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Student Name: Bonita Tania Last name First Name
Student Number: Email:c3117454@uon.edu.au
Course: ode Course Code Course Title
Campus of Study: PSB Academy
Assessment Item Title: Research Project
Tutorial Group: Word Count (If applicable): Due Date/Time:
Lecturer/Tutor Name: Robert J.
Extension Granted: Yes No Granted Until: Please attach the approved copy of your extension approval.
Include here any instructions / checklist for submission
I declare that this assessment item is my own work unless otherwise acknowledged and is in accordance with the University’s plagiarism policy available from the Policy Library on the web at
http://www.newcastle.edu.au/policy/academic/general/academic_integrity_policy-new.pdf …show more content…
I certify that this assessment item has not been submitted previously for academic credit in this or any other course. I certify that I have not given a copy or have shown a copy of this assessment item to another student enrolled in the course.
I acknowledge that the assessor of this assignment may, for the purpose of assessing this assignment:
Reproduce this assessment item and provide a copy to another member of the Faculty; and/or
Communicate a copy of this assessment item to a plagiarism checking service (which may then retain a copy of the item on its database for the purpose of future plagiarism checking).
Submit the assessment item to other forms of plagiarism checking.
I certify that any electronic version of this assignment item that I have submitted or will submit is identical to this paper version.
Turnitin ID:
Signature: Tania Bonita Date: July 12, 2012
Executive Summary
This report consists of Foster’s Group’s in-depth analysis and provides the development of an integrated and well- proportion marketing mix elements and gives the solutions and recommendation to the problem which the company encounter. Foster’s Group has been facing problems in the Asia business sector regarding to the deficiency of extrinsic marketing endeavor. Infestation is an important thing in establishing the company as a prospective competitor in Asia for Foster’s Group to reduce the issue that the company is facing. The European and Australian market are the one with biggest and most profitable money cycle, involving itself there would acquire Foster’s Group , an absolute global market success
One of the ways, Foster’s could establish itself in Beverages Industry in the Asian region, could be by making massive investments in the extensive advertising campaign. Though advertising campaign may help them establish their brand, it is also crucial for them to undertake various marketing operations in order to achieve success. Taking measures like, sponsoring a few staged functions on a global level, like FIFA world cup, or Olympic Games, can be crucial for Foster’s to encourage its standing in beverage industry all over Asia. Well looking at the results in 2009, where Foster’s group was able to inflate at a growth rate of 16%, from the previous 3.8% and 4.3% growth in sales, We can conclude that supporting any forms of investing and expanding activities shouldn’t be a challenging for them, as they are financially sound firm.
Foster’s Group involved in over 160 brands in the world serving the people with Beers, Wines, Cedars and Spirits and a group with high potential in the Non-alcoholic beverages global market as well. Foster’s marketing campaign is targeting themselves as the global leader in their field Building an effective and efficient marketing strategies and communication process, a deep market research about their variously divided customers and applying a perfectly balanced marketing mix will be important for Foster’s to reach their goal . This report shows Foster’s Group’s marketing efforts and critiques their strategies to help the company reach their success and for company survival.
Table of Contents
Executive Summary……………………………………………………………………………. 3
1. Introduction………………………………………………………………………………….5
2. Foster’s marketing strategy description and critiques on the strategy……………………....6
3. Recommendation ……………………………………………………………………………10
4. Conclusion……………………………………………………………………………………11
References………………………………………………………………………………………...12
Appendixes………………………………………………………………………………………..13
1. Introduction
Introducing the Australian Beverages Industry
A well-known industry as one of the lead in global beverage markets in the world is Australian Beverage Industry. According to Austrade (2005), “in relation to Australia as being the most clean, healthy and free ambience – diseases, there is a chance to take with the current trend by exporter who has a leading edge over other countries and the opportunity to gain benefit from the inclination .” For economic and social well-being of our health, it is necessary to keep changing the trend of alcoholic and non-alcoholic beverage markets. It will give consumers a wide range selection of beverages that compromises with social needs and dietary purposes.
Foster’s Group Pte. Ltd.
Globally, there are more than 160 brands managed by Foster’s Group Ltd. Those brands come from different parts of the world. Generally it performs its business in more than 5 continents, which has a history back in the year of 1860s. Every day thousands of consumers are being served with wine, beer, spirits, as well as non-alcohol drinks by Fosters Group. Fosters Beers noted as one of the best beverages company in the world. Fosters Group founded their very first office in Melbourne, Australia. Soon in that year the company was listed on the Australian Securities Exchange (ASX). There are more than 7,000 employees working in the company; supporting Foster’s to produce, distribute, and sell its products to over 150 countries in the world. The figure below shows the Regions of businesses for operations and the Brands of Product it attempts to sell.
