Posted March 2020
Local is the new global
Localism ǀ The globalist dream was persuasive. As the world’s economies grew more interdependent, consumers revelled in the fantasy of the world becoming a single place, and all of us living together like a family. TV channels, movies, and music became universally available. The internet took over our lives. We were happy to see “superbrands” like McDonald’s, Starbucks, Coca-Cola, Pepsi and Heineken anywhere we went. They made us feel part of something bigger and gave us a sense of belonging. So when did globalisation become a dirty word?
The globalisation of the brewing industry, which covers the period 1990 to 2015, from the Fall of the Iron Curtain to AB-InBev taking over SABMiller, will eventually be seen as the textbook example of companies successfully going global. While global beer output rose from 1.3 billion hl (1998) to 1.9 billion hl (2018), erstwhile regional champions snapped up other brewers one by one. By embracing the tactic of “buy and build”, AB-InBev, Heineken and Carlsberg bulked up and became the multinational behemoths – the Big Brewers – they are today. Combined AB-InBev, Heineken, Carlsberg and Molson Coors control half of the world’s beer production. AB-InBev alone is responsible for a quarter of all beer drunk on this planet.
In North America and Western Europe, lots of consumers would not have noticed that their domestic brewers had changed hands. How should they have known that a Belgian-Brazilian firm had bought Budweiser, or that Danish Carlsberg had acquired the Holsten brewery in Hamburg, unless they diligently followed the business news? For as long as their traditional brands continued to be available, they probably could not care less about consumer brands quickening their pace to reach the farthest corners.
Not so in other parts of the world. I remember travelling through Malawi, a landlocked country in southern Africa, in 2001, armed with Naomi Klein’s first book, No Logo. Her anti-globalisation treatise took aim against superbrands for swamping our lives and selling us an idealised lifestyle, rather than the physical product itself. Its publication came soon after the “Battle of Seattle” (1999), the first of violent anti-globalisation protests, when tens of thousands rallied against the World Trade Organisation, and the global corporate interests it represented. As marchers stomped on cans of Coke, they were met with tear gas and rubber bullets.
In dirt-poor Malawi, I finally grasped how the promises of globalisation had impacted consumers’ purchasing behaviour. All of the roadside shacks sported huge billboards, screaming Coca-Cola, Carlsberg, Lipton’s tea and other Western consumer brands. There was no escaping them. Mind you, you could not fault Malawians for desiring them. Not only did they vouch for a better quality than local wares, they also delivered on consumers’ aspirations. “Local brands show what we are; global brands show what we want to be.” In Malawi and elsewhere, consumers looked to global brands as an entry ticket to an imagined global culture and community, which they could share with like-minded people.
In retrospect, the year 2008 was the high water mark of the 21st century’s faith in globalisation – as well as its turning point. In July 2008, InBev surprised the world by taking over US brewer Anheuser-Busch for the then staggering sum of USD 52 billion. Feebly, Anheuser-Busch had tried to fend off InBev’s advances by appealing to its consumers’ patriotism. On the internet, plenty admitted to being truly upset that Budweiser would no longer be American made and owned. But Anheuser-Busch’s jingoistic knee-jerk proved futile, as investors had long decided that their money was better served by what was to become AB-InBev than the old Anheuser-Busch.
Globalisation has run its course
A few weeks later, in September 2008, the investment bank Lehman Brothers went bust. The world tumbled into the Financial Crisis and globalisation became a malediction. So did the word “Big” – as in Big Business, Big Agriculture, Big Government. Big, with a capital B, turned Bad. Obviously, the globalisation of the brewing industry continued apace. Yet the whole process began to feel almost fatalistically predetermined. Even when AB-InBev bought the world’s number two brewer, SABMiller, in 2015 for the eye-watering sum of USD 100 billion, the general sentiment in the industry was only a dispassionate “Ah well”. To all appearances, SABMiller had resigned itself to being acquired one day, which meant its ostentatious protests against a takeover were more about driving up the price than anything. With SABMiller gone, the globalisation of the brewing industry drew to its close. There was nothing major left to buy.
In my view, 2008 was a pivotal year for the brewing industry. While talk about globalisation schemes and tactics beat a retreat to secretive board rooms and bankers’ clubs, consumers for their part began to rewrite the narrative of globalisation, first in the US, and later in other markets too. In 2006, historians say, social media took off in a big way. Consumers became digital warriors. By extolling the virtues of craft beer on internet platforms, they conquered the discourse of beer itself and relegated global beer brands to commodity status.
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