an 18-pack is still cheaper.

Shares of Molson Coors (TAP) have recovered nicely since bottoming in March. But it still trades more like a defensive stock. Will the beer-in-a-box transition create growth?

If so, TAP could be a big winner with this marketing ploy. Perhaps I should have added the name to my list of "Red-Hot Summer Sizzlers." The stocks on this list have an aggregate return of 19% since publication on May 22.

Seems to me beer in a box may be a trigger for a bump in share price. Just don't expect me to drink the stuff.

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http://online.wsj.com/article/SB124882355717088341.html
MillerCoors Tests a Draft-Beer Box for the Fridge
Product Is Among Latest Innovations From Major Brewers Fighting for Business in a Jammed, Sluggish Market

By DAVID KESMODEL
See Corrections & Amplifications item below.

MillerCoors LLC has begun testing the sale of $20 draft-beer systems for consumers to drink at home, part of a string of new products and package innovation from beer giants grappling for market share in a crowded, slow-growing industry.

MillerCoors, the second-largest U.S. brewer by revenue, has begun testing the 1.5-gallon "Home Draft" for its biggest brands -- Miller Lite and Coors Light -- in about a half-dozen cities, including Dallas, Phoenix and San Diego. The boxed product, which is designed to fit into refrigerators for drinkers to consume periodically, rather than for one-time party use, comes amid packaging overhauls by the U.S. units of Heineken NV and Anheuser-Busch InBev NV.


  • MillerCoors; Heineken; Anheuser-Busch

    Makers of Miller Lite, Newcastle Brown Ale and Bud Light are competing with new products and packaging.

Sales of major U.S. beer brands are struggling as some recession-weary consumers drink less or switch to cheaper brews. Many of the top-selling brands showed declining sales volume at retailers in the 13 weeks through July 12 compared with a year earlier, according to market tracker Information Resources Inc. Anheuser's Bud Light, the No. 1 brand, saw its sales volume slide 5.5%, while Heineken, the No. 9 seller, fell 15%. (The figures exclude sales at certain retailers that don't share data with such research firms.)

"In this economy, we are seeing an increase in packaging innovation" in consumer-goods industries, said Kara Gruver, head of the North America consumer-products practice at consulting firm Bain & Co. "In many cases, it can be less costly [than creating a new product] and a very effective form of innovation."

Chicago-based Miller Coors, a U.S. joint venture of SABMiller PLC and Molson Coors Brewing Co., is testing home-draft packages at a time when one of its major brands, Miller Lite, is mired in a prolonged slump. Despite a new ad campaign this year aimed at revitalizing the brand, Miller Lite's retail sales fell 7.5% by volume in the recent period tracked by Information Resources.

Sister brew Coors Light, on the other hand, continues to post sales gains. Analysts attribute its long-running success in part to innovations in packaging, such as "cold-activated bottles," whose labels turn blue when the beer inside cools to a certain temperature.

MillerCoors's new Home Draft systems are meant to be placed upright in a refrigerator, which will keep the beer fresh for about 30 days. The price per ounce is roughly 15% higher than for an 18-pack of the same beer, MillerCoors said.

The product, which is recyclable, is aimed at the 30% of beer drinkers who say they prefer draft beer to the bottled or canned variety, said Andy England, chief marketing officer at MillerCoors. "We're really trying to meet that occasion when you just got back from work and want to reward yourself," rather than "the party occasion," he said.

Home Draft -- which carries about 5.7 liters -- bears some similarities to Heineken's five-liter DraughtKeg, which the Amsterdam-based brewer introduced in the U.S. in 2005. But the DraughtKeg generally is designed to consume all at once, unless drinkers buy an optional BeerTender countertop chilling system, which is sold at retailers for about $200.

The performance of the DraughtKeg may hint at the challenge MillerCoors could face to woo consumers. The DraughtKeg enjoyed an explosive start in the U.S., but Heineken pulled back on distribution as sales cooled and the company learned the product is most popular around holidays, the football season and other social occasions.

Heineken this month began testing the sale of Newcastle Brown Ale in the DraughtKeg format -- about $20 at retailers -- in Chicago, Minneapolis and Southern California. The company continues to focus on innovation in packaging "in a way that reinforces the premium nature of" its brands, said Christian McMahan, chief marketing officer at Heineken USA.

The U.S. unit of Leuven, Belgium-based Anheuser plans to unveil new can and box designs for brands such as Bud Light when the football season gets under way next month. As part of the shift, the company says it intends to better leverage its sponsorship of the vast majority of National Football League teams by creating packages showing the colors or logos of teams such as the Pittsburgh Steelers. Meanwhile, it also will roll out packages with generic colors tailored to college teams in specific regions -- such as red-colored cans in Nebraska, home of the University of Nebraska's Cornhuskers.

"It's an opportunity to tap into the passion people have for their teams," said Dave Peacock, president of Anheuser's U.S. arm, which is the biggest American brewer by sales. The company's research has shown that the most loyal consumers of its light beers "associate with sports in a dramatic way."

Brewers including Anheuser also plan some new beers in addition to new packaging. Anheuser intends to test Budweiser Select 55 -- a brew with just 55 calories -- in several markets later this year, as it tries to compete better with MillerCoors's MGD 64, a 64-calorie brew that is off to a strong start. Mass-market brews such as Bud Light, Miller Genuine Draft and Budweiser are roughly in the 100 to 140 calorie range.

Write to David Kesmodel at david.kesmodel@wsj.com

Corrections & Amplifications:
This article says Heineken NV's DraughtKeg generally is designed to have its contents consumed all at once unless drinkers buy an optional BeerTender countertop chilling system, but fails to note that the product stays fresh for 30 days in a refrigerator or cooler after it is tapped.
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Old 08-05-2009, 08:47 PM
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Old 08-06-2009, 06:30 AM
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I do not think they could make a box strong enought to hold the pressure.
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Old 08-06-2009, 02:59 PM
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Originally Posted by JK kat View Post
I do not think they could make a box strong enought to hold the pressure.
Don't shake it up.
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Old 08-06-2009, 05:56 PM
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If it still tastes and works like beer then I dont care what it comes in, just give me one.
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