Battling the Competition

Competition from foreign beers is thus far not significant for Czech brewers, large or small. The Czech consumer remains relatively poor compared to his counterpart in the West, and his ability to afford the massive quantities of beer that he drinks depends on an extremely low cost product. The government does its part by classifying beer as a basic foodstuff, which qualifies it for the same tax rate as bread and milk.

Beer prices have crept upwards with inflation over the past decade (to the tolerant grumbles of the population), but a large-scale increase in beer prices would likely result in the type of social upheaval to be expected from a similar increase in the price of rice in China or gasoline in America.This works to domestic brewers’ advantage, and the few beer imports that make their way into the country are expensive and thus consumed primarily by a relatively tiny minority in Prague.

Domestic competition is real, though, and Czech breweries have been quick to grasp the crucial role played by marketing in promoting their beers. Furthermore, attention to the expenses of transportation, equipment maintenance and salaries has become an often unwelcome responsibility of every brewery’s management.

Many breweries have responded by merging into associations, usually grouped within a region. These mergers allow the individual labels to maintain their identity yet benefit from the economies of scale that come with being part of a larger distribution and marketing structure. Prazske Pivovary (Prague Breweries) followed this path by combining the breweries of Mestan, Branik, Ostravan and Vratislavice nad Nisou under one corporate umbrella along with its biggest member, Staropramen. Another such merger is Jihoceske Pivovary (South Bohemian Breweries), which unites Regent (located in Trebon), Platan (located in Protivin), and Samson (located in the home of Budweiser, Ceske Budejovice). Many other breweries, however, remain completely independent and rely upon the magic of marketing to cultivate their own distinct images among Czech drinkers.

Rebel Yell

For some odd reason, Czechs have a vivid fascination with the American Civil War and, particularly, with the southern confederacy. "North versus South" books and TV mini-series abound, and the rebel flag is always a point-earner in any marketing campaign. One might assume that Rebel beer, brewed by Mestansky Pivovar (Municipal Brewery) in the town of Havlickuv Brod, is another example of Confederate name-dropping. Havlickuv Brod, however, has its own history of rebellion.

In the mid-19th century a local writer by the name of Karel Havlicek Borovsky gained fame by propagandizing against the Habsburg monarchy, which had ruled Bohemia and Moravia since 1620. Borovsky was persecuted and eventually exiled from Bohemia by the powers in Vienna. But his fame outlasted the Habsburgs, and the town became known as Havlickuv Brod (Havlicek’s Ford). The town brewery, which had been in operation at least since the year 1333, likewise began to call its beer Rebel when Borovsky died in 1856, five years before shots were fired at Fort Sumter.
Havlickuv Brod is located in East Bohemia about 65 miles to the southeast of Prague. While Rebel beer is difficult to find in the capital and elsewhere in the republic, in East Bohemia it is impossible to miss. Sixty percent of the brewery’s output is sold within 20 miles of Havlickuv Brod, while 30 percent is distributed elsewhere in eastern Bohemia.
Like the majority of beers in the Czech Republic, Rebel is a classic Bohemian pilsner. Its balanced, medium-bitter flavor is achieved using barley from eastern Bohemia, Czech Saaz hops, and soft water from the surrounding Ceskomoravska Vrchovina (the Bohemian-Moravian Highlands).

In addition to its flagship 5 percent abv Rebel Original light lager, the Mestansky Pivovar also produces a number of other varieties, including a 4.7 percent dark lager, a 4.7 percent light lager, and a 3.9 percent semi-dark specialty, "garnet" beer. This last variety is marketed especially to female drinkers and is considerably sweeter than the other beers in the Rebel family.

Since 1989, the Rebel brewery has increased its yearly output from 119,000 to 150,000 hectoliters and has secured its position as one of the most financially stable medium-sized breweries in the Czech Republic. Sales Representative Jana Pankova predicts that in the difficult situation that characterizes the Czech market there is room for only about 40 breweries to survive. There is little doubt in Havlickuv Brod that Mestansky Pivovar will be among them.

In addition to maintaining Rebel’s solid position in its eastern Bohemian base, the brewery aims to strengthen its export portfolio, particularly to the United States, where competitive pricing is a key element of Rebel’s strategy. The brewery and its American importers have worked to keep the price of its half-liter bottle close to US $1 for consumers in order to make Rebel one of the most affordable European beers available. In doing so, it hopes to give plenty of American rebels—both Yankees and Confederates—something great to yell about.

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NEXT: Marketing to the High End

This story originally appeared in All About Beer Magazine in January 2000.