Like the proverbial curate’s egg, the performance of the cider market can be summed up as good in parts.
The exponential growth of a few years ago has settled down, with pockets of positivity balanced by areas of mild concern, with the overall picture slightly better than some other categories in an on-trade that has seen difficult times.
The official figures from CGA (year to February 20) confirm a mixed bag of fortune.
Total on-trade cider was up 2.7%, with volumes ahead by 0.9%, perhaps unspectacular growth in its own right but a creditable performance set against a total long alcoholic drink (LAD) volume decline of 2.7% and value that nudged ahead by just 0.3%.
Cloudy year boost
One segment that doesn’t register in its own right on the CGA score charts is cloudy cider, the buzz category for cider during summer 2015.
The year saw major cider producers seeking to take the cider haze traditionally associated with farm-gate producers into the mainstream, led by Heineken with its Strongbow Cloudy Apple.
The draught-only brand found its way into 1,250 pubs last year and free samples were given to 600,000 people in city centres and at transport hubs.
The good news for operators is that it offers a premium trade-up over mainstream brands. “Cloudy Apple should be on the bar at a 10% premium to Strongbow Original,” says Turner at supplier Heineken.
Thatchers’ entry into the cloudy market is its Somerset Haze bottled brand. “Cloudy cider is where things are really happening now,” says managing director Martin Thatcher, who says the retention of actual bits of apple in the liquid, to give Somerset Haze its cloudiness, makes it a more refreshing option.
“Traditionally the haze in cider has come from the yeast, but keeping some of the fruit in makes it more apple-y,” says Thatcher.
The worlds of cloudy and fruit ciders collide in the launch of Westons Rosie’s Pig Festival bag-in-box ciders. The 4% range comprises rhubarb-flavoured Flat Tyre, damson Handbrake and raspberry Old Banger.
“The names each relate to stories about Rosie’s Pig, Westons’ first delivery vehicle,” says Bradman, “which was notorious for being a pig to start and a pig to drive.”
Of the £1.8bn spent on cider in the on-trade during this time, apple cider accounts for around two thirds, but fruit cider remains the big growth area, with volumes up 34% and value 31% during the year, though still off a relatively small base.
Apple cider still outsells fruit cider by more than two to one in value terms but fruit is now a quarter of all on-trade cider, up from one sixth two years ago.
Rachel Chard, senior account manager at CGA Strategy, says: “Cider continues to create new opportunities as category volume sales outperform an otherwise declining LAD sector, with fruit cider remaining the standout driver of growth.”
Volumes of apple cider are down 5.7% over the year, with value sales of the segment in decline by 3.9%. CGA says that premium draught offers “shoots of green” for apple with sales of such products up 0.3%.
Fruit flavours are scoring by not only persuading consumers to switch from apple but by attracting new consumers to the category as a whole. CGA says that its Peach Brand Track research conducted last July showed that 59.6% of fruit cider drinkers are aged 18 to 34 — against 42.9% of all cider drinkers — and that 58.3% of fruit consumers are women, compared to just under half for cider as a whole.
“Fruit recruits a younger demographic to the cider category, who are key to the on-trade in terms of visits and spend,” says Chard.
The strength of the likes of Kopparberg and Rekorderlig have, to date, seen bottled cider dominate in fruit cider but an influx of draught brands — most notably Strongbow Dark Fruit — has seen that part of the market double in the last year, now accounting for £102m in sales, around 5.7% of the total market.
Andrew Turner, category and trade marketing manager for Strongbow’s parent company Heineken, says: “Dark Fruit has been a phenomenal success. It’s now the third biggest cider brand in its own right and, in the past 12 weeks, it’s been number two.”
This year sees Heineken launch Wild Blueberry & Lime into its Bulmers bottled cider range. The flavour replaces Bold Black Cherry in a rolling programme of releases that, last year, saw the launch of Zesty Blood Orange. Turner said that it had been its “fastest innovation build ever”.
He adds: “It’s important in flavours to keep people engaged. It’s not about extending the range but refreshing it to keep excitement and engagement in the market.
