Uphill climb in taking beer battle to Suntory

Reeb, Shanghai's home-grown beer brand, which was launched at a time when Shanghai's products enjoyed nationwide renown, stands almost alone as a reminder of the past in a city which is undergoing tumultuous change. The seemingly insatiable appetite for foreign brands that has characterised Shanghai's dramatic renaissance over the past 15 years signalled the end for many local products, but not for Reeb, which retains a relatively strong market share. Shanghai's local tipple, however, has been deposed as the city's favourite beer by Japan's Suntory. The Japanese beer secured market leadership just four years after launch, with adroit marketing to establish itself as a drink for Shanghai's younger generation, the energetic urbanites at the vanguard of the city's transformation. As a result, Reeb appears old-fashioned and unhip. Suntory's lighter taste, in marked contrast to Reeb's rounder flavour, also played well in a market where beer is often drunk with food at restaurants. Reeb, still the city's second best-selling beer and with no serious rivals nipping at its heels, set its sights firmly on recapturing its crown, staking its future on its links with the past. This strategy, capitalising on Shanghai's civic pride, has had its successes, particularly in its 'I Love Shanghai' TVC. This Bates-developed ad soon became known for an unashamedly rousing song that proved a citywide hit in Shanghai's bars and karaoke parlours. The beer's owner, Asia Pacific Brewery, has also introduced a new, less robust variant, Reeb Superlite, which has managed to reclaim ground in restaurants. However, despite these advances, Reeb is still a long way from the number one spot, with an estimated market share half that of Suntory's. For a mass-market beer, volume is key and Reeb hasn't succeeded in mounting a sustained challenge strong enough to make substantial inroads into its rival's strongholds. Although the heritage card looks like the right one to play, the rapid changes sweeping through Shanghai mean the strategy could backfire if Reeb's marketers aren't careful. 'Made in Shanghai' may have lost its cachet and Reeb must tread carefully, lest 'Brewed in Shanghai' suffers the same fate.