E-Malt.com News article: Russia: Efes Russia plans to increase Krasny Vostok brand popularity and distribution level

Efes’ bet on Krasny Vostok trademark which failed to prove itself profitable for the last two years is differently interpreted by analysts (Krasny Vostok’s market share dropped from 7% to 2.5% in last two years), the Russian Brewers Union released August 18.

“This is the most powerful and recognizable trademark in Krasny Vostok’s brand portfolio (Solodoff, Czech standard, Jigulevskoie, Ershistoye)-” said Natalia Zagvozdina from analytic company Renaissance Capi-tal. “Releasing a new brand will be much more expensive for Krasny Vostok at this moment,” she continued.

A federal advertising campaign is supposed to increase Krasny Vostok brand popularity. Efes will spend to this purpose RUR135 million. As Kirill Ustinov, manager within “Efes Russia” Public Relations department stressed, ourdays Krasny Vostok is rather a new product: the logotype was changed, the packaging, the brand positioning and even the brew’s formula to which Efes added some of its own know-how tips. In order to modernize its production capacities, Efes has already spent RUR50 million and plans to spend as much until the end of 2006.

The brewery has already begun the cross-brewing (brand crossing between the breweries of the holding). It is assumed that Krasny Vostok will be brewed by all Efes Russian breweries (in Moscow, Rostov-on-Don and Ufa). Besides Krasny Vostok, the breweries in Kazan and Novosibirsk will also roll out brands like Efes Pilsner, Starii Melnik, Belii Medvedi and Sokol.

This year, their production capacities are estimated to 1.5 and respectively 10 million hl per year. The Novosibirsk brewery plans to forwardly double its production capacities. By the end of 2007, Krasny Vostok’s share in Efes Russia beer production (nearly 18 million hl) will reach 50% (only 25% nowadays).

Besides increasing production capacities, Efes plans to upgrade the distribution level of this brand. Efes intends to bring it to Starii Melnik level which is distributed to 70% of the Russian market (distribution share of Krasny Vostok reaches actually 15%).


25 August, 2006