Heineken Takes Nespresso-Like Shot With Designer Home Beer Keg

Heineken NV (HEIA), the world’s third-biggest brewer, is taking a leaf from Nespresso owner Nestle SA (NESN)’s book by offering a beer-making machine for drinkers who want a freshly pulled pint at home.

The Sub, shaped like a beer barrel on its side, was unveiled tonight in Paris and will be rolled out in Italy and France early next year, the company said today. The device is loaded with replaceable two-liter Torps of beer -- like a Nespresso cafe capsule -- that can be kept in the refrigerator.

Heineken is seeking to attract urban, gadget-conscious men looking to trade up from a can of beer at home, Francois-Xavier Mahot, senior director for global innovation, said today at a meeting in Paris. The Sub will retail at 249 euros ($340), with Torp refills available at 6 euros to 8 euros, the company said.

“If you go to the bar, is it acceptable if a waiter opens a can and gives it to you? That’s not O.K., it’s not sophisticated,” Mahot said. Having freshly poured beer -- each Torp stays fresh for 15 days in the device, which keeps it chilled -- will also impress friends, he said.

Heineken is among brewers seeking to edge sales in western Europe back into growth amid strong competition from spirits, craft beers and wine as the euro-region economy stagnates. The company said in August it expected earnings this year wouldn’t grow as drinkers cut spending across the region and poor spring weather held back purchases. First-half volume fell 3 percent, led by an 8 percent decline in western Europe.

Reviving Beer

Heineken, based in Amsterdam, is seeking to get 6 percent of sales a year from new products. Competitors are also trying to revive flat-lining beer brands with new products, such as Anheuser-Busch InBev NV (ABI)’s new Bud Light Platinum product introduced last year. Heineken’s also been creating new packaging, like light-up bottles.

As well as Heineken refills for the Sub, drinkers can buy more local brands including Desperados in France and Amstel in the Netherlands, where the device will be introduced “very soon,” Mahot said. Refills will be available in shops and online with membership of the sub club potentially leading to benefits, echoing the strategy at Nespresso, one of Nestle’s fastest-growing brands.

Heineken wouldn’t comment on how much was spent on the machine, which was three years in the making, saying only it was a “big” investment.

Craft Brewers

“They’ve had all these interesting ideas but they haven’t been proven before to be enough to shift the tide away from the decline they’ve been facing at the hands of the craft brewers,” Spiros Malandrakis, an analyst at Euromonitor, said. “I wonder how successful it’ll be with millennials who don’t have that much money and are skeptical.”

It’s not the first time Heineken’s tried an at-home beer system. It introduced BeerTender in 2004 and the DraughtKeg in 2005, and competitor AB InBev also introduced a similar product in 2004, Draftmark. Heineken says it’s learned from its experiences -- BeerTender has been very successful in France, Mahot said without revealing any numbers, and will also benefit from being smaller, at two liters not five.

Heineken is answering to the needs of consumers that want a fresher, classier beer at home, the company said. Sub owners should see the device as a display item like an expensive coffee machine, said designer Marc Newson.

“This isn’t a product you want to put in a cupboard and hide away like a vacuum cleaner,” Newsom said. “Men love gadgets.”

To contact the reporter on this story: Clementine Fletcher in London at cfletcher5@bloomberg.net

To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net

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