Dia 1

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Industry operators research interests and
priorities
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Industry operators research interests and
prioritiesAn attempt to cover some aspects
using the Nordic countries as a case
The Alcohol Policy Arena Positioning Science,
Knowledge and Policy in Relation to the Alcohol
Industry, Dublin 15-16 May 2008
by Matilda Hellman1, Thomas Karlsson2,
and Esa Österberg2
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2)?
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Industry operators research interests and
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Contents of the presentation

• Introduction (Matilda)?
• The Nordic alcohol industry (Esa)?
• Alcohol industrys research interest and Nordic
  experiences (Thomas)?
• Some results from our survey questionnaire
  (Matilda)?

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Industry operators research interests and
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Shift towards more entrepreneurial research
activity

• Driving force the intensification of
  international competition in business and
  industry
• Raises potential conflict of interest questions
  and normative conflict between the expectations
  and standards of academia and those of private
  enterprise. (Etzkowitz, Webster Healey (1998)
  Capitalizing knowledge. New intersections of
  Industry and Academia)?
• ..success of the firm depends on the potential
  of the creativity and infrastrucrute in respond
  to market demand (Gibbons et al. 1994)?

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Nordic alcohol monopolies

• Norway Vinmonopolet had from 1922 to 1996
  monopoly on alcohol production except on beer.
• Iceland ATVR had from 1922 to 1996, monopoly on
  alcohol production except on beer.
• Finland Alko had from 1932 to 1995, monopoly on
  alcohol production but all beer and part of fruit
  wines were licenced to private producers by the
  monopoly.
• Sweden Vin Sprit had from 1955 to 1995,
  monopoly on all alcohol production except on
  beer.

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The number of brewery plants and brewery
companies in Finland in 1950-1980
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The number of alcohol producers in Finland in
1980-1997
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Concentration of the production of distilled
spirits and wine in the Nordic countries since
1995

• The Danish private distilled spirits monopoly De
  Danske Spritfabrikker was sold to the Swedish Vin
  Sprit in 1999.
• In Finland, the fruit wine production of Chymos
  and Marli was merged in 1999 to Nordic Wine Group
  which was bought up in 2002 by Vin Sprit.
• In Finland Altia, the former production part of
  the Alko is still the most imprtant producer of
  distilled beverages. In 2000-2004 it, however,
  sold the Finlandia Vodka to Brown-Forman.
• In Norway the production monopoly was in 1996
  named to Arcus. Argus was privatised in 2002.
• Vin Sprit was sold to Pernod-Ricard in 2008

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Concentration of brewing industry over the
borders in the Nordic countries before 1995

• In Denmark Carlsberg and Tuborg were merged in
  1970. (In 2000 Carlsberg Brewers had 85 brewery
  plants in 46 countries).
• In 1991 the biggest brewery in Finland Hartwall
  and the biggest Swedish brewery Pripps jointly
  grounded Baltic Beverage Holding to be active in
  brewing on the former Soviet Union territories.

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Concentration of brewing industry over the
borders in the Nordic countries after 1995

• In 1995 Norwgian Ringnes (Orkla) bought up
  Swedish Pripps. Ringnes (Orkla) also got a
  minority shareholder position in Hartwall.
• Carlsberg bought up the second biggest Swedish
  brewery Falcon in 1996 and in 1998 the second
  biggest Finnish brewery Sinebrychoff, which owned
  the Vena brewery in St Petersburg.
• In the years 2000-2004 Orkla's brewing
  activities were merged with Carlsberg.
• In 2002 English Scottish Newcastle bought up
  Hartwall.
• In 2008 Carslberg and Heineken bought up Scttish
  Newcastle. Heineken got Hartwall and Carlsberg
  the Baltic Beverage Holding.

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Market studies and consumer profiles

• The vast majority of research commissioned by
  the drinks industry is, hardly surprising, market
  investigations and consumer profiles.
• The UK based website just-drinks.com
  (http//www.just-drinks.com), contains for
  instance links to 4 000 market reports. The
  biggest suppliers are Euromonitor, Datamonitor
  and Canadean, which are widely used by the
  beverage alcohol industry as a source of business
  intelligence.
• Looking at the alcohol industry by beverage
  type, beer emerges as the most researched
  beverage type (354 reports). A lot of market
  studies are also conducted regards to spirits
  (286 reports) and wine (210 reports).
• Producing market analysis seem to be lucrative,
  as prices for the most extensive reports can be
  over 5 000 .

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but also other research areas are of interest!

• Industry financed research institutes, in this
  case ICAP, produce a variety of different
  publications (Book Series, Reports and Reviews).
• Half of all publications published by ICAP deal
  with different aspects of drinks and drinking
  practices. Almost a third of the publications
  deal with different policy interventions. Topics
  covered in this category are for instance
  Education, Alcohol in the workplace, drunk
  driving, age limits, self-regulation of
  advertising and violence.
• Only two publications ( a report and a review)
  deal with issues on taxes and availability.

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The case of Alcohol Update The Swedish Retail
Institute (HUI)?

