Interviewer: Stewart Park from Shanghai (S)

Interviewee: Jacqueling Speek (J)

S: How long have you been with Heineken?

J: For 12 years, I started working at our China headquarters in Hong Kong in 1999. Before this, I was working in Argentina, where I was also responsible for marketing the Heineken brand, and I have been area export manager for Southern Europe. Originally, I am from the Netherlands.

S: Tell us about Heineken's presence in China and your target market.

J: We have been doing business in China in a more formal and structured way since the mid-1990s. We set up our main office in Hong Kong and now have five regional representative offices all over the country, including one in Shanghai. For us, China is a growing market with a large potential for the future.

We target young and outward-looking people with a more cosmopolitan and active lifestyle. Generally speaking, they are a new generation of urban professionals who are moving up in society and have adopted drinking beer as part of their lives.

S: What type of events do you sponsor in Shanghai?

J: With Heineken we focus mainly on sports and music activities. Heineken is the founding sponsor of international tennis in China with the sponsorship of the Heineken Open Shanghai since its start-up in 1998. As the title sponsor, we are interested in building up an international and dynamic atmosphere around the event.

S: Apart from tennis, what else do you focus on?

J: Our other major platform of sponsorship in China is music, as it is very close to the heart of our target consumers. The Heineken Beat open-air festival in Beijing has been a big success over the last three years, and we feel that music events fit in very well with beer drinking moments. Heineken was also a sponsor of the Beijing Olympic Bid Committee for the 2008 Games.

S: How do you associate beer with sports?

J: We associate ourselves through event sponsorship, such as the international Heineken Open tournament. We can't really say that we involve ourselves directly with sports. For that matter, Heineken will not sponsor sports stars or teams.

S: Local beer companies have been stepping up their promotion campaigns in the face of competition from international brands. Heineken and Budweiser are competing with the likes of local brands Tsingtao and Reeb through advertising and sponsorships. How do you see the situation developing?

J: The first brewery to set up in China was Tsingtao, just 100 years ago. It is very different from Northern and Western Europe, which has a long tradition of beer brewing and a real beer culture. Nowadays, in countries such as the UK, USA and the Netherlands the average consumption is 80-90 litres a year. In China, beer is a relatively new and developing product, with consumption less than 20 litres per person. The selling of brands rather than just a commodity product is a fairly recent market phenomenon. So competition has really only just started. Up until five years ago, there were over 800 breweries in China. Today only 450 have survived, which shows an increasing concentration in the brewing industry. Large groups are emerging and buying out smaller breweries. Meanwhile, consumers are also gaining beer knowledge and experience and becoming more aware of brand image and quality aspects.

S: Do you think local consumers care much about ingredients and quality or are more concerned with image?

J: I think Chinese consumers are very selective and know how to choose the best quality beer.

S: How do you see the local beer market evolving over the next five to 10 years?

J: We expect that a couple of large brewery groups will dominate and strong local brands will develop into regional brands. There will be a significant share of premium beer, similar to that in more mature beer markets around the world.

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