Category: Beer

Trends in the global market beer

The global market trends has faced substantial changes over the past three decades with giants like Heineken being edged out by upcoming new brands such as Corona Extra from Grupo Modelo.

The two key strategies that clearly alter global beer market are strategic alliances with strategic partners and global marketing strategies that are unique and quickly identifiable.

The two Mexican companies Modelo and FEMSA were forced to form strategic alliances with international distributors with sound knowledge on local market and because of the fact that they enjoyed less international restrictions especially because of the North American Free Trade Agreement (NAFTA).

Modelo chose Anheuser-Busch while FEMSA opted for Heineken. These strategic alliances were especially important in terms of market penetration since less cost was incurred.

The strategic marketing images of “fun in the sun” and strategies employed by Modelo played a pivotal role in its international growth toppling market leaders such as Heineken in the United States.

On the other hand FEMSA faced a rather difficult time while Heineken marketing strategies caused its significant market loss to Modelo. This was because Modelo focused less on human image for marketing but rather focused on the experience enhanced by its products.

It actually created a myth “fun in the sun” which swept the U.S. market like never before. Its mergers with Gambrinus Inc and Barton Beers also reduced the cost of distribution, marketing, insurance and advertising.

The current global marketing has rather shifted to strategic alliance partnership to enhance global market dominance as evident in the case of InBev and Anheuser-Busch possible alliance.

Such an approach has shaped the brewing industry towards global strategic partnership to create a behemoth capable of taking advantage of economies of scale and other strategic benefits to enhance their market presence and future sustainability.

Mondelo’s international expansion

International market entry for Modelo was particularly strategic because the international market nature and the restriction faced by foreign companies while exporting their products across borders.

This was specifically experienced in the United States where North American Free Trade Agreement (NAFTA) limited foreign companies from accessing the market.

It was because of these restrictions that forced Modelo to form strategic alliances with local distributors that could ease the expense incurred as a result of the restrictions. Modelo first chose Anheuser-Busch because it enjoyed the NAFTA environment.

This initial step was particularly important for Modelo to enhance its international coverage especially with its economically strong neighbour the U.S.

In order to further increase their international strength internationally, Modelo entered into new contracts with local distributors with local market knowledge to further their creative campaign strategy of “fun in the sun”. Modelo also maintained an active role in the decision making process regarding its products.

Modelo aligned itself with Barton Beers a large importer of beer with more than 25 countries internationally and also experienced in marketing of imported beers. It was through Barton Beers that the image of “fun in the sun” gained a substantial ground. Because of the continuing growth in the U.S. market, Modelo decided to add another major distributor, Gambrinus Inc. Modelo was advantaged because the company was headed by former Modelo executive.

Modelo gained from these two distributors because they helped to ease cost related to transportation, insurance, customer and even advertising among other international expenses.

Modelo however maintained an active role with respect to the brands image and thus ensuring the brands increased performance internationally.

To further strategically coordinate its international distributors, Modelo tasked Procennex Inc as a subsidiary mandated the task of coordinating and supervising the activities of the two distributors.

Next foreign market for Mondelo to enter

The next strategic market that Modelo should enter is the European and Asian market. The rationale for this is because Heineken has succeeded in these regions. In Europe Ireland and Germany are potential countries while in Asian, China is strategic market opportunity.

Modelo has a number of strategic advantages that it has gained from its U.S. market exploitation; the key advantage is its marketing image “fun in the sun” which has gained popularity as opposed to Heineken strategic plan that is focused on its qualities.

Modelo should enter these Key international with an open mind considering that the strategies used in U.S. may not be efficient especially in China.

It is however strategic for Modelo to consider the same approach of selecting an experienced distributor that is well acquainted with the local market in Europe and Asia. This will ease the trade restrictions that are especially significant in China and thus reducing the cost of market penetration in the country.

Another important aspect that Modelo should ensure is the uniqueness that it demonstrated in the market penetration both locally and in the United States.

In the modern marketing strategies, it is imperative to ensure that the products being sold and unique and remarkable for the consumers to be able to instantly recognize the brand and differentiate it from other brands.

Constant and strategic marketing strategies that align with the local market should also be enhanced in order to ensure that these strategies are successful in the target local market. Few modifications may therefore be necessary with advice from the local distributors in order for Modelo to penetrate the market significantly.

Challenges facing Modelo

The possible alliance between InBev and Anheuser-Busch will likely create unimaginable behemoth in the brewing industry, a situation that will dwarf giants like Modelo and Carlsberg and Heineken among others.

Such a strategic alliance will not only play an important role in cost saving through economies of scale but also provide a strong competition to almost all the brewing industries in the world.

Such a step announced by the InBev executive has forced other industry stake-holders to rethink their strategies in order to be sustainable amidst a strong competition from the colossus merger.

The immediate strategic response that Modelo should take is to create a consolidated merger with other stakeholders in the beer industry. Such a merger will be a response to the steps taken by InBev (Ellet, 2007).

The most immediate alliances should thus be started with mid-tiers such as Anheuser, Molson Coors and Heineken among others.

The steps taken by InBev will limit the options of these mid-tiers and thus important for Modelo and other to consider an immediate response strategic alliance in order to ensure their sustainability (Hughes, 2005).

Modelo’s diversification

The most immediate action that Modelo should ensure is not to diversify into other businesses but rather enhance its global presence in terms of market ownership of the beer industry. The rational for this reasoning is because a company ought to be sustainable in order to think of other diversification elements.

If Modelo for instance diversifies into other market niches, its primary source of income may be relaxed and thus allowing competitors to reduce the company’s market share.

It is however strategic for Modelo to diversify into other market niches such as wines production, this should however happen only when the company has acquired a substantial global market share in country’s outside the US and Mexico.

Since the Modelo brand is already established and even a market leader in the United States market, the brand should help the company acquire more international market niches instead of pre-mature diversification (Thompson, 2010).

The other rationale for objecting pre-mature business diversification is the overall risks of another business venture. Modelo will have to drain its resources and risks market variations in a new market niche yet its core competencies are doing extremely well established.

Its 7.8 % revenues from international market will be reduced by the cost of starting new operations and thus weakening its financial status when its competitors such as InBev are forming strategic alliances to capture global market.

These alliances are significant in terms of reducing cost of new market penetration. Modelo should also seek strategic international alliance in order to keep at pace with the global leaders if it is to be sustainable in the beer industry.

References

Ellet, W. (2007). The case study book: How to read, discuss, and write persuasively about cases. Boston: Harvard Business School Publishing.

Hughes, R., & Beatty, K. (2005). Becoming a strategic leader: Your role in your organization’s enduring success. San Francisco: John Wiley & Sons.

Thompson, A. A., Strickland, A.J., & Gamble, J.E. (2010). Crafting and executing strategy. New York, NY: McGraw-Hill-Irwin.

Executive Summary

Tsingtao’s entry to the Thai market requires a robust project management approach. The project scope includes construction of a beer brewery, and establishing a value chain in Thailand. The technical requirements for the project include the construction of a brewery that can produce three million bottles of liquor monthly.

The systems needed for the success of the project includes a change management system, and Project Management Office (PMO), and a risk management system. The project manager is a senior vice president of Tsingtao Beer. The project management team reports directly to the board. The main risks associated with the project arise from Tsingtao’s limited understanding of the business environment in Thailand.

Tsingtao Beer Project Plan

The Tsingtao Beer company is in the process of expanding its overseas operations to create new markets for its products. This document examines various aspects of the project plan developed to ensure the success of the new venture. The issues covered in this plan range from the work breakdown structure to project management tools and approaches used in the project.

Scale and Scope of Project

This project relates to the construction of the facilities for use in beer production in Thailand. A business development team from Tsingtao’s headquarters in Beijing will handle the commercial aspects of the project. The project objectives are as follows.

Project Objectives

The three objectives of this project are as follows.

1. The first objective of the project is to construct an operational brewery in Thailand with the capacity to handle the demands of Thai Consumers as well as to provide products for distribution in nearby markets.
2. The second objective of the project is to make preliminary business plans for the operations of the brewery.

Major Deliverables

Based on these objectives the list below provides the project deliverables associated with the project.

1. A fully functional beer brewery in Bangkok
2. Signed service and maintenance contracts with suppliers
3. Product supply contracts with rice farmers
4. A marketing strategy
5. Licenses, permits and regulatory approvals necessary for brewing operations in Thailand

Milestones

Table 1 below presents the milestones associated with the project

Table 1: Milestones and Related Indicators

Technical Requirements

The technical requirements for this project are as follows. First, the project should deliver a brewery with a production capacity of three million bottles per month.

The brewery should have the capacity to store up to three months supply of rice to avert any supply shortages. The third technical requirement is that the water supply must be at least one hundred thousand cubic litres per day to support brewing operations. Electricity supply should be three-phase at 415 volts.

Speculative Work Breakdown Structure

The speculative work breakdown structure for this project is as follows.

