Vladimir Vava, CEO of Carlsberg Srbija: We are brewing for better today and tomorrow

Our consumers are striving for innovations and we as producers must be humble and listen carefully. We are convinced that with proper business and good communication, we will achieve the set goals.

We talked with Vladimir Vava, CEO of Carlsberg Srbija, about the current market situation, changes in consumer habits in regard to beer consumption, but also about the important jubilee– 130th anniversary of the Čelarevo Brewery. Mr Vava also touched on global strategies that are implemented locally – Zero Strategy and SAIL’27, and future plans.

Vladimir Vava, CEO of Carlsberg Srbija

If 2020 was a year of challenges, 2021 was a year of the fight against the pandemic. What is the current situation on the beer market like and how would you describe last year?

Indeed 2021 was a complex year from the business point of view. Beer market contracted by 3% mainly du to the Q1 restrictions in OT channel while the season showed a strong performance, both driven by the so called staycationists (people that decided to stay home and not travel as usual) and by the solid Montenegro inflow of tourists, especially from Serbia as this beautiful country lifted all the restrictions in a very early stage. Taking into account these ups and downs I would say that beer market displayed high resilience and consumers were willing to enjoy our golden liquid as fast as the pandemic limitations eased. Year-end was almost a return to the pre-covid times, people using each and every opportunity to spend the Slava’s and other religious celebrations surrounded by friends and family. In a nutshell not a bad year taking into account the uncertainty created by C19.

Has the consumer market changed in terms of segments – premium, economy, mainstream – in recent years?

It is a very good and “at the point” question as we observe that consumers shifted from main stream and economy brands during past years and culminated with a significant decrease by 4.1 pp in 2021.In the same time the Upper, Premium and Super Premium segments grew by 4 pp showing a clear tendency in premiumization of the beer market. This move was supported by the “rise of CAN and NRGB packages” followed by a slight decline of RGB – the locomotive for the mainstream segment. And the logic behind is simple, during the 2020 and 2021 pandemic times, KA and LKA become the main channel of purchase in Off Trade where RGB pack type is less attractive for purchase so CAN boosted…in the same time OT become a wish channel for every person as the symbol or sign of returning to normality, so once re-opened (even with limitations) created a high demand for NRGB and draft format…again eroding the RGB development.


“The Serbian consumer showed high willingness to try new products, even new categories”


On the other hand, the Serbian consumer showed high willingness to try new products, even new categories, and innovation was driven mainly by Upper plus segments while the main stream and economy delivered the “old news” solely. It was a classic lesson for us as FMCG industry: we must innovate constantly in order to survive.

Carlsberg has recently announced the implementation of the SAIL’27 strategy globally. Could you tell us a bit more about it?

Sail ’27 is not a revolution; it is rather an evolution of the already well-established previous Sail ’22 strategic path. One would say “is something goes well, don’t touch it” and there is a seed of true in this saying but also, we know that doing well for long could lead to complacency and that is a very dangerous place to be. Taking this into account Sail ‘27 is continuing but boosting some of the successful trends from before focusing Carlsberg worldwide on five main pillars: 1. Portfolio choices (to highlight two:  Acceleration of the AFB and Beyond Beer categories) 2. Carlsberg Geographical priorities, 3. Execution excellence (covering among other Excel at point of purchase and Manage supply chain) 4. Winning culture (covering mainly TTZ and Live by compass) and for making everything described above possible we decided to focus on the last but of core importance: 5. Funding our journey, working hard in keeping the cost under strict control.

We are always integrating the bottom-up with the top-down strategy methods by aligning the individual countries strategies with the Global one. And yes, there are differences or areas less attractive for a specific market, however in the big strategic directions we are following the Sail ’27 strategy. Together with the local leadership team of Carlsberg Serbia Group, so called TOP 40 we’ve selected our “must win choices” from the cascaded-down Group strategy and tailor made those for our 3 markets, Serbia, BiH and Montenegro. We clearly use similarities of each of our Markets but also understand the differences as we must treat our customers and consumers with the respect they deserve.

The Together for Zero Strategy has been launched as part of a global effort to preserve the environment. What results and progress have you achieved in the previous period?

