Beer Company Segmentation Essay

Demographic: From the market analysis portion of the paper we already established that internationally, Anheuser is expanding both into the Asian and Latin American markets. But typically what segment of the market do they target specifically? Well currently, the company is making an attempt to target the female population. Michelob Ultra is being marketed in women’s magazines like cosmopolitan and other AB brands are placed on woman-focused channels such as Oxygen and Lifetime. Women however aren’t the only focus. With the recent focus being on FMB’s, the most consistent and continuous market has been the 21-27-age bracket, mostly college students. It’s Bacardi line of flavored malt beverages and the latest additions, Tilt and B-to-the-E agree with the lifestyle of the contemporary adult looking for innovative drinks that is suitable for a variety of occasions and is an alternative to beer. For the more traditional and patriotic consumer, Anheuser markets towards its US customers by boasting on the fact that it is the only American made beer. Geographic: Currently, Anheuser is a global enterprise with distribution centers in the U. K, Japan, Canada, and Spain. It holds a 50% market share in the U. S beer market and a 50% market share in Grupo Modelo, Mexico’s leading brewer. Anheuser Busch owns 27% stake in China’s number one brewer Tsingato and is pursuing Harbin brewery Group in China. Psychographics: The trend today is for people to lead healthier lifestyles and be more conscientious in the activities and interests that they partake in. This is ever so visible in the diet plans and low-carb phase that has emerged and has become dominant. To capitalize off of this Anheuser promotes its low-calorie beer to these individuals. Anheuser also places more emphasis on it flavored malt beers to appeal to its wine and spirit consumers and to compete in a changing environment where people lead highly social lifestyles by going to bars/clubs, shows, sporting events, etc. Sponsorships of the 2006 Fifa world cup, MLB and its 26 domestic teams and the Mexican national soccer team are an attempt to capture this segment of the market. Behavioral: â€Å"18-34 year old Hispanics are consuming Spanish and English broadcast media at nearly equal rates with Spanish-language television and radio outpacing English-language television and radio; * A greater percentage of young Hispanics shop at more store types than do young non-Hispanic adults; * Young Hispanics are more likely to be impulsive shoppers. They like to keep up with styles and will spend what they have to look younger — more so than non-Hispanics young adults; * Young Hispanic adults are heavy readers of magazines with lifestyle, entertainment, automotive and sports-focused titles taking the lead; * 18-34 year old Hispanic consumers are more persuaded by advertising in Spanish and are more loyal to companies with ads in Spanish. † (Hispanic business) The trend is for Hispanics to be trendsetters and innovators instead of followers/laggards so the pattern has been to market on a personal portfolio basis instead of brand-loyalty aspect. The younger generations tend not to be brand loyal but adoptive of the newest and trendiest innovations. The behavior marketing of Anheuser Busch is tailored to the Hispanic with events, in magazines, television stations and sporting events. It sponsors the 2006 Fifa World Cup, MLB and its 26 domestic teams and the Mexican national soccer team. Not only is the behavior of Hispanics evaluated but all of diverse nations. Anheuser promotes diversity in the workforce at distribution centers across the world to be familiar with the consumer behavior of all groups. Positioning strategies: Beer is always associated with negative stereotypes of death, drunken behavior, a male activity and many other bad connotations. The fun image of Anheuser Busch (more commonly known as Busch Gardens) land looks to change the appearance as a fun image for the family. Children at a young age will be familiar with the product and see it as user friendly because it is positioned as healthy and acceptable for everyone. The addition of the low carb line of beer also helps to suggest that the beer is also healthy and socially suitable. Product strategies: Anheuser Busch product strategy includes the eye catching 7ounce shrink-wrap bottle that comes in six colorful festive designs. Bud Light, one of the brands of AB, is including the addition of flavorful beer with Bud light Oranguatang and Bud light berry. It also introduced two new one of kind brews, Celebrate by Michelob and Brews Masters Private Reserve by Budweiser. Pricing strategies: To better target the Hispanic market, AB increase the Latino budget to more than 60 million dollars, which is 66% more than last year. The increase of