Energy beer
Who knew? SABMiller's latest acquisition is in an exploding sector of the beer market - energy beer. The beer giant announced it would buy the Sparks brand from the US's McKenzie River for $215 million. SABMiller also got rights to another beer brand, Steel Reserve, which has a higher alcohol content than most beers. Miller already brews these beers under contract.
Sparks's claim to fame is that it is supposed to be an energy fink. It contains ginseng, caffeine, taurine, and guarana, and has a citrus-y taste. The energy drink craze is colliding with the alcohol market, as Red Bull and vodka has become a favored mixed drink. Is it people feeling guilty about getting beer bellies, or is it the desire to be a more energetic drunk?
Anheuser-Busch already has two energy beers called Till and B-to-the- E, malt beverages containing caffeine, guarana, and ginseng. SABMiller already is launching a similar beverage called Mickey's Stinger, a caffeinated malt beverage. Analysts see this new category as one bright spot in the otherwise flat beer industry. And of course, industry convergence makes all the key actors scramble after the same new market segments.
Why is SABMiller spending so much and why are analysts so bullish? The youth market. According to a BBC News online article commenting on Anheuser-Busch's roll-out of caffeinated beer in Britain ("Caffeine beer sparks binge fears". 3/6/06), the idea is to get young people even drunker:
Victoria Manning, research psychologist for Action on Addiction, added: "This concerns us because the combination of caffeine and beer will enable people to drink more because the caffeine will keep them awake longer."
She added: "The beer also contains fruit flavours which make it particularly appealing to young drinkers, especially young women which is worrying as binge drinking among young women is on the increase."
