Czechs and balances: Are Czech brewers selling out their heritage?

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Drinks: Beers

Purists say the Czech Republic’s world famous pilsner beer industry is losing its soul. Nigel Huddleston reports from a country struggling to reconcile tradition and modernity


These are critical times for Czech beer. Its most famous breweries are being taken over by global players and its brands face tough competition from around the world.

While other countries have established trademark themes to promote their beer – Mexican parties, Spanish sunshine or cuisine-matching – the Czech Republic’s USP is that it gave the world its most popular style of beer in the form of pilsner lager: clear, golden beer, slowly fermented at low temperatures, and matured for weeks.

The fear for some is that watering down its brewing tradition puts the Czech beer industry’s point of difference – or even its very soul – under threat. Recent years have seen Czech beer fighting to hang on to its identity. Urquell, the world’s oldest pilsner, has been snapped up by SABMiller, as part of its UK-based trade. And InBev, which owns Staropramen, has already had to do one U-turn under consumer pressure after trying to brew under licence in the UK.

Selling out?

Then there’s Budweiser Budvar, which for many years was the definition of Czech beer in the UK market. After years of speculation, the Czech government has signalled its intention to sell off its only remaining state-owned brewing jewel, and it’s unlikely that US giant Anheuser-Busch – which has been locked in a century-long legal battle with the Czechs over the rights to use the name Budweiser – will allow itself to be outbid by anyone.

  Neville Hall, sales and marketing director for Budweiser Budvar UK, is unconcerned about the prospects of any sell-off. ‘The Czech government has a tender out to find an outfit that can advise on how to convert the brewery from a state-owned organisation into a joint stock company,’ he says. ‘Nobody knows how to do this and it may not possible because of the trademark issue. I’ve learnt not to worry about things that may never happen.’

Martin Kec, director of the privately owned Zatec brewery, based in the heart of the prestigious Saaz hop-growing region, says the brewery is still trying to cling on to Czech brewing tradition, even if such a commitment comes at a price.

Identity crisis

‘We want to be in the expensive end of the market, such as good restaurants and bars,’ says Kec. ‘We’re never going to be sold in big supermarkets because we can’t compete. We want to be able to show that there’s a big difference between one lager and another.’

Zatec was bought in 2002 by Rolf Munding, the English owner of Smiths of Smithfield bar and restaurant in London, and despite a £2m investment in new equipment, the company has clung on to long maturation times and traditional open-top fermenting vessels that reduce the need for artificial carbonation of the beer. Kec says: If you look at the overall quality of Czech beer, it is declining significantly and most of the big breweries are in foreign hands. The real Czech brewing tradition is disappearing. There are not many breweries left that use open fermentation, a long lagering period, as well as purely homegrown hops, which haven’t been chemically treated. Budvar is one and we are another.

Lucy Kilborn, senior product manager for Pilsner Urquell at Miller Brands (UK), agrees that Czech identity is less significant than other factors for marketing the original pilsner from the town of Pilsen. ‘Of course, people rate Czech beer,’ she says, ‘but it’s not the main reason for purchase. It’s a supporting factor, but Pilsner Urquell is a great beer in its own right, not just because it’s Czech.’ Urquell has had a fragmented presence on the market for the past couple of decades. A succession of different distributors have taken it on, but never quite the right one – it’s either ended up hidden in the portfolio of a big brewer with its own fish to fry, or isolated with small-time agents without the cash needed to support it.

Although SABMiller bought it in 1999, it wasn’t until the establishment of its UK marketing arm in 2005 that the company took Urquell in-house, and only now is it really starting to make its presence felt again on the market. Kilborn comments: ‘Prior to us taking on the brand it was involved in things that, from a marketing point of view, weren’t quite relevant. We’ve spent the last year getting the pricing sorted out and we’ve now got a virtually blank piece of paper.’

She admits that brand awareness is as low as 10%. ‘We’ve done around 30 focus groups in cities including London and Leeds, which have told us that while people don’t really know the brand very well, they see the pilsner category as a positive thing.’

Draught resolutions

A change in emphasis could also be on the cards – from bottle to tap. ‘Draught is how the brand is ideally served,’ says Kilborn. ‘The bottle is good for branding but draught is where we really want to go.’

Budweiser Budvar has also been pursuing draught sales in the UK. With the bottled beer market becoming increasing cluttered, around 50% of its on-trade sales in the UK are on tap. And it has recently taken Czech beer into new territory as far as the UK market goes, with a gradual rollout of Budvar Dark, in bottles and on draught. Draught is also the focus for Zatec, with 75% of UK sales in 20- or 50-litre kegs.

And despite what Kec sees as the unwelcome presence of big brewing giants in the Czech market, Zatec has enlisted the UK subsidiary of US heavyweight Coors to handle UK sales, which account for 85% of Zatec’s exports. ‘Coors is experienced enough in the top end of the market to know what needs to be done,’ he explains. ‘We are proud that it’s one of the most expensive beers on the market, and people want to try it for that reason. Zatec doesn’t let you down; it’s worth the money.’ With the Czech brewing industry undergoing such rapid change, it has to be.


Popping pils

Your basic guide to Europe’s most imitated style

Urquell pioneered pilsner, which was produced in Pilsen from 1842, but the name has never been protected by law. As a result, brewers around the world have appropriated it as a generic description for anything vaguely like lager.

The Germans were the first to adopt the style, sticking an ‘e’ in the middle to create pilsener, or shortening it to pils. Interestingly, the pils style was actually created by a German. Josef Grolle was hired by the brewery for his expertise in the modern cold fermentation methods to come up with something to compete with a new breed of dark beers from Bavaria.

Using lightly roasted malt and characteristically aromatic Czech hops, he created a golden lager with exceptional clarity and a seductive hoppy bitterness that went on to become the blueprint for brewers throughout mainland Europe.


Trying the genuine article

Zatec

Tasting note: A fresh grassy nose, with a crisp, clean delivery on the palate, opening out to melon and apple skin fruit with mellow bitterness levels.

London listings: Smiths of Smithfield; The Rake; The Academy

UK agent: Coors Brewers, 01283 511000 RRP: £3.60/bottle; £3.50/pint


Budvar Dark

Tasting note: This has the fresh, sweet, malty aroma of the brewhouse and a dry, clean flavour with understated hoppy bitterness that makes it more-ish in a way so many continental dark beers fail to achieve.

London listings: Bar Prague; Cock & Bull (Chelsea); Lord John Russell

UK agent: Budweiser Budvar UK, 020 7554 8810 RRP: £3.30/bottle; £3.40/pint


Pilsner Urquell

Tasting note: As crisp and clean as you would expect from the original golden lager, but with a characteristically high level of hoppy bitterness that sets it apart form many of its other later imitators.

London listings: Browns; Corney & Barrow

UK agent: Miller Brands (UK), 01483 264100 RRP: £3.50/bottle; £3.60/pint


Editorial feature from Imbibe Magazine – January / February 2008

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