Metro-Richelieu launches first private label beer in Que.

Montreal: Good cheer and raised glasses were the order of the day at the splashy Montreal press conference called to launch Quebec's first private label beer.The launch of Metro-Richelieu's 4.9% Norois Premium lager was especially satisfying for the company and the...

Montreal: Good cheer and raised glasses were the order of the day at the splashy Montreal press conference called to launch Quebec’s first private label beer.

The launch of Metro-Richelieu’s 4.9% Norois Premium lager was especially satisfying for the company and the beer’s brewer, Lakeport Brewing of Hamilton, because it had been opposed for better than a year by the Quebec Brewers Association, the two principal members of which are Brasserie Molson O’Keefe and Brasserie Labatt.

Molson and Labatt have sought to pull the plug on a Lakeport/Metro-Richelieu business partnership, claiming such an arrangement would give the supermarket chain an unfair marketing advantage.

Their fear is that a major retailer such as Metro-Richelieu that sold private label beer would be in a position to give preference to its own product at the expense of competing brands.

After weathering numerous legal challenges and court battles, Metro-Richelieu and Lakeport walked away from the Quebec Regie des Alcools des Courses et des Jeux on June 22 with authorization to begin selling its private label beer.

Two weeks later, on July 4, Molson and Labatt appealed the decision to the Quebec Superior Court.

A subsequent appeal to the Regie on July 5 by Molson and Labatt to suspend the selling of Norois Premium until after the court hearing was rejected by the tribunal.

Pushing ahead with case

Despite their inability thus far to sway the courts with their arguments, Molson and Labatt are pushing ahead with an effort to have the case heard before the Quebec Superior Court, sometime next month.

In the meantime, on July 27 Metro-Richelieu began stocking the Norois Premium brand in about 800 company-owned retail outlets operating under its flagship Metro banner, as well as such banners as Super C, Marche Richelieu, Jem and Ami.

Distribution

For now, Norois Premium will be distributed exclusively through Metro-Richelieu outlets, but Gilles Caron, Metro-Richelieu’s vice-president, marketing, notes that, in theory, the beer could eventually gain listings in other outlets across the province.

Jean Guy Laberge, general manager of Brasserie Lakeport, Lakeport’s Quebec subsidiary, says the company’s expectations for Norois Premium in its first year is that it will capture between 1% and 2% of the Quebec beer market, representing between 600,000 and 1.2 million cases.

Caron says Metro-Richelieu is first off the mark with a private label beer because of ‘our very aggressive policy with in-house products.’

Metro-Richelieu has a department full of specialists who work exclusively on developing new private label products for the chain.

Caron says demand for quality, cost-effective in-house brands is growing in the Quebec grocery market.

In-house products

Metro-Richelieu now has 800 in-house products mainly under the Metro label, and Caron says 48% of Quebec consumers buy Metro-Richelieu brands.

This is compared with 39% for in-house brands marketed by Metro’s main competitor, Provigo.

Norois Premium is being sold at the legal minimum-allowed price in Quebec of $4.22 for a six-pack, $8.56 for a 12-pack and $16.90 for a case of 24.

Non-alcoholic product

In 1992, Metro launched a non-alcohol private label beer entry using the Norois name.

This label has captured 10% (150,000 cases of 24 bottles) of the Quebec non-alcoholic beer market.

The advertising campaign for Norois Premium is well under $1 million, less than some of the reported budgets for local microbrewery brands.

The media plan includes French and English daily newspapers and radio.

LG2 gets account

Caron says Montreal ad agency LG2, with no current beer accounts, has been awarded the Norois Premium business.

Jean Gamache heads up the account for LG2. Metro-Richelieu’s general agency-of-record is bcp.

Caron says Lakeport intends to organize sampling kiosks for the new private label at point-of-sale, adding that tv exposure and other promotions may follow once the colder fall temperatures arrive.

The Hamilton-based company, headed by President William Sharpe, expects sales to grow by more than 20% this year to $55 million.

Output

Lakeport says it expects to brew between 800,000 and one million cases of Norois beer for Metro in 1994, about 25% of Lakeport’s four million cases of production in 1993.

Lakeport is in the process of expanding its private label beer production and now has agreements with Loblaw’s for President’s Choice and a&p and Dominion stores for the production of Master’s Choice.

Lakeport is majority-controlled by Toronto-based Cott.