Value creation by Foster’s Group Ltd.
According to the history of beer, wine, cider, spirits and non-alcoholic beverages; Foster’s groups is at the peak in multi-beverage industry. With a net gain worth up to AUD$850 on profit-margin ratio, they are licensed to merge with a comprehensive campaign in marketing all over Asia. Their objective is to engross in the market of Australia. In order to maintain the finest standard, they are committed to innovate and invest in their brands. More than 28 brands under beer products such as Belgian – Stella Artois, Victoria Bitter, Carlton Premium light and Foster’s Lager, has been distributed throughout the world.
2. Foster’s marketing strategy description and critiques on the strategy.
Analyzing on the product market
Defining the product market boundaries
After did some researches and analyzing based on the company profile, we have chosen Foster’s Beers as the product market which will be discussed in details in this report. In the Australian market, alcoholic beverage has a big net worth about $16.4 billion. In the process of sub-dividing the alcoholic beverage market focusing in particular products it was found that for about 49% above the market is represented by Beer, followed by Wine which is at 28% and 20% represented by Spirits. According to the amount of the beer the company produces, the rebates for the company to gain off are diverse. As the example, the microbreweries which produce 30,000 liters and below gain about 61% expurgate rebate. According to Ellis (2008), about 70.6% of the market share owned by the Full Strength Beer, while about 12% owned by Mid-strength Beer with about 9% in each premium and light inside the beer industry.
Market structure
A range of products such as beers, wines, cedars, and spirits has been encompassed under the market structure of Foster’s Group.
Although there are various kinds of products under Foster’s Group, we will just focusing on the Foster’s Beer and discuss it further in this report. Basically, the Beer Market includes 3 major types of beers which are Porter, Scout, and Brown Ale. Foster’s expanded their offerings containing the whole 3 kinds of Beers and they also allow their customers the power to choose their own which beer they prefer the most. Porter has its special taste which is strong in barley flavor and implies chocolate. Some examples of Porter Beers are Foster’s Lager, KB Lager and Melbourne …show more content…
Bitter.
While the second type of beer; which is Stout has strong taste, darkest, and thickest type of beers Stout. The examples of Foster’s product for the Stout type are Victoria Bitter, Sheaf Stout, Cascade, Pure Blonde, and Stella Artois. Those Stout beers under Foster’s mentioned before are competing based on the variables such as friendly, sporty, regular, and relaxing kind of beers (see appendix 3).
And lastly the third type of beers, Brown Ale, Foster’s produced Fiji Bitter, Carlton Draught, Asahi, and Carlsberg’s Kronenbourg 1664.
Regarding to the wide range of products that Foster’s Group distributes to everywhere around the world and sells to a large number of different people, their target market would mostly be extensive. Beer has been a universal product that people, especially males, always persuaded at almost the whole adult (age levels). Based on the information by Orth, McDaniel, Shellhammer, and Lopetcharat (2004), Foster’s focusing their target market to the males with the age between 17 years old to 70 years old. In the Asian market, there is no special demographic for Foster’s segmentation, they just stated that the age limit is 18years and above. Foster’s general target markets are people range from first time drinkers to the old-aged men, from college students to the office and workers.
Analysis on the competitors
In the Australian Beer Industry, Foster’s Group participating in an oligopolistic market and it makes them has very few numbers of direct competitors in the market. Lion Nathan and Coopers are the 2 competitors for Foster’s. In the Australian Beer Market, Foster’s engaged 63% of the share in 2009 (Australian Beverage Statistics, 2011). In 1888 in Collingwood, Foster’s brothers founded Foster’s company which then became the first brand in Australia to develop a profitable and successful lager brewery. Foster’s attained 5 dissimilar competitors, as one of the components of its strategic visions, with the purpose of increasing the company competitive advantage and become the first in the Australian masses. The 5 competitors are Victoria Brewery Proprietary Ltd., Castlemaine Brewery company (Melbourne) Ltd., Shamrock Brewing and Malting Company Collingwood Ltd., Carlton Brewery Ltd., and McCracken’s City Brewery Ltd. Foster’s and Nathan are the current Australian Beer company which currently dominating the market. Talking about the Beer market in Asia and around the world, Foster’s still has to compete with numbers of well-known brand such as Heineken, Kingfisher, Tiger, and Amstel light.
Lion Nathan, as Foster’s main competitor, applied a strategy which they investing in primary brand marketing, entering the product category under Black spirits or RTD product category; broaden their offering on premium wine. This strategy influences the company scale and product diversification.
Lion Nathan competes with Foster’s Group Ltd. which based in Australia. The competition is on the beer and wine products. In competing the wine product, the U.S. based Constellation Brands Inc. is in charge to handle the product. While Anheuser-Busch Inc. is in charge to handle the beer product.
