Madcap Craftbrew And Bottleworks Case Summary
Issues /Problems
Madcap Craftbrew and Bottleworks, Inc. needs to develop a strong brand image, increase sales and revenue and build brand loyalty.
Analysis of the case
The origins of the Zebra beer could be traced back to the Decker family, who lived in the Aslace region between Germany and France around 1857. This German family has immigrated to United States and wanted to establish brewery in the Cincinnati area. However, the lack of capital and an arrival of the prohibition era put their dreams on hold. Eventually three member of the family: Rick Sietz, Jerry Decker & Chad Seitz decided to establish as well as grow their family business. By May of 1997, the three members were still devoted to the success of their company, …show more content…
but their passion was strongly affected by the difficulties they have came across in breaking into the beer market and growing a sustained level of sales. Therefore, in order to compete with other super-premium beers, such as Samuel Adams, Pete’s Wicked Ale and Blue Moon, MCB must make major changes in its product and marketing plans. MCB must expand its market offerings and make adjustments to production and marketing that will allow distribution outside of the Ohio, Indiana and Kentucky regions.
List of alternatives
To increase Zebra’s sales volume and revenue and build brand loyalty, MCB has the following alternatives:
a. Maintain the Zebra brand position as a Super-Premium Beer
b. Launch the Zebra brand on the West coast.
c. Repackage the Zebra brand from painted bottles to paper labeled bottles
d. Introduce new brands to compete with Premium and Ultra-Premium brand categories
Evaluation of Alternatives
The test market data performed in Bloomington, Indiana leads us to believe that a lower price may be the solution to increase the acceptance of the Zebra brand. I feel that this price reduction will also weaken the perceived value of the Zebra beer. In a microbrew situation such as this, lowering the price will bring higher sales at first, but at the end, it is difficult to build a loyal following in the microbrew market because we are dealing with beer drinkers who love to taste different kinds of beers, but do not stick to the same beer, no matter how great the taste is. Therefore, MCB needs to move the Zebra beer away from the microbrew drinkers, and position the Zebra brand as a Super-Premium beer choice.
MCB has been receiving a lot of phone calls from people in California, who have tried the Zebra beer and absolutely love the taste.
There has also been some interest in Georgia and Florida area. Therefore, the next step would be to launch the Zebra brand on the West coast, beginning with California. The company is well aware that there is a high level of demand for the Zebra beer on the West Coast since they have been receiving numerous inquiries as to the availability of the beer. Contracting with the West coast brewery for manufacturing and distribution will allow MCB to benefit from an increase in sales, brand awareness and revenue growth while trying to establish itself as a long-term competitor in the profitable beer market.
MCB should also repackage the Zebra brand beer to take advantage of the less expensive paper label. I fee that this will increase per case margin and eliminate the problems with the bottle supply coming out of Mexico. It has been estimated that MCB could save between $0.50 - $1.00 per case by using standard bottles with paper labels. Also, the distributors and retailers perceive the paper labels to be of a better quality. Therefore, MCB should take advantage of this perception and savings by changing from painted bottles to those with paper
labels.
I feel that Zebra brand should be positioned as Super-Premium Beer, but MCB name should also be advertise to appeal to Premium and Ultra Premium markets. MCB brands should be launched nationally by contracting with regional breweries for manufacture and distribution. This will give MCB a brand at a lower cost and it will bring in the increase in volume of sales and will build a level of loyalty. MCB should also focus on the Ultra-Premium Beer market. It might take a while to get there and substantial amount of capital will be required, but considering the fact that MCB has a unique and a great flavor beer why not go after the Ultra-Premium market as well.
Decide on Alternative and Support It
I feel that all the above alternatives should be applied. The beer market is extremely competitive and MCB should maintain the Zebra brand position as a Super-Premium brand and at the same time should repackage the Zebra beer to cut costs where possible. In addition, MCB should launch the Zebra brand on the West coast and tap into the Premium and Ultra-Premium brand categories. MCB needs to make all those changes in order prosper and to maintain its status as a long-term viable business entity.
