Brassivoire, the Heineken-CFAO joint venture, has launched a new beer brand. Called ‘Class’ the new beer is positioned as a premium malt beer, has an ABV of 5.2% and is part of an intense battle to challenge market leader Solibra (Castel).
The new beer joins Brassivoire’s existing brands: Ivoire, which launched in 2016; and Mützig, a Heineken-owned lager originally brewed in Alsace, launched in Côte d’Ivoire in 2017. The new beer will formally be a sub-brand of Mützig and will retail at FCFA500for a 50cl bottle. Mützig is also brewed by Heineken subsidiaries Rwanda, Cameroon, the Republic of Congo, DRC and Sierra Leone. In addition, Brassivoire also imports the Heineken and Desperados brands and brews the non-alcoholic Maltina brand.
Brassivoire was formed in 2015 and is 51% owned by Heineken and 49% owned by CFAO. The two companies have an existing 20-year partnership of Brasseries du Congo (Brasco) in the Republic of Congo. Brassivoire operates a modern brewery in the new industrial zone north of Abidjan. The brewery officially opened in April 2017 at a cost of FCFA100bn ($170m). It now has an annual production capacity of 1.6 million hectolitres of beer, having doubled capacity in late 2017.
Brassivoire aims to challenge what was a near monopoly by Groupe Castel subsidiary Solibra, owner of the Solibra, Flag and Castel brands in Côte d’Ivoire. Solibra has an annual capacity of 2 million hectolitres of beer in a market that consumes just over 3 million hectolitres of beer per year. Although the market effectively doubled in size between 2007 and 2017, Brassivoire’s entry effectively creates 0.8m hectolitres of spare capacity between the leading two players.
Solibra has fought off competition before in the beer market. In 2013, Les Brasseries Ivoiriennes (LBI), a subsidiary of the Eurofind Group, sought to challenge it and succeeded in taking 10% market share. That challenge ended in 2015 when it was bought out by BGI Groupe, a Castel subsidiary. Solibra also faced (and continues to face a challenge in soft drinks from NCBI, which has a 10%+ market share). After acquiring LBI Castel doubled capacity from 250,000 hectoliters to 500,000 hectoliters at its Yopougon brewery.
The challenge for Brassivoire is that in order to hit close to 80% of production capacity, it needs to acquire a market share of 40%. By late 2017 it had acquired 25% market share in the Ivorian beer market, creating an intense battle for consumers that has meant ugly allegations of sales reps tearing down one another’s signs and concerns from consumer groups that both companies were advertising too close to schools.
The real challenge is for affordability to drive consumption volumes and the value sector: the average bottle of beer costs consumers FCFA500 ($0.87) in a country where only 5% of the population have an income above $10 a day.