Consumer analysis
The target market for Foster’s Group varies from young generation Y, experienced generation X, and the baby boomers. Unique traits and characteristics owned by these 3 categories of groups. The unique traits and characteristics are important for the marketers. Those who were born in the 80s, included in the generation Y groups. They are students and young professionals who have been prepared to enter the workforce. Since generation Y are tech-savvy, achievement-oriented, and attention-craving, they known as Millenial. Generation X groups would prefer a drink which they can drink while chilling with their friends. For the people who were born on 1965-1980 grouped under Generation X, they are about 30 to 40 years old. Most of generation X are on the position of middle-management level and some other business level positions. They have individualistic, value work to a broaden level, technologically adept, and flexible characteristics. Consideration and understanding about the characteristics of generation X are crucial in designing and positioning Foster’s brands in the market. The last group is the baby boomers. They are those who are in the age of 50s. Baby boomers include of managers, executives, leaders, senior support staff and business partners. Goal-oriented, independent, competitive, and workaholic are their characteristics. They prefer to drink in a relaxing and comforting ways.
Objectives and Brand Positioning
Foster’s wishes to be the leading player in the Australasian region in beverages industry and takes over the global business in the future, as well as building a brands’ sequent in all continents. Foster’s has 2 groups of target market and these target markets will be targeted inversely. The first group is the primary consumers. Primary consumer involves consumers who never tasted any of the Foster’s products. While the second group called secondary consumers. Secondary consumers are the consumers who have been consumed Foster’s brands before. Based on Cioletti (2007), Foster’s marketing action aimed to boost and create brand loyalty from its consumers. Moreover, Foster’s also convince its customers that their brand is the finest choice and are available everywhere in Australasia (Cioletti, 2007).
To reach the company goals, a right positioning in customer’s mind and create specific positive image of the brands are important for Foster’s Group. By owning a varied product range, Foster’s Group can gain the advantages; such as the capability and authority to sell the products to numerous market segments with their various and unique products. Foster has produced 28 different beers with special taste presenting the unique experience on each of the beer. For years Foster’s Group has been put splendidly along with an ‘’Australia for Beer’’ tagline (White, 2009). From 2005 to 2005 there was a failure which cause Foster’s to decline the shipment at the diminishing export level of 29.9% to 9.4%. Foster’s Group decided to back to their old tagline ‘’Crack open a friendly’’ which refers more to the youth audiences and putting Foster’s itself as a drink which considered more as a sociable drink than just a drink which are sporty and relaxation-oriented. Based on the information from White (2009), Foster’s Group conveyed a 6.1% sharp growth rate in their beer sales. In the appendix shown later there will be a picture showing the perception of Foster’s Brands in its customer’s mind in Asia, America, and Australia.
Foster’s Marketing Mix
The primary marketing mix for Foster’s Group will be allocating the 4Ps efficiently and build a collaboration among human resources and its other resources.
4Ps defines as Product, Price, Place, and Promotion. Based on the statement from Smith and Wiggins (2008), the 4Ps refers to strategic controls for the whole marketing concept. 4Ps determine the product life cycle’s growth and movement. The first P refers to ‘’Product’’ which here Foster’s has a wide range of products, such as beers, wine, and spirits, which their prices are various as well. A positive result from the wide range of products which Foster’s has will bring the company to enter a huge market. In a large market like Asian market, beer is the most popular and easiest product to sell; so to begin their marketing program Foster’s will be focusing in marketing their beers. Besides popular and easy to market, commonly the price of beers consider as cheap and handy to a large size of customers. After they success to gain market share by marketing their beers, Foster’s will expand their marketing by taking in their wine and spirit products to the market. Foster’s products will be marketed as being accessible to
everyone.
The second P refers to ‘’Price’’. Price considers as an important factor for the consumers, especially when they are going to make a purchase. The price series for Foster’s beers are their primary advantage over the company’s competitors. To gain sustainable competitive advantage, Foster’s applied Porter’s Generic Strategies which is cost leadership as their competitive basic (Khermouch, 2000). The range of the price of the beers from the cheapest to the higher price levels allow the company to gain bigger potential market regarding to the virtual elimination of the demographic income levels. Foster’s beers are inclusive to any of the various income levels and more important their products are accessible to everyone.
