Curry houses, not pubs, priority for new Cobra owners

Molson Coors has suggested that it sees the priority for its newly-acquired Cobra beer brand as being consolidating distribution in curry houses, rather than further expanding into pubs.

It follows Cobra Beer just over a week ago being bought out of administration by a joint venture controlled by Molson Coors UK operation.

Cobra Beer, which predominantly supplies bottled beer to Indian restaurants, had launched a high-profile push into pubs in April 2008. It appointed a crack team of on-trade marketers, relaunched the brand and ran a pub-based sampling campaign. Although the £14m marketing activity resulted in a 20 per cent year-on-year sales increase in the nine months ended April 30, 2009, the company soon fell into financial difficulty.

"The investment model was not sustainable in the current environment. The business had over-extended itself," said Molson Coors director of communications Scott Wilson. "The priority for us is to secure where the brand is strongest, in Indian restaurants."

He added that Molson Coors sees pubs as an opportunity in the longer-term, and would have natural advantages over Cobra Beer in its ability to penetrate the market through its stronger distribution network. "We have a larger sales force and can make a clearer portfolio play to our on-trade customers," he said.

The deal has strengthened Molson Coors' world beer portfolio, bringing Cobra alongside Grolsch, Grolsch Blonde, Grolsch Weizen, Sol, and Blue Moon. Wilson said: "Cobra is very complimentary to our other brands. The trick to a portfolio is appealing to diverse tastes and to sitting brands side by side each other without overlapping."