• In September 2007 Alcohol Update (an industry
  sponsored newsletter discussion forum) together
  with the Swedish Retail Institute (HUI),
  published a report New prerequisites for
  Swedish Alcohol Policy.
• The report focused on travelers alcohol imports
  and the growing black markets of alcoholic
  beverages, and discredited the official alcohol
  imports figures. By claiming that alcohol import
  figures were higher and that the alcohol monopoly
  was underachieving, the report concluded that
  alcohol taxes should be lowered.
• Journalists had the possibility to read the
  report beforehand, whereas the researchers from
  SoRAD who were criticized, were not given this
  possibility. According to Alcohol Update the news
  value of the report would diminish if this was
  done. During Alcohol Update meeting where the
  report was published the SoRAD researchers were
  not given ample space to defend their findings.
• The HUI report was quite unscientific, and did
  not contain any big or new revelations. Because
  of its speculative nature, the whole exercise
  received very little publicity, and it remained
  unclear what the new prerequisites for Swedish
  alcohol policy in fact were.
• The report is a good example on industry
  commissioned research, using biased research.

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The case of travelers' alcohol imports the
brewing industry in Finland

• Before 2004 both the Ministry of Social Affairs
  and Health as well as the Brewers Association
  commissioned their own survey on estimating the
  level of travelers' alcohol imports. The
  estimates were gathered by the same research
  institute (TNS Gallup), but with different
  questionnaires, and the results were published
  only a few weeks apart.
• The two estimates differed a lot from each
  other. This created confusion both in the media
  and in the public as well as with TNS Gallup
  themselves, who had difficulties in defending the
  figures in public, i.e. they couldnt fully
  defend one figure without discrediting the other.
• By initiative of TNS Gallup discussions on
  combining the two surveys into one joint survey
  was started in 2004. The design of the new survey
  was inspired by SoRADs Monitor project and the
  first joint data gathering was made in November
  2005.
• The expenses of the joint survey was divided
  equally between the industry and state
  authorities and the analysis of the material was
  made by TNS Gallup, together with STAKES.
• So far the research interest of the industry and
  state authorities have not been contradictory,
  and the figures obtained in the survey have been
  approved by all parties. This is at least partly
  because the interpretation of the survey results
  has been outsourced to TNS Gallup and the
  researchers at STAKES.

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SURVEY QUESTIONNAIRENordic alcohol beverage
industry views on research and information

• Web survey, web address posted by e-mail to 153
  companies in the Nordic countries.
• Of the companies
• 4 retail sale monopolies
• 22 breweries
• 105 importers/ brand representatives/wholesale
• 22 supermarket chains retail
• 12 answers, three feedback letters
• However, the ones that answered represent a very
  large part of the Nordic alcohol market. Not
  possible to generalize, but some features that
  make up a profile of the ones that answered.

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Some features based on the survey
(1/5)? Important information and research topics
(acc. to the respondents)?
Information on the taste preferences of
different population groups Information on the
impact of educational programmes on alcohol
consumption by young people Evaluations of the
effectiveness of other alcohol prevention
policies (limited sales hours, age limits
..etc.)? Information on trends in the
occurrence of acute social harm caused by alcohol
(drink driving, violence, accidents, drunken
behaviour etc.)? Insights into motivations
underlying binge drinking General remark On
average, the respondents seemed interested in
information and research
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Some features based on the survey (2/5)? Ongoing
research and information gathering
The companies conduct themselves Tests to
determine the quality of your company's alcohol
product(s)? Studies of consumer perceptions of
brands and brand images Studies of the taste
preferences of different population groups
Remarks Some of the research that was
considered very important in the previous section
was considered important, is not being conducted
by the companies themselves.
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Some features based on the survey
(3/5)? Research that the companies do not conduct
Studies of the genetic mechanisms involved in
alcohol dependence Studies of the health
benefits of alcohol consumption Studies of
population-level trends in the incidence of liver
cirrhosis or other somatic diseases Remark The
respondents do not conduct medical and biomedical
studies regards to alcohol use, and do not seem
interested in it.
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Some features based on the survey
(4/5)? Attractive research and information
sources
Trade organizations in the alcohol beverage
industry (e.g. market reports and statistics)?
Consulting firms (information/ reports purchased
by the company)? Social research on alcohol
conducted by government research institutes (e.g.
consumption trends, polls on attitudes towards
alcohol use, trends in damage caused by alcohol
consumption produced e.g. by STAKES (Finland),
SIRUS (Norway), SORAD (Sweden))? Remarks
Academic institutions were not considered as
important as f.ex. STAKES, Sirus.
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Some features based on the survey
(5/5)? Statements that the respondent were asked
to take a stand on
A majority fully agreed that All publishing
scientists who are directly or indirectly
supported by the alcohol industry should be
required to declare their interests. Alcohol
education and information is an effective way of
influencing people's drinking habits. Different
opinions There are some health benefits from
drinking small amounts of alcohol every
day. Banning alcohol advertising will reduce
alcohol consumption among the under-aged.
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Conclusions
Industry operators research interests and
priorities
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In the Nordics developments in the industry
structure in the past 10-15 years. Brewing is
concentrated. Two main international players
Carlsberg and Heineken. Lots of distilling and
fruit wine making in the hands of
Pernod-Ricard. Some more cases of industry
involvement in research and information
production has emerged during recent years.
Industry seems interested in and open to new
information and research depend on outside
sources and research institutions for some of the
information they consider very important
http//www.nad.fi/wk