The third P refers to ‘’Place’’; which for Foster’s it means their Australasian regions as their main focus places to market their products. The main problem for Foster’s is the cost factors in importing their beer products. To deal with this problem, Foster’s opened their own breweries and act as self-supplied company in the region. The next issue will be on investment as they will step in for a long run into a huge Asian market. Based on Khermouch (2000), to capture the emergence of the Asian market this step determines a good concentration on Foster’s part. In Great Britain and Australia, Foster’s has gained a great reputation through their sponsorship at number of events; such as Melbourne Grand Prix, Beijing Olympics in 2000, FIFA World Cup in Germany, and 2010 South Africa World Cup (Wall Street Journal, 2011). In Australia and Europe, Foster’s has become the leading brand for years (Wall Street Journal, 2011). To start their marketing movement in Asia, Foster’s has used a campaign through TV channels in order to identify the target markets and encourage them in purchasing their beer products (Khermouch, 2000). Thus, Foster’s has been implemented their marketing mix into actions successfully.
3. Recommendation
For the recommendation, an investment in products’ extensive advertising is crucial; moreover the advertising should not confuse the audience. Creating different market segmentations for their portfolio brands is another important recommendation for Foster’s Group Ltd. to do. Before creating a communication process effectively, it is important for a marketer to keep in mind that they must understand their consumers very well. An in-depth-market research is important thing for Foster’s in order to understand their target market based from the consumer characteristics, socio-cultural, and the individual’s economic features. Another suggestion from Philipson and Zineldin (2007), an analysis on the consumer’s income levels and religious norms will help a company to create and effective marketing mix. In addition, a recommendation in adjusting the different price levels in Australian market contrasting from Indian market based on the customer’s different income levels is also one thing Foster’s has to consider.
Improving the company’s image which can be distinguished from its competitors in the mind of their consumers is as important as the recommendations mentioned above for Foster’s. Foster’s has to be able to position themselves as the company which the consumers desire them as the successful company. To assist on the deep understanding of the positive image of the company over its rivals Foster’s need to apply a ‘’Perceptual Mapping Approach’’. As the result, the competitors’ brands could be differentiated on two basic dissimilar variables, e.g. Price and Image could be refers to Sporty vs. Friendly.
4. Conclusion
Over the years, Foster’s beer and wine products have gained consumer’s loyalty successfully. The whole of the company’s marketing effort has been successful in attracting consumers from Australia, America, Asia, and Europe regions. The current strategy of Foster’s Group is entering the non-alcoholic industry and creating its technical and marketing abilities to return to the environment of the non-alcoholic drinks and gain market control in adding one more sector. In using marketing tools, Foster’s has applied CSR (Corporate Social Responsibility) and sustainability to achieve competitive advantage. For Foster’s CSR, in the long run, is more as an investment rather than an expense. Foster’s Group Ltd. has survived in the rough international beverage industry and will continue build their business in the future.
REFERENCES
Austrade, Australian Food Statistics 2005 – Department of Agriculture, Fisheries and Forestry (http://www.austrade.gov.au/)
Cioletti, J. 2007. What’ll You Have, Mate? Barron’s; Sep. 15, 2007; 126, 1778; ABI/INFORM Global pg. 30.
Ellis, E. 2008. Beyond Borders. Beverage World; Oct 27, 2008; 88, 43; ABI/INFORM Global pg. 34.
Foster 's Brewing Olympics Tie to Aid In Image at Home. (2011, March 24). Wall Street Journal (Eastern Edition), p. B, 5A:6. Retrieved July 7th 2012, from ABI/INFORM Global. (Document ID: 39959534).
Khermouch, G. 2000. The Australian Rules. Brandweek; Oct 16, 2000; 41, 40; ABI/INFORM Global, pg. 4.
Orth, R.U, McDaniel, M, Shellhammer, T & Lopetcharat, K. 2004. Promoting brand benefits: The role of consumer psychographics and lifestyle, The Journal of Customer Marketing; 2004; 21, 2/3; ABI/INFORM Global. Pg. 97.
Peter, S. & Wiggins, J. 2008. Foster’s braced for approaches. Business Times, 25. Retrieved July 8th, 2012, from ABI/INFORM Global. (Document ID: 1573532471).
Philipson, R. & Zineldin, K. 2007. Relationship marketing and truth of the 4Ps, Journal of Consumer Marketing, 24th April, 2007. Emerald Group Publishing limited [ISSN 0736 – 3761]. Pp. 229 – 241.
Sandoval, G. 2006. Foster’s Lager: from Local beer to Global Icon. Marketing Intelligence & Planning, Emerald Publishing Limited, Vol. 27, No. 2, pp. 170 – 190.
White, L. 2009. Foster’s beer shifts ad spending to Web, 3rd August, 2006. CNET News. (http://news.cnet.com/Fosters-beer-shifts-ad-spending-to-Web/2100-1024_3-6102028.html).