national media spending will also increase by three times more than last year topping 3 million dollars. â€Å"While the domestic beer company has increased tactical price promotions this year on a specific market, brand and package basis to reduce price premiums versus competition, company executives confirmed that the company’s long-term pricing strategy continues to target increases at or slightly below the consumer price index. â€Å"(Forbes) Promotion strategies: As stated before the company is promoting its product to attract woman through woman-focused channels like Oxygen and Lifetime. In addition to becoming familiar through sponsorships of major sporting events, it promotes its products through marketing messages as the only American brewery that is still American owned with profits staying in the states. Miller Brewing Company Demographic: Many breweries realize the potential of the growing Hispanic market and Miller is no different. Especially important, 75% of the Hispanic population is under 45 years old- a prime age group for beer consumption. Hispanics are the most brand-loyal demographic among beer consumers. However this is not the only segment that it targets. Miller is tailored to the contemporary drinker minimum age 24. Commercials for products such as Miller Light show the masculine image of men in masculine environments. Most of Miller products are marketed in a way where they will attract the high-end buyer that will pay a little more and conscientious of high quality. While Anheuser Busch’s Bud Light targets the younger generation, Miller Light’s targets the older demographic with the minimum age being 24. A segment that has been omitted in the marketing strategies of many products not just the beer industry has been the homosexual population. Miller hopes to capitalize off this market to regain its position as No. 1 in the industry by targeting all areas of the market. Geographic: In July 2002 Miller Brewing Company merged with South African Breweries plc, making Miller a subsidiary of the #2 brewer in the world. It became the first international brewery to establish a presence in Central America. As its top competitor, Anheuser Busch, it is expanding into the Latin and Asian markets. Unlike most breweries, it doesn’t concede to a particular geographic segment of the market but intends to account for every beer drinker in every market. Psychographics: To further appeal to their No. 1 consumer the Hispanic market, Miller Brewing Company, promotes most of their products through Hispanic events such as sponsorship of Cinco de Mayo and sponsorships of World Cups. The Hispanic market is seen as the most brand-loyal and therefore is targeted so aggressively. The advertising has an effect on the psychology of consumer behavior through the emphasis of stating that their products are of higher quality. Males are attracted to the idea of a beer that places emphasis on the bravado of a product and their behavior is altered through male marketing. Behavioral: In a male-marketed item such as the high life products, you must target the behavior and activities of the typical man. Miller is the official sponsor of the National Football League. Most of the products are marketed on a brand loyalty basis so it sponsors everyday products to gain the familiarity with consumers (ex: Kraft, Frito-Lay, Gillette, etc). Positioning strategies: Miller positions its products for the loyal consumer to the more rebellious and daring drinker. The homosexual segment is seen as a daring segment because they do not adhere to the norm of today’s society. Miller Genuine Draft Light is seen targeted on the gay and lesbian network LOGO. Miller is big on letting it’s great taste speak for itself, as seen with it’s No. 1 product Great taste-less filling ads, and has been successful. Miller with Food: Taste for yourself summer campaign was used and was instrumental in increasing sales. Product strategies: As a company, you want to be seen as one of the top in your industry. Miller guarantees this by strategically placing Genuine Draft Light next to the number one competitive low-calorie brand. The confidence of the taste and quality of its products are so high that it implements the technique of sampling to capture new beer drinkers and convert them into loyal consumers. Another technique used for their products is space management which achieves more cooler and shelf space through long-neck N-R’s in 6-pack baskets and loose case, 6 and 12 pack cans, and 6-pack N-R’s represents the package mix consumers demand. The selling of recyclable plastic bottles which made Miller the first making it the first brewer to offer widespread distribution in plastic in the United States. The plastic bottles allow for a more transportable product that remains cold for the same length as aluminum. The only downside may come from recycling officials that argue that the brown plastic bottles do not recycle well with regular soda and water bottles and the cost for accommodation of these brown bottles would be unfeasible. Pricing strategies: To further place emphasis on the higher quality of products, it does not discount its products. It believes in a motto of â€Å"No Compromise,† to get a superior product you must be prepared to pay for it. Most of its pricing strategies are given towards the advertising efforts. Last year alone it spent 40. 