Asia Pacific Breweries Singapore investing in tech and data analytics to meet ‘unique and experiential’ demands of younger consumers

03-Jun-2024 - Last updated on 03-Jun-2024 at 03:08 GMT

APBS has observed significant differences in the alcohol-purchasing behaviours of millennials and Gen Zs. ©APBS

Asia Pacific Breweries Singapore (APBS) says that it is actively addressing the complex needs of the new generation of beer consumers through strategic investments and portfolio diversification.

A part of The HEINEKEN Company, APBS’s portfolio includes Tiger Beer, Guinness, Heineken, ABC Stout, Anchor Beer, Baron’s Strong Brew, Archipelago Brewery, and more.

As a leading brewer in South East Asia, the company has observed marked differences in the purchasing behaviours of millennials and Gen Zs compared to older age groups, which have sparked new challenges as well as innovations to tackle them.

“Beer is a social catalyst whose broad appeal makes it a popular beverage of choice at casual dinners, special occasions, and cultural events. What we have noticed is that millennials and Gen Zs, driven by a thirst for new experiences, actively seek out novel flavours, turning beer consumption into a journey of exploration.

“Whether it’s discovering a new brew or sharing the latest find with friends, they see beer as more than just a drink, but also a conversation starter and an expression of identity. In contrast, older generations are more hesitant to move out of their comfort zone,” Gerald Yeo, Marketing Director of APBS, told FoodNavigator-Asia.

Yeo added that although older consumers do not reject new drinks, they generally stick to the same flavour profile. And if they do try something new, convenience is key — for example, products placed near the cashier.

According to Yeo, the drivers behind the younger generation’s purchasing decisions are multifaceted.

“Family and peer influence play a significant role, particularly among first-time drinkers. Many begin with sweeter alcoholic beverages, guided by social circles and familial norms.

“As they mature, they look for new and exciting flavour profiles that challenge their palate. Nevertheless, even as they develop their tastes, there’s a tendency to gravitate back towards familiar favourites when they get older.”

In addition, ABV level, cost, and packaging are said to wield considerable influence too.

“Singaporean consumers, known for their pragmatism, factor in the ABV level in the price-value equation. They seek a balance between alcohol content and product price. Younger consumers, who are just starting to earn their own income, are also more price-sensitive.

“Despite being mindful of costs, it does not deter them from choosing quality brands, especially when socialising with friends. They prioritise value and are willing to spend on reputable brands. Moreover, eye-catching and disruptive packaging designs capture their attention, creating an important first impression that affects purchase decisions.”

Findings from a recently published survey by the Singapore Beer Industry Association (SBIA) showed that among 600 respondents, 75% listed beer as their favourite alcoholic drink, surpassing wine and spirits.

Recognising the importance of consumer insights, APBS has put aside S$4m (US$2.95m) in 2024 to invest in technology and data analytics.

“This would enable us to stay abreast of evolving consumer preferences and tailor our offerings accordingly.

“Additionally, the rise of social media has transformed consumer behaviour, making it essential for brands to engage and resonate with audiences across various online platforms. We will also look into developing unique and experiential products that appeal to the younger demographics.”

Innovating to stay competitive

In order to build and maintain brand loyalty, and stand out amid increasing competition, APBS is actively diversifying its product line-up.

“In the hunt for growth, beverage companies are experimenting in new categories, blurring the lines of beer, soda, and spirits. This has significant implications for the industry as a whole, as it challenges traditional notions of product categorisation, leading to increased competition among companies vying for market share in this evolving landscape.

“It also highlights the importance of adaptability and innovation for companies looking to stay ahead in a rapidly changing market. Our focus remains on high-quality products that best meet the diverse needs of consumers across drink-appropriate occasions,” said Yeo.

For instance, the company has expanded beyond beer into low- and no-alcohol, flavoured, and less-bitter variants. These include non-alcoholic beer Heineken 0.0 and Tiger Soju Infused Lager.

“These more-inclusive products aim to excite and delight existing consumers, and recruit new drinkers. Consumer centricity and relevance is at the heart of all our innovations. This entails not only anticipating but also shaping consumer needs through creative product development and engaging experiences, even at the moment of consumption.”

In addition to product innovation, APBS is prioritising “authentic and transparent” communication with consumers.

“By leading discussions on responsible consumption and supporting initiatives that address harmful drinking habits, we are fostering a culture of awareness and social responsibility. Furthermore, through a wide-ranging portfolio of beers, we provide consumers with greater options.”