Appendixes
Australia Beverage Industry
(Source: Austrade, 2005)
(Source: Orth, McDaniel, Shellhammer and Lopetcharat, 2004)
Foster’s VS Nathan beer products
Student Name: Bonita Tania Last name First Name
Student Number: Email:c3117454@uon.edu.au
Course: ode Course Code Course Title
Campus of Study: PSB Academy
Assessment Item Title: Research Project
Tutorial Group: Word Count (If applicable): Due Date/Time:
Lecturer/Tutor Name: Robert J.
Extension Granted: Yes No Granted Until: Please attach the approved copy of your extension approval.
Include here any instructions / checklist for submission
I declare that this assessment item is my own work unless otherwise acknowledged and is in accordance with the University’s plagiarism policy available from the Policy Library on the web at
http://www.newcastle.edu.au/policy/academic/general/academic_integrity_policy-new.pdf …show more content…
I certify that this assessment item has not been submitted previously for academic credit in this or any other course. I certify that I have not given a copy or have shown a copy of this assessment item to another student enrolled in the course.
I acknowledge that the assessor of this assignment may, for the purpose of assessing this assignment:
Reproduce this assessment item and provide a copy to another member of the Faculty; and/or
Communicate a copy of this assessment item to a plagiarism checking service (which may then retain a copy of the item on its database for the purpose of future plagiarism checking).
Submit the assessment item to other forms of plagiarism checking.
I certify that any electronic version of this assignment item that I have submitted or will submit is identical to this paper version.
Turnitin ID:
Signature: Tania Bonita Date: July 12, 2012
Executive Summary
This report consists of Foster’s Group’s in-depth analysis and provides the development of an integrated and well- proportion marketing mix elements and gives the solutions and recommendation to the problem which the company encounter. Foster’s Group has been facing problems in the Asia business sector regarding to the deficiency of extrinsic marketing endeavor. Infestation is an important thing in establishing the company as a prospective competitor in Asia for Foster’s Group to reduce the issue that the company is facing. The European and Australian market are the one with biggest and most profitable money cycle, involving itself there would acquire Foster’s Group , an absolute global market success
One of the ways, Foster’s could establish itself in Beverages Industry in the Asian region, could be by making massive investments in the extensive advertising campaign. Though advertising campaign may help them establish their brand, it is also crucial for them to undertake various marketing operations in order to achieve success. Taking measures like, sponsoring a few staged functions on a global level, like FIFA world cup, or Olympic Games, can be crucial for Foster’s to encourage its standing in beverage industry all over Asia. Well looking at the results in 2009, where Foster’s group was able to inflate at a growth rate of 16%, from the previous 3.8% and 4.3% growth in sales, We can conclude that supporting any forms of investing and expanding activities shouldn’t be a challenging for them, as they are financially sound firm.
Foster’s Group involved in over 160 brands in the world serving the people with Beers, Wines, Cedars and Spirits and a group with high potential in the Non-alcoholic beverages global market as well. Foster’s marketing campaign is targeting themselves as the global leader in their field Building an effective and efficient marketing strategies and communication process, a deep market research about their variously divided customers and applying a perfectly balanced marketing mix will be important for Foster’s to reach their goal . This report shows Foster’s Group’s marketing efforts and critiques their strategies to help the company reach their success and for company survival.
Table of Contents
Executive Summary……………………………………………………………………………. 3
1. Introduction………………………………………………………………………………….5
2. Foster’s marketing strategy description and critiques on the strategy……………………....6
3. Recommendation ……………………………………………………………………………10
4. Conclusion……………………………………………………………………………………11
References………………………………………………………………………………………...12
Appendixes………………………………………………………………………………………..13
1. Introduction
Introducing the Australian Beverages Industry
A well-known industry as one of the lead in global beverage markets in the world is Australian Beverage Industry. According to Austrade (2005), “in relation to Australia as being the most clean, healthy and free ambience – diseases, there is a chance to take with the current trend by exporter who has a leading edge over other countries and the opportunity to gain benefit from the inclination .” For economic and social well-being of our health, it is necessary to keep changing the trend of alcoholic and non-alcoholic beverage markets. It will give consumers a wide range selection of beverages that compromises with social needs and dietary purposes.
Foster’s Group Pte. Ltd.
Globally, there are more than 160 brands managed by Foster’s Group Ltd. Those brands come from different parts of the world. Generally it performs its business in more than 5 continents, which has a history back in the year of 1860s. Every day thousands of consumers are being served with wine, beer, spirits, as well as non-alcohol drinks by Fosters Group. Fosters Beers noted as one of the best beverages company in the world. Fosters Group founded their very first office in Melbourne, Australia. Soon in that year the company was listed on the Australian Securities Exchange (ASX). There are more than 7,000 employees working in the company; supporting Foster’s to produce, distribute, and sell its products to over 150 countries in the world. The figure below shows the Regions of businesses for operations and the Brands of Product it attempts to sell.