1. Brewery construction

1.1 Architectural planning

1.2 Land survey

1.3 Obtaining of construction permits and regulatory approvals

• Obtaining construction permits
• Obtaining permits from the environmental management authority

1.4 Retaining contractors

• Retaining architectural contractor
• Retaining of electrical engineering contractor
• Retaining of mechanical engineering contractor
• Retaining of civil engineering contractor

1.5 Construction phase

• Construction of foundations
• Constructions of external and partitioning walls
• Roofing
• Installation of brewing equipment
• Interior design

1.6 Handover of construction project to the company

2. Marketing strategy development

2.1 Marketing research

2.2 Market analysis

2.3 Market segmentation

• Identification of market segments
• Choice of market segments to serve

2.4 Branding decisions

2.5 Development of marketing objectives

2.6 Action plan

3. Business process contracts

3.1 Identifications of rice suppliers

• Prequalification of suppliers by projected volume of production
• Prequalification based on the quality of rice produced
• Qualification of suppliers
• Signing of supply contracts

3.2 Identification of product distributors

3.3 Obtaining trade licenses from government

• Obtaining general trade licenses

3.4 Obtaining permits from alcohol regulators

• Obtaining of liquor trading licenses

3.5 Environmental assessment

• Retaining an environmental consultant to conduct an environmental audit
• Presentation of report to environmental authority for approval

3.6 Identification of service contractors

• Identification of electrical engineering services contractor
• Identification of mechanical engineering service contractor

Systems to Ensure Project Success

The systems needed for the success of this project are as follows.

The Project Management Office (PMO)

Tsingtao usually implements various projects concurrently. Usually these projects relate to marketing, product development and streamlining of business process.

Tsingtao found it wise to establish a full time PMO to handle project management functions in the company. The PMO will provide the project management team in charge of the Thai expansion project with decision support and oversight to ensure that it meets all the required project management standards.

Change Management System

Change management is a vital part of project management. The change management system for this project has three aspects. First, it handles the chance that a senior project manager may leave the company at a critical stage of the process. The strategy in place is to ensure that every senior project manager shares responsibilities with a highly capable assistant who can provide continuity in case of staff changes.

Secondly, the company has retained lawyers in Thailand to keep an eye on the legal environment to ensure that Tsingtao enjoys the benefits provided by any new laws affecting foreign investments, and avoids the pitfalls associated with business in Thailand.

The third aspect of Tsingtao’s change management strategy is keeping an eye on the business aspects of the project. This includes observing changes in the tastes and preferences of the Thai consumers as well as the availability of supplies.

Project Control System

The project control system in place has two main aspects. First, the company gave sufficient space to the project management team to handle all issues relating to this project.

This team reports directly to the board of Tsingtao. Secondly, the PMO and the Internal Audit Department of Tsingtao provide immediate oversight of the activities of the project management team. Reports by the PMO and the Internal Audit Department form the basis of discussions of the project management team’s activities at the board.

Risk Management System

One of the main duties of the project manager is to keep track of risks that may affect the project The project management team has a risk matrix that forms the basis for risk identification and management.

This risk matrix makes it easy for the project management team to identify risks to the project through regular reviews. Every week, the project manager submits a report that contains a risk appraisal of the project based on the risk matrix developed for this project.

Project Collaboration

One of the biggest challenges that every organization faces when it comes to project management is how to achieve collaboration across various business units. The nature of projects is that they usually require the input of various departments in ways that do not conform to the established organizational structure.

A project management committee can function as a separate organization within the organization. In order to reduce the risk of dysfunction in Tsingtao’s Thailand project, the company took the following measures.

First, the company assigned one of the senior vice presidents the role of project manager for the Thailand project. This VP will be the first president of the Tsingtao’s’ Thailand brewery. The Board felt that making this VP the project manager would give him the opportunity to understand the Thai business environment.

Secondly, the board decided to reduce red tape in decision making by making the project management team directly answerable to the board. This makes it easy for the team to make decisions independently away from the bureaucratic processes that plagues many business decisions The board only tracks the overall performance of the team in regards to the objectives of the project.

The third aspect of this project is that the board enlisted the help of the Internal Audit Department to keep an eye on the expenses of the project. However, the audit team can query expenses that fall out of expectations. The Internal Audit Department, then reports its findings to the board for further action.

The PMO on the other hand analyses all reports presented by the project manager on behalf of the board. The board then makes decisions based on the reports presented by the PMO and the Internal Audit Department.

Role of Organizational Culture in Project Success

The organizational culture of Tsingtao is playing a very important part in the development of this project. Internally, Tsingtao has a global mindset because of its international clientele. Tsingtao works well with people from other cultures in its marketing chain.

The company’s German heritage gave it an international focus on business. The company does not look at itself as a Chinese company, but as a brewery operating in China. This explains the decision by the board to move some operations to Thailand in order to serve its customers better.

Despite the internal perception of the company’s identity, the company operates within a Chinese cultural context. One of the visible impacts of Chinese culture in the operations of the project management committee is the choice of the senior VP to head the Thai project.

The Chinese culture stresses seniority when it comes to promotions and during hiring. In addition, staff members hold seniors in high regard because of the cultural heritage of the Chinese people. The board is sure that the senior VP will have complete control over the project because of the respect the other project team members accord him.

In addition to these cultural aspects, the Chinese power structure usually works around centralised controls. The senior VP is an organizational insider. The board is therefore comfortable with him at the helm of the new operation.

The Iron Triangle

The success of this project depends on the ability of the project team to deliver it within the scope, cost, and schedule. The scope of the project is non-negotiable. The project management team must deliver the project exactly as designed for it to meet the project’s objectives. On the question of cost, the team can find cost effective options in the design of some aspects of the project.

For instance, the project management committee can find large rice suppliers and sign supply contracts with fewer people. This option will save on the cost of organizing large-scale meetings with many smallholders. However, the company will need time to find these cost effective options.

The schedule of the project is flexible and is not entirely in the hands of the project committee. For instance, the company cannot force the Thai authorities to process permits faster than usual. The company must wait for the authorities to act.

ICT Resources Assessment

The three main types of ICT resources useful to this project include project management software, teleconferencing facilities, and internet banking. The project committee needs project management software to schedule tasks and to keep track of progress. The project can also benefit from collaboration software to ensure the team is in touch at all times. This will cut the costs of physical meetings and will save time.

The project management team and the board can have meetings via teleconferencing facilities. This will cut out the need to travel between Thailand and China for board meetings. This will also save on time and cost for the project.

Thirdly, the project management team will benefit from the internet banking facilities because of the need to transfer funds between China and Thailand to finance the operations of the project. Currently, there are many options available for international funds transfer. Some of these options require regulatory approval.

Retrospective Project Plan

The diagram below shows that network diagram and the critical path for this project.

Figure 1: Network Diagram

The tasks, detailed in the network diagram are as follows. The tasks listed in red show the critical path of the project.

1. Start
2. Architectural planning
3. Land survey
4. Obtaining of construction permits and regulatory approvals
5. Retaining contractors
6. Construction phase
7. Market analysis
8. Market segmentation
9. Branding decisions
10. Development of marketing objectives
11. Action plan
12. Identifications of rice suppliers
13. Identification of product distributors
14. Obtaining trade licenses from government
15. Obtaining permits from alcohol regulators
16. Environmental assessment
17. Identification of service contractors
18. Handover of construction project to the company
19. Marketing research
20. End

Risk Management Plan

Table 2: Risk Management Plan

Evaluation of Project Tools and Methods

The following table summarises various project management tools and methods, alongside their benefits to this project.

Table 3 Assessment of project management tools and methods

Conclusion

This success of the Tsingtao project in Thailand will depend on the use of robust project management tools and methods. The project enjoys strong support from the Tsingtao board, which is a critical requirement for the success of any project. However, the project will require careful implementation because of uncertainties inherent in establishing a new business in an unfamiliar business environment.

Reference List

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Dixon, DR 1999, ‘The Behavioral Side of Information Technology’, International Journal of Medical Informatics, vol 56, no. 10, pp. 117-123.

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Introduction

Pure Blonde came into the market in 2004. It was first produced by Fosters Group and it has become the first low-carbohydrate beer which was really successful in Australia. Many companies attempted to produce such kind of bear in the previous years.

For example, Bond Brewery had Swan Gold in the 1980s, but it did not do well in sales and Cooper’s launched Coopers diet beer in the 1960s, but decided to remove it from the market in 1990s due to a declining market share.

After a whirlwind product development process which took 90 days and with a promotional focus on customer discovery instead of aggressive push, Pure Blonde single handedly re-launched the ‘Low-carb beer’ market in Australia.

Foster Group Company is known for manufacturing beer and soft drinks. It was founded in 1888 by two brothers, William and Ralph Foster who owned a refrigerating plant. Two decades later, the Brewing Company decided to form a liaison with other four companies to form Carlton and United Breweries.

Today, this group stands as a sub-branch under the Foster Group umbrella. The Foster Group has become popular in Australia and is famous for brands such as Victoria Bitter, Carlton Drought, Crown Larger and Cascade. Pure Blonde was the first low-carbohydrate beer to be successful in the Australian market in spite of the failure of other companies to market their brands successfully.

In 2004-2005, the dominant players in the beer market were Foster group and Lion Nathan. The popularization of the Aitkins diet and the rising health awareness led to the Australian consumers preferring low carbohydrate products in the 1990’s and early 2000’s. Why did Pure Blonde succeed in this market when so many had failed before? Deeper investigation of the customer base can reveal signposts to its success.

Situational/SWOT analysis

Pure Blonde’s success was based purely on the consumers’ preference of the premium beer sector. Premium beer is one segment that was under constant scrutiny. The Premium Peter beer segment seemed to grow at a much faster rate due to favorable economic times, raised standards of living and education, and the delay to have children.

This resulted in the decline of Victoria Bitter. Unfortunately the Premium beer market was quickly becoming crowded and it became increasingly difficult to differentiate between the different brands. This was a major threat to Fosters’ profits.

Fosters immediately identified this problem in the Australian market and came up with a low-carb beer that differentiated its products from the others in the market. This gave it a strength or higher hand over the other products in the market. A good way of exploring opportunities for Fosters was conducting a market research.

