Canada’s Top Breweries Continue to Struggle
Molson Inc. has fired the top marketer on its flagship Canadian brand, the
latest sign both of the countries megabrewers continue to struggle to turn
around their most profitable brands.
Montreal-based Molson, which along with Labatt Breweries of Canada account
for 90% of beer sales, has let go Sean Moffitt, vice-president of marketing
for Molson Canadian, after six months on the job. Mr. Moffitt, a beer
marketing veteran, joins a string of short-lived managers of the brand.
“At six months in that job you get a gold watch,” said an executive with a
rival brewer. “They go through them so quickly I haven’t even met him.”
Canadian, Molson’s largest and most profitable brand with about 11% market
share nationally, has lost a full share point over the past year. Each share
point is worth about $23-million in profit.
A Molson spokesman said yesterday the vice-president “was let go as part of
a reorganization of the marketing department.” No other changes were made
and the brewer has not decided whether to replace him.
Molson president and chief executive Dan O’Neill, who has won praise for his
efforts to turn around the brewer’s profits, if not its market share, over
the past four years, spoke angrily about the company’s share weakness on a
conference call last week. In the key markets of Ontario and the West it
fell an unprecedented 1.5 share points during the April to June period.
While Molson’s marketing department has seen a flurry of faces come and go
during Mr. O’Neill’s leadership, Labatt has made the most changes in its
executive suite. Last month, Belgian parent Interbrew SA announced European
executive Stewart Gilliland would be taking over as president of its
Canadian business and its current president Bruce Elliot would be leaving
“It is certainly disruptive to the organization — he will be the fifth
president in six or seven years,” noted beer analyst Michael Palmer.
Labatt has the luxury of operating more or less as a private company in
Canada. Although it is part of publicly owned Interbrew, it does not have to
divulge market share or profit figures for its operations here, which can
allow management to take a longer-term approach to the market, observers
say. The Canadian company also has the luxury of being able to tap
Interbrew’s international portfolio to sell imported brands such as Beck’s,
Stella Artois and Hoegaarden here.
The rising share of imported brands in Canada, which have doubled in recent
years to about 10% of the market, are responsible for much of the decline of
brands such as Blue and Canadian. Molson acts as the distributor and
marketer for the fast-growing Heineken and Corona brands and this spring
launched Marca Bavaria from Brazil, sold, like Mexican-brewed Corona, in a
clear bottle. (Source: National Post)