Boston Beer Company Case
Boston Beer Company Case
_Background Information_: The Boston Beer Company, which was founded in 1984, had a very diversified thriving product line which entailed about twenty different kinds of beers. Their product was available in over nineteen various countries and used a network of around four hundred distributors. Revenues grew from 21 million dollars to 210 million dollars from inception to 1997.
_Problem and Opportunity Identification_: As a result of the company’s product line and its variety, the company encountered issues sustaining and upholding of their products such as Lightship – which has been withering in recent years and which doesn’t have the volume like other products to sustain distribution. Since the light beer business that Lightship belonged to was one that was rapidly growing, the Boston Beer Company felt the need to investigate its products disappointment. The research to do so took place in different forms such as competition, market, and financial analyses, customer surveys, and finally deep emotional analysis using the ZMET technique.
_Alternatives_: One option the research team is considering is introducing a new light beer into their product line. It is understandable that since the high-priced light beer industry is one of the biggest and rapidly growing field in the beer industry, the Boston Beer Company wants to occupy and take advantage of this field to further enhance its name and maintain its market share and its standing. However, there are issues in terms of positioning and marketing of this product. The product needs to be communicated as a light, rich, fun beer and targeted at a different audience that entails women. In addition to the fact that this option might cause conflict in terms of the brand image being a macho rough beer brewer, using it doesn’t solve the problem for Lightship if Lightship is going to be kept in the market offerings.
Another option the research team considered was repositioning Lightship and throwing in more effort and investment into the marketing of the product. It was obvious that, compared to one of their biggest competitors Heineken, the Boston Beer Company has had trouble and sort-of failed to build a unique brand identity for this product. The product was not successfully differentiated and positioned in the market in order for it to build market share and improve standings. This failure could make it difficult for the company to reposition itself and change consumer perceptions to gain their interests and so it might be a waste of time and efforts.
Finally, the last option is the dreaded one of not competing in this realm of the industry. This is a very extreme option since this realm is a huge and growing segment of the market and they would be missing out on a lot if they decide to pull out it. The failure to fit into this field, however, might have proved that the Boston Beer Company is not competent enough and ready to compete in this segment.
_Critical Issues_: There are two main critical issues that the company should consider when making the decision about their situation in the light beer industry. One critical issue concerns the brand image – the company has an umbrella brand image of being a premium masculine macho craft beer brewer and shaking that could be seen to influence consumer perceptions. The second critical issue relates to the field study and the results it yielded – do they answer our questions about how to position the light beer product or on whether we should even introduce/keep products in this segment of the market.
_Conclusion and Recommendation_: After reviewing the results of the various research techniques, the recommended option would be to introduce a new high-end light beer into the market (while probably retiring Lightship). Making use of the ZMET research results, this new product should be positioned in a manner that represents an active, refreshing, and healthy lifestyle. Having a new product instead of improving Lightship is best in order to avoid the difficult efforts of having to change stubborn consumer perceptions. Also, in terms of the umbrella brand image of BBC being a macho tough image, having a separate offering targeted at other audiences will probably add to the image of having two instead of eroding the existing image.