1 million on Hispanic-targeted print and television advertising, more than any other advertiser in the alcoholic-beverage category. Promotion strategies: Promotion of Miller products is heavily dependent upon the ever-growing population. SAB Miller signed a 100 million deal with Univision Communications, the largest Spanish language broadcaster in the U. S. It includes sponsorship of programs, product placement and commercial time on Univision’s radio, cable and broadcast networking properties. Miller realizes that all marketing efforts can be targeted at the older segment so it looks to work with major record labels and will sponsor preview parties for new album releases for popular artists. Comical commercial advertisements for Miller Light’s (Good Call) also attract the younger market. Promotion also comes from its virtual online game â€Å"Miller beer runner. † â€Å"The introduction of the Miller game came within days of Anheuser-Busch, the colossal corporation who brought the famous slogan â€Å"king of all beers† to Budweiser and its Bud family, pulling their funding for a game called â€Å"Bud pong. † After discovering that many people, especially young adults, were using beer during the game instead of water, as directions specified, they axed the marketing ads and funding for the game. â€Å"(FordhamObserver) In no way is the company promoting under-age drinking/misconduct and stands by its slogan â€Å"Live Responsibly† to promote drinking in moderation. Molson Coors Brewing Company. Demographic: Coors Brewing company has 40 different brands which appeal to consumers all over the world, specifically in United States, Canada, United Kingdom, and Brazil. In the U. S Coors light is its number one brand which is targeted more towards the young adult drinkers. Molson Dry is a substitute for Coors light in Quebec, the company is spending more money in advertising this product in order to make it as appealing as Coors Light is in United States. In the United Kingdom lager holds most of the market share with beer brands such as Carlin and the introduction of the new Coor’s fine lite beer. As most beer companies recognize the potential in the Hispanic community, Coors thrives to gain market share within the community by offering donations and scholarships to the Hispanic Association of Colleges and University. Molson Coors objective is to get the â€Å"Hispanic Community to adopt the brand, not just try it. † Geographic: On February 9th, 2005 Coors joined forces with Canada’s leading brewery Molson making them the 5th largest brewery by volume. This merge has presence in seven of the top either beer markets which include U. S, U. K, China, Mexico, Russia, Brazil, and Japan. Molson Coor’s holds 18. 5% market share in the United States and 21% market share in the United Kingdom. Currently it’s continuing to grow Coors light in China and other Asian markets. Psychographic: Molson Coors is always looking for new ways to attract consumers, and one of the most efficient markets is to attract people who watch their carbohydrates. In the U. S and other markets Molson Coors has No. 2 low carb beer to attract these consumers. As the craze for lite beer and low-carb beer increases, Molson Coors will keep bringing out new products for their consumers. Molson Coors also targets consumer through activities such as sports. In the U. S Coors light has the biggest sponsorship with NFL in order to promote their product. Also in the U. K whenever a consumer thinks about soccer they associate it with Carling, United Kingdom’s No. 1 lager. Behavioral: In order to make consumers familiar with their products, Molson Coors targets them through their everyday habits for example Coors light portrays the image to young adults that drinking Coors light is cool and socially acceptable. Because of this Coors light has a dominant market share amongst college students rather than Miller and Budweiser. In order to gain customer brand loyalty from most consumers Coor’s light always promotes or sponsor’s programs which are liked by consumers with different taste. Place (Distribution) Strategy: Molson Coors is always looking for new ways to communicate with its distribution channel. Recently in an attempt to increase sales Molson Coors has added more staff and applied more resources