On the other hand, if the consumer was drinking for taste there are also several substitutes available for them to choose from. The substitutes that we decided to use in this area of analysis include rum, tequila, and vodka. All of these different substitutes serve the same purpose but are different in content, taste, and price. Table 8 Substitute Profitability of Industry Switching Cost Vodka High Low Tequila High Low Rum High Low The first substitute researched was vodka. The process of distilling vodka has been around since the 1400’s and was created by the Russians. Although the taste of vodka and bourbon are very different, they are made from similar ingredients. Such ingredients include wheat and grains. Both use food items high …show more content…
The higher quality products have a longer aging period, more alcohol content, and a higher price. Consumers may choose a substitute that has as much aging, but has more alcohol content for a cheaper price. In other words, the may be more concerned with feeling like they are getting their money’s worth. Table 9 Product Aging Alcohol Content (%) Price (1 liter)* Bourbon 1-20 years 40 - 75 $13 - $180 Rum 1-22 years 40 – 95 $4 - $120 Vodka No aging 40 – 50 $8 - $75 Tequila 14 days – 10 years 45 - 50.5 $3 - $140 *Source: Price information was retrieved from Hollywood Tobacco & Liquor in Florence, KY. When observing the above table, one can see that a one liter bottle of rum that has been aged for the same amount of time as bourbon contains more alcohol and cost less. On the other hand, if price was the only preference then all of the other available products listed are cheaper than bourbon. As previously stated, it is all based on purpose and preferences of the
Using consumer survey information, we devised a metric for calculating and projecting Coors market share. While only 300 customers were surveyed (Research Study G), we made an assumption that this sample sufficiently represents the preferences of the greater population in the two-county market area. We also assumed that attitudes toward Coors were equally distributed amongst consumer weekly beer consumption levels. Then, we forecasted Coors market share by multiplying the percentage of people with a certain preference by the Coors purchase percentage for that preference. We projected an anticipated market share range, between 13.7% and 21.5%, illustrated in Exhibit 2. Calculations relied upon customers’ “Attitude Toward Coors” because we felt this measure was more indicative of regular purchasing frequency than simply an “Intention to Buy Coors”.
Worsnop, R. L. (1997, March 14). Alcohol advertising. CQ Researcher, 7, 217-240. Retrieved from http://library.cqpress.com/cqresearcher/
Lots of attempts have been mane to legalize spirit production for personal use but the law against distilling spirits remains the same. US representative Bart Stupak says that the reason for this is because of money. Alcohol is one of the heaviest taxed goods with 32% of the purchase price going straight to state and federal taxes. That is more than three times the tax on wine, and twi...
Once prohibition had been passed the demand for alcohol increased. Many people would do whatever they had to just to get their hands on something that contained alcohol. This had created a new business
The soft drink industry in the United States is a highly profitably, but competitive market. In 2000 alone, consumers on average drank 53 gallons of soft drinks per person a year. There are three major companies that hold the majority of sales in the carbonated soft drink industry in the United States. They are the Coca Cola Company with 44.1% market share, followed by The Pepsi-Cola Company with 31.4% market share, and Dr. Pepper/Seven Up, Inc. with 14.7% market share. Each company respectively has numerous brands that it sales. These top brands account for almost 73% of soft drink sales in the United States. Dr. Pepper/Seven Up, Inc. owns two of the top ten brands sold. Colas are the dominant flavor in the U.S carbonated soft drink industry; however, popularity for flavored soft drinks has grown in recent years. The changing demographics of the U.S population have been an important factor in the growing popularity of these flavored soft drinks. The possible impact of this factor will be addressed later in the case.
The demand for alcoholic beverages as a whole is inelastic which can be proved from the price elasticity of demand formula. The price elasticity of demand is explained by Hubbard et al. (2012) as ‘the responsiveness of the quantity demanded to a change in price’ and can be calculated from the following formula: Price elasticity of demand = Percentage change in quantity demanded/percentage change in price. From the statistics given by The Economist et al. (2013) of how a 10% price rise in prices would decrease consumption by around 5%, the equation would be: Price elasticity of demand = -5%/10% which means the price elasticity of demand would equal -0.5. Due to the fact demand ...
