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How Heineken forecasts supermarket demand

In recent years, Heineken has been using data to learn more about its customers and how they behave. Using this new data, the brewing company’s marketing department has optimised revenues and built new products.

“What has changed in the market, is that consumers drink more at home – they might even set up a microbrewery with a group of friends,” said Johan Smits, director of global planning, speaking to Essential Retail at JDA’s UK customer event.

“We’re taking some market share from wine, if you have a good home brew, you might drink beer over wine. And there’s a big demand for craft beers,” he added, explaining how Heineken has capitalised on this trend by starting an online craft beer business called Beerwulf which sells the beer direct to consumers, while also providing advice on how the beer was made.

But the majority of Heineken’s business is wholesale to supermarkets and bars, and Smits believes by using JDA’s manufacturing planning and intelligent fulfillment suites the brewing company has become a better partner due to its improved forecasting ability.

While traditionally, Heineken has grown in different markets through acquisitions which has led to each region developing its own technology, since implementing JDA across the business, it has been able to develop more advanced models which automatically run weekly forecasts.

“Our accuracy goes up using JDA, and it has a huge impact to increase revenues with the retailer – the worst thing that could happen is there is no beer on the shelf, but the techniques are better to prevent these out of stocks.”

Changing shopping habits

But Smits acknowledges that while customer tastes are changing in favour to beer, their shopping habits are also changing at a rapid pace.

“You can order on your iPhone from an online shop, standing in a retailer, to be delivered to home – how can we forecast it and know this customer and how do we make money when the logistic costs will go up?”

He adds: “We’re good at delivery to a bar and to a distributor which takes a cost, but we can’t deliver direct to a consumer at home in a crowded city centre. Nobody knows who is going to make money and if it’s going to happen.”

But while Heineken isn’t about to sell and fulfil its most popular brands direct to consumer, Smits does admit the business is very good at marketing. “We can make sure customers find the Heineken brand on their iPhone much easier.”