Premium Beer Market in Thailand

Topics: Marketing, Alcoholic beverage, Beer Pages: 14 (3478 words) Published: November 7, 2008

Year 2005
There were various kinds of determinants influencing the enlargement of the beer market; especially the cause from gas price has risen up high like never before. Deriving the consumer products price had to be adjusted to avoid suffering from higher cost of production and transportation. On the other end, consumer’s purchasing power had become lower due to the higher cost of living; driving them to adapt to the economic situation they were facing.

From the observation in the beer market, we could notice there were obvious changes in consumer’s behavior; consumers or drinkers tended to shift from having large size of beer 640ml. to the smaller size 330ml. in the form of small bottle or can. Moreover, there was a slightly drop in the frequency of buying beer also. (Source: B&A CO.,LTD/Daily Manager Newspaper: May 1st 2005)

In addition, government sectors also had plan in process to leverage IRS tax on alcohol beverage as the European Union had implemented it before in order to improve the social overall status and also eliminate beer industry pitfalls.

Year 2006
In this year, there were many interesting movements occurring in the premium beer market. Beer manufacturers in the premium segment had planned an expansion in their production base to penetrate in other potential segments which were most likely to be the offering in light beer; providing more choices for consumers, containing less amount of alcohol or to be exact, lower than 5%.

From the total amount of alcohol contained, although light beers were obviously positioned separately from the premium segment, still, they had become the new face of drinking premium beer which targeting on consumer who loves to drink healthier responded to the healthy concerning issues and trend in nowadays. Most importantly was light beers were actually sold in the cheaper price than premium beers.

Plus with the facts that light beer market was still in the introduction stage, holding only 35 million liters in total production quantity or only 2% of the market shares in beer industry; therefore, showed that the light beers market still had more potential growth along the way (Source: Thai Beverage Marketing CO.,LTD/Prachachat Newspaper: March 13th 2006)

For the entrepreneur in light beers segment, San Miguel, the first brand penetrated into this market, was using the ‘Push Strategy’ in the early stage, implementing the intensive distribution to cover all convenience stores and on-premise market like pubs, bars, and restaurant in order to take advantages of being the first offering in the market.

After the intensive distribution was taken place to cover all potential areas in the market, San Miguel immediately continued with the follow-up plan by using the ‘Pull Strategy’ in order to create more brand awareness through mass media; TV commercials, radio spots, and also held promotional events at particular on-premise restaurants, pubs. Moreover, San Miguel had collaborated with 104.5FM FAT RADIO holding “San Miguel Music Fest Volume 2” which counted as the latest marketing activities of San Miguel.

On the other hand, Chang Beer, who had been testing the light beer market since year 2005, decided to officially commercialize Chang Light into the premium market in March 2006; at a price of 45 baht per bottle which contains 4.2% of alcohol volume; also implementing ‘sport marketing’ or ‘event sponsorship’ through golf and related activities.

By March 2006, Singha Light was introduced to the premium market in Thailand. Although Singha was planning to focus on exporting their light beers to penetrate in Europe and America continents, but because of the high volume of alcohol up to 6% containing Singha Beer, it caused them to face with higher tax than the competitors. Plus, most drinkers in those markets preferred drinking beers with low degree of alcohol.

Apart from that, Singha Light also put more focuses on...
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