It was found that the premium beer was linked to the Maslow’s Hierarchy of needs. Maslow hierarchy of needs dictates that an individual needs to look good and sophisticated. Those who drank Premium Peter needed to communicate that they fit into this profile. Therefore the main drive here was ego. Consumers of Premium Peter needed to show that they were masculine in spite of this gentle side.

However, they also didn’t want to be referred to as metrosexual because to them this translated that they were homosexual. Fosters Group concluded that Premium Peters image didn’t quite match to what being considered as male and masculine according to the Maslow hierarchy of needs. A weakness that they found in their marketing strategy was how to position Pure Blonde to the consumers’ best.

Pure Blonde couldn’t be categorized as being feminine or masculine. More research was required in order to understand where the average consumer placed Pure Blonde and they also had to avoid cannibalizing their lead selling beverage, Crown, market share.

Consumers of Premium Peter needed to consume the beer knowing that it was masculine and still had low-carb content. This clearly had set it apart from Pure Blonde. Fosters managed to make Pure Blonde its premium full strength beer that was low in carbs.

The packaging was of high quality, not to mention the European style bottle and the gold stylish label. Fosters decided to launch the product in 6X350 ml bottle that was sold in clubs and pubs in bottle, giving the consumer an opportunity to discuss the product.

This allowed those who consumed Premium Peter to discover Pure Blonde and tell their friends about it. This reinforced the masculine perception of the beer. Fosters had regained differentiation of its beers and this saw Pure Blonde being a success in the beer market.

They managed to regained differentiation and, within a year, Pure Blonde had achieved a great success with an estimated 3.3per cent by value of the entire Australian beer market and was reported to be twice the size of its nearest low carbohydrate competitor.

Situational problem

The main problem in this case study is the decline in the demand for Pure Blonde and Premium Peter. Currently, the Fosters and Lion Nathan are facing erosion in their market share. This can be due to the fact that Australians have more disposable income and the “premiumisation” of the beer market has led to the consumers demanding higher quality products.

The two companies have experienced a drop in sales for the past ten years with demand shifting from ready to drink spirits to foreign beer products. In addition, a blend in product innovation and packaging, specifically the four bottle packs, could be another cause.

The government could have also played a key role in the decline of local beer consumption when it announced in 2010 the introduction of an alcoholic volumetric measuring system to implement changes in the taxation of alcoholic beverages. This resulted in a 5% rise in beer prices.

The market share is set to face continual erosion in the future because of intensifying competition from other competitors that flood the market with their products. Entrants such as Coopers are set to re-enter the market with low-carb beer brands and Coca-Cola Amatil which recently acquired the Blue Tongue Beer brand.

Traditional retailers also present another problem to the beer market as they decide to promote their own brand low-carb beer instead of Pure Blonde, thus making them direct competitors. For instance, Coles has taken up advertising of its own Maxx Blonde beers over Pure Blonde by directly comparing the two products.

Currently, there are more competitors in the market who have flooded it with their own low-carb beers making it difficult for the average consumer to differentiate between the various brands. As a result, there has been a decreased loyalty between brands.

Pure Blonde has suffered greatly because of this competition and has not been able to combat Fosters’ current decline in Victoria Bitter sales. Major assumptions that may help explain the current Pure Blonde’s challenges include a shift in competition and changes in tax laws.

A closer look at Premium Peter shows that there has been a continuous growth in its sales. This is evident through a careful analysis of the premium beer segment, which has seen strong growth with total premium beer sales growing by 11.3 per cent in 2009. This might have taken quite a long time to explain the continued decline in Victoria Bitter’s brand which had lost over 3% of its market share since 2005.

Identification and alternatives used by Fosters

The premium beer segment has seen significant growth in spite of the declining low-carb beer sales. As the Premium Peter segment grew in numbers, it can be argued that this segment has evolved or even fractured.

Further analysis of the softer segmentation criteria, for example, attitudes and beliefs, understanding of self and self-concept, can help in defining these fractured segments. In order to maintain sales in the market, the key players have developed a strategy of maintaining their consumers by catering to their constantly evolving needs and preferences.

Fosters Group and Lions Nathan have sought to capitalize on the premium beer trend through investing in exclusive licenses to sell imported beers. This is seen by Fosters to obtain the sole license to sell Corona Extra in Australia.

To compensate this, Pure Blonde has expanded its distribution and has begun selling through liquor retailers and service venues including bars, clubs, cafes, and restaurants. They took another step and made the beer available on tap at clubs and pubs.

Pure Blonde sits comfortably in the center of the relatively concentrated premium beer price range, with Maxx Blonde and Platinum Blonde occupying the bottom price ranks and products such as Peroni Leggera sitting at the top.

The product has been effectively promoted and appeared to have held on to its ‘Jack-of-all-trades’ positioning with a focus on the ‘purity’ of the brand.

This positioning is clearly seen through advertisements featuring a 30-something man nurturing a dove back to health along with the tag line ‘from a place much more pure than yours’. Other current promotional materials available carry the message: ‘for men or women, anyone who is weight conscious’.

Recommended course of action

This case study suggests that the customers of Foster Group have a distinct set of values such as taste of beer, physical fitness and health in general, and self-image. The managers of Fosters Group should rely on the psychographic elements of segmentation in order to move away from the ‘one- size-fits-all” positioning.

This is why they need to offer several groups of products. In the first case, they should emphasize the taste qualities of their beverages and brand image. In the second case, they should stress the fact that their products contain very low amounts of carbonate, and that such beverages will be more beneficial for the health of customers. In such a way, the company will make a distinct value proposition to various groups of customers.

Discussion Questions

How shifting the market would gain Pure Blonde Competitive advantage

The average Australians are health conscious and this in turn makes them prefer low-carb diets. Promoting Pure Blonde as a low-carb beer attracts consumers who are health conscious, unlike premium beer consumers. The Pure Blonde product can capitalized on this understanding by effectively aligning its brand personality to the personalities of the segments, with positive results.

However, women are more conscious of their weight and appearances as compared to their male counterparts who are more concerned about maintaining appearances and fitting in with the boys. Therefore, if the beer is attributed to being more feminine than masculine, then the product may lose its male consumers.

On the other hand, it is traditionally viewed that many women aren’t great beer drinkers as compared to men therefore the product might only decline in sales if it is attributed to being feminine. However, the current woman is more educated and independent, and current trends show that many women embrace lighter beers and other low-carb beers such as Pure Blonde.

Although it would be a difficult task to re-invent Pure Blonde to fit both, the male and female consumers that will definitely be advantageous to the product in the market. The main limitation of this strategy is that many customers felt attached to former brands of Foster Group. I

t may be difficult for low-carbonate beers to win their loyalty. This issue is particularly important for the segment called Premium Peter or male customers who valued premium beer products. They may switch to other premium beers instead of purchasing Pure Blond. This is the risk that the company should not overloo

Customer profile for Pure Blonde

• Female
• 18-35 years of age
• White collar job
• Single, looking for a partner either short or long term leading to marriage
• Prefers to look beautiful and healthy
• Is social and likes fitting in with friends
• Earns a good salary and has little financial and emotional commitment
• Likes to be seen as a bit of a ‘lovable larrikin’ but also likes to be taken seriously in a work environment
• Works very hard so as to be successful and plays hard.
• Is currently on a diet and identifies that the Atkins diet
• Low-carbohydrate diet ‘is a good thing’
• Would forego a beer to save the calories- watching her weight
• Would choose a beer with a sweet taste
• Socializes with friends usually at clubs, pubs etc.
• Alcohol consumption is out and about.

The two key aspects that the female consumer is interested in according to the above profile is the taste of the beer and the amount of calories it contains.

Recommendations for the Fosters Group

On the basis of this customer profile and perceptual map, one can recommend the marketing strategies that Forsters Group. The company should make a distinct offering to female customers. While advertising such a product, they need to focus on the idea that Pure Blond products will not lead to the increase of weight, but at the same time they have the excellent taste qualities as other premium beverages.

Their main message should that the company’s beer is low-carbonate, but they should connect this message to such priorities of female buyers as physical appearance and self-image.

Premium Peter

The segment called Premium Peter did not completely disappear; it continued to expand even despite the global financial crisis. Male white-collar employees, who place emphasis on style and sophistication, still continue to consume high quality beers when socializing with their friends.

Probably, the lifestyles or attitudes of these people have evolved in a certain way. For instance, they may have changed their attitude toward marriage or health. However, they still play an important role for the producers of premium beers.

Moreover, the main values of these people such sophistication and good appearance did not alter significantly. The existence of this segment will affect the strategies of Pure Blonde. They will have to set stress on the quality of their products when designing packages for their beverages or advertising them.

There are eight stages in the new-product development process. Should companies always use all steps in sequence, or can some be deleted or overlapped to speed the development process? Provide reasons to support your answer.

New product generation has eight main stages: idea generation, idea screening, concept development, marketing strategy, business analysis, product development, test marketing and commercialization (Kotler & Armstrong 2010). Ideas are generated either within the company or from competitors and customers. Once an idea has been generated, it has to be screened to ensure it is feasible and workable.

The concept can then be developed further by taking it to a test audience and checking how they respond to it. If they are satisfied or excited about how the concept sounds, it can be moved to the marketing stage. The company must establish how the product will be marketed, how the market will be segmented and position strategies. If the marketing strategy is sound, the business should then establish the feasibility of the new product.

This involves checking if the product is profitable in the long run. After all these stages are satisfactorily passed, a prototype of the product is then developed and presented to a target audience. Marketing the product to a target audience is the test marketing stage. Test marketing is beneficial because it provides feedback according to which the product may be improved. Finally, it is launched on a national/regional scale, depending on the marketing strategy selected (Subramaniam 2009).

