Case 2: Mountain Man Brewing Company
Prepared for:Marketing 181
Date:February 9, 2011
Question 1: There are many factors that have enabled MMBC to create a strong brand. These include: taste, perceived quality, image, tradition, and authenticity. Taste is achieved through a selection of rare Bavarian hops and unusual strains of barley creating a defined Mountain Man quality. In addition, Mountain Man Lagers’ distinctively bitter flavor and higher alcohol content sets this beer apart from its competitors, which uniquely contributes to the company’s brand equity. To complement the richer stronger taste, a dark colored bottle is used to enhance perceived taste and quality. The 1925 original design of coal miners imprinted on the front promotes tradition, regional loyalty, and authenticity. By association the picture links the blue-collar worker to the image; therefore MMBC is able to target consumers of age 35+. Mountain Man Brewing Company is able to distinguish its beer apart from its competitors mainly through its high-perceived quality and brand image strongly appealing to West Virginia population where Mountain Man Lager is also known as “West Virginia Beer.” In addition, MMBC has a high brand loyalty rate of 53% in comparison to their competitors who have a lower brand loyalty rate (i.e. Bud Light 36%, Budweiser 42%). Thus, the Mountain Man Lager has the brand loyalty advantage over its competitors. MMBC is also able to distinguish itself from competitors by Mountain Man Lager being produced and distributed by an in-house small marketing team in West Virginia. Consumers in the region have close brand ties in comparison to larger breweries that do not have distributers acting as direct promoters of brand. Even though MMBC has a strong brand name many things have caused its decline. The key qualities that have built a strong brand exclude drinking populations who cannot associate themselves with such a distinct image. The company’s most loyal customers belong to part of an aging population thus producing a shrinking market in the Mountain Man Lager. Therefore, they are unable to capture the younger growing market (21-24 segment), which has a greater interest in drinking light beer. The main reason for MMBC’s decline is due to a dwindling market size or a shift in consumer preference towards a lighter beer despite its strong brand name. By not establishing a strong presence in the 21-24, 1st drinker segment, MMBC will lose potential buys as customers deviate away from their brand towards competitors. The Mountain Man Lager is only capturing 2% of 1st time drinker demographic while its competitors, domestic light and domestic premium, have a 6-7% advantage over this market. Also, in West Virginia the market has become competitive. Retail stores are strongly discriminating against smaller brands making hard for the Mountain Man Lager to attain shelf space. Question 2:
The pro’s and con’s of introducing a light beer are as follows: Pro’s | Con’s |
Appeal to younger demographic, including women | Could lose sight of core consumer| Would extend product line | Would potentially lose market share to blue collar, loyal customers | Gain more share of “on-premise” locations | More expensive to launch new product: costs $4.69 more per barrel | Would give MMBC more shelf space| Big risk involved: potential to hurt brand image if quality doesn’t meet the standards of the original Mountain Man Lager. | Potential growth of light beer product at 4% annually| It would be hard for MMBC to introduce a light beer within such a competitive market; will never achieve the volume of larger light beer brands like Miller & Coors Light could| Create more competition in the beer industry | Large advertising expenditure necessary for visibility and currently MMBC only uses grassroots marketing|...