“When we start on developing a new flavour we have between five and seven concepts that are narrowed down to two or three and shown to consumer groups, and then we end up with the product itself.
“Blueberry is a big trend at the moment so it was no surprise that Wild Blueberry & Lime came out number one.”
Kopparberg’s Mixed Fruit and Strawberry & Lime are the number one and two products in overall packaged cider, both bigger than Magners Original, the brand that kick started a new era for cider a decade or so ago (CGA, year to Jan 23, 2016).
Rob Salvesen, customer marketing manager for Kopparberg says there is a trend towards the additional draught taps that are being brought in by pubs being used for fruit or craft apple ciders.
“We believe this trend will continue as licensees install additional taps, switching from beer, lager and multiple standard cider installations to capitalise on the growing trend,” says Salvesen.
Fruit cider specialist Brothers Drinks has added Coconut & Lime and a Hop Cider to its range. The latter is a blend of apple and pear ciders flavoured with Hersbrucker hop extract and the company is pushing it as a match for light pasta and seafood dishes.
Sales and marketing manager Gerry Doyle says: “Cider and food matching is an area of opportunity for pubs, and pairing Brothers Hop Cider with dishes on a food menu or as part of a meal deal is an excellent way to attract consumers to try something new.”
The past 12 months have seen Aspall launch a still kegged cider called Temple Moon and introduce its Isabel’s Berry fruit cider on draught, with food matching again a marketing focus.
“This has given a genuine trade up from the flavoured ciders currently on the market, and has a sweet sourness that pairs particularly well with desserts,” says partner Henry Chevallier Guild.
But Angela Ham, customer marketing controller at Magners producer C&C Brands, suggests that there will be a drift back to apple from fruit ciders.
“Fruit is no longer the main driving force in the on-trade,” she claims. “While there is never a shortage of flavour choice for the cider drinker, and we have seen a number of these entering the market, many do not stay the course, nor do they add any real value to the category.
“We anticipate a renewed interest in the apple cider segment and, in particular, the core brands that sparked the initial cider surge such as Magners Original.”
Ham promised new product development later in 2016 and said the company would be putting a lot of focus on rolling out draught Magners.
In the immediate aftermath of the first Kopparberg wave of a few years ago, there was a rush to market with pear ciders, but many of these have as quickly disappeared as consumer’s attentions have switched to other fruit brands.
Pear accounts for just 3.5% of all on-trade volumes and is outsold by a factor of around 7.5 pints to one.
One notable feature of the market is that the steam appears to have come out of premium cider, though many producers still talk up the top end. Whereas premium products are fuelling growth in categories such as gin and craft beer, in cider, products categorised by CGA as standard, are in annual growth of just under 6% by value, while premium ciders are down 1.5%.
While cider may not be enjoying flavour of the decade status as it was through the 2000s, it’s far from ready to be written off.
The on-trade beer market is six times bigger but flat in value and down in volumes during the past year. And for all the drop-of in premium cider sales, it still offers higher price points than beer, with an average price per litre of £6.31 in 2015 against £5.98 for beer.
Craft in good stead
With the nebulous area of ‘craft’ driving growth in beer it’s perhaps not surprising to see the same trend emerge in cider, though, like beer, the definition appears to be as such in the eye of the beholder as in any firm industry standard.
A 2016 survey by CGA revealed that 27% of on-trade operators see craft cider as a trend to watch in 2016.
Chard at CGA says: “Small but growing craft cider taps into wider drink category trends of heritage, tradition and quality, which have propelled other on-trend categories, such as craft beer and gin, standing craft cider in good stead for future growth.”
The interest in ciders from smaller craft producers has brought a surge in interest in still ciders dispensed by bag-in-box.
Somerset-based Lilley’s makes 20 brands of its own and wholesales from 17 other producers.
Marc Lilley of the family-owned firm said its eventual aim was to supply over half the bag-in-box cider sold in total.