It is obvious that all these stages of new product development are dependent on each other, and everything is working to form a strong product. When a company is launching a new product, it would be advisable to follow all the steps sequentially. However, this is not entirely necessary. If, for example, a beer selling company needs to launch a new flavour of its product, it will take a shorter time – or probably skip – the marketing strategy process and jump straight into the business analysis.

This is because it has already established a marketing strategy that works for other brands of the company, and only requires changing its strategy slightly to suit the new product. However, for companies that want to build an entirely new product that has never been tested in any market before, it is essential to follow each step and take the required time needed to develop the product fully.

How many beer flavours you think a beer manufacturer should offer?

To recommend that a company should market a number of beer flavours are foolhardy. There are certain factors that affect the number of products a company can produce, and each must be considered when making the decision to market one product over another. The main factors to be considered in this answer are the total annual capacity and market segmentation.

Total annual capacity refers to the number of finished products a company can produce in one calendar year (Answers.com 2011). The capacity of a company to produce is limited by plant capacity and cost of production. If a company’s manufacturing plants are able to produce a certain number of finished products, this number may be increased by building more manufacturing plants, using the available resources more efficiently and producing certain products at a time. In addition, the company should be able to meet the cost of producing all its products. Certain companies have been known to consider stopping the production of a specific brand if the cost of producing it is not sustainable (Timken 2011).

If a company has been found to have the capacity to produce enough products to suit its needs, then market segments are what would guide a company’s number of brands. The beer market, for example, is unique. According to Hall (2007), there are two main types of beer: lager and ale. The main difference between the two is the temperature at which they are fermented. Ale is fermented at a higher temperature (65⁰ – 75⁰ F) than lager, which ferments at between 46⁰ and 55⁰ F.

The other factor that distinguishes these two is the type of yeast used in the fermentation process. Top-fermenting yeast is used in the manufacture of ale, while bottom-fermenting yeast is used in the manufacture of lagers. Beers can then be flavoured to differ in taste, colour and thickness, once these distinctions have been made. Market segmentation guides a company to how many flavours it can produce. If a company, for example, chooses to segment its market demographically, then it may choose to produce a certain number of flavours for younger people, for adults, for men, for women and any other segment it may choose to form.

There is a handful of very large beer producers in Australia, plus numerous imported beers. What are the main beer brands in your local region? How can a small micro-brewery such as Five Island s compete in such a marketplace?

There are hundreds of beer brands in New South Wales, some are big, and some are small. The leading beer brands in the New South Wales region are KB Lager, Tooheys, Reschs, James Squire and Hahn. KB Lager is manufactured by Tooth and Co., an Australian company. Tooheys is produced under the Tooheys and Hahn trademarks which are parts of the Lion Nathan beverages group, a New Zealand company. Resch’s is produced by Carlton and United Breweries, which was taken over by Tooth and Co., the Australian company. James Squire is produced by the Malt Shovel Brewery, an Australian brewery. Hahn Premium and Hahn Premium Light are products of Hahn Brewery, located in the New South Wales, Australia.

It is difficult, therefore, for micro-companies like Five Islands to compete in such a market, which is dominated by local and international brands. One of the most effective and well-tested strategies used by small companies in the development of a niche market.

A niche market refers to a company’s core business (Beijerse, 2000). Most companies have a niche market within which they operate. Without these niche markets, it is impossible for a small company to operate and survive in such a saturated marketplace. Certain companies have specialized in working in partnership with larger companies. They use large company’s systems which are dependent on their technology and expertise, and, in return, they offer a piece of their niche market to a larger company. This creates a win-win situation for both companies.

Another method used by small companies to compete with larger companies successfully is to provide excellent customer service. Five Islands, for example, has developed a distinctive relationship with its customers by building and running a pub just next to the factory. That way, customers are able to provide the company with direct feedback about their products. It is easier for smaller companies to keep in touch with their customers than larger ones. This strategy works remarkably well with micro-breweries (Rodriquez 2003).

Finally, a small brewery can remain competitive by teaming up with other small breweries to enjoy certain advantages of larger breweries. One of the advantages that larger breweries enjoy, for example, is the reduced cost of procuring supplies. By teaming up and getting their supplies together, smaller breweries can give themselves the same advantage larger breweries have (Rodriquez 2003).

In your opinion, what flavours of beer, or niche markets, that don’t currently exist might be a commercial success?

Although this has been discussed before, it has certainly not been conclusively pursued by brewing companies. One of the beer niche market’s last frontiers is an exclusive brewing of ‘session beer’. Session beer is defined as a beer that contains an AVB of not higher than five per cent. It features a balance between malt and hops ingredients and has a clean finish (Bros 2005).

The term ‘session beer’ was coined in the United Kingdom during the First World War. During this period, there were designated times when workers were allowed to drink beer. These sessions were between 11 am and 3 pm, and 7 pm to 11 pm. These restricted hours meant workers needed a beer that they could drink and go back to work without being drunk and disorderly. Although this definition is not concrete or proven, it has continued to linger in the beer world over the years and has become an unofficial term for a beer with low AVB.

Concentrating on brewing session beers exclusively is a terrific way to have a strong market niche in a saturated market (Walen 2011). The beer market is so full of rival companies that manufacture similar flavours of beer and similar target customers. Beer manufactures seem to be increasing the amount of alcohol content in their beverages, and this does not suit the typical session drinker. If a company could, therefore, focus entirely on manufacturing session beer of different flavours and targeting different demographic groups, there would be tremendous potential for success.

Five Islands Brewing Company currently targets residents in a local geographic area plus tourists. Given the high tourist activity in the region, how might Five Islands expand to market its brand outside the current geographic region?

There are several ways in which a small brewery like Five Islands can expand beyond the region within which it operates. This answer focuses on three ways that are considered being best suitable for Five Islands. The brewery can increase its number of outlets and factories, start franchising, or do direct marketing in the new target regions.

Although it is an expensive option, constructing or buying new premises for additional outlets and factories is one of the best expansion methods the company may choose to adopt. Building additional outlets requires capital to build the new premises, transport raw materials or finished goods to the site, market, and hundreds of other costs. Without sufficient capital, this move could bring a small brewery to its knees. However, if it is able to raise additional capital and either open brewing or manufacturing centres, then expanded into a new market in another region will be hugely successful.

Another less expensive but highly effective form of marketing is franchising. Franchising is a remarkably convincing way of capturing and keeping new customers in a new market, even if the market is in another region (Gappa 2010). Franchises help customers form the mental image of a brand and how the brand can be beneficial to them in the present and in the future. The downside of franchising is that it does not favour a small company. The main reason for this is the lack of sufficient knowledge about the company’s products.

Finally, an old fashioned method of direct marketing is a slow but highly reliable way of marketing. With direct marketing, there are no channel intermediaries. A good example of a company that does direct marketing is Apple Inc. (Apple Inc. 2006). Instead of looking for distributors to sell their products, they choose to build Apple Stores and sell their products directly to their customers.

References

Answers.com 2011, What does total annual capacity for a company mean? Web.

Apple Inc. 2006, Direct Marketing. Web.

Beijerse, RU 2000, ‘Knowledge management in small and medium-sized companies: knowledge management for entreprenuers’, Journal of Knowledge Management, vol. 4, no. 2, pp.162.

Bros, A 2005, Session Beers, Defined. Web.

Gappa, B 2010. What Is Franchising? Web.

Kotler, P & Armstrong, G 2010, Principles of marketing. London: Pearson Publishers.

Rodriquez, G 2003. 10 Ways Small Businesses Can Compete With the Big Boys. Web.

Subramaniam, A 2009, New Product Development. Web.

Timken 2011, Timken Increasing Capacity Across Steel Plants. Web.

Walen, B 2011, A Migration Towards a Niche Market. Web.

Introduction

Currently, Bud Light is recognized as the “King of Beers in the US” (Budweiser Bud Light: Brand Profile, 2016, para. 1). This beer outsells all of its competitors with impressive statistics – one out of every four beer bottles sold in the United States is Bud Light (Budweiser Bud Light: Brand Profile, 2016). As a brand, Bud Light competes within a densely populated industry where the rivals are aggressive and skilled. However, the brand manages to remain on top of the competition and overcome all the challenges imposed by the rivals.

Brand Development

Ever since 1957 and up to 2011, Budweiser (the brand from which Bud Light originates) has been the best selling beer brand in the world; after 2011, it was overtaken by a new Chinese domestic brand (Budweiser Bud Light: Brand Profile, 2016). The brand was launched in 1982, and its initial name was Budweiser Light. Soon, it managed to become the most popular beer of the Budweiser family steadily taking over all of its main competitors (Budweiser brands included). In 2015, the off-trade sales revenues of Bud Light estimated as large as 6.15 billion dollars (not counting the incomes gained by the beers sold by bars and restaurants) (Budweiser Bud Light: Brand Profile, 2016). The victorious path of Bud Light was not without losses and falls. For example, in 1988, it has experienced a significant decline in revenues which made it drop to the second rank in the list of the best-seller beers of the United States. Another decline occurred in 2009 after a peak in 2008, this year-by-year rise and fall pattern used to be quite typical for the brand.