Madcap Craftbrew and Bottleworks, Inc. needs to develop a strong brand image, increase sales and revenue and build brand loyalty.
Analysis of the case
The origins of the Zebra beer could be traced back to the Decker family, who lived in the Aslace region between Germany and France around 1857. This German family has immigrated to United States and wanted to establish brewery in the Cincinnati area. However, the lack of capital and an arrival of the prohibition era put their dreams on hold. Eventually three member of the family: Rick Sietz, Jerry Decker & Chad Seitz decided to establish as well as grow their family business. By May of 1997, the three members were still devoted to the success of their company, …show more content…
but their passion was strongly affected by the difficulties they have came across in breaking into the beer market and growing a sustained level of sales. Therefore, in order to compete with other super-premium beers, such as Samuel Adams, Pete’s Wicked Ale and Blue Moon, MCB must make major changes in its product and marketing plans. MCB must expand its market offerings and make adjustments to production and marketing that will allow distribution outside of the Ohio, Indiana and Kentucky regions.
List of alternatives
To increase Zebra’s sales volume and revenue and build brand loyalty, MCB has the following alternatives:
a. Maintain the Zebra brand position as a Super-Premium Beer
b. Launch the Zebra brand on the West coast.
c. Repackage the Zebra brand from painted bottles to paper labeled bottles
d. Introduce new brands to compete with Premium and Ultra-Premium brand categories
Evaluation of Alternatives
The test market data performed in Bloomington, Indiana leads us to believe that a lower price may be the solution to increase the acceptance of the Zebra brand. I feel that this price reduction will also weaken the perceived value of the Zebra beer. In a microbrew situation such as this, lowering the price will bring higher sales at first, but at the end, it is difficult to build a loyal following in the microbrew market because we are dealing with beer drinkers who love to taste different kinds of beers, but do not stick to the same beer, no matter how great the taste is. Therefore, MCB needs to move the Zebra beer away from the microbrew drinkers, and position the Zebra brand as a Super-Premium beer choice.
MCB has been receiving a lot of phone calls from people in California, who have tried the Zebra beer and absolutely love the taste.
There has also been some interest in Georgia and Florida area. Therefore, the next step would be to launch the Zebra brand on the West coast, beginning with California. The company is well aware that there is a high level of demand for the Zebra beer on the West Coast since they have been receiving numerous inquiries as to the availability of the beer. Contracting with the West coast brewery for manufacturing and distribution will allow MCB to benefit from an increase in sales, brand awareness and revenue growth while trying to establish itself as a long-term competitor in the profitable beer market.
MCB should also repackage the Zebra brand beer to take advantage of the less expensive paper label. I fee that this will increase per case margin and eliminate the problems with the bottle supply coming out of Mexico. It has been estimated that MCB could save between $0.50 - $1.00 per case by using standard bottles with paper labels. Also, the distributors and retailers perceive the paper labels to be of a better quality. Therefore, MCB should take advantage of this perception and savings by changing from painted bottles to those with paper
labels.
I feel that Zebra brand should be positioned as Super-Premium Beer, but MCB name should also be advertise to appeal to Premium and Ultra Premium markets. MCB brands should be launched nationally by contracting with regional breweries for manufacture and distribution. This will give MCB a brand at a lower cost and it will bring in the increase in volume of sales and will build a level of loyalty. MCB should also focus on the Ultra-Premium Beer market. It might take a while to get there and substantial amount of capital will be required, but considering the fact that MCB has a unique and a great flavor beer why not go after the Ultra-Premium market as well.
Decide on Alternative and Support It
I feel that all the above alternatives should be applied. The beer market is extremely competitive and MCB should maintain the Zebra brand position as a Super-Premium brand and at the same time should repackage the Zebra beer to cut costs where possible. In addition, MCB should launch the Zebra brand on the West coast and tap into the Premium and Ultra-Premium brand categories. MCB needs to make all those changes in order prosper and to maintain its status as a long-term viable business entity.