Mountain Man
Business Model
Mountain Man Brewing Company was a family-owned business which owned a quality beer called Mountain Man Lager. As shown in Exhibit 1, the Mountain Man Lager was well known as working man’s beer. Its quality taste with bitter flavor and high alcohol content were the value propositions for the products. And the key resources for these features were the special recipe and a meticulous selection of barley. Also the main customer segment for the Lager was blue collar most of whom were low or mid-income working-class man. In customer relationships, this beer had strong brand image among mid-age blue collars that showed strong loyalty to it. However, according to a study, the results showed that young drinkers had low purchasing preference even though they all well knew the product. What’s more, the company only had one product which makes the revenue stream very thin.
Although Mountain Man Lager’s reputation as a quality beer was well entrenched throughout the East Central region of the United States, it experienced declining sales. So Chris was thinking about whether they should launch a light beer to enhance the company’s sales.
Market Analysis
Market Environment
The United States was the largest beer-consuming market in the world. However, since 2001, U.S per capita beer consumption had declined by 2.3%. This was caused by increased taxation and people’s health care awareness, and competition from wine and spirits-based drinks, and mostly by drinkers’ preference changes.
In that situation, the market share for premium beer was 19.7% in 2005 with a negative growth rate. (See Exhibit 2) However, on the contrary, the light beer market showed a huge potential. In 2005, the light beer had gained a market share about 50.4%, compared with 29.8% in 2011. This means that under the overall declining consumption situation, the premium beer market was limited but the light beer market still showed aggressive potential.
So in the macro-environment aspect, to
Mountain Man Brewing Company was a family-owned business which owned a quality beer called Mountain Man Lager. As shown in Exhibit 1, the Mountain Man Lager was well known as working man’s beer. Its quality taste with bitter flavor and high alcohol content were the value propositions for the products. And the key resources for these features were the special recipe and a meticulous selection of barley. Also the main customer segment for the Lager was blue collar most of whom were low or mid-income working-class man. In customer relationships, this beer had strong brand image among mid-age blue collars that showed strong loyalty to it. However, according to a study, the results showed that young drinkers had low purchasing preference even though they all well knew the product. What’s more, the company only had one product which makes the revenue stream very thin.
Although Mountain Man Lager’s reputation as a quality beer was well entrenched throughout the East Central region of the United States, it experienced declining sales. So Chris was thinking about whether they should launch a light beer to enhance the company’s sales.
Market Analysis
Market Environment
The United States was the largest beer-consuming market in the world. However, since 2001, U.S per capita beer consumption had declined by 2.3%. This was caused by increased taxation and people’s health care awareness, and competition from wine and spirits-based drinks, and mostly by drinkers’ preference changes.
In that situation, the market share for premium beer was 19.7% in 2005 with a negative growth rate. (See Exhibit 2) However, on the contrary, the light beer market showed a huge potential. In 2005, the light beer had gained a market share about 50.4%, compared with 29.8% in 2011. This means that under the overall declining consumption situation, the premium beer market was limited but the light beer market still showed aggressive potential.
So in the macro-environment aspect, to