Marketing

The marketing campaigns of the brand have become a significant part of its image due to its memorability and unconventional approach (Budweiser Bud Light: Brand Profile, 2016). For instance, the most recent series of advertisements features the Bud Light Party (a likening to a political party competing during the elections). The advertisement employs multiple celebrities known and loved among the Millennial generation, in particular, some of the most significant roles in the commercials are given to Amy Schumer, Seth Rogen, and Michael Pena (Fromm, 2014). The advertisements are done in a comedic and sharp manner with the involvement of multiple relevant concepts such as the upcoming Presidential elections in the United States, references to the pop culture objects, and common social arguments. As a result, one may conclude that the brand image of Bud Light is skillfully constructed based on the social relatedness and thorough research of the interests and needs of the customer base.

Distribution

Even though the domestic market of the US is the primary source of revenue for Bud Light, this brand is distributed in about seventy other countries (Budweiser Bud Light: Brand Profile, 2016). One of the largest distributors of the brand is China where it is sold by seventy different wholesalers in forty regions (Budweiser Bud Light: Brand Profile, 2016). The diversity of the cultures and markets in which Bud Light has expanded over the years has caused some challenges for the brand name that had to be changed in some countries.

Conclusion

Bud Light is the beer number one in the United States, and also one of the top global competitors in the industry with massive revenue. Bud Light is recognized for its powerful and aggressive marketing campaigns that involve multiple American celebrities and popular concepts in order to appeal to the Millennial generation that currently represents the largest sector of Bud Light’s customer base (Fromm, 2014).

References

Budweiser Bud Light: Brand Profile. (2016). Web.

Fromm, J. (2014). The Secret to Bud Light’s Millennial Marketing Success. Web.

Executive Summary

The present report is devoted to an external, internal, and stakeholder analysis of Cobra Beer Ltd (CB). CB is a UK- and India-based beer company that is predominantly oriented towards Indian cuisine (Bloomberg 2017b). The external analysis, which includes Porter’s Five Forces, shows that the UK beer industry has been losing its attractiveness because of an increase in supplier, customer, and substitute powers. However, CB remains a powerful incumbent of the mature UK beer industry. The PEST analysis demonstrates that the worldwide beer industry appears to be relatively attractive, especially due to new markets development in the still-growing industry, but it has issues, including the sluggish crisis recovery (Tomlinson & Branston 2013).

The internal analysis shows that the major resources of CB include its experience (positive and negative), human resources and their management, and the organisational culture. Also, customer research and innovation are an important element of CB’s value chain (Davies 2016). As for the PR issues, the analysis determines that CB had lost and needed to win the trust of external stakeholders as a result of a questionable deal in the past, but nowadays, the company demonstrates that it is a responsible corporate citizen (Smale 2014).

The four alternatives that are currently available to CB include focusing on domestic market and avoiding global expansion, postponing global expansion until the recovery from the recession is complete, or advancing in the global market with or without simultaneous extensive development in the domestic one. The report argues that the focus on a prompt global expansion without a similar focus on the domestic one suits the company’s goals, is acceptable from the perspective of its vision and can be feasible due to CB’s resources.

Introduction

The present report investigates the Cobra Beer company’s strategy and outlines recommendations for future strategic development based on external, internal and stakeholder analyses. Cobra Beer is a major brand manufactured by Cobra Beer Ltd (CB), currently a subsidiary of Molson Coors Brewing Company (UK) Ltd (MC) (Bloomberg 2017b). CB has launched a diversification program and currently produces various other goods, including bicycles, sunglasses and lamps (Cobra Beer n.d.a). However, CB brand beer remains the company’s primary product, which has earned the company 88 Monde Selection medals for unique smoothness, quality and taste, tailored specifically for Indian dishes (Cobra Beer n.d.b). The present report reviews the specifics of the company’s strategy to define its future action, which should involve global expansion.

Forces and External Environment that Shape the Industry

This part of the paper is devoted to an external analysis of CB’s industry, which includes the UK and global beer industry (Bloomberg 2017a). The analysis will be carried out with the help of PEST (a macro-analysis), Porter’s Five Forces (PFF) and Industry Life Cycle (ILC) models (Allen 2015; Fleisher & Bensoussan 2015; Rao & Klein 2015). The summary of the analyses can be found in Appendices A–C and Figures 1–3.

The company’s founder and current chairman, Lord Bilimoria, believes that the UK beer market is extremely competitive (Burns 2014). This view corresponds to the fact that local beer industries tend to be relatively well-developed and are often mature due to their long history of beer-brewing (Stack, Gartland & Keane 2016; Wells 2016). The international beer industry, on the other hand, can be defined as still growing (see Appendix A): it started its development in the second half of the previous century, and it continues to expand (Stack, Gartland & Keane 2016). From the point of view of PFF, this means that the UK industry faces significant entry barriers because of the resistance of the incumbents (Rao & Klein 2015). CB is one of these incumbents, meaning that it enjoys the protection of high entry barriers.

With respect to the force of consumers, the UK beer industry is characterised by the high bargaining power of clients. Indeed, the demand for beer in the UK has been decreasing in recent years. Tomlinson and Branston (2013, p. 213) demonstrate that this phenomenon is likely to be the result of other alcoholic drinks (especially cider and wine) becoming more popular. These beverages can be regarded as a threat of substitution (see Appendix C). However, there has been a trend showing a modest increase in off-trade beer in the UK (British Beer and Pub Association 2016b). Tomlinson and Branston (2013) point out that on-trade beer has been increasing in price, justified by increases in taxes and duties but making the product less attractive than off-trade beer, the price of which has managed to decrease due to supermarket discounts. The issue of increasing prices and growing taxes can be viewed as a problem from the perspective of supplier bargaining power because price control depends on the suppliers’ prices and quality (Fleisher & Bensoussan 2015). It is particularly significant since nowadays, the production of beer is greatly facilitated by potentially costly technological advancements (Cobra Beer n.d.b).

However, the consumption of beer is growing in certain global regions. As of 2012, Europe showed little increase in consumption while Africa, Asia and Latin America exhibited a noticeable increase (Stack, Gartland & Keane 2016, p. 61). Therefore, the situation in the UK market is less economically favourable compared to the global one.

One of the major economic factors affecting the industry was the recession of 2008 (see Appendix B). The Indian cuisine industry in the UK, which is directly connected to CB’s on-trade sales, was damaged by the crisis of 2008 and has been struggling to recover with relative success (Washtell 2016). Another significant economic factor involves supportive industries, in particular, tourism. The number of Indian tourists visiting various parts of the world has increased, but the British Beer and Pub Association (2016a) reports that for the UK, the number has been decreasing, which illustrates the increasing attractiveness of the global market.

From political and legislative points of view, a couple of factors are of importance for the industry. Lord Bilimoria sees the EU as a force that is both restrictive and beneficial: in particular, he considers the regulations to be limiting, but he is not sure if he can support Brexit because he believes that it would result in the UK losing its value as a market (Howard 2016). In general, Lord Bilimoria believes that the mere intent to leave the European Union may have damaged the reputation of the UK as a stable business partner. As a result, he is searching for the means to improve the situation: for example, by advocating for changes in tourism policies and the development of new visas, especially for the Indian population (Bilimoria 2015; British Beer and Pub Association 2016a; Skapinker 2015). For the time being, however, the political events related to Brexit appear to be somewhat threatening to the stability of the industry.

The government of the UK appears to support the brewery industry, especially with respect to export. As of 2013, 22% of the country’s exports in foods and drinks constituted alcoholic beverages (Collin, Johnson & Hill 2014, p. 19). In general, the government considers representatives of the industry to be important stakeholders, which means that current policies are developed in consultation with them and keeping their interests in mind (Hawkins & Holden 2014, p. 67). Therefore, the government provides a beneficial environment for the development of the industry. However, it also has introduced certain restrictions and standards with respect to production and marketing; for example, the UK has maintained its Advertising Standards Authority Code of Broadcast Advertising (Searle, Alston & French 2014).

Concerning social developments, two factors can be pointed out. First, it is important for the beer industry that the beverage typically is strongly identified with a particular nation, and national drinks are usually favoured over foreign ones (Stack, Gartland & Keane 2016). This factor can be both restrictive (from the perspective of global export) and beneficial (from the expatriate perspective). As for expatriates, migration is a socioeconomic and political factor that can be regarded as significant for the beer industry; for CB, Indian migration is particularly important. To sum up, PEST, PFF, and ILC demonstrate that the UK beer industry is mature or, possibly, declining and faced with multiple issues and threats while the global industry seems to offer numerous opportunities.

Internal Strategic Analysis

An analysis of CB’s internal strategic analysis involves discussing the company’s value chain (VC) and considering CB in the context of a resource-based view (RBV) analysis (Fleisher & Bensoussan 2015; Grant & Jordan 2015; Well, 2015). As one of the company’s major resources, experience should be pointed out. Throughout almost thirty years of its history, CB has encountered both successes and failures. From the time of its establishment, the company was growing at a rapid pace (about forty percent growth every year), and profits were predominantly used to support ongoing growth (Smale 2014, para. 5–6). According to Lord Bilimoria, the latter decision was a major mistake, which eventually resulted in overproduction and debts and nearly destroyed the organisation (Heilpern 2016; Howard 2016).

Lord Bilimoria reports that the crisis of overproduction was only resolved through the formation of a joint venture with MC through a pre-packaged sale, which helped to write off the debts (Burns 2014, p. 189). He also states that the sales of the company have never stopped growing, although he has managed to prevent outgrowth from occurring again (Smale 2014).

It is noteworthy that Lord Bilimoria has a degree in commerce (and another in law), and if at the beginning of his career as an entrepreneur, he had no experience, today he is an experienced and competent chairman (Howard 2016; Smale 2014). Also, the deal with MC did not just save CB from bankruptcy: it provided CB with more extensive resources, including those of a financial nature, and made it a part of a brewery giant with more than 350 years of experience, an 80% market share in the American market and a 17% share in Europe (Barrow 2016, p. 248; Stack, Gartland & Keane 2016, p. 67).

