Business Analysis: Mountain Men Case

Interoffice Memo
Date: 2/20/2015
To: CHRIS, Marketing Operations Manager
Cc: Nasser
From: 001744285; WVE Consulting
RE: Mountain Men Solution
At WVE Consulting, we as a company strive to help companies find solutions that improve their companies’ daily operations while also guiding companies to look into untapped opportunities that have potential to maximize profit in the long run. After reviewing over Mountain Men case, we were able to conclude that Chris needs help convincing senior management team that Mountain Beer Light will generate profit within a two year time frame.
Overview
We were able to analyze the company operations and noticed Mountain Men lager is losing 2% of its revenue annually (see Appendix B). We also noticed introducing
Mountain Men was able to build their brand equity by successfully implementing grass root marketing strategy and targeting off premise consumption. This allowed Mountain men to create brand awareness among the blue collar male workers from 45-54 in the east central region of America. Mountain Men held the top market position in West Virginia for almost 50 years. The company prices their product similar to premium domestic products in the market. As a company they differentiated their company by using a custom recipe with rare ingredients that created a flavorful and bitter-tasting beer also back by authenticity. In order for a consumer to purchase your product they considered a few factors; taste, price, the occasion being celebrated, quality, tradition; local authenticity (see Appendix E). Mountain Men were able to rely on their history and its status as an independent company to create a great aura of authenticity to successfully position their brand to their core drinkers. However, in recent years light beer is trending in the marketplace. The consumer segment has changed as well keying more on ages 21-27 because they are not loyal to a specific brand as of yet.
Mountain Men Brewing continues to decline due to the competition, aging demographics, high taxation in the premium beer segment, the advocating of living a healthier life, and the modifications to managing consumer beer consumption.
Choosing this decision can help keep this brand alive for many more generations for years to come. MMBC should not make any significant changes to the name or packaging of the new product because it could possibly damage the brand equity MMBC built over the years. In order for MMBC to Break even at a average market share rate of 25% they would have to sell 100,473 barrels to cover the cost of introducing the light beer products (see Appendix C).The most reasonable cannibalization rate I found most profitable to the MMBC is 5% because beside the first fiscal year MMBC will continue to increase their profit margin each year after (see Appendix