Carlsberg Group moves global media account from OMD to Initiative

Carlsberg has named Initiative as global media, and the partnership includes its Singapore and Malaysian market. Carlsberg has also confirmed the news to A+M.

The incumbent on the account is understood to be OMD, which has worked with the brand since 2005. The global review was first called in March this year and was said to be handled by Ebiquity globally. According to global media reports, the review covers international brands, including Tuborg, Somersby ciders and Kronenbourg 1664, across 30 markets.

Last year, the company also began the development of a new commercial approach "specifically focused on helping customers to grow the beer category by better meeting consumer needs", it said. Moreover, an analysis of the allocation of marketing spend was carried out in order to ensure the right level of support for the right brands. The company said it initiated work on revitalising the Carlsberg brand and updating the visual identity of the Tuborg brand in order to keep these brands relevant for the future. Results are expected to show this year.

According to Carlsberg’s recent financials the brand has strong market positions in 24 markets across Europe and Asia, with 74% of volumes are sold in these markets. Last year, net revenue in Asia grew organically by 4%, with the price/mix of increase 6% more than offsetting the organic total volume decline of 2%.

According to the group, it has"an attractive footprint" with solid market positions in Asia. Total beer market volumes in its Asian footprint amounted to approximately 576m hl in 2016, with China by far the largest beer market. However,volumes in Malaysia were negatively impacted by the excise tax increase on 1 March. Nonetheless, growth in our premium products, price increases and good cost control ensured solid financial performance.

In Singapore, the group increased its market share as a result of its premiumisation efforts. In Indochina, Laos again delivered solid top and bottom-line growth. Water and soft drink growth in Cambodia was offset by share loss in the increasingly competitive beer market.

According to Carlsberg, the strong price/mix was a result of the growth of its premium brands as well as premiumisation efforts on local power brands and the reduction of low-priced products in China. The Tuborg brand, which remains key in its premiumisation efforts in the region, grew by 15%. Since 2013, Tuborg volumes in Asia have more than tripled. Organic operating profit grew by 6% and the reported operating margin improved to 19.1%.

During 2015 and 2016, Carlsberg’s Chinese organisation went through a comprehensive restructuring and cost-saving programme, resulting in closures and disposals of a total of 17 sites by the end of 2016. Its premium portfolio grew by 8%, with particularly strong growth for Tuborg and 1664 Blanc.

Meanwhile, Initiative, which is a media agency under the IPG Mediabrands, operates in more than 80 countries. Its clients include the likes of Dr Pepper Snapple Group, Uber, Unilever and Merck. Globally, Initiative named Mat Baxter as its global chief executive officer in July last year.

A+M has reached out to Carlsberg Singapore and Malaysia for further comment.

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