Mainstream Light Beer Brands E.G. example essay topic

"Business has only two functions -- marketing and innovation", Peter Drucker. Anheuser-Busch remains focused on three major objectives to improve shareholder assets. Their first goal is to increasing per barrel profitability. The second is to expand international beer operations. There last objective is the continuing support of profitable growth in packaging and entertainment.

Proper packaging brings cost savings and assures the quality for there products, while entertainment enhance the company public image. The company's most important technique is target marketing. Anheuser-Busch sponsor's events and runs advertising specifically aimed at all sorts of consumers: blacks, whites, blue-collar workers, computer-buffs, and sports fans. Sports fans make up a large, diverse population. The beer industry can be segmented into the following divisions: (Stack) 1. Worth-More = Aggregate of the Import, Super-premium, Flavored Malt Beverage, and Craft / Specialty segments.

Brands within these segments, in general, sell for higher prices and have higher margins. (Stack) o Imports: Brands brewed in another country and imported into the U.S., e.g. : Corona, Heineken, Pilsner Ur quell o Super-Premium: Domestic brands (excluding craft) which sell at prices higher than Mainstream brands, e.g. : Michelob o Flavored Malt Beverages (FMB's): Also known as RTD's or FAB's, e.g. : Smirnoff Ice, Sky Blue, Jack Daniels Hard Cola, Mike's Hard Lemonade o Craft / Specialty: A niche segment, characterized by small domestic brewers who brew brands which are darker and have unique flavor which differentiate them from mainstream brands 2. Mainstream = Aggregate of the Premium Full Calorie and Premium Low-Calorie o Premium - Full Calorie: Mainstream full calorie beer brands, e.g. : MGD, Budweiser, Coors Original o Premium - Low Calorie: Mainstream light beer brands e.g. : Miller Lite, Bud Light, Coors Light 3. Economy = Aggregate of the Near Premium, Budget, Malt Liquor, and Non-Alcoholic beer segment. Brands within this segment typically sell at prices below Mainstream brands o Near Premium Brands whose selling prices are typically below Mainstream but higher than Budget, e.g. : Miller High Life, Busch o Budget Brands which sell at prices significantly below the prices of mainstream brands, e.g. : Milwaukee's Best, Natural Light, Keystone Light o Malt Liquor Brands which are higher in alcohol content than normal beer, e.g. : Olde English 800, Mickeys, Magnum, Colt 45 o Non-Alcoholic Brands which contain no (or very low) alcohol, e.g. : Sharp's, O'Douls (Stack) To meet the company goal of a profitable one percent increase in market share of the beer market per year. A couple avenues can be approached: Microbreweries represented a new strategy in the brewing industry: rather than competing based on price or advertising, they attempted to compete based on inherent product characteristics.

They emphasized the freshness of locally produced beer; they experimented with much stronger malt and hop flavors; they tried new and long-discarded brewing recipes, often reintroducing styles that had been popular in America decades earlier. Together, these breweries have had an influence much greater than their market share would suggest (approximately 5-7 percent). (Stack) There could also be a gradually movement from exporting small amounts of Budweiser. The company could enter into licensing agreements whereby breweries in a range of countries such as Ireland, Japan, China, and Argentina can begin to brew Budweiser for sale in their domestic markets. The most profitable way to increase market share would be to enter the Craft / Specialty segment of the market through Microbreweries. This can be accomplished regionally with private labeling, regional branding, joint venture with existing microbrewer's, or buy complete control.

Because of using this vehicle to expand market share, the product that is produced will return more profit to the company and there is a possibility that through experimentation with regional tastes a new national brand could be introduced. Stack, Martin H... "A Concise History of America's Brewing Industry". EH. Net Encyclopedia, edited by Robert Whales, July 5 2003 URL web Rosenthal, David and Brown, Lew G. : Cases in Strategic Marketing, Prentice Hall Upper Saddle River, NJ, 2000.