Grin and beer it

Liquor writer SIMON HENDERY looks at the brewers' new tack to keep the product - and the money - flowing

Four years ago you couldn't get a beer in most of Mt Eden. But the once mainly "dry" suburb is now a drinker's nirvana, and a battleground in the new high-price brewery conflict - the war of the theme bars.

On Enfield St, the DB-aligned Horse & Trap Tavern offers seven types of Monteith's on tap and a menu which includes shepherd's pie, oysters and mussels.

Around the corner, Lion's Cardrona Speight's Ale House has a facade to match the look of the Central Otago pub it is named after.

Inside, drinkers find rustic surroundings that would make any good southern man feel at home.

Down the road in Mt Eden village, well-trained staff at De Post Belgian Beer Cafe, another Lion concept, will offer you a plate of mussels and a perfectly-poured Stella Artois, Leffe or Hoegaarden, all presented in branded glasses.

This gentrification of the pub experience is the breweries' response to falling beer sales.

And it seems to be working. This week, DB Breweries and Lion Breweries (through Australian parent Lion Nathan) reported jumps in operating profit for the year to September.

So while we aren't the nation of beer-guzzlers we once were, our two major brewers continue to thrive, basically by convincing us to spend more on a pint.

The numbers speak for themselves. Ten years ago, we drank an average of 103 litres of beer each a year. Today, we drink 79 litres.

In pure alcohol terms, we imbibe almost as much today as we did 10 years ago (7.1 litres a year compared to 7.4 litres in 1993).

But the beer component of that intake has fallen, while the wine and spirits components have risen.

The beer component (3.3 litres of pure alcohol a person) has been unchanged over the past year so while the beer market grew by almost 2 per cent over the past year - from 308 to 331 million litres - that increase has come from population growth.

Lion Breweries managing director Julian Davidson puts a positive spin on the stable per-capita consumption figure.

He says it shows that from a social responsibility perspective, the beer industry is "self-regulating nicely".

"Seeing the trend where consumption is levelling out is good. All that we're doing is encouraging people to try a premium beer rather than a mainstream beer."

The breweries make more from a bottle of premium beer such as Stella Artois or Monteith's than they do from the mainstream brands such as Lion Red or DB Draught.

And the profit from a pint of premium tap beer at the pub is even higher.

Hence the push to lure drinkers back to the bars by offering them a sophisticated, safe, family-friendly environment with good food and fresh tap beer.

DB managing director Brian Blake says concepts such as the Monteith's bars are changing the face of the industry as pub operators realise the benefits of offering patrons a sophisticated drinking environment.

"We're seeing people being prepared to invest more on the realisation that if they do a good job in terms of theming and decor, they get longevity in the outlet.

"We're seeing investors being prepared to take a long-term view and I think it's paying dividends."

There are four Monteith's bars in Auckland and three in other centres, and Blake says numbers will grow.

Likewise, Davidson says Lion is planning more theme bars, and expansion this financial year will focus on the existing Belgium beer cafe and Speight's ale house formats.

It is looking at ways of making them economic in smaller centres.

Davidson said the theme bars were intended to raise the expectation of what a pub experience is all about.

"We do a lot of work to communicate what the Speight's brand means, but by walking into a Speight's ale house that communication is so much more pronounced.

"When a drinker goes in, it just all makes sense. It's a neat environment to have a beer in but it's also a fundamental marketing tool for the brand."

Further down the track, the company could consider other theme possibilities such as a sports bar based on Lion's All Blacks sponsorship, he said.

The evidence suggests drinkers are responding to the swept-up bars.

When it issued its annual result this week, Lion said overall tap beer sales were on the decline, but premium tap beer sales and turnover at the theme bars was growing.

Davidson says about 80 per cent of alcohol sales at the Mt Eden Cardrona Speight's Ale House are tap beer.

"We think that is going to continue to filter down as more and more bars are upgraded or revamped.

"The whole industry is travelling in a really neat direction. I think the standard of pubs overall in New Zealand has lifted radically."

Blake says that while a lot of attention has been shown to "the premium end of the market" - bars in places such as Auckland's Viaduct, Courtenay Place in Wellington and "the Strip" in Christchurch - he sees further opportunities to develop and revamp "traditional-type pubs".

DB is beginning to expand the concept to develop bars around its Heineken and Tui brands.

"We're getting a nice balance from the [pub] operators in terms of what they want to do and the role our brands have to play.

"In many ways, what we're seeing develop is a bit like the English-style pub but with a New Zealand theme."

So for the likes of the Mt Eden residents mulling over which bar to call their local, the difficult decision is whether they feel more at home in general kiwi surroundings, something more reminiscent of the deep south, or a Belgium haven in central Auckland.