Lord Bilimoria believes that the main features that help his business stay afloat include a loyal team and the company’s culture, especially its values, which incorporate integrity (Heilpern 2016). Thus, the chairman of the company appears to regard human resources (HR) and organisational culture as key resources of CB. Both components can also be viewed as a part of the value chain because they involve multiple activities aimed at the creation of value, and they are rather closely related (see Appendix D, Figure 4). Here, they will be discussed in detail.

CB’s culture involves open communication and the requirements of honesty, commitment and discipline – which, however, is predominantly related to work. There are no additional rules (for example, dress codes), which, in the view of the managers, should help the team to remain efficient but content with their job. In fact, employees are allowed to drink at the workplace within sensible limits (Davies 2016, p. 72). The values of the company include passion, enthusiasm and the desire to achieve success, as well as a ‘vision for the product, supported by a commitment to all stakeholders’ (Davies 2016, p. 70). With respect to people, CB is devoted to the development of HR: even Lord Bilimoria is sometimes involved in coaching (Davies 2016). Thus, the company acknowledges the value of organisational culture and related HR management.

The main competitive advantage of CB is its unique, original product, Cobra Beer, which comes in three varieties: Cobra Beer Zero, an alcohol-free beer; King Cobra, a double-fermented beer and Cobra Premium, as the name implies, a premium Cobra beer (Cobra Beer n.d.b). Lord Bilimoria specifically points out that the beer was developed to fit Indian cuisine, which, in his view, the UK beer of his youth could not manage. As a result, he attempted to create ‘a beer with the refreshment of a lager, but with the smoothness of an ale’ (Smale 2014, para. 27). It can be suggested that the product was developed to fit the needs of the customers and with a deep understanding of their wishes. Therefore, the company was established due to a feat of customer research, nowadays a major part of the value chain for CB (Cobra Beer n.d.a).

The development of the product involved experimenting with the aim to achieve the flavour that Lord Bilimoria had envisioned (Davies 2016). In other words, the beer was innovative, and the element of the development of a solution to challenges discovered through customer research was not overlooked in CB’s value chain (Burns 2014; Skapinker 2015). CB continues to innovate in diverse fields, including beer (Cobra Beer n.d.a). For example, the company has recently improved glasses for CB, which the company has been producing since the beginning (Burns 2014, p. 188), to enhance the pouring process (Cobra Beer n.d.b).

The next element of the value chain is production (see Appendix D). CB maintains and indeed highlights the quality of its product (Barrow 2016). Also, CB’s managers think strategically with respect to production and other operations; CB’s reports are not available to the public, but it reports the rule of having detailed three-year operating plans (Davies 2016). Apart from that, the brand promotion, marketing and public relations (PR) efforts of CB have proven successful. CB has always generously invested in advertising (Davies 2016), and it has been demonstrating through contributions to charity that it is a responsible corporate citizen (Cobra Foundation 2017). Thus, by responding to the customers’ needs, innovating, ensuring the quality of production and promoting the product, CB has found a particular niche and discovered a demand for a particular type of beer (Heilpern 2016; Howard 2016).

By 2015, CB’s beer was sold in the majority (more than 95%) of UK curry restaurants, which can be explained by the company’s targeting strategies (Barrow 2016). In addition, the company has been extending its reach towards supermarkets (Smale 2014, para. 40), becoming available in most of the largest supermarkets by 2015 (Barrow 2016, p. 248). As of 2016, the retail value of the company amounted to £250 million (Heilpern 2016, para. 7). To sum up, CB has gained a notable prominence in the market (Barrow 2016), and Lord Bilimoria reports his intent to make the business global in about 20 years (Davies 2016, Howard 2016).

External Stakeholder Issues, Corporate Reputation, and Brand Equity

The present part of the report reviews PR issues and activities of CB. The concepts of corporate social responsibility (CSR), reputation management and organisational ethics (Beal 2013; Buckler 2017), as well as stakeholder theories (Crisan & Adi 2017), were used in this part. These concepts were aimed at assessing the issues of the external stakeholders as well as the way CB addresses them.

The PR activities of CB are important as an element of its value chain (see Appendix D), which is particularly obvious because of crisis-related activities. It can be suggested that the risky activities of the past, involving uncontrolled expansion, demonstrated a lack of concern for stakeholders (Crisan & Adi 2017). In addition, the growing overproduction of CBL, partially coinciding with the financial crisis of 2008, made the managers execute the deal with MC, which is not always considered ethical (Smale 2014, para. 3). In particular, it is problematic because the pre-packaged sale legally wrote off the debts to unsecured creditors, including suppliers and package developers (Burns 2014). In other words, the company has the right to avoid paying these debts, and Burns (2014) reports that the reaction of the creditors has naturally been negative. Thus, a major concern of CB’s stakeholders includes this event, which must have affected the company’s reputation. Fortunately, CB is working to resolve the issue.

Indeed, Lord Bilimoria reports that he has been paying the debts despite the fact that they are legally non-existent because he believes that it is the right thing to do (Smale 2014, para. 15-16). Lord Bilimoria also claims that throughout the period of the crisis, the team were open about the issues and gave interviews to report changes in the situation (Heilpern 2016), which is logical given the company’s emphasis on the importance of integrity and honesty. Finally, CB remains loyal to its supporters who showed loyalty in return; for example, the company continues to use its original warehouse, which struggled through the crisis with CB, even though additional warehouses are necessary to meet the current levels of CB’s production (Davies 2016, p. 71). It is noteworthy that the supply of beer never stopped, even when the company was on the brink of bankruptcy (Smale 2014). Thus, the company has been working on preserving and cementing the trust of external (and internal) stakeholders, attempting to alleviate the damage dealt.

Lord Bilimoria views CSR and PR as a means of building relationships with the community, prompting the company to engage in multiple activities aimed at demonstrating that it is a responsible citizen (Davies 2016, p. 72). In particular, CB has created its charity organisation Cobra Foundation (2017), which provides various forms of support to the young people of South Asia. It is also noteworthy that People for the Ethical Treatment of Animals (2017) includes King Cobra, one of CB’s products, in its list of vegan-friendly beer brands, meaning that animals are in no way involved in or harmed by the production process. Thus, the company clearly takes into account community and environmental concerns and contributes to their resolution.

Finally, it is noteworthy that the staff of the company is diverse, which is reflected even in the board of directors, including ‘a Kenyan, two Britons, a Pakistani, and an Indian’ (Davies 2016, p. 72). Lord Bilimoria promotes the relationship between India and the UK and supports immigrants (Bilimoria 2015; British Beer and Pub Association 2016a), which can be regarded as another attempt to respond to the community’s concerns. Apart from that, Lord Bilimoria suggests that immigration presupposes an influx of talent to the UK (Skapinker 2015), demonstrating that his agenda extends beyond helping individuals and involves being responsible with respect to the entire country. It can be concluded that the company works to create welfare for all the stakeholders involved, including shareholders, employees, customers and the community at large (Crisan & Adi 2017). Regarding the concerns that CB has managed to identify, including trust and the company’s reputation as well as CSR-related issues, the company is choosing to respond to those that appear to be strategically important for itself.

Strategic Options and Recommendations

The presented analysis points to several important conclusions. First, the UK may be slowly losing its attractiveness while also offering a relatively stable market for CB given the ubiquitous use of the beer by the target population (visitors to restaurants specialising in Indian cuisine). It should be pointed out that CB does not appear to have experienced a problem related to the reduction in beer demand due to its unique niche (Heilpern 2016). Tomlinson and Branston (2013) also report that reduction in demand has predominantly damaged pubs, which CB has never targeted. Also, CB’s spread to supermarkets offers promise due to the slight increase in the off-trade sales of beer. Still, the trend of decreasing demand for beer in the UK raises concerns about the future, especially since CB intends to continue to expand both in the field of beer sales and other areas that the diversification process has opened (Davies 2016, Howard 2016). Moreover, the problem of the Indian cuisine crisis in the UK and the Brexit threat suggest that CB might experience consequences from these issues if precautions are not taken. Therefore, CB needs to make a decision about future action as soon as possible – before it experiences the negative outcomes of the described situation.

Second, the global market seems to be exceptionally attractive for CB. Here, it is noteworthy that beer is reported to be historically related to a country’s or a nation’s identity (Stack, Gartland & Keane 2016), and given CB’s focus on Indian cuisine, there are many Indians not currently reached by the company. Ongoing globalisation is prompting Indians to emigrate to a number of countries, and in 2015, the Indian diaspora of migrants was the largest in the world, amounting to 16 million people (United Nations Department of Economic and Social Affairs 2015b, p. 3). The countries that are reported to hold the greatest number of Indian expatriates are the United Arab Emirates, the US, and Saudi Arabia (United Nations Department of Economic and Social Affairs 2015a). Apart from the expatriates, the tourism industry is noticeably supportive of brewery entrepreneurs (British Beer and Pub Association 2016a), which is especially relevant for CB’s experience of selling on-trade beer. Thus, CB does have an opportunity to reach numerous potential customers if it expands.

