Boston Beer Company (BBC) is faced with a critical decision that will potentially impact its operations and sustainability. BBC’s penetration into the light beer market should be based on its past, and current market positioning, and prospects. The company has primarily operated in the craft beer sector and has proven to acquire a significantly large market share. Previously, the attempt to join the light beer industry failed because the company had not established itself in the market (Cyr et al., 2001). Entering a new sector requires some experience, adequate market research, and resource capability. However, the company has grown and is now better placed to attack the light beer industry. Therefore, the answer as to whether the company should implement its strategy to join the light beer market is yes. There are available resources, market information, and potential for growth that positions the company for excellence.
A company’s reputation, as described by the years of quality products and services, is a crucial factor to consider when penetrating new markets. Currently, BBC has a good reputation for being a high-quality craft beer dealer offering premium prices. It has a consistent flow and a wide range of innovative products, such as new specialty brews, and a strong level of brand awareness in its current market (Cyr et al., 2001). To maintain its corporate brand value, the company should aim to break into the light beer market. This is primarily because the craft beer market has reached a steady plateau, whereas the light beer business continues to grow.
In addition to a high reputation, the company has the benefit of market dominance with many beer users who might be willing to trust the company for a new product. BBC should take advantage of its best performing beers-Samuel Adams when seeking an opening to enter the light beer industry (Cyr et al., 2001). Many customers will rely on their previous beer-drinking experiences and switch to a light beer produced by the same firm. The corporation should also consider associating its beer with a new customer niche to be profitable. Capitalizing on customer loyalty is vital since the company will face less resistance in the new niche. However, it should endeavor to maintain a high quality of light beer to avoid losing customers and being thrown out of the market. With an effective marketing campaign and sustained quality, the company will expand its customer base and increase its profitability.
For BBC to establish itself within the light beer market, it should conduct extensive research through taste tests, consumption data, and ZMETs. In this case, the company needs to know how well its light beer will be received by the target customers. Taste tests are valuable for establishing user preferences before launching the product officially for sale. Cyr et al. (2001) record that the corporation used taste tests initially when launching its light beer, which failed soon after its introduction into the industry. Currently, the firm already has a reputation for quality beer. Therefore the taste tests will serve as a tool for comparing the currently available craft beer to the proposed light beer so that management can note the areas for improvement. An assessment of consumption data would be essential to reveal the estimated sales, enabling the firm to plan accordingly. The data would also help the company understand how resources will be used in the production and marketing processes, thus avoiding past mistakes.
Market segment analysis through a ZMET is vital in understanding how far the company can penetrate the light beer sector. During the previous attempts, BBC used ZMETs to evaluate how men and women felt about light beer. The results showed that people found the light beer to be a different product worth trying (Cyr et al., 2001). This time, the company has already known that the light beer market is expansive. Therefore, it should conduct ZMETs to understand how to direct its market campaigns and branding. Since the corporation should focus its efforts on a specific target group, ZMET s will enable management to have a clear picture of the composition of its customer base. For instance, if most men are willing to try light beer, then advertising and packaging should be done to target them. In essence, without a ZMET, it would be challenging for the company to direct its efforts appropriately, resulting in losses.
Getting “heard” in the marketplace calls for strategic plans that go beyond production, traversing the marketing and sustainability plans for a company. According to Cyr et al. (2001), BBC seeks to partake in the light beer industry due to its potential growth, although there are other players in the sector. For the company to make its presence known, it should start by communicating its brand image in a way that sets it apart from current rivals. Owing to its large market share following the success of Samuel Adams, it may be easier for it to make an impact in the light beer market. Using its market analysis data, the firm can come up with a unique beer that should be an extension of its successful brands. In essence, being heard implies the company’s ability to encourage customers to purchase its products, sifting their interests from their preferred beers.
To obtain a significant client base, BBC should understand the market well, then rely on its customer royalty to spread the message to new customers. Cyr et al. (2001) record that the previous market analysis revealed that men want to have a brand that communicates who they are. In this case, BBC can be highly recognized in the market if it designs its new product brand to reflect customers’ feelings and perceptions of themselves. Pricing is also an essential factor to consider, especially when entering the market for the first time. BBC should tailor its prices to accommodate all consumer classes to encourage them to continue using its products.
Case studies are vital for market analysis, but their efficacy is tied to the strategic methods applied during the research. At the beginning of the field study, it would be important to categorize the target market into several groups based on their predominant features. For instance, since the company intends to supply light beer to the entire community, it would be crucial to segment the target customers into men and women and then delve deeper into each group’s preferences.
To help BBC avoid repeating the same mistakes, I would start by underscoring the company’s main goals and its value proposition. The company’s moves should be guided by the end goal and be within its capability. Therefore, I would begin by analyzing the firm’s resources to understand the extent to which it can expand into the new market. In addition, I would advise the management to partner with other established firms to ease their entry into the market. Lastly, the company should not just focus on its entry while ignoring its future; it should work on a sustainability plan to maintain its market relevance.
Reference
Cyr, L., Lassiter, J., & Roberts, M. (2001). Boston Beer Company: Light beer decision. Harvard Business School. Web.