How a new beer went viral offline
Formally introduced in February, Bira 91 has already become a household brand among beer lovers in New Delhi and in Bengaluru.
New Delhi: Brewing beer wasn’t the original calling of Ankur Jain, whose first venture as an entrepreneur was a healthcare information start-up he founded in 2002.
When the venture was being incubated in New York, he frequented Brooklyn Brewery, run by a former Associated Press correspondent who opened the outlet after he had had enough of covering the West-Asia conflict.
Those visits made a big impression on Jain, 34, who had put in a brief stint at Motorola after graduating with a Bachelor’s degree in computer engineering from the Illinois Institute of Technology, Chicago, in 2002.
“From the very beginning, I understood that I couldn’t work for others. I set up my first venture in 2002. By 2007, we reached the inflexion point, and I decided to sell that company,” he said in an interview.
In the same year, he decided to return to India, having made up his mind that his entrepreneurial future lay in brewing beer. In 2008, he founded Cerana Beverages Pvt. Ltd, which started as an importer of exotic brews, and in May last year soft-launched Bira 91.
Formally introduced in February, Bira 91 (the number stands for India’s country code) has already become a household brand among beer lovers in the capital and in Bengaluru.
Bira 91 White (a low-bitterness wheat beer, as the company website describes it) and Bira 91 Blonde (an extra hoppy craft lager) are available in draft and bottle formats at 150 retail stores in Delhi and almost 70 retail outlets in Bengaluru.
“There was no marketing, no campaign. We made it available in a few pubs such as Beer Café, Monkey Bar, Raasta, Pint Room and Barsoom. People tasted it, liked it and it has gone viral,” said Jain.
The beer sells 10,000 cases a month in Delhi alone. the response to Bira 91 has encouraged Jain to sell the beer in eight other cities in the next 12 months. In July, Cerana will be taking the flagship brew to Mumbai, Pune and Kolkata, Jain said.
“Bira has evoked a phenomenal response. The feedback has been excellent from people,” said The Beer Café founder and chief executive Rahul Singh.
Hard work went into the success. Jain spent the first couple of years after returning to India on understanding the beer market, including undertaking a three-month road trip across Europe to identify beer brands that suit the Indian palate.
The trip included countless pub crawls and visits to breweries and even expensive restaurants that served exotic beers.
“Initially there was this guilt of spending money that I had earned selling my first baby (a healthcare start-up). But then it was work, not luxury for me,” Jain said.
When he returned home and set up Cerana Beverages, the company started by importing beers that only connoisseurs were familiar with.
Even now, Cerana imports about 20 brands, including several Belgian beers.
“I had to understand the market more before I could jump in with my own brand,” he said.
By 2013, Jain was ready to launch his own brand.
He reached out to his friends from college and collected
$1 million from half a dozen of them. A brewmaster from Belgium was hired as a consultant.
“The aim was to fill the gap in the market for a trendy, unorthodox, fun and smart brand of beer that could be positioned between Indian brands and the expensive imported beers. The focus was on taste and experience in a market that is dominated by strong beers,” says Jain.
The logo of Bira 91 is a reverse B, which Jain says shows “a spirit of rebellion against the conventional”.
Bira 91 was “imagined in India” and made in Belgium with French and Belgian malts, hops from Himachal Pradesh, and water from a source near the contract bottling facility in Delhi.
It is a mild variety of beer, much milder (with alcohol content below 5%) than other beers in the Indian market dominated by strong beers including Kingfisher, Kalyani Black Label, Carlsberg Elephant, Budweiser Magnum and Miller ACE.
Around 280 million cases of beer were sold in India in 2014, of which about 85% was strong beer. Only 20 million cases of premium beer are sold in the country.
Jain’s target is to reach sales of one million cases a year by the end of 2015 (up from 10,000 cases a month in the Delhi market now), his ambition fuelled by the response to Bira 91 in Delhi and Bengaluru.
“The growth has been fast, much faster than we could have imagined. The aim now is to be among the top three in every market that we will be present in by the end of this year,” says Jain.
He wants to continue with the two variants and add one more by the end of the year and eventually brew the beer in India. To scale up, Jain said the company has decided to lower prices from Rs.150 a pint to Rs.100 over the next few months.
If price isn’t a barrier to growth, why does he plan to lower it?
Jain’s rationale is simple—Bira 91 needs to combine availability with affordability in its category. “We could have worked out a lower price. But taxation is something that we can’t control,” he adds.
Tax for beer differs from state to state, ranging from 25% in Goa to 65% in Maharashtra.
However, he said the market for all draft beers put together is minuscule at the moment. “We will have to wait and watch,” he said.
Singh of The Beer Café is upbeat. He finds Indian consumers are willing to experiment with beers and demanding a wider choice. “They want variety in yeast content, malt strength and flavour, and that’s why draught beer is in great demand. It’s a new category in India, but has seen double-digit growth,” he said.
Bira, he added, has the potential to be a global brand with an Indian identity.
Cerana has six partners who own about 75% of the company (the remaining stake is with a bunch of individual private investors). The company employs 50 people, of whom 25 have been added in the past 45 days.
“By the end of the year, we’ll have about 300 people,” Jain said.
From a beer that’s “imagined” in India, Jain wants Bira 91 to become one that’s made in India. By October-November, Bira 91 will be produced in India, initially with two contract manufacturers—one each in Maharashtra and Rajasthan.
Cerana Beverages now generates $1.5 million a month—about 95% from Bira 91 and the remaining from imports of other brands.
To scale up. Jain is in talks with private equity investors and venture capitalists for $10 million in Series A funding, which is expected to be closed in the next couple of months. “This would be deployed over the next 12 months from the time we raise the funds,” he said.
Heady on his brand’s initial success, Jain claims the game is yet to begin.
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