Third, CB currently has many resources. The company has recovered from the crisis, although it has not reported that all its debts have been paid. The production growth of CB never stopped, but it slowed down, and Lord Bilimoria managed to deal with the issue of overproduction, which can be regarded as a positive outcome. Also, CB’s joint venture with MC offers the company access to extensive financial and other resources relevant for a beer company. At the same time, other breweries also experienced the crisis (Walle 2015), even though they may not have suffered to a similar extent if they had no comparable internal issues. In other words, CB is a strong competitor nowadays with its distinct, original product and recognisable brand that targets a particular market segment but does not yet reach it globally. CB has the resources to handle expansion and related challenges, and it should be capable of repeating its success in new settings due to the specifics of its product.

Fourth, the company has had issues with expansion, resulting in PR problems and damage to the company’s reputation. This aspect is important to consider because it narrows the options available to CB: to refuse to carry out any global expansion and focus instead on the domestic market, to postpone global expansion until the market is fully recovered from the recession or to expand globally in the near future with or without a simultaneous domestic market expansion. According to the SAF model, the options need to be evaluated from the point of view of their suitability (appropriateness from the perspective of the objectives of the company), acceptability (appropriateness for the stakeholders) and feasibility (the use of resources in the most efficient way) (Daidj 2015, p. 5; Morley 2014, p. 221). The present report appears to demonstrate that the latter option is the most suitable, appropriate and feasible, which is proved by the environmental, internal and stakeholder analyses.

From the point of view of appropriateness, a global expansion is of interest for CB’s stakeholders, including MC. Currently, MC has a very small share in Asia and no sales in Africa, a situation that does not correspond to the increase in the rate of beer consumption in the regions (Stack, Gartland & Keane 2016, p. 67). However, Asia (especially the UAE) seems to offer many potential customers, making an expansion to an area that has been showing a rapid increase in beer consumption reasonable. It should be pointed out that appropriateness needs to be defined by the stakeholders themselves (Daidj 2015, p. 5). However, it can be inferred that the option would be considered appropriate due to the company’s unchanging focus on the Indian population. This focus probably could be modified with time, but it is directly related to the company’s philosophy, vision and integrity, which is why the present report does not suggest such a radical change. Instead, the company is encouraged to proceed with its visionary work on a larger scale, a familiar activity for CB.

With respect to suitability, the company’s goals, opportunities and situation need to be taken into account. The purpose of expansion appears to remain important for the company if its ongoing growth of production can serve as an indicator. Moreover, Lord Bilimoria believes that, sooner or later, a company has to expand globally, which demonstrates that the option corresponds to the goals of the management (Davies 2016, Howard 2016). Similar goals would be expected from MC, and this fact can be especially relevant due to the lack of the company’s engagement in the rapidly developing beer markets that can be targeted by the expansion. At the same time, as mentioned, the situation calls for action: while the UK demonstrates unimpressive growth rates of beer consumption, the rapidly growing markets like Asia and Africa are being taken up by competitors (Stack, Gartland & Keane 2016). Waiting for an excessively long time can result in these competitors settling in the markets and CB having to overcome significant entry barriers. Thus, the decision to expand globally in the near future appears to be suitable.

With respect to feasibility, the issue of the negative experience of expansion needs to be taken into account. Currently, the industry is recovering from crisis as seen in the struggles of Indian restaurants in the UK. As a result, it would not be surprising to discover similar tendencies in other countries, making progress in them more difficult. However, as pointed out, CB is currently at its strongest; it is a mature incumbent in the UK, with limited opportunities to develop in the country, but with multiple resources coming from its ongoing growth and MC’s support. The issue of trust has almost been resolved, and the company has proved itself to be a responsible corporate citizen and a financially capable project. As a result, the hardships of global expansion should be feasible from the point of view of investment, which should facilitate its acquisition. Also, the option of expanding globally without simultaneous expansion within the domestic market can be used to focus the resources of the company on the former, making it more feasible. To sum up, the present report suggests making use of the increase in Indian tourism and the notable expatriation rates, as well as currently available resources, to focus on proceeding with the visionary work of CB on a global scale in the near future.

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Summary

The case concerns the development of a flavor prediction innovation (neural networks) by a leading British brewing company, Coors Brewers Ltd. Although a large amount of chemical and sensory data is available, techniques for determining the relationship between the two variables are lacking. Neural networks offer a quicker prediction method than the test panels traditionally used to test beer flavors¹. Coors, motivated by the need to expand its market presence, set out to find a technique that would determine beer flavor based exclusively on analytical (chemical) data. The technique would enable the firm to create brands that could meet the diverse tastes and expectations of drinkers.

Coors developed the technique in a three-phase project. Initially, Coors used a single neural network to determine how chemical composition influences flavor based on sensory and analytical data it had collected. To implement it, Coors trained the MLP neural network using different combinations of sensory and analytical data.

This enabled the firm to analyze each quality and sensory output individually. Normalized data allowed the network to compare different outputs and minimize network error. However, the technique could not define meaningful relationships between output and input data because only a single quality was analyzed at a time. This limited data variability. In addition, ‘noise’ created by extraneous inputs affected the technique’s effectiveness.

Coors developed an improved version that included a software switch to eliminate the effect of insignificant inputs and reduce the network error. The method was exhaustive as it evaluated all input combinations. However, it yielded a large dataset (combinations) that could not be solved with the available computational methods. To overcome this limitation, Coors developed a genetic algorithm to determine the input/output combination that could yield a lower network error and thus, predict flavor more accurately. The results indicated that the trained genetic algorithm could accurately predict a number of flavors using trained chemical data. The current technique can only predict a few flavors. Moreover, it does not take into consideration other sensory factors.

Why is beer flavor important to Coors’ profitability?

Customer beer preferences and choices are never constant. A customer’s drink choice often depends on the occasion, settings, and psychological state¹. Coors, as one of the leading firms in the British brewing industry, intends to expand its flavors to reflect the changing and diverse customer preferences and needs. The beer flavor is one way the company can differentiate its products in order to provide customers a broad array of drinks that suit all situations.

The beer flavor is an important quality that drinkers take into consideration in choosing a brand-appropriate for a particular occasion. The traditional testing methods (panel tests) are time-consuming. In contrast, alternative techniques that are faster and accurate can give a company a strong competitive advantage in the industry. Coors aims to come up with a novel method of predicting flavor based on chemical data alone. This will enable the company to develop beer brands that meet customer expectations.

What is the objective of the neural network used at Coors?

The aim of Coors’ neural network is to select input/output combinations with the least network error in order to predict beer flavors more accurately¹. Such combinations will improve the accuracy and speed of predicting beer flavors. The alternative method (panel testing) is slow and requires multiple inputs. In contrast, neural networks have the ability to predict beer flavor using only the chemical input data.

Coors implemented different versions of neural networks in a bid to develop a refined prediction technique. The genetic algorithm technique developed synthesizes chemical inputs and releases sensory outputs, which define a beer’s flavor. The company uses input and output data that have been gathered from panel testing over the years¹. The role of the neural network is to model the link between inputs and outputs. Coors has improved the performance of its neural networks over the years producing a highly accurate prediction tool. The prediction accuracy of the genetic algorithm tool stems from its ability to reduce network error.

Why were the results of Coors’ neural network initially poor, and what was done to improve the results?

Coors launched its project by implementing a single neural network. This product was made up of a two-layered MLP sourced from an external developer. It focused on a single input (chemical quality) and output (flavor). Using normalized data drawn from input combinations, the network was trained to do cross-comparisons of different sensory outputs. However, the single neural network had two significant limitations that affected the quality of the results. First, it used a single input variable, which reduced data variability. This meant that no meaningful relationships could be modeled. Second, ‘noise’ caused by extraneous inputs affected the network’s effectiveness.

To improve data variability, Coors expanded the product range. This generated more analytical input data for training the network. The second modification was the introduction of a software switch that allowed the training of the network using input/output combinations making up the probability space¹. This exhaustive search, though effective in removing the ‘noise’, generated many combinations. The huge number of combinations per each sensory attribute (up to 16.7 per flavor) was mathematically impossible to compute¹. A gene algorithm method, which could select relevant inputs, was developed to replace this method. The gene algorithm technique is a more accurate method of searching inputs with minimal network error for accurate flavor prediction.

What benefits might Coors derive if this project is successful?

Coors will gain many benefits from the ongoing project. First, the technology will help Coors in product differentiation. This will ensure that it offers unique and more attractive products than those offered by its competitors. An improved version of this technique will have the capacity to predict more flavors. The technique will enable the company to select chemical inputs that produce unique flavors.

Coors will also be able to produce a broad range of flavors that reflect diverse customer tastes and expectations. This will increase the firm’s market share and give it a strong competitive advantage over its rivals in the beer brewing industry. Since it owns the technology, Coors will also benefit from the exclusive rights that come with patenting an innovation. It can sell or lease the technology to other brewers for a fee.

What modifications would you make to improve the results of beer flavor prediction?

The current technology can only predict a small range of flavors. Moreover, it leaves out certain compounds that influence beer flavor. To enhance prediction, I will analyze all the compounds that affect flavor to enrich the available chemical data. With a broad array of input data, more flavors can be determined accurately. Moreover, I will factor in the effect of physical variables related to drinking as they affect flavor sensation. These include ‘mouth-feel’ variables and the appearance of the beer. I will develop a sensory profile of a typical drinker to aid in the prediction process. To improve the neural network’s prediction accuracy, I will include the physical variables in the input data fed into the program.

Reference List

1. Sharda R, Delen D, Turban E. Business Intelligence and Analytics: Systems for Decision Support. Upper Saddle River, NJ: Prentice-Hall; 2014.