across the three largest channels Grocery Stores, Liquor Stores, and Convenience stores. Molson Coors also created a channel marketing team to develop customized promotions aimed at addressing each customer’s unique needs. Product Strategy: Molson Coors strategy as a whole is to provide high quality products using high-quality ingredients. In order to compete in the market a company has to always keep coming out with new products to evolve with the taste of the consumer. Molson Coors not only does that but also promises its consumers that the product is kept cold from packaging to delivery to retail. In the U. K the company introduced two new products called the Kasteel Cru, which is a fine imported lager brewed in Alsace France and C2 which is Carling’s new 2 percent alcohol by volume lager. In the U. S Molson Coors introduced its new low-carb beer called Aspen Edge and to make Coor’s light more attractive now consumers can buy it in new 8 oz cans. Pricing Strategy: Molson Coors is trying to cut cost and provide more value to its share holders by planning on cutting down the advertising budget. Last year alone Molson Coors spend 300 million dollars on advertising. Another method which Molson Coors used to cut costs is by reducing the number of suppliers, and building more strategic value added relationship with their vendor-partners. Promotion Strategy: In order for a company to come out on top it has to attract it’s consumers through promotions and discounts. Molson Coors promotes its products by being involved in many charities as well as Non-Profitable programs such as the Deaf Awareness program, Alcohol program and policies such as â€Å"21 means 21. † In Canada the company was involved in promoting an event called the Coors Light â€Å"Trauma Tour† which included music and action sports. In Puerto Rico the company is trying promote its product by being more involved in community programs. Pabst Blue Ribbon Beer Demographic: Pabst is one of the very few brewing companies that does not own a brewery. Instead it negotiates deals with other breweries such as Miller to brew its products while maintaining ownership and marketing rights of its brands. Pabst has a 3. 6% of the market share. Pabst Blue Ribbon is mostly popular amongst urban hipsters and this brand is being adopted by older generation X, and younger generation Y in Portland. In the U. S Pabst is starting to become more popular amongst professional and semi-professional snowboarders. Pabst is also being used by people who do gallery shows in order to portray and image that its time to get back to the basics. Overall Pabst uses a strategy which doesn’t involve cash but it involves customer use of the product. Geographic: Pabst has about 3. 6% market share in the U. S and about 2. 5% market share in Portland. Amongst many brands Pabst Rainier beer is more successful in the northwest. Overall in the Unites States Pabst grew 25% more in 20 different states. Psychographic: Pabst which has history associated with its name is beer for older people. The beer is acquired more with taste and consumers who use to drink Pabst in the old days have started to drink it again making them bran-loyal. Behavioral: Pabst is also considered a blue-collared beer and is targeted towards blue-collared workers. Since Pabst is the oldest brand there is customer loyalty from the older baby boomers that drank it. Place (Distribution) Strategy: Now that Pabst is trying to increase its sales in the United States as well other countries it has created highly customized retailer specific programs. Pabst Blue Ribbon has also convinced a lot of important chain grocery stores to carry their product.. Product Strategy: Pabst let’s its customer decide how they want their beer served. They haven’t done a package redesign in the last 10 years. The only change they have made in their product strategy is that they serve Pabst in bottles now. Pricing Strategy: Pabst was always known as the low cost beer. They keep their prices low by not spending money on advertisement; instead they let word of mouth do the job. Promotion Strategy: Pabst does very little promotions in order to cut cost and save money. Among the few promotions which they do have, they offer cash payments to rowdy bike messengers to drink their beer. Pabst is also trying to come out with new promotions in Portland because they see a substantial growth market there. Another way Pabst promotes is by giving away their beer free to those who use it as a advertising for their own retail shops. References http://www. usatoday. com/money/industries/food/2005-08-08-bud-tilt_x. htm http://www. hispanicbusiness. com/news/newsbyid. asp? id=12515 http://www. forbes. com/execpicks/prnewswire/feeds/prnewswire/2005/05/25/prnewswire200505250915. 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