Mountain Man Brewing Company
Bringing the Brand to Light
Mountain Man Brewing Company (MMBC, or the Client) is a family-run business in West Virginia that has experienced much growth since launching its flagship premium beer Mountain Man Lager (MMB) in 1925. Over the decades, brand loyalty, quality and brand awareness have been the cornerstones of the Client’s success – the importance of the MMBC brand among consumers has allowed the company to build its small but consistent market share in the East Central region (ECR), particularly in its home state, the only region it distributes in (7.1% of the market with more than 50 million USD in revenue).
2. Challenges & Opportunities
MMBC currently faces a potentially identity-changing challenge: The traditional premium beer market has been declining at a compound annual rate of 4%, and MMB experienced a 2% decrease in revenue last year, the first drop in its entire history; accordingly, MMBC’s target aim is to recover from the 2% decrease in revenue that occurred in the prior year.
The light beer market – popular with younger drinkers – has also been growing at a CAGR of 4%. Although MMBC has been historically weak in the 35-years-and-under segment, there is opportunity to generate more sales by releasing a new Mountain Man Light Beer (MML) line to target this younger market. However, there is the risk of negatively impacting their current distribution of MMB through shelf-space cannibalization and higher costs; as well as the risk of alienating their core segment of older, blue-collar drinkers.
MMBC faces potentially losing more revenue at the current forecasted compound annual decrease rate of 2% – the projected decrease for MMB standalone in year-to-year net revenue from actual 520,000 barrels sold in 2005 (USD 50.4 m) to 470,039 barrels (approximately USD 45.6 m) by 2010 totals nearly 10% (see Exhibit