Problem statement
• There is an increase in competition from major breweries on the premium beer category.
• Mountain Man brewery has experienced a 2% decline in their sales revenue because of changes in beer drinker’s preference, from a high concentrated alcohol to a light beer premium beer.
Solution
• Increase promotion for Mountain Man Lager in order to reinforce the brand.
• Launch Mountain Man Light to a new target segment such as younger drinkers, middle-high income business man, and woman to be able to increase overall profit of the company.
Justification
Over six years, beer consumption has declined by 2.3% due to health concerns and other spirit based drinks. Light beer sales category in the US has growing at compound rate
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of 4%, while the premium beer categories declined annually at the same rate. In 2005, 50.4% of beer sales in the United States falls to the light beer category makes them to be the newer, fast growing, and the only beer category that shows a consistent growth within the industry. This has shown that there is a change in the drinker’s preference from premium beer to light beer category. This trend has changed overtime because the aging demographic of the premium beer segment. Baby boomers generation prefer premium beer, whereas newer generation after baby boomers prefer lighter beer to consume and enjoy. Moreover, Mountain Man Lager does not attract a big segment.
According to the focus group that Mountain Man conduct, Men in early thirties with a medium or a higher income does not correlate Mountain Man Lager with their lifestyle and parties. Young adults in their 20’s thinks that Mountain Man lager is too heavy for them and women just prefer something light. Mountain Man lager only target one segment, that is blue collar workers in the age over 45 years old. Mountain Man breweries should not heavily rely on only one segment because if this segment is declining in sales, it will directly affect them in sales and …show more content…
revenue. Furthermore, heavy competition from major breweries affect the decline of Mountain Man breweries sales. Large national brewers, who has economies of scale, bigger production and marketing effort has put pressure to Mountain Man sales and distributors in order to fight with shelf spaces. Hence, shrinking & aging of the segment that Mountain Man choose and heavy competition has reduce the overall sales & revenue of Mountain Man Lager by 2% annually. Mountain Man are still able to remain profitable but if this trends keep going down annually, their business will be in trouble. In order to increase the sales of Mountain Man beer, the brewery should increase the amount of promotion and advertising.
This will help Mountain Man brand to increase the brand awareness surrounding its target segment. Mountain Man brewery should relate Mountain Man Lager with public events so that it will increase the usage of the product and create brand awareness. Mountain Man can relate their product with the symbol of authenticity of a true West Virginia’s beer. This will create a sense of belonging and increase brand loyalty. In addition to that, Mountain Man can promote their new light beer in an event that could expose the product to new segments. For example, Mountain Man could set up a stall in a music festival events where younger adults in their 20s could actually try out the product. This could relate their product with fun activities and festivals leading to a new brand image of Mountain Man light. The drawbacks of increase in promotion and advertising is that it will reduce the overall income that the brewery get because they will spend it on advertising. Nonetheless this will help to increase brand awareness and usage leading to increase in sales and generates higher profit to counteract the 2% decline in
sales. Creating a new Mountain Man Light will not just attract a newer, fast growing segment. But it will also increase the overall revenue of Mountain man brewery. Mountain Man are able to capture bigger market segment such as men in their thirties, young adults, and women who wants light beers. These diverse segments will help Mountain Man not to overly depend on only one big segment and reduce the probability of the brewery to fail. On top of that Mountain Man are able to reinforce its brand through the new product, and empowering one another creating a stronger brand with a bigger segments. Product line extensions can help Mountain Man to gain greater shelf space and create better product focus on distributors and retailers. However, creating a new product will cost a lot of money such as product creation, production, advertising, and promotion. Hence, Mountain Man brewery needs to heavily invest in the new product. In addition, the fact that the Mountain Man Lager consumers might be against with the idea of Mountain Man light due to change of brand image, can negatively react to the overall brand identity. Mountain Man brewery can convince their customers that Mountain Man light is for someone who prefers a lighter beer that has a high quality unique ingredients, and have that distinctive bitter taste that the lager has. Reinforcement of brand identity from their own sales force to introduce the new light beer and the strong brand image that the mountain man have will help to expose the new product to the new segment.
