Inter the hot seat

Mark Stretton talks to Steve Cahillane, the newly-appointed chief executive of Interbrew UK.

Apparently, getting married, having a baby, moving house and changing job are the four most stressful things you will ever do.

If that's the case Steve Cahillane's blood pressure must be riding sky high.

In just seven weeks he has shipped his family from the US to the UK, seen the birth of his fourth child and embarked on one of the biggest jobs in UK brewing. In short, having replaced Stewart Gilliland as chief executive of Interbrew UK, he is responsible for one of the Belgian brewer's most important beer markets. He heads up 3,400 employees and in Stella Artois, has one of the most successful lager brands in the UK.

So how did he land one of the hottest seats in brewing? "Well, I had a phone call one day to ask me if I would be interested - clearly it was a big opportunity for me," he says. "It was strategically very important and it would give me international exposure.

"I suppose from the company's perspective what I can bring is a core set of skills and fresh thinking. Being put in a new environment, I have to challenge the paradigms - because I don't know what the paradigms are."

And what about persuading the pregnant Mrs Cahillane to up-sticks from their leafy Connecticut home on the east coast of America and move to England? "I floated a hypothetical question to her and she was thrilled - that's not to say I didn't have some negotiating to do," he says. "When she signed up with me she knew this kind of thing might be a possibility."

The beer fraternity tends to look up to the New World wine folks with envy and aside from the MBA from Harvard and most recently a stint at the helm of Labatt USA, the Cahillane CV also shows that his first job was with E&J Gallo, the winemaker. "What the wine guys have been good at is selling the romance and history of the product," he says. "But they are not the best at branding - when people buy wine they are all over the place, going from brand to brand."

Steve says beer groups have a lot to shout about. "The beer business comes from a position of strength," he says. "We need to stop being apologists. Beer has some great things going for it - it is part of the culture. If you think of all the great times in your adult life, the high points, the celebrations, beer is often there somewhere - part of the memory."

There is a belief in some quarters that the big brewers are focusing on the ever growing off-trade at the expense of the on-trade. Asked what his vision is for respective volumes in pubs and supermarkets in five years time, he says: "I would expect them both to be a lot bigger." The new Interbrew boss comes with an exceedingly straight bat. Pressed further, he says: "The on-trade is hugely important so we would ignore it at our peril.

"In pubs, people make switching decisions. People don't buy cases at a time so they are far more inclined to switch between brands. That's a big opportunity, and it is much easier to create the romance of a brand in a pub."

The man he replaces, Stewart Gilliland, went with a big reputation. The two know each other and spent a couple of weeks working together before Stewart headed for Canada.

One of the Gilliland watchwords was "quality" and his successor is no different. "The pub experience has to be better tomorrow than it was yesterday," he says. "If the quality of the beer, the standards and the service are exceptional then that sounds a lot better than going home and cooking some food and cleaning and so on.

"If they are not, then I think I might stay at home." Steve says that "the learning curve is vertical" at the moment. He has spent his first few weeks getting round the business as quickly as possible, with visits to breweries all over the UK.

So what are new man's first impressions? "The level of change sticks out," says Steve. "The UK market was fully integrated 10 years ago, now it is completely different.

"In America, we think of beer and pubs in England as being a unique, romantic, embedded part of the culture but then you come here and see people talking about decline, people not drinking beer, discounting and so on."

One brand certainly not in decline is Stella Artois, Interbrew's flagship lager brand. Some people have turned its success into a weakness, saying that perhaps Interbrew is a one-trick pony. "Nothing happens by accident," he says. "People make conscious decisions and with Stella Artois people have done the right things all the way.

"Stella Artois is a huge part of the company but the customer needs a portfolio of brands so we need a portfolio of brands - it wouldn't make sense for us just to focus on Stella."

Successful brands will always face challenges. One for Stella Artois is the reassuringly expensive campaign that doesn't quite fit with supermarket pricing policies, where Stella is often sold as a loss-leader. "We have a winning brand that consumers love and retailers are always going to feel pressure to promote it," he says.

"I think the pricing differential (between pubs and supermarkets) is almost a non-issue. A pub is a totally different experience. Think about the perfect experience - the temperature, the glass, the head, served with a smile - it's priceless. This is a little slice of heaven and if everyone has that then price becomes irrelevant because you are getting what you pay for."

Another challenge for the Belgian lager is the distasteful "wife-beater" alias, commonly used among young male Stella drinkers - a mocking reference to the lager's premium-strength potency. Is the brand owner worried over such a slur?

"I wasn't aware of it," says Steve. "But as a brand owner you worry about anything that can be detrimental to the image of your brand. Stella isn't stronger than other premium lagers, just more people drink Stella than anything else."

On the wider issue of encouraging responsible drinking, he says: "Everybody who participates in this industry has a responsibility towards the use of alcohol but then Interbrew UK has a great track record. It is a founding member of The Portman Group, a responsible advertiser and we are just rolling out our code of conduct surrounding advertising and marketing."

Although lips were sealed, Interbrew appears to have grand plans for its Bass brand and will shortly advertise it on a scale that has not been seen for seven or eight years.

In the stout niche, will Murphys always play second fiddle to the supremely dominant Guinness? "The notion of catching up with Guinness is certainly challenging," he says, rolling his eyes.

With the withdrawal of standard Heineken from the UK, Interbrew is now working with the Lion Nathan brand Castlemaine XXXX. "Castlemaine is hugely exciting," he says. "We are starting from a low base but the research that we have done shows that it is a brand that people still feel very good about. The product has excellent brand heritage."

Heineken has now launched its premium five per cent version, pitting the brand head on with Stella Artois. North of the border, Carling is gunning for Tennent's, the dominant Scottish lager. "We love the challenge," he says. "The better the competition the better we have to be."

The Interbrew UK head offices are extremely pleasant but they are not located in the most salubrious of English towns. Did he still want the job after he had seen Luton? "I love Luton," he exclaims.

"I worked on the south side of Chicago, which is a tough town, for four years and then I worked on the east side of Los Angeles, which is a tougher town, for four years."

It's a big job and as Stewart Gilliland's replacement he has a big pair of shoes to fill. So, how big are his feet? "Big enough," he says. "It's been a fast but fascinating two months. My challenge is to take the mantle on and make us bigger and faster."

Steve Cahillane CV​