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Brands continue to drive growth in German discounters and at premium level

Published:  30 June, 2016

Unlike in the UK, where branded products are used solely as benchmarks by which the stores can use 'we're cheaper than' claims, in Germany, Aldi and Lidl are gaining traction by welcoming brands into the heart of their offering.

Unlike in the UK, where branded products are used solely as benchmarks by which the stores can use 'we're cheaper than' claims, in Germany, Aldi and Lidl are gaining traction by welcoming brands into the heart of their offering.

Having successfully attracted consumers with highly competitive prices, discounters in Germany have become the main retail distribution channel for alcoholic drinks; and recent listings indicate that discounters are now trying to gain more share from other channels by offering branded products with a high degree of recognition.

With 31 Days of German Riesling preparing to launch in 200 restaurants, wine bars and retailers across the UK, Euromonitor International's country report shows that branded products in Germany are continuing to enter discounters and will remain key growth-drivers going forward.

Aldi Einkauf began offering Germany's leading domestic premium lager brand, Krombacher, in early 2016, and has also repeatedly sold well-known sparkling wine brands through promotions.

Premiumisation also continues to drive growth particularly in spirits, where English gin, dark and white rum and vodka, are increasingly attached to premium and super premium products.

A spokesperson for Euromonitor said: "German consumers regard premium spirits as worth paying extra for, in return for high quality, strong brand names and because they are often seen as a status symbol. Especially for international brands, which are becoming more popular amongst German consumers, premiumisation is pushed through continuous investment and constant innovation.

While a growing emphasis on health has had a negative impact on alcoholic drinks overall, sales of non/low alcohol options in categories such as beer and

Germany

sparkling wines have benefited.

In a declining beer category, one area which continues to gain share is speciality beer, and has prompted many brewers to refocus on improving their brand image.

German consumers are increasingly drawn to regional beers, as well as beers which are positioned as being brewed with traditional techniques.

Because beer is seen by many consumers as a beverage with which they can identify on a more emotional level, either due to its regional appeal or its hand-crafted character, more brewers are attempting to capitalise on this development.

Festbier, kellerbier and landbier, all traditional types of beer, are gaining traction.

To reinforce this particular image, some brewers also returned to packaging their beer in compact old-fashioned bottles.

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