Research: Alcoholic Beverage and Premium Lagers Essay

Submitted By B00571368
Words: 1100
Pages: 5
Open Document
“When a firm finds itself exposed to a change to the environment in which it operates, it must determine how the processes of change in the marketplace impact on that firm’s choice of strategies, its related resource deployment and the nature of its competitive advantage within that environment”.
Economical
Volume sales of beer have been declining for some time now, especially via on-trade sales outlets such as bars, pubs and restaurants. A variety of socio-economic trends including the squeeze on consumers’ wallets from the recession in the uncertain economic times, high taxes on alcohol and growing concerns about the health impacts of alcohol consumption have all contributed to the general decline in the amount of alcohol adults are drinking. On-trade sales have declined at a steeper rate than off-trade sales, as the latter are generally significantly lower in cost, while the rising taxes have made alcohol unaffordable for many.
Despite this, the beer industry is so much a part of UK culture that there is little need for concern. The sector received a welcome boost when it was announced that the tax escalator policy, which had been pushing prices up annually by 2% above the rate of inflation, was to be scrapped. However, this policy still remains imposed on cider.
Although Gross domestic product at annual chain-linked prices contracted in 2009 has been positive, it has been weaker year-on-year since 2010. GDP at current prices also contracted in 2009 (by 2.7%) and has subsequently grown year-on-year — by 4.6% in 2010; by 3.4% the following year; and by 1.7% in 2012. Positive GDP growth is usually considered indicative of a healthy economy and should both reflect and encourage greater consumer confidence. This should provide positive support for sales of alcoholic drinks through both on- and off-trade channels. Greater consumer confidence should also support sales of premium drinks, as people are less likely to be discouraged by the higher price tag of premium brands.
Unemployment rose by 68.1% in 2009, leaving 1.5 million people claiming Jobseeker’s Allowance (JSA). This number fell in 2010, but increased again in 2011 and 2012, by 2% and 3.9%, respectively; just under 1.6 million people were claiming JSA at the end of 2012. Rises in unemployment are likely to have encouraged off-trade sales at the expense of sales through on-trade channels, while many people are likely to have reduced their expenditure on alcohol through both channels, regarding it as an unaffordable luxury. This is particularly likely to have affected sales of premium beers, lagers and ciders, as they tend to be more expensive.
Living costs which for the most part cannot be avoided such as transport and energy bills have been rising, while wages have tended to stay fairly flat. This has left shoppers with less disposable income in real terms and, therefore, less income for non-essential products such as beers and lagers.
Rates of excise duty: Brewers in the UK continue to complain about the levels of excise duty in the UK compared with the rest of Europe. Excise duty is as much as seven times higher than in France, resulting in major smuggling operations into the UK.
Social
Premium lager started to gain popularity in the UK in the 1970s, displacing ales and stouts as the nation’s favourite beer. The craze for craft beers (few of which are lagers), coupled with the rise of microbreweries, has seen the ales category start to challenge lagers in recent years. Cider has also seen strong growth, with consistent performance expected over the next few years as the long running over-ice trend gives way to fruit-flavoured ciders.
The term cider refers to a fermented alcoholic beverage made from fruit. It is usually made from apples, but perries (cider made from pears) and other fruit ciders are also well-established products, and are gaining in popularity. Cider is particularly popular in the south west of England and East Anglia, which are the
Show More

Related Documents: Research: Alcoholic Beverage and Premium Lagers Essay

Essay on Band Audit Budweiser Budvar

conducted. This report is a combination of primary and secondary research which begins with collection of published data on the brand elements and its current positioning strategy. Further the brand equity is assessed through quantitative research in the form of questionnaires that assess the brand on multiple dimensions like knowledge, awareness, image, personality, associations and value to name a few. Next the findings of the research are analysed on the mentioned dimensions that inspect the equity…

