CASE STUDY ANALYSIS
OFMountain Man Brewing Company :Bringing The Brand To Light
Key PersonalitiesChris Prangel - MBA Graduate Oscar Prangel – Retired Owner
and President of MMBCGuntar Prangel – Founder of
MMBC John Fader, VP Sales
Case FactsMountain Man Beer Company founded
in 1925 by Guntar PrangelChris Prangel , an MBA graduate
wanted to inherit his father`s business.
Mountain Man brewed one beer called Mountain Man Lager
Also known as West Virginia`s beerChris wanted to launch Mountain Man
Light among the youngsters
For the past 6 years beer sales in US had been growing at a compound annual rate of 4%
Also had decrease of traditional premium beer sales with same percentage
The reputation quality beer was well entrenched throughout the East Central region of United States
By 2005, Mountain Man generated revenue over $50million and selling over 520,000barrels² of Mountain Man Lager.
Held in top market position in West Virginia among Lagers
Price $2.25 for a 12-ounce serving of draft beer in bar
$4.99 for a 6-pack in a local convenience store
Unaided response rate of 67% from State`s adult population
In 2005, MML won “ Best Beer in West Virginia “ for its 8th year straight
Also won “ Best Beer in Indiana”Selected as “ America`s Championship
Lager “ at American Beer ChampionshipMM sold 70% of its beer for off – premise
consumption
SWOT AnalysisStrength :1. Market leader and well established brand
name2. Strong brand equity3. Best range of Attributes4. Promotion Strategy & Customers Weakness : 1. Improper utilization of funds in
advertising2. Lack of financial resources to compete in
the light beer advertising market
Opportunities :1. Reach out to younger demographic 2. Increase lifetime customer value Threats:1. Risk of canalization of core brand2. Alienation of core customer through
new brand3. Dilutes Brand equity
Leading QuestionsHow brand awareness campaign can be
carried out ?Is the promotion strategy for Mountain
Man Lager & Mountain Man Light the same ?
Whether the MMBC should launch the new brand in the market ?
What are methods adopted by MMBC to improve their sales in future ?
Does the new brand affect the sales of existing brand i.e Mountain Man Lager ?
Major Issues & AnalysisPressure on regional breweriesMountain Man`s revenue declined in
2005 by 2%Challenging company`s ability to
remain profitableStruggling to maintain steady share of
its market segment against large domestic brewers
Impact of Mountain Man Light on sales of Mountain Man Lager
Financial projections showed regional revenue growth of the light beer product @ 4% annually
Mountain Man steadily growing its share of the regional light beer market by a quarter of a percent each year off of a 2006 base market share of 0.25%
SolutionsLaunch Mountain Man Light via brand
extension.Launch new product using 4p`s of
marketing mix i.e Product, Price, Place Promotion.
Advertising the new beer brand through Online Media and Social Networking Sites
Providing offer in prices for Mountain Man Light if bought in high quantity
Easy to convince retailers to stock & promote
Labeling and packaging efficiency
Promotional material to cover all partner retailers
Permission marketing getting customer involved in the brand and connecting other customers
Advertise in spot radio, outdoor and social networks
Need to capture on-premise locations like bar, pub which are frequented by younger target market
Multi-brand distribution system should be followed
Situation Analysis of Customer :-
The beer industry in US generates $ 75 Billion in annual sales.
Customers base their choice on taste, price, occasion, perceived quality, brand image, tradition, local and authenticity
Eastern Central Region represents $13 billion in annual sales out of $75billion.
Mountain Man counts with 81% male drinkers, thus neglects Female market segment
Female market segment which represents 32% of the TAM of domestic premium beer.
Focus on a target market: blue-collar male workers.
While their target customer brings them the focus and loyalty needed to build brand awareness and equity,
MML not taking consideration of other market segments such as the white-collar class and other potential niches
64% of Mountain Man drinkers are 45+ years old while the TAM for that age category represents 49% of the domestic premium beer market in the Eastern Central
Competition :Competitors for Mountain Man are
Anheuser Bush, Miller brewing Co. and Adolf Coors possessing 74% market share of the overall brewing market.
These three companies have 84% market share in the light beer market.
They rely heavily on broadcasting market as well product diversification to create barriers of entry for other brands
Company :-Revenues of over $ 50 Million, MMBC Founded in 1925 by Guntar Prangel who
established itself as a premium domestic quality beer,
Known for its flavor and bitter taste. With time Mountain Man Lager became the beer
of pride in the Eastern Central region of the United States.
Oscar Pragnel retired president and owner and the business stayed focused on maintaining the quality and serving a specific market niche building brand equity among blue-collar, middle-income and below workers.
Collaborators Off-premise locations, such as
liquor stores and super markets, is Mountain Man main sales channel as it sells 70% of its production at these locations.
The main reason for this result is that 60% of blue-collar workers buy their beer through the off premise locations.
MARKETING MIX ANALYSISProduct:1. MMBC will stand out as compared to competitors in
the light beer market .2. Label should portray a fresh and young image since
the target segment is young adults. 3. Use of bold and vibrant colors to attract attention of
the customers4. The bottle should use a lighter shade such as light
green to differentiate from the dark brown bottles of Mountain Man lager.
5. The light green used also indicated a lower alcohol content of a new brand extension.
Promotion :1. Promotion Bar mats to be distributed to bars and ret
ail outlets carrying light brew and Mountain Man lager.
Place :1. Product line extensions actually helped brewers
obtain greater shelf space for products and created greater product focus among distributors and retailers
2. There is a need to increase distribution among bars which is only 30% of current sales. Need to target locations that are frequent by the young adults.
Price:1. Observe competitors pricing strategy and carry
out market research to determine the optimal pricing.
2. It is important to price Mountain light brew not too low in order to break even quickly and not to price it too high for fear of low sales.
References :-http://www.scribd.com/doc/49132085/
Mountain-Man-Brewing-CompanyPrinciples of Marketing, 13 Edition, Philip
Kotler www.authorstream.comhttp://www.scribd.com/doc/49132085/
Mountain-Man-Brewing-Company
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