Heineken Case Study

The United States beer industry represents 233 million hectoliters of the world’s 1,501 million hectoliters and is a dynamic part of the United States national economy, contributing billions of dollars in wages and taxes. Within the U.S., the beer market accounts for nearly 50% of total volume of alcohol, with the import specialty and light beer segments driving growth.

Heineken was established in the United States in 1863 and in a short time it became the world’s largest brewer with 116.8 million barrels of beer sold.

Heineken’s number one position depends on the number of markets they are present with their products. Local markets are important but the international markets will provide more opportunities to grow.

Exporting beer continues to boost year after year. In 2006 the increase was over 18% compared to 2005. The United States exported approximately 34.4 million hectoliters of beer in 2006 compared to 29.9 million hectoliters in 2005.

Heineken expands constantly and recently has purchased Hartin, 4th largest brewer in China, and invested $33M in convertible bond of Tsing Tao Brewery. Heineken’s partnership with Budweiser in Italy allowed Budweiser to brew, market, and distribute “Heineken” and make use of Budweiser’s distribution network in Europe.

Heineken has been the most successful beer company in Europe and the rest of the world due mostly to the quality of their product, their marketing/advertising and their sponsorship ability. They sponsor annually the biggest sporting event, which is the Champion’s League (a soccer tournament) in Europe. With games shown across the world every two weeks, Heineken has been their main sponsor for numerous years. The frequency and reach they achieve through the tournament is to die for and marketer’s dream since the tournament is played for nine months out of the year.

Language and culture are problematic issues when it comes to international marketing. When a company enters the global markets it has to deal with many issues, which do not exist when it comes to the local market. Language is one of the problems and is always a challenge. Even though English is spoken around the world in most cases it cannot be used as a language for international campaign. Therefore the translation of the campaign into the foreign language is very important.

Some English words do not have corresponding words in most foreign languages so there are issues with exact translation. It may take more words to present the same message in a different language.