United Breweries Beer, owned by an Indian businessman Vijay Mallya, is among the most successful companies selling alcoholic beverages in the United States. Its nearest competitor, Sensex, has a 7% worst performance as can be seen in Figure 3. The growth of United Breweries Beer is phenomenal because it emerged as a small producer of beer in the United States, as a branch office of its Indian parent company UB Group, and turned into the giant at the American alcohol beverages market (Figure 1). Nowadays, United Breweries Beer works in 50 states.

The activity of United Breweries Beer on the territory of the United States began in 1983 when the Indian Branch Office decided to expand globally. In 1990, an affiliated company of UB Group, called Foster’s Group (named so to promote one of the company’s central products) began its activity in the United States. Foster’s Group growth was remarkable with an annual 12% expansion. Due to its efficient revenue management, focused sales, well-thought-off marketing companies, and the other measures directed to fostering clients’ interest in their product, the company became one of the leaders in the American market. Foster’s Group continued its growth and included hundreds of privately owned brew houses and pubs. Later, it received the new title of United Breweries Beer. The company is famous for its flexible strategies of marketing which permit it to maintain its high levels of sales in the United States. However, the performances of United Breweries Beer in the country are worse than in the other regions of the world including Latin American countries, Canada, and Australia which is explained by the abundance of competitors in the US alcohol beverages market, and especially at the beer sales market. The dynamics of United Breweries Beer performances can be seen in Figure 2.

The major brands sold by United Breweries Beer in the United States are Foster, Kingfisher (which is also a brand with the fastest-growing popularity), and Carlton. The main reason for the company’s success in the US market is occupying the niche of strong beer sales. The decision to occupy this niche is by far the wisest decision by the company’s management in the United States that has led to its incredible success. To realize the plan of catering to the strong beer market segment, it was decided to initiate the production of the new burton called Kingfisher Strong Premium. This decision was brought into reality in 1999. Immediately, Kingfisher Strong Premium Beer has become the most popular burton among the American people. The secret of its appeal to the masses is in the values promoted by it which are so close to the heart of Americans. Among these values are style, youthfulness, strength, power and machismo. One more secret of Kingfisher Strong Premium Beer’s popularity is in its packing standards because it has the styles and sizes of its package able to satisfy the most diversified categories of consumers.

All in all, United Breweries Beer, owned by an Indian company UB Group, is one of the most popular beer-selling companies in the United States. The secrets of its appeal to consumers are in the wise marketing actions by the company’s management, in the values promoted by its marketers, and in the wide assortment able to satisfy the most diversified categories of buyers.

Market positioning

In today’s business world, marketing is one of the fundamentals without which a business company would have significantly fewer possibilities of success in the market. There are several methods for marketers to develop new ideas and advertise new products and services. Market positioning for a company is essential for its wellbeing (Kahn, 2005). It is a factor of strength and profitability. Of course, these are features of a positive, comfortable, market positioning. Its opposite means the company has much to change and reorganize. Through its positioning in the market, the firm can further expand its business activities.

To achieve positive results in market positioning a company has to carefully select the product, products, it will launch in the market. A product launch is something that involves various activities. It begins with the costs of operations and continues with market strategies and customer perceptions (Kahn, 2005). First, we have to take care of market segmentation and select the typology of customers that our product is directed to. Our company is a beverage-related business firm that has identified as a market segment to launch its product a certain social group, category, which is identified as white/Caucasian male, who lives in the NW area of Oregon, aged between 25 and 31 years old. We are not seeking just for anyone with these characteristics but for middle (and upper-middle) income people who earn on average $50,000 or more per year.

A final characteristic of our target customer would be that he frequents Brew Pubs on a certain frequency, at least once a week. But that is also the focus of the two main competitors for our company: the Sierra Nevada and Blue Moon.

The market positioning of Sierra Nevada is quite more favorable than that of our company, Widmer Brothers Brewing Company. If we have to use a perceptual map, we would use the following:

In it, C is the positioning our company stands. B is the position of Sierra Nevada Brewing Company. And D is the position of Blue Moon. This map makes it clear that there is a big difference between our company and the competition. Unfortunately, for the moment this difference is in disfavor of Widmer Brother’s Brewing Company. This graph also shows something important regarding the three companies. They have different branding strategies and are sending out different appeals to the consumers. A is the positioning that our company should aim for shortly.

We will talk in detail later on this.

Branding

The three companies have managed to be perceived differently from the consumers. They have tried to differentiate themselves to gain as many customers as they could. Brand differentiation is one of the best strategies and solutions for commodities to avoid fierce competition and stabilize their market share (Aaker, 2004).

Blue Moon, has managed to be perceived as the ‘best friend of individuality’. It has appealed to customers with individuality and quality being the two most recognizable features. It has marketed itself as a ‘solo’ beer, which people would enjoy in private. During the last decade, it has managed to distinguish itself in this respect. The following graph demonstrates their efforts to build a brand that is based on individuality and quality. For the last 4-5 years they embarked on a marketing campaign promoting those two qualities. The data was taken from surveys done by the company itself and publicized on their website.

As we can see, since four years ago, there has been an improvement in customer perception in terms of individuality and quality of this Belgian-White Witbier style beer. Since its launch in North America in 1995, it has now managed to form brand recognition for individuality and quality.

Sierra Nevada is the other main competitor. It has selected a different branding strategy and market approach then Blue Moon. Its brand equity is focused heavily on quality and then on social appeal. Its managers decided they wanted to form a beer that was recognized for its social appeal. Sierra Nevada beer began a marketing strategy with the intention to make it distinguishable in beverage quality. As proclaimed in its website (www.sierranevada.com) this beer wants to be recognized as a product which makes people enjoy their coming together under a high quality beverage; a sort of Coca Cola of beers. From the surveys made on the effects of their branding marketing campaign we have constructed the following graph. It demonstrates the results on customer brand perception of the product foe the last 5 year period.

What the graph shows are that they have had a lot of success in being recognized as a high-quality beer but still have much to do regarding their social appealing. Here is where our company could benefit.

Widmer Brothers launched its Drifter beer in the market with the hope it will become the consuming product of the target group mentioned at the beginning. This beer targets a certain category of people in their social activities (pub frequenting). It is not a ‘lowliness’ beer and ‘solo’ individual. Since it is the start of the product launch we will try to identify in the next part what strategy should the company apply to achieve positive results.

Changes projected for the future

Drifter beer’s current customer perception is incomparable with that of Blue Moon and the Sierra Nevada. But since the product is young, it has all the time to develop and improve. What the company should do now, is to differentiate Drifter and make it attractive to the designed target group of customers (Trout and Rivkin, 1996). To do this, branding should be moved toward social appealing first and quality then. If we move toward quality recognition, we will be in direct conflict with the Sierra Nevada which already has a comfortable position regarding quality. Instead, in the social appeal field, there is still ‘ground to gain’. The advertisement and marketing campaign should aim at transforming Drifter as the social entertainment of the white middle-class guy during his time spent at Drew pubs. The link between the pub and the beer is essential. The pub is the symbol for a certain social group coming together in an area, and the beer will become the social atmosphere symbol within these pubs. This connection of symbolisms will make a strong social appeal to the selected social category (Asker and Erich, 2000). After this first stage of a marketing campaign, the company can move toward reinforcing brand quality recognition.

It will be easier since we will have a customer base on which to implement strategies. People will already have a perception of Drifter as a socially appealing product related to certain pubs.

References

Aaker, D. A. (2004) Brand Portfolio Strategy. New York: Free Press.

Aaker, D. A. & Erich, J. (2000). Brand Leadership. New York: The Free Press.

Kahn, K. B. (2005). The PDMA Handbook of New Product Development. Second Edition. Hoboken, NJ: John Wiley & Sons.

Trout, J. and Rivkin, S. (1996) The New Positioning: The latest on the world’s #1 business strategy. McGraw Hill, New York.

Craft beer production’s general and industry environment is characterized by the constant emergence of new tastes and the combination of different styles in creating products. Craft beer requires constant taste experimentation from brewers and people in business, as the current public (especially the younger generation) appreciates variety. People want to try new things, compare the taste with the old, already classic, and choose what they like. The habits of the younger generation of consumers and their new values ​​force brewers to stick to the competitive game, becoming part of new segments, atypical for beer.

In the craft beer industry, profoundly rooted in style-matching and problematic production, suppliers have a powerful influence on pricing. By supplying the craft beer resources needed to make one beer stand out, they make buying for brewers less physically challenging than financially challenging. This burden falls on consumers who see a big difference in price between craft beer and regular wheat beer. Suppliers directly influence the price of a particular craft beer. Buyers actively influence the formation of proposals since their desires become the engine for competition. Listening to the opinions of consumers, brewers have already recorded the high popularity of lightly flavored drinks based on them. Occupying this particular niche is considered adequate at present (Famousdc, 2016). Competition forces brewers to constantly be creative in terms of product promotion. If one cannot release a new IPA in response to their competitor, it makes sense to show originality by releasing a lager with a unique taste. Competitive struggle is tied to attracting the attention of consumers and the opportunity to surprise them with new flavors and combinations.

In my opinion, the craft beer industry at the moment reflects well the needs of consumers. Most people do not know much about craft beer and want to drink good-tasting while watching their favorite movies or sporting events. The industry has changed dramatically over the past 15 years, driven by consumer needs. COVID-19 has had a significant impact on reducing the growth of this business. Now people are returning to friendly meetings, cozy gatherings at sports matches, where craft beer is easy to drink in company, discussing its taste. It is impossible now to talk about the unprecedented heights the craft beer business is experiencing. It should take more time to recover such a business focused on products consumed during friendly meetings or in crowded places.

Reference

Famousdc. (2016). Famous for DC: Port City Brewing Company [Video]. YouTube.