Samuel Adams Beer Competitive Analysis Assignment

Samuel Adams Beer Competitive Analysis Assignment Words: 5350

Competitive Analysis For the Samuel Adams brand, indirect competition is based primarily in distilled spirits, liqueurs, and wines. Spirits typically contain 37. 5% ABV or greater and are usually not infused with any flavors during the distilling process, however, some modern spirits are infused with flavors after distilling. Liqueurs, on the other hand have a slightly lower ABV and are characterized by uniquely infused flavors and high sugar content. Wine includes any alcoholic beverage that is made from fermented fruit juice and contains from 7%-18% ABV. The most common distilled spirits include whisky, vodka, rum, and tequila.

Whisky (or whiskey) refers to a spirit that is distilled from fermented grain mash and aged in wooden casks. The most popular types of whisky are Scotch, Irish, Canadian, and Bourbon. Vodka, one of the world’s most popular distilled beverages, is a clear liquid that is distilled from a fermented substance such as potatoes, grain, or sugar beet molasses. Although vodka is traditionally drunk in the Eastern European and Nordic countries of the “Vodka Belt”, its popularity elsewhere owes much to its usefulness in cocktails and other mixed drinks, such as the Bloody Mary, the Screwdriver, the vodka tonic, and the vodka martini.

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Rum is a distilled beverage made from sugarcane by-products such as molasses and sugarcane juice. The distillate is then usually aged in oak barrels. The majority of rum production takes place in and around the Caribbean. Light rums are referred to as light, silver, or white and are sometimes filtered after aging to remove color. Gold rums are medium-bodied and gain their color from aging in wooden barrels. Dark rums are even darker in color and aged longer, they are used in cooking and to add color to different drinks.

Spiced rums are usually golden or dark in color and obtain their flavor through the addition of spices and sometimes caramel. Tequila is made from the blue agave plant, which is native to Mexico. Tequila is categorized in five ways, according to how it is aged. Blanco (white) or plata (silver) is un-aged and bottled immediately after distillation or aged less than two months in oak barrels. Oro (gold) is un-aged tequila blended with other aged varieties. Reposado (rested) tequila is aged a minimum of two months, but less than a year. Anejo (aged or vintage) tequila is aged a minimum or one year but less than three years.

Maduro (extra aged) is aged more than three years. The brands that compete directly with Sam Adams include Budweiser, Miller Genuine Draft, Miller High Life, Michelob, and Coors Original. While these brands are all formidable competitors, Sam Adams has a significant edge in product quality and variety. Budweiser is a global pale lager brand owned by the St. Louis???based Anheuser-Busch Company. The company produced the United State’s first national beer, Budweiser, in 1876 and innovated ideas such as beer pasteurization and refrigerated distribution using railcars, truly making Budweiser available nationally.

Budweiser is made with a proportion of rice in addition to barley malt, for which it has received some criticism, though the company takes the position that the rice gives the beer a lighter taste and cleaner finish. Since Budweiser includes rice and other adjuncts, it does not meet the traditional definition of beer. It is a filtered beer available in draught and packaged forms. It has 5. 0 percent alcohol by volume, and is brewed using rice, barley malt, water, hops and yeast. It is lagered with beechwood chips in the aging vessel which, according to A-B, creates a smoother taste.

While beechwood chips are used in the maturation tank, there is little to no flavor contribution from the chips, mainly because they are boiled in sodium bicarbonate (baking soda) for seven hours for the very purpose of removing any flavor from the wood. Anheuser-Busch was one of the few breweries during Prohibition that had the resources and wherewithal to convert to “cereal beer” production ??? malt beverage made with non-fermentables such as rice and unmalted barley and rye, and able to stay under the 0. 5% ABV limit established by the Volstead Act.

Following the repeal of Prohibition in 1933, the major breweries continued to use unmalted cereal grains to provide the full body and mouthfeel of a “real” beer while keeping the alcohol content low. The maturation tanks (they call them chip tanks) that Anheuser-Busch utilizes are horizontal and, as such, the yeast aggregates more quickly. Anheuser-Busch refers to this process as a secondary fermentation, with the idea being that the chips give the yeast more surface area to rest on. This is also combined with a procedure that re-introduces wort into the chip tank therefore activating the fermentation process again.