Value creation by Foster’s Group Ltd.
According to the history of beer, wine, cider, spirits and non-alcoholic beverages; Foster’s groups is at the peak in multi-beverage industry. With a net gain worth up to AUD$850 on profit-margin ratio, they are licensed to merge with a comprehensive campaign in marketing all over Asia. Their objective is to engross in the market of Australia. In order to maintain the finest standard, they are committed to innovate and invest in their brands. More than 28 brands under beer products such as Belgian – Stella Artois, Victoria Bitter, Carlton Premium light and Foster’s Lager, has been distributed throughout the world.
2. Foster’s marketing strategy description and critiques on the strategy.
Analyzing on the product market
Defining the product market boundaries
After did some researches and analyzing based on the company profile, we have chosen Foster’s Beers as the product market which will be discussed in details in this report. In the Australian market, alcoholic beverage has a big net worth about $16.4 billion. In the process of sub-dividing the alcoholic beverage market focusing in particular products it was found that for about 49% above the market is represented by Beer, followed by Wine which is at 28% and 20% represented by Spirits. According to the amount of the beer the company produces, the rebates for the company to gain off are diverse. As the example, the microbreweries which produce 30,000 liters and below gain about 61% expurgate rebate. According to Ellis (2008), about 70.6% of the market share owned by the Full Strength Beer, while about 12% owned by Mid-strength Beer with about 9% in each premium and light inside the beer industry.
Market structure
A range of products such as beers, wines, cedars, and spirits has been encompassed under the market structure of Foster’s Group.
Although there are various kinds of products under Foster’s Group, we will just focusing on the Foster’s Beer and discuss it further in this report. Basically, the Beer Market includes 3 major types of beers which are Porter, Scout, and Brown Ale. Foster’s expanded their offerings containing the whole 3 kinds of Beers and they also allow their customers the power to choose their own which beer they prefer the most. Porter has its special taste which is strong in barley flavor and implies chocolate. Some examples of Porter Beers are Foster’s Lager, KB Lager and Melbourne …show more content…
Bitter.
While the second type of beer; which is Stout has strong taste, darkest, and thickest type of beers Stout. The examples of Foster’s product for the Stout type are Victoria Bitter, Sheaf Stout, Cascade, Pure Blonde, and Stella Artois. Those Stout beers under Foster’s mentioned before are competing based on the variables such as friendly, sporty, regular, and relaxing kind of beers (see appendix 3).
And lastly the third type of beers, Brown Ale, Foster’s produced Fiji Bitter, Carlton Draught, Asahi, and Carlsberg’s Kronenbourg 1664.
Regarding to the wide range of products that Foster’s Group distributes to everywhere around the world and sells to a large number of different people, their target market would mostly be extensive. Beer has been a universal product that people, especially males, always persuaded at almost the whole adult (age levels). Based on the information by Orth, McDaniel, Shellhammer, and Lopetcharat (2004), Foster’s focusing their target market to the males with the age between 17 years old to 70 years old. In the Asian market, there is no special demographic for Foster’s segmentation, they just stated that the age limit is 18years and above. Foster’s general target markets are people range from first time drinkers to the old-aged men, from college students to the office and workers.
Analysis on the competitors
In the Australian Beer Industry, Foster’s Group participating in an oligopolistic market and it makes them has very few numbers of direct competitors in the market. Lion Nathan and Coopers are the 2 competitors for Foster’s. In the Australian Beer Market, Foster’s engaged 63% of the share in 2009 (Australian Beverage Statistics, 2011). In 1888 in Collingwood, Foster’s brothers founded Foster’s company which then became the first brand in Australia to develop a profitable and successful lager brewery. Foster’s attained 5 dissimilar competitors, as one of the components of its strategic visions, with the purpose of increasing the company competitive advantage and become the first in the Australian masses. The 5 competitors are Victoria Brewery Proprietary Ltd., Castlemaine Brewery company (Melbourne) Ltd., Shamrock Brewing and Malting Company Collingwood Ltd., Carlton Brewery Ltd., and McCracken’s City Brewery Ltd. Foster’s and Nathan are the current Australian Beer company which currently dominating the market. Talking about the Beer market in Asia and around the world, Foster’s still has to compete with numbers of well-known brand such as Heineken, Kingfisher, Tiger, and Amstel light.
Lion Nathan, as Foster’s main competitor, applied a strategy which they investing in primary brand marketing, entering the product category under Black spirits or RTD product category; broaden their offering on premium wine. This strategy influences the company scale and product diversification.
Lion Nathan competes with Foster’s Group Ltd. which based in Australia. The competition is on the beer and wine products. In competing the wine product, the U.S. based Constellation Brands Inc. is in charge to handle the product. While Anheuser-Busch Inc. is in charge to handle the beer product.