Lilley says ease of serve and long shelf life are among its appeals. “Serving traditional cider from a bag-in-box is simple and versatile,” he says. “You can serve it straight out of the box on the back of the bar, bar fridge or trestle table at a festival, or you can have it in the cellar and either pull it up on hand pump of through a tap on the T-bar, with the serving temperature generally acceptable anywhere below room temperature.”
Westons has caught the eye with the launch of Caple Rd, aiming to replicate the success of canned craft beer in cider. It has just added Caple Rd Dry to the range.
“Consumers are becoming increasingly discerning and are becoming used to better quality products and experiences,” notes Bradman at Westons, and adds that the super-premium Mortimer’s Orchard brand is “really gaining momentum and driving increased rate-of-sale”.
Chevallier Guild at Aspall suggests that upmarket ciders “represent incredible value against the equivalent wine option, so the associated opportunity for up-selling is huge.”
He claims that mainstream new product development in cider “has simply not resonated with consumers”, with marketing spends and trade discounts only serving to raise short-term awareness.
“There is little point of difference to many other mainstream brands, the stories lack authenticity and the quality of liquid falls short of consumer expectations,” he says.
“The initial early volume charge is being followed by volume decline as consumers look elsewhere for satisfaction.
“This often means a trade up to brands that not only have genuine authenticity in terms of story, but deliver great liquid in an engaging way.”
The likes of non-Champagne sparkling wines, gin, rum and tequila are all on an upwards curve and in double-digit on-trade growth, but their combined sales still don’t match those of cider.
Trends in formats seem to shadow the trends in premium versus standard cider, with draught cider up 6.2% and packaged brands are down 2.3%.
“More and more pubs are putting on a second, or even third, cider on draught,” says Martin Thatcher, managing director of Thatchers. “Licensees are starting to realise that there’s no need to have four lagers and only have room for one cider. It’s good to give consumers choice.”
CGA figures show the number of outlets with one cider on the bar at just under 47,000 but that number is falling, while a little less than 13,000 have three or more, a figure that is growing by 3.2% (year to August 2015).
Thatchers Gold is one of the recent star performers in the on-trade and Thatcher said a lot of the company’s current development work was looking at the blending potential of different varieties rather than imminently unleashing new brands.
Around 20,000 bottles of two blends — Tremlett with Falstaff and Redstreak with Katy — have been tested in pubs local to Thatchers’ Somerset base.
Thatcher says: “It’s interesting to see how Redstreak can introduce a peppery taste or how Tremlett’s hard tannins can be softened, rounded and made more complex through blending. We’re looking at how individual varieties perform at any time or when grown in one place or another.
“There’s a lot of fine detail, which is about understanding what we can do to improve Gold but also will lead us to other ciders in the future.”
Around the world
One area gaining interest is so-called world ciders — not just the Swedish architects of fruit cider but niche products from elsewhere in Europe, the US and Australasia which are bringing a touch of exoticism to the cider fridge.
Heineken’s New Zealand brand Old Mout has been at the forefront of the trend but regional brewers and smaller importers are also coming in with more niche offerings or brands that have hit big in their own market.
Shepherd Neame is importing Angry Orchard, the number one cider brand in the US market, in kegs with a striking “angry tree” tap handle and 50cl bottles. The product is a big player in the craft range in Wetherspoon’s, which lists it in all its outlets.
Bibendum PLB is deploying the portfolio approach it deploys in its main wine business to assemble a range of world ciders distributed through its Instil Drinks division.
Its cider portfolio includes Maeloc from Spain, Hills from Australia, France’s Le Brun and Zeffer from New Zealand.
“Just like craft beer, the premium cider consumer is looking for something new, so give them it,” says Instil managing director Mark Johnson.
He advises licensees to “refresh your bottle range, take some space from mass-produced fruit ciders and, if you have the space, put a craft cider on chilled draught with appealing glassware rather than hide it at the back in a warm bag-in-box”.
The company will be having a market-testing push during the period when the Euro 2016 football tournament is on but, suggestive of a more upmarket target, “in the bars more likely to be showing Wimbledon”.