Words 3359 - Pages 14

Essay on Diageo Final

world’s leading premium drink provider of beverage alcohol brands, founded in 1997 when Grand Metropolitan and Guinness decided to merge. In 2009, the company was supporting over 20,000 workers and operating in over 180 countries around the world, centrally located in London, Unite Kingdom. In 2011, it recorded revenue of 13.232 billion pounds and an operating income of 2.595 billion pounds (Diageo, 2012). Diageo strategic brands produced are the leading brands across total beverage alcohol across…

Words 3058 - Pages 13

Heineken: The Four Drivers Of Foreign Direct Investment

Introduction Heineken was founded in 1864 was The first beer that was introduced and exported to United States was henieken, way back in the early 1940s. It became an essential market for Heineken and gradually expanded into one of the world largest beer markets. Despite being one of the world largest breweries, Heineken does not have any brewery to produce beer in the United States. By late 1940s, Dr H.P Heineken, sent his son, Alfred and has brought in new marketing strategy and new technology…

Words 2043 - Pages 9

Boston Beer Co. Abstract Essays

the industry is much more focused on high quality products, meaning firms rarely compete on price. Premium beers are well positioned for increasing growth as consumer preferences shift coming out of the financial crisis in 2008. As consumers become more health conscious, the market will see a shift toward premium beers which are viewed as healthier than lower end beers. According to SAM’s research, the craft brewing sector grew approximately 11% in 2012 compared to the measly 1% growth of the overall…

Words 2986 - Pages 12

Essay Paddock Wood Brewing Co Maha Kumaran Sept

Wood needs to invest in advertising to groups by offering taste testing occasions perhaps in locations like the University campus in Saskatoon and Regina to attract more crowds. Lowering their costs is not an option but marketing themselves as super-premium, high quality beer would help draw customers without damaging their image. Introduction According to their website, Paddock Wood is “Saskatchewan’s first microbrewery” that produces craft beers in unique and distinctive flavors that could not be normally…

Words 2356 - Pages 10

Essay about Heineken Marketing Report 2009

number two beer brewer in the world. The company accounts for nearly 5% of the world’s production. With a major global presence, Heineken’s main market is Europe, accounting for 47% of its sales. According to the Plato Logic November 2008 Research report, beer consumption worldwide has grown less than three percent that year. The researcher stated that the world's five biggest beer markets were China, United States, Russia, Brazil and Germany.[8] In the last several years imported and…

Words 5005 - Pages 21

Essay on Heineken global branding and advertisin

Analyzing the case we could see that Heineken was on the right track to its globalization. Its two projects: Mosa and Comet and the extensive research that was done to supplement them and Heineken learned and benefited tremendously from them resulting in going on the right track to become a fully global. 2. Evaluate the research in the case. What has been learned? Managers at Heineken’s headquarter conducted two kinds of projects. First project was named: Project Comet. A manager who…

Words 3096 - Pages 13

Boston Beer Essay

has launched the company to be able to compete nationally with companies such as Anheuser-Busch, Heineken, Constellation Brands, and Adolph Coors. Boston Beer Company’s customer loyalty can be seen in the decrease in sales in The Samuel Adams Boston Lager and an increase in Sam Adams Light during the rollout in 2002, therefore cannibalizing sales. Their real major competitors in the better beer industry are Heineken and Corona, but…

Words 17847 - Pages 72

Function: Salads and Fleur de Baie Essay

Baie “Excellence is the unlimited ability to improve the quality of what you have to offer.” – Rick Pitino This operations report of the new function centre Fleur de Baie located in Sydney’s Central Business District aims to cover various research fields, in particular: * Overview of Fleur de Baie * Target Market * Floor plan and accessibility * Brief overview of revenue and support centres * Service styles offered * Menu’s and Packages * Staff organizational…

Words 5638 - Pages 23

Heineken Business Analyses Essay

Heineken Family, but the daughter of Alfred Heineken is still closely involved in the company. Globally, Heineken is in the top 5 of the largest breweries and in Holland they are the largest brewer. Heineken NV is a Dutch multination in the beer- and beverage sector and operates in more than 170 countries. With a total beer volume of 125.8…

Words 15248 - Pages 61