The company launched an initiative collaborating with the “Lyft”, which will provide free rides for drunk customers [8]. This indicates the amount of dedication the company has towards its customers. It also provides tours to customers across the 12 flagship breweries in the United States [9] and would also help customers with samplers. Any company that values its customers would become a great success and Anheuser Busch has proved this again. It also values its employees making sure every one of them feels like an owner and everybody would work as considering the results to be personal [10]. All these put together has helped the ANHEUSER BUSCH to brew beers that are loved by their customers and in making it the leader of its domain of
The beer brands were classified as popular, premium, super premium, and ultra-premium. The distinguishing factor determining if brands belonged to different classes was whether beer was produced by four largest companies (Anheuser-...
Belgium is known for a culture of high-quality beer and this concept was formulated by an electrical engineer from Fort Collins, Colorado. The electrical engineer, Jeff Lebesch, was traveling through Belgium on his fat-tired mountain bike when he envisioned the same high-quality beer in Colorado. Lebesch acquired the special strain of yeast used in Belgium and took it back to his basement in Colorado and the experimentation process was initiated. His friends were the samplers and when they approved the beer it was marketed. In 1991, Lebesch opened the New Belgium Brewing Company (NBB) with his wife, Kim Jordan, as the marketing director. The first beer and continued bestseller, Fat Tire Amber Ale, was named after the bike ride in Belgium. The operation went from a basement to an old railroad depot and then expanded into a custom-built facility in 1995. The custom-built facility included an automatic brew house, quality-assurance labs and technological innovations. NBB offers permanent, seasonal and one-time only beers with a mission to be a lucrative brewery while making their love and talent visible. In the cases presented by the noted authors (Ferrell & Simpson, 2008), discusses the inception, marketing strategy, brand personality, ethics and social responsibility that New Belgium Brewing Company has demonstrated. The key facts with New Belgium Brewing Company are the marketing strategy, promotion, internal environment and social responsibility with the critical issues of the public, brand slogan, growth and competition.
The scope of this report is an evaluation of the profitability of each brand. The report does not intend to make recommendations of how invest and promote new products and how to increase brewing capacity.
Michael Messner and Jeffrey Montez de Oca explain that contemporary beer ads represent a desirable male lifestyle to reaffirm masculinity in a time when men are insecure. Their essay, “The Male Consumer as a Loser: Beer and Liquor Ads in Mega Sports Media Events,” goes on to list the reasons for their insecurities: historic and cultural shifts such as deindustrialization, declining real value of wages, feminists and sexual minorities. They support their main point by providing a window to the past as beer ads of the 1950s depicted a desirable lifestyle that was appropriate for post war style of living. By following the transitions of beer ads from the 1950s to now, we could follow the accepted lifestyles of the times during which the ad was made.
As larger beer corporations move toward this growing market, NBB will have to develop measures to maintain market share (Gorski, 2013).
commercial appeals to the demographic of young, entrepreneurial males who are wanting to become more than what people and society thinks they should be and they not only want to sell their beer but also have an underlying message of pro-immigration.
"Americans Still Oppose Lowering the Drinking Age." Gallup Poll Briefing. (24 July 2014). Web. 19 Feb. 2016. The article provides the views of those who wish to keep the legal drinking age at 21. It states that almost 75% of Americans are still against lowering the drinking age. They believe that the higher age has reduced drinking and driving accidents. Also stated is the belief that since it has been in act for thirty years it should be left the same. The articles also provides statistics based on the specific classes of Americans who are for or against the issue. The purpose of the article is to show readers the benefits of keeping the drinking age as is. It was published on a website that is used to report new and political issues, therefore, allowing it to draw the attention of many people. It is unique in the fact that it provides surveys and information about the specific kinds of people that were surveyed. This article helps me with my thesis because it provides me with the views of people who do not agree with it, therefore, allowing me to show both sides of the
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