Coors Light

Topics: Beer, Statistical hypothesis testing, Brand Pages: 34 (6484 words) Published: February 19, 2010
Executive Summary - Coors’ prominence in the beer industry has always been overshadowed by its bigger competitors like Budweiser, Miller and Molson, but new insights unearthed by this report may pave new roads for a more exciting future. The first part of our analysis describes the typical Coors drinker as an aged 25 to 44 male light beer drinker consuming almost seven bottles a week. He also works in a managerial or professional occupation earning over $30,000 annually. Coors’ three competitors also exhibit a similar consumer base with the exception of Molson being predominantly regular beer consumers. These conclusions are tested to be statistically significant. The second part of our report tests for associations. In the end we have found that males prefer regular beer while females prefer light beer. Younger people also showed increased interest in light beers, and are more likely to be a brand switcher rather than be loyal to a brand. Coors has the largest percentage of people working in managerial or professional occupations while people who categorized their jobs as others mostly described themselves as non-loyalty drinkers. The brand switching matrix analysis confirms the previous research on competitors. We lose the most consumers to Budweiser, Miller and Molson, but we also have a potential to gain new brand loyalists from those same three companies. This analysis also uncovers the strength of Coors’ potential market expansion by showing a brand strength ratio of 2.083. Moreover, we find that Blatz is most vulnerable to Coors in terms of the percentage of loyal consumers switching to Coors. The fourth division of the research attempts to better understand consumer lifestyles through factor analysis. We find that Coors has a relatively neutral stance in terms of innovation and risk-aversion, but has a higher score in terms of machismo. We identify that brands with the closest positioning are Busch, Michelob and Blatz. Of the three big competitors, Budweiser has the nearest profiling to Coors. In the final part of our analyses, we run a couple regressions to understand beer consumption quantities and light beer preference. Our results conclude that consumption is negatively related to age and income. Males and skill laborers also tend to consume more drinks per week. As for light beer, preference is significantly correlated to females, young adults and individuals who like to drink at social events. We also find that Coors potential new customers are more or less similar in demographics to the existing consumer base. Our recommendations arising from our research comes in two parts: consumer retention and market expansion. We believe that strategic product positioning in the retail scene will help mitigate customer losses while at the same time interest new consumers. We also think that skilled labor workers who are loyal to Coors should be specially targeted due to their higher consumption. If Coors’ management decides to expand its light beer market share, its marketing campaign should possess flair of youth and social sophistication without neglecting the female market. Finally, because of similar consumer bases, we advise Coors to engage in sports marketing both in the retention and market expansion strategies. 1) Consumer Profiles and Segmentations - The characteristics of a typical Coors loyal drinker is a male who has a stronger preference with 68.5% in favour of light beer versus 31.5% regular drinkers (Exhibit 2) with average household income $50,000 and above. Also the most drinkers consume beer in social occasions and while watching sports (Exhibit 3). Moreover, we have also conducted a t-test which shows the data analyzed for Occasions of beer consumption to be significant as all the t-values are greater than 2. Thus, we would be able to conclude confidently that both data graphs for social occasions and sport event drinkers to be a bimodal distribution where it...
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