Consumer analysis
The target market for Foster’s Group varies from young generation Y, experienced generation X, and the baby boomers. Unique traits and characteristics owned by these 3 categories of groups. The unique traits and characteristics are important for the marketers. Those who were born in the 80s, included in the generation Y groups. They are students and young professionals who have been prepared to enter the workforce. Since generation Y are tech-savvy, achievement-oriented, and attention-craving, they known as Millenial. Generation X groups would prefer a drink which they can drink while chilling with their friends. For the people who were born on 1965-1980 grouped under Generation X, they are about 30 to 40 years old. Most of generation X are on the position of middle-management level and some other business level positions. They have individualistic, value work to a broaden level, technologically adept, and flexible characteristics. Consideration and understanding about the characteristics of generation X are crucial in designing and positioning Foster’s brands in the market. The last group is the baby boomers. They are those who are in the age of 50s. Baby boomers include of managers, executives, leaders, senior support staff and business partners. Goal-oriented, independent, competitive, and workaholic are their characteristics. They prefer to drink in a relaxing and comforting ways.
Objectives and Brand Positioning
Foster’s wishes to be the leading player in the Australasian region in beverages industry and takes over the global business in the future, as well as building a brands’ sequent in all continents. Foster’s has 2 groups of target market and these target markets will be targeted inversely. The first group is the primary consumers. Primary consumer involves consumers who never tasted any of the Foster’s products. While the second group called secondary consumers. Secondary consumers are the consumers who have been consumed Foster’s brands before. Based on Cioletti (2007), Foster’s marketing action aimed to boost and create brand loyalty from its consumers. Moreover, Foster’s also convince its customers that their brand is the finest choice and are available everywhere in Australasia (Cioletti, 2007).
To reach the company goals, a right positioning in customer’s mind and create specific positive image of the brands are important for Foster’s Group. By owning a varied product range, Foster’s Group can gain the advantages; such as the capability and authority to sell the products to numerous market segments with their various and unique products. Foster has produced 28 different beers with special taste presenting the unique experience on each of the beer. For years Foster’s Group has been put splendidly along with an ‘’Australia for Beer’’ tagline (White, 2009). From 2005 to 2005 there was a failure which cause Foster’s to decline the shipment at the diminishing export level of 29.9% to 9.4%. Foster’s Group decided to back to their old tagline ‘’Crack open a friendly’’ which refers more to the youth audiences and putting Foster’s itself as a drink which considered more as a sociable drink than just a drink which are sporty and relaxation-oriented. Based on the information from White (2009), Foster’s Group conveyed a 6.1% sharp growth rate in their beer sales. In the appendix shown later there will be a picture showing the perception of Foster’s Brands in its customer’s mind in Asia, America, and Australia.
Foster’s Marketing Mix
The primary marketing mix for Foster’s Group will be allocating the 4Ps efficiently and build a collaboration among human resources and its other resources.
4Ps defines as Product, Price, Place, and Promotion. Based on the statement from Smith and Wiggins (2008), the 4Ps refers to strategic controls for the whole marketing concept. 4Ps determine the product life cycle’s growth and movement. The first P refers to ‘’Product’’ which here Foster’s has a wide range of products, such as beers, wine, and spirits, which their prices are various as well. A positive result from the wide range of products which Foster’s has will bring the company to enter a huge market. In a large market like Asian market, beer is the most popular and easiest product to sell; so to begin their marketing program Foster’s will be focusing in marketing their beers. Besides popular and easy to market, commonly the price of beers consider as cheap and handy to a large size of customers. After they success to gain market share by marketing their beers, Foster’s will expand their marketing by taking in their wine and spirit products to the market. Foster’s products will be marketed as being accessible to
everyone.
The second P refers to ‘’Price’’. Price considers as an important factor for the consumers, especially when they are going to make a purchase. The price series for Foster’s beers are their primary advantage over the company’s competitors. To gain sustainable competitive advantage, Foster’s applied Porter’s Generic Strategies which is cost leadership as their competitive basic (Khermouch, 2000). The range of the price of the beers from the cheapest to the higher price levels allow the company to gain bigger potential market regarding to the virtual elimination of the demographic income levels. Foster’s beers are inclusive to any of the various income levels and more important their products are accessible to everyone.
