Mountain Man Light
Mountain Man Light – To be or not to be?
The problem:
Should MMBC launch Mountain Man Light?
Mountain Man brand image:
Quality taste, competitive pricing, higher-than-average alcohol content, “working man’s beer”, regional loyalty, generations in the family business.
Customer Base: 81% male, 19% female. The large majority of drinkers is between 45 and 54 at 32%. 47% make less than 49.9K/year.
The mountain man brand has a loyal following. Why?
Grass roots marketing.
Off premise consumption.
Effective promotions.
Developed their own sales force.
The reason of MMBC’s decline in spite of the strong brand:
1. US beer consumption decline, also competition from spirits and wines.
2. Increased taxation.
3. Increasing health awareness.
4. Consumer dynamics changed. Key consumer segment for beer companies was younger drinkers of 21-27. The “first drinker demographic” had not yet established loyalty to any particular brand. This segment accounted for more than 27%.
Is the light version feasible?
Possibilities.
Yes – 1) Light beer sales represent over 50% of beer consumption in East Central US. 2) 4% annual growth.
3) Changing demographics. Aging consumer base. Need to attract new younger consumer base that has yet established loyalty to a particular brand. No – 1) Brand loyalty. Could the company lose current customers feeling disappointed of the recipe and fear the product will not be as good?
2) Image. The company may lose customers with the addition of the light beer because they feel the product will not hold its integrity. Also the image is very important to upper management.
3) Research&Development. May not be cost effective.
4) Cannibalization of shelf space of current MML.
What is required for Mountain Man Light to break even in two years?
Must sell enough barrels to cover marketing and incremental SG&A expenses.
Must cover expected losses in Mountain Man Lager sales.
Must cover increased advertising costs for at least 6 months.
The problem:
Should MMBC launch Mountain Man Light?
Mountain Man brand image:
Quality taste, competitive pricing, higher-than-average alcohol content, “working man’s beer”, regional loyalty, generations in the family business.
Customer Base: 81% male, 19% female. The large majority of drinkers is between 45 and 54 at 32%. 47% make less than 49.9K/year.
The mountain man brand has a loyal following. Why?
Grass roots marketing.
Off premise consumption.
Effective promotions.
Developed their own sales force.
The reason of MMBC’s decline in spite of the strong brand:
1. US beer consumption decline, also competition from spirits and wines.
2. Increased taxation.
3. Increasing health awareness.
4. Consumer dynamics changed. Key consumer segment for beer companies was younger drinkers of 21-27. The “first drinker demographic” had not yet established loyalty to any particular brand. This segment accounted for more than 27%.
Is the light version feasible?
Possibilities.
Yes – 1) Light beer sales represent over 50% of beer consumption in East Central US. 2) 4% annual growth.
3) Changing demographics. Aging consumer base. Need to attract new younger consumer base that has yet established loyalty to a particular brand. No – 1) Brand loyalty. Could the company lose current customers feeling disappointed of the recipe and fear the product will not be as good?
2) Image. The company may lose customers with the addition of the light beer because they feel the product will not hold its integrity. Also the image is very important to upper management.
3) Research&Development. May not be cost effective.
4) Cannibalization of shelf space of current MML.
What is required for Mountain Man Light to break even in two years?
Must sell enough barrels to cover marketing and incremental SG&A expenses.
Must cover expected losses in Mountain Man Lager sales.
Must cover increased advertising costs for at least 6 months.