Canadian government controls the making and trading of liquor, for the duration of the war its production and importation into provinces is illegal (1918).
The distribution and sale of alcohol often referred to as “bootlegging” was still going on throughout the country. One of the most famous of the bootleggers in the time was the Chicago gangster Al Capone. Al Capone also famous for his involvement of the St. Valentine's Day massacre made over 60 million dollars in the bootlegging business. Another way people got there there fix was gaining access to nightclubs or stores that sold alcohol called “speakeasies”. The most dangerous way of getting some alcohol was making it at home and smuggling it across state lines. The most famous of these homemade brews still in manufacture today in a large part of the country was “moonshine”. Moonshine is made the same way whiskey but was not aged in barrels. The most legal of all was to have a doctor prescribe you whiskey for your toothache with orders from the doctor to “take three ounces every hour for stimulant until stimulated”. Speakeasies soon took on the look of pharmacies to further their business.
The price for Grey Goose is normally around 30 dollars depending on the retailer. The product’s appeal is higher than their competition; therefore, Grey Goose is sold at a relatively high price. For instance, at CVS the price for Grey Goose is $34.00, which to most consumers is considered expensive but for Grey Goose they are willing to pay. They think that if the price is expensive, then the quality of the Vodka must be better. Meaning that the organization uses high-quality materials when producing Grey Goose Vodka. CVS as the intermediaries are the ones that take the titles of Grey Goose and are able to make the decision on the price for $34.00 per bottle. On the other hand, if consumers decide to shop around, they can find a better deal
For example, the United States’ capita consumption of bottled water lagged those of soft drinks by more than a 2:1 margin. In terms of bottle water, the majority of sales volume is based on single-serving PET containers rather than 5 or 1-2.5 gallon high density polyethylene containers used for home or office use. The single PET container has been satisfied by the customers because it is convenient and portable. It can be purchased from a convenience store. Number of rival There were fierce competitions among the producers that had scale and scope of operations which were similar to each other.
Moonshine was originally a slang term for high-proof distilled spirits usually produced illicitly, without government authorization. In recent years, however, moonshine has been legalized in various countries and has become a commercial product. Legal in the united states since 2010, moonshine is defined as “ clear, ungaged whiskey”, typically made with corn mash as its main ingredient.
Generally speaking, other alcoholic beverages can be viewed as being a substitute for wine. However, specific substitution of wine in the New World is low because most individuals prefer to purchase wine from a retail facility instead of producing their own. Where as in the Old World the option of producing wine...
Consumption pattern in the Philippines is shifting over time. Once, the main priority for expenditure is on food, then education and health. Now, part of the expenditure pattern of an average Filipino is to spend a portion of their income on leisure and relaxation. Part of leisure expenditures are the buying of alcoholic beverages. And one of the newest entrants in this commerce is the wine industry. It has posted the fastest growth rate of 15% in 2005 among the alcoholic drinks. The population now has increasingly warmed to wine. It has shifted from the mass spirits (beer) to the more sophisticated, affordable and healthier alcoholic beverage.
As a bartender, you will be expected to know the ins and outs of the liquors you are handling, as well as the types of glasses your drinks are to be served in. Learning the different types of liquors and what they mix well with can be a daunting task, but one that is mandatory. Some people who come to your bar may want to try something new, or have a question about what mixes well. While you are not required to provide the most elaborate answ...
Alcohol is a class of organic compounds that is characterized by the presence of one or more hydroxyl groups (-OH) attached to a carbon atom. Alcohol was unknowingly produced centuries ago when fermentation occurred to crushed grapes (Pines, 1931). In today’s society alcohol is produced for the use of household products such as varnishes, cleaning products, but is more commercially important in the liquor business. A chemical process called fermentation accomplishes the production of ethanol, the alcohol or liquor. From there, the ethanol goes through distinct processes to become the dark and clear liquors on the store shelves.