I don’t know why I subscribe to Forbes, the articles generally aren’t that good, but I found this article about Heineken’s new keg interesting both from a business perspective and as a Heineken drinker, The Keg That Scored:
The retail kegs represent perhaps $300 million in revenue after the impact of lost sales from bottles and cans, but they offer more than that. They are still scarce enough that grocers can pocket 35% to 40% gross margins on them–17 to 20 percentage points better than what they typically get on a six-pack. That buys Heineken the bargaining power it needs in the U.S. to get coveted end-of-the-aisle floor space–and a novel means to promote its new beer, Premium Light, which boosted sales 12% last year but has recently missed growth targets.
Heineken spent an estimated $15 million on a keg production line at its giant brewery in Zoeterwoude, South Holland. At full speed the new line can churn out 120,000 kegs per day, holding 6% of Heineken’s 19-million-barrel annual production worldwide. The minikeg is something Heineken’s big American rivals cannot easily copy. Each drum holds 5 liters, or 14 bottles. Bottles of Budweiser or Miller retail for $5 a six-pack, too low a price to support the cost of a disposable keg.
Does anyone else remember the Bubba? 5 litres of Canadian, perfect for a night of drinking. Plus they looked cool.