The third P refers to ‘’Place’’; which for Foster’s it means their Australasian regions as their main focus places to market their products. The main problem for Foster’s is the cost factors in importing their beer products. To deal with this problem, Foster’s opened their own breweries and act as self-supplied company in the region. The next issue will be on investment as they will step in for a long run into a huge Asian market. Based on Khermouch (2000), to capture the emergence of the Asian market this step determines a good concentration on Foster’s part. In Great Britain and Australia, Foster’s has gained a great reputation through their sponsorship at number of events; such as Melbourne Grand Prix, Beijing Olympics in 2000, FIFA World Cup in Germany, and 2010 South Africa World Cup (Wall Street Journal, 2011). In Australia and Europe, Foster’s has become the leading brand for years (Wall Street Journal, 2011). To start their marketing movement in Asia, Foster’s has used a campaign through TV channels in order to identify the target markets and encourage them in purchasing their beer products (Khermouch, 2000). Thus, Foster’s has been implemented their marketing mix into actions successfully.
3. Recommendation
For the recommendation, an investment in products’ extensive advertising is crucial; moreover the advertising should not confuse the audience. Creating different market segmentations for their portfolio brands is another important recommendation for Foster’s Group Ltd. to do. Before creating a communication process effectively, it is important for a marketer to keep in mind that they must understand their consumers very well. An in-depth-market research is important thing for Foster’s in order to understand their target market based from the consumer characteristics, socio-cultural, and the individual’s economic features. Another suggestion from Philipson and Zineldin (2007), an analysis on the consumer’s income levels and religious norms will help a company to create and effective marketing mix. In addition, a recommendation in adjusting the different price levels in Australian market contrasting from Indian market based on the customer’s different income levels is also one thing Foster’s has to consider.
Improving the company’s image which can be distinguished from its competitors in the mind of their consumers is as important as the recommendations mentioned above for Foster’s. Foster’s has to be able to position themselves as the company which the consumers desire them as the successful company. To assist on the deep understanding of the positive image of the company over its rivals Foster’s need to apply a ‘’Perceptual Mapping Approach’’. As the result, the competitors’ brands could be differentiated on two basic dissimilar variables, e.g. Price and Image could be refers to Sporty vs. Friendly.
4. Conclusion
Over the years, Foster’s beer and wine products have gained consumer’s loyalty successfully. The whole of the company’s marketing effort has been successful in attracting consumers from Australia, America, Asia, and Europe regions. The current strategy of Foster’s Group is entering the non-alcoholic industry and creating its technical and marketing abilities to return to the environment of the non-alcoholic drinks and gain market control in adding one more sector. In using marketing tools, Foster’s has applied CSR (Corporate Social Responsibility) and sustainability to achieve competitive advantage. For Foster’s CSR, in the long run, is more as an investment rather than an expense. Foster’s Group Ltd. has survived in the rough international beverage industry and will continue build their business in the future.
REFERENCES
Austrade, Australian Food Statistics 2005 – Department of Agriculture, Fisheries and Forestry (http://www.austrade.gov.au/)
Cioletti, J. 2007. What’ll You Have, Mate? Barron’s; Sep. 15, 2007; 126, 1778; ABI/INFORM Global pg. 30.
Ellis, E. 2008. Beyond Borders. Beverage World; Oct 27, 2008; 88, 43; ABI/INFORM Global pg. 34.
Foster 's Brewing Olympics Tie to Aid In Image at Home. (2011, March 24). Wall Street Journal (Eastern Edition), p. B, 5A:6. Retrieved July 7th 2012, from ABI/INFORM Global. (Document ID: 39959534).
Khermouch, G. 2000. The Australian Rules. Brandweek; Oct 16, 2000; 41, 40; ABI/INFORM Global, pg. 4.
Orth, R.U, McDaniel, M, Shellhammer, T & Lopetcharat, K. 2004. Promoting brand benefits: The role of consumer psychographics and lifestyle, The Journal of Customer Marketing; 2004; 21, 2/3; ABI/INFORM Global. Pg. 97.
Peter, S. & Wiggins, J. 2008. Foster’s braced for approaches. Business Times, 25. Retrieved July 8th, 2012, from ABI/INFORM Global. (Document ID: 1573532471).
Philipson, R. & Zineldin, K. 2007. Relationship marketing and truth of the 4Ps, Journal of Consumer Marketing, 24th April, 2007. Emerald Group Publishing limited [ISSN 0736 – 3761]. Pp. 229 – 241.
Sandoval, G. 2006. Foster’s Lager: from Local beer to Global Icon. Marketing Intelligence & Planning, Emerald Publishing Limited, Vol. 27, No. 2, pp. 170 – 190.
White, L. 2009. Foster’s beer shifts ad spending to Web, 3rd August, 2006. CNET News. (http://news.cnet.com/Fosters-beer-shifts-ad-spending-to-Web/2100-1024_3-6102028.html).
Appendixes
Australia Beverage Industry
(Source: Austrade, 2005)
(Source: Orth, McDaniel, Shellhammer and Lopetcharat, 2004)
Foster’s VS Nathan beer products