Heineken and Unibra go head to head in Rwanda’s beer market

Heineken, whose Bralirwa brand once enjoyed a near 50 year monopoly in Rwanda’s beer market, is facing a battle as it goes head to head with Unibra’s high growth Skol brand.

Skol Brewery Rwanda, which is owned by Belgium’s Unibra, has revealed that its market share has jumped by 20 percentage points to 25% since 2010, when it had just 5% of the market. By 2015 it had 14% market share. The company had originally targeted 20% market share by 2020. A key feature in its sales growth has been a 30x increase in distribution points. Skol is also innovating in both the value and premium sectors of the beer market, and in December 2018 launched its 5.5% ABV Skol Select brand. The brand retails at Rwf700 ($0.80) per bottle.

For its part, Bralirwa, which still holds around 70% market share, is responding with a greater focus on innovation, cost cutting and local production. In the past two years it has also introduced Primus Citron (a locally brewed lemon-flavoured beer) and the low alcohol Amstel Malt brand. In December 2018, it announced that the flagship Heineken brand, previously imported from the Netherlands, would now be brewed at Bralirwa’s Gisenyi Brewery on the border with The Democratic Republic of Congo. It is only the 9th Heineken subsidiary to brew the brand locally. As a result of local production, the retail price of Heineken will fall from Rwf1,000 ($1.14) to Rwf800 ($0.91), a substantial shift which will open up more aspirational consumers for what is still a super premium product in Rwanda.

In November 2018, Heineken brought in a new Managing Director to grow its business in Rwanda. The new MD was responsible for revamping Heineken Ethiopia’s sales and marketing profile for 5 years, during which market share doubled. Even so, he faces a major challenge: Heineken has sought to cut costs by reducing headcount and cutting expenditure such as sponsorships. In December 2018 Skol announced a new, flagship sponsorship deal with leading football team Arsenal.

Both Bralirwa and Skol face challenges from the east – East African Breweries (Diageo) beers such as Tusker Lager and Tusker Malt, but more importantly ready-mixed spirits such as Smirnoff Black Ice, which compete for share of throat with premium beers. East African Breweries has traditionally not been a strong player in what was always francophone Rwanda but it has a strong presence in both Kenya and Uganda. East African Breweries has been trying to accelerating its presence in Rwanda since 2012, although beer imports still constitute only 5% of the market by value.