BACKGROUNDER: LCBO SUPPORT FOR ONTARIO CRAFT BEER
July 18, 2013 16:01 ET
Ontario craft beer has been an enormous success story in recent years and LCBO is proud to have been able to play a role in that. Since first being introduced to the market in 1984, locally brewed, small batch beer has steadily gained popularity and market share to become one of LCBO’s fastest-growing product categories.
Changing customer preferences have helped Ontario craft beer become an increasingly popular choice for beer drinkers over the years. Coupled with the buy local movement, organically grown products have helped buoy sales, as has the development of unique flavour combinations that appeal to people who might otherwise have preferred a different beverage.
Facts about Ontario craft beer and LCBO:
• The numbers: In fiscal 2006/07, LCBO sold 2.6 million bottles and cans of Ontario craft beer, which accounted for $4.5 million in sales. By fiscal 2012/13, LCBO sales of Ontario craft beer had increased 575 per cent since then with net sales of approximately $40 million. In 2012-13, Ontario craft beer sales led all beer segments again, with sales growth of 33 per cent.
• Market Share: More and more, people are shopping at the LCBO for domestic beer, of which a large component is Ontario craft beer. Over the last five years, LCBO has increased its market share of domestic beer sales by more than 14 per cent and Ontario craft beer has significantly contributed to this growth. LCBO is constantly refreshing and updating Ontario craft beer product selection and at any given time there are more than100 Ontario craft beers in stock.
• Beer cold rooms: LCBO is currently in the midst of its largest-ever store network expansion, with 35 new or enlarged stores opening last year and another 30 planned for this fiscal. In almost all of our new locations, and in many of the store expansions/renovations, we’ve added beer cold rooms and devoted more display space to our growing beer selection. The Local Fridge program uses dedicated space in these refrigerated sections to feature the flagship brands of Ontario craft breweries.
• More variety at more locations: LCBO offers an on-shelf Ontario craft beer program in key premium beer stores and has craft beer-specific promotional opportunities, including our annual month-long promotion starting in September. We also offer expanded product assortment and store distribution of Ontario craft beer, which makes it easier for local brewers to get their product on our shelves.
• Merchandising: Displaying craft beer in prominent areas throughout the store and grouping all formats (single cans, bottles, multipacks) help to promote sales and increase customer awareness. LCBO also uses ‘display walls’ in flagship stores, shelf-extenders and end aisles in 51 stores to draw customer attention and create interest for these products. As well, special on-shelf displays showcase Ontario’s smallest craft breweries on a rotating basis.
• Expertise: Our 150 “Beer Ambassadors” located at select stores in our network share their passion and knowledge with staff and customers alike. They are specially-trained and highly knowledgeable about the craft beer industry, its practices, and beer varieties, and are there to help customers make informed buying decisions. Our category team also gives regular seminars to Ontario craft breweries to guide them in conducting business with LCBO.
• Partnership: About 10 years ago, LCBO began working closely with the Ontario Craft Brewers Association (OCB) to help develop a strategic, long-term plan for their members that would create encourage awareness and growth in the local craft beer market. The successful alliance has been mutually beneficial to both the LCBO and Ontario craft brewers, and most importantly provides our customers with the very best that Ontario brewers have to offer. The Discover Our Community program is part of this strategy. It allows local craft brewers who are connected to local events to work directly with key stores of their choosing. The brewer benefits from increased profile of his or her product and customers get to try another great craft beer.
• See for yourself: Join LCBO experts on a 25-minute journey behind the label to meet the talented masters of Ontario craft beer. Watch this chapter of the LCBO-produced Discover series:
LCBO Media Relations Co-ordinator
Tel: 416 864-6772
Cell: 416 587-3729