In order to contribute to global efforts to preserve the environment, the Carlsberg Group adopted in 2017 the Sustainability Strategy “Together to Zero”, which includes four areas with clearly defined goals in each by 2030 – Zero carbon footprint, Zero water waste, Zero irresponsible alcohol consumption, as well as Zero injuries at work.

Globally set goals are being diligently implemented in local markets as well. Carlsberg Serbia is working year after year to achieve the postulates, and shows evident progress in its annual Local Sustainability Report.

The Local Sustainability Report for 2020 states that in the last five years, i.e. in the period from 2015 to 2019, Carlsberg in Serbia reduced its carbon footprint in the value chain by 12 percent. Carbon emissions in production were reduced by as much as 23 percent per hectoliter of beer produced, and only in 2020, at the carbon purification station in Čelarevo, as much as 3,985.6 tons of CO2 were purified.

In the mentioned time period, from 2015 to 2019, the efficiency of water use in Carlsberg Serbia was improved by 15 percent, and with the help of wastewater treatment plants, as much as 99 percent of input materials are purified in order to preserve water flows. In addition, in order to achieve the goal of Zero irresponsible alcohol consumption, Carlsberg Serbia has undertaken a large number of activities. Thus, on the packaging of its products, it pointed out the symbols for responsible consumption, and our biggest brands, LAV and TUBORG, in 2020 drew attention to the importance of responsible consumption directly from cans to all consumers of alcoholic beverages. Also, in 2020, as many as two beer products with 0 percent alcohol were part of the company’s broad portfolio, and this year they were joined by a third product.

Carlsberg Serbia constantly takes care of its employees, and in order to achieve the goal of Zero Injuries at Work, we organized a large number of trainings and courses for its employees, because good training, but also high safety awareness, is an excellent base for minimizing injuries. The success of the courses is also evidenced by statistical data – compared to 2019, last year the rate of injuries at work was reduced by 36 percent.

Carlsberg Serbia is known for innovations (Somersby, Blanc). Will the company continue at the same pace in the future too?

As mentioned already above, our consumers are striving for innovations and we as producers must be humble and listen carefully. We see how successful were Somersby and Blanc 1664 understanding clearly that Serbian beer market shows a high degree of sophistication. Henceforth we will continue bringing novelties and surprising our consumer also in 2022 using the pre-season as the launch period of the new products. For now, I could not tell more for not spoiling the amazement!

Given that 2022 has been declared as the year of recovery, what will Carlsberg focus on this year?

Carlsberg’s focus is clear and pre-defined by Sail ’27 guidelines where we will cover the 5 areas personalized to each of our 3 markets by following closely the trends and listening to our customers and consumers.


“Globally set goals are being diligently implemented in local markets as well”


On the other hand, the next period on the market will be very challenging due to the price increase of raw materials on a global level. In addition, I firmly believe in our plan and defined strategy, as well as in the strength of our brands and a strong connection with loyal consumers to whom we will offer exciting innovations and campaigns. We are convinced that with proper business and good communication, we will achieve the set goals.

2022 is a special year for Carlsberg Serbia as it marks the 130th anniversary of the brewery in Čelarevo. What does this jubilee mean to you personally as the director of Carlsberg Serbia, but also to the company?

Our commitment is clear in Carlsberg Group: “We are brewing for better today and tomorrow”. And the 130 years anniversary of Celarevo Brewery is the right moment to emphasize our confluence between of Lazar Dunderski and J.C. Jacobsen that will celebrate 175 years of the inception of the business in Copenhagen.


Meaning of the jubilee

What does this jubilee mean to you personally as the director of Carlsberg Serbia, but also to the company?

I mention always that when I choose to work for Carlsberg, I did it for main 3 reasons: the Rich Heritage, both in Serbia and in Denmark, the Carlsberg Foundation and the huge investment the Company is doing investing into the sustainable future (TTZ).

Our purpose is something that differentiate us from many other companies in the world, as one said “while they look constantly for their purpose, our purpose was here from early 1847”.

Personally, I feel blessed and proud to be a part of the Carlsberg Serbia Group and we will do our utmost to remember, celebrate and praise our founder fathers and our rich history in the period to come.


 

Leave a Reply

Your email address will not be published.