Executive Summary- Mountain Man Beer Company (MMBC) is experiencing declining sales for the first time in the company’s history. Chris Prangel, who will inherit the family-owned business in five years is faced with a hard decision that whether to take the risk of launching a new product to attract younger customers or to follow his father’s steps, continuing doing the 80-year-old Mountain Man Lager business. His father has concerns about the profit, the core business and the cannibalization and Chris has done several researches to estimate the potential business opportunity of the new product Mountain Man Light Through an analysis about the company, the product and the market, it is clearly ...view middle of the document...
Brand frolicked a critical act in beer buying decision. Mountain Man was a legacy brew in a mature market. It relied on its past and rank as an autonomous, relations owned brewery to craft an aura of authenticity.
The contest in the beer marketplace dropped in four disparate categories. Main and second-tier internal producers, import beer firms, and specialty brewers. The Main internal producers like Anheuser Busch, Miller Brewing Firm and Adolf Coors Company, accounted for 74% of the marketplace in Massif Man’s region. The subsequent tier internal producers had 12.5% allocate, import beer firms had a 12% allocate and the craft beer industry owned the rest. Massif Man Brewers were a subsequent tier company.
Changes in beer drinkers’ preferences were a main cause of weakening sales. Light beer sales were producing at an annual rate of 4% each year coinciding alongside a 4% plummet in premium beer sales. The light beers had by now increased to 50.4% of finished beer sales and Massif Man had no representation in this segment. The demand for import and craft beer was increasing. Heavy discounting on beer had provoked larger beer producers to locale pressure on tinier ones.
Action Overview-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 within the 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 a rate 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 line to target the 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.
Mountain Man Brewing Company does not desire to go one more year alongside revenue capitulated from Mountain Man Lager. By adding a light beer to the product line it might gain loyalty from a younger crowd and appeal extra next just the workingman. At the alike period he does not desire to lose the brand fairness that has seized years to create. He is additionally confronted along solid monopolies in the beer globe that make it hard to retain up. Chris is confronted alongside a hard decision, will seizing a chance and changing the picture truly be the right move for Mountain Man.
By familiarizing a new product line shouted Mountain Man Light the firm should be able to grasp a broader audience. They should no longer focus on the workingman, they should appeal to a younger creation of beer drinkers. They should additionally be...