This story was originally published in TravelDine India by Vernika Awal.
After acquiring The Beer Cafe, Bira presents its own taproom experience — a move that even the behemoth Kingfisher hasn’t pulled off in India.
On October 12, a regulatory filing highlighted one of the most significant acquisitions in the food and beverage industry of India this year. Bira 91, the makers of the popular homegrown beer range, acquired the also-popular alco-bev retail chain, The Beer Cafe. The move was an all-stock deal, which means that Bira 91 now has full ownership of The Beer Cafe’s business. If you are a beer lover, you’re likely in tune with what both these brands represent for beer, and what each has done to democratise and liberalise beer drinking in India. It is this that made the acquisition largely significant, and one that could define the homegrown beer industry in the near future.
The importance of The Beer Cafe
Ever since the opening of its first outlet in Gurugram — incidentally known for its undying love of alcohol — in April 2012, The Beer Cafe cultivated itself into a 33-outlet chain over the past decade. It offered a quirky, casual yet warm interiors that did not take itself too seriously — the perfect aesthetic for the target audience of beer drinkers. It is, in many ways, different from the legacy watering holes of cities — Kolkata’s Olypub and Mumbai’s Gokul come to mind straight away.
As its competition, the venture has had comrades such as Doolally Taproom to contend with. But, whichever way you look at it, there is no denying that The Beer Cafe set off an enduring trend of making beer a light, casual drink that you can catch up with colleagues, friends, acquaintances and even dates over. It did not need elaborate planning, and even if you were not deeply into alcohol, the drink on-tap experience is one that gave a breezy vibe akin to what Goa has offered for generations.
A beer-based business upstart
Ankur Jain, the founder of Bira, seemingly started selling us beer after having returned from the US following his stint with a healthcare startup. Through this transition, what Jain reportedly witnessed was the lack of a ‘casual’ beer — Kingfisher and Haywards, which enjoy popularity here, are often deemed as rather hardcore.
In 2015, Bira entered the Indian consumer market, armed with quirky packaging and a range of options in terms of flavour and alcohol content. It was an instant hit, with reports claiming that the brand hit shipments of a million cases per year in less than three years of operating in India. The company has continued to report stable financial figures since — with its FY21 financial report showing a reduction of 30 per cent year-on-year in its net loss, despite closures due to the pandemic.
Today, while the behemoth United Breweries continue to enjoy the largest market share, there is no denying that Bira has captured its own mind share among the patrons of beer. An October 2021 report from private equity marketplace tracker Planify pegged Bira’s overall market share last year at 2.5 per cent — and its market share in the ‘premium’ beer segment at 10 per cent. Given that the company is up against giants such as UB and Anheuser-Busch InBev, which markets Budweiser in India, the young company’s impact is undeniable.
Setting a business trend?
Going beyond the business for a bit, there is no denying that Bira brought with it an attitude and vibe that matched the taproom spirit that was also just growing in the country. With its light-hearted packaging and marketing intent, Bira quickly became one for the millennials.
It is perhaps this that set Bira up for its eventual acquisition of The Beer Cafe. With vibes and approaches that match each other, what Bira has achieved is that even with a minority market share, it has now established its own chain of taprooms across the country.
In its joint statement announcing the acquisition, Bira spoke of expanding the “Bira taproom experience”. So far, in the Indian alcobev industry, such a brand-driven experience has been scarce. A potential similarity may be found in Dutch beer giant, Heineken–and its association with the European footballing authority, UEFA.
Linking a visible restaurant chain that’s present across 15 cities with a brand gives Bira the equity to craft a beer experience to its own taste. Even if it cannot take on the off-counter sales of a brand like Kingfisher, establishing a one-of-a-kind taproom experience would give Bira plenty of mileage to amp up its beer sales in the country.
A potential way forward
Ever since Bira has made its mark, hundreds of young beer brands have made it to urban homes. From relatively lesser known ones such as Lone Wolf to the comparatively more popular ones such as Simba, the choices are plentiful–and each have their takers for taste.
In such a market, the business model put forth by Bira 91 and The Beer Cafe could be a potential trendsetter–and show the way for future brands to follow, in order to expand in the country. A 2020 market report by Expert Market Research pegs India’s beer industry to have been growing at an annual rate of 6%–faster than before, but still slower than developing markets with potential.
How its bets pay off is something that will only be seen in the years to come. But, for the time being, the Bira 91-Beer Cafe association looks set to be one that becomes a milestone in the chapter of young beer experiences in the country.