By placing chips at the bottom of the tank, the yeast remains in suspension longer, giving it more time to reabsorb and process green beer flavors that Anheuser-Busch believes are off-flavors which detract from overall drinkability. As with most food products opinions differ regarding its taste. While some drinkers prefer the lightness of beers like Budweiser and consume it as refreshment, some beer writers consider it as being too bland. The beer is light-bodied with faint sweet notes and negligible bitterness, leading to reviews characterizing it as a “… beer of underwhelming blandness. Despite these negative reviews, Budweiser has a 19. 9 user share and accounts for 26% of sales volume in the regular domestic category, which makes it the most popular beer in the U. S. Bud has perhaps the broadest target market among domestic beers ??? they focus their marketing efforts on men ages 18-54 who usually do not have an education past high school or a four-year university and are mainly employed in natural resources, construction, and maintenance. Budweiser spent nearly $110. 2 million on advertising in 2005 to try and appropriately reach its extremely large target market.

This broad appeal is certainly a valuable strength, however, it is true that Bud is sometimes viewed as having a lower quality and less variety when compared to Sam Adams. On the beer front, consumers are demanding one of two extremes, super premium beers and low-cost value brands. Budweiser falls in the middle-tier premium segment, which has suffered at the hands of this bifurcated demand. Compounding this beer trend is the fact that alcohol drinkers are moving away from beer towards wine and spirits. On the positive side, Anheuser-Busch does have significant brand equity with its top selling brand and its unique entertainment offerings.

Anheuser-Busch operates theme parks–including Busch Gardens, Sea World, and Discovery Cove–which generated 7% of net sales and 10% of income. The company uses these venues to emphasize Budweiser’s rich history as the U. S. ‘s first national beer. Other strengths include a more affordable price than Samuel Adams, an extensive distribution network, and the fact that they target those most likely to be heavy users. From the table below, it is obvious that Budweiser’s dominance in nearly every advertising medium is its key strength.

This spending dominance allows it formidable amounts of exposure no matter where or whom the consumer is. MediumBUDWEISER Ad Dollars (000)Media MixShare of Voice Network TV69,059. 062. 67%77. 24% Spot TV7,691. 86. 98%49. 67% Cable TV16,107. 414. 62%47. 77% Syndication166. 10. 15%54. 84% Magazines5,039. 74. 57%48. 19% B-to-B 0. 00%0. 00% National Newspaper867. 40. 79%100. 00% Newspaper5,850. 15. 31%98. 74% Network Radio56. 40. 05%49. 17% Spot Radio 0. 00%0. 00% US Internet1,008. 50. 92%87. 85% Outdoor4,342. 83. 94%60. 54% TOTAL110,189. 2100. 00%66. 24%

Miller Genuine Draft was introduced in 1985 as the original cold filtered packaged draft beer, which means that the beer is not heat pasteurized. Miller uses an exclusive cold-filtered process that prevents some of the beer’s flavor from being heated away. MGD received the gold medal in the American-style Premium Lager category at the 1999 World Beer Cup. It also received the silver medal at the 2003 American Beer Festival. New product consultant Calle & Company developed the concept for Cold-filtered Miller Genuine Draft. Martin Calle, a long-time neighbor of the W. R.

Grace family, owners of the company that purchased Miller in 1966, evolved the concept from Miller’s New Ventures effort to launch a new dry beer at a time Miller Brewing was in danger of becoming a much-cloned Lite Beer manufacturer. Originally introduced as “Miller High Life Genuine Draft”, the “High Life” part of the name was soon dropped. MGD is actually made from the same recipe as Miller High Life, with a different treatment. High Life is heat pasteurized after packaging and MGD is filtered before packaging. It was developed to give High Life drinkers the same taste in a can or bottle as they found in non-pasteurized kegs.

It has 4. 7% ABV. Most beer writers note MGD’s pale yellow color and fizzy white head. The taste is not very bitter or robust with low hops content. Most reviews mention a bland, watery taste with no positive characteristics other than it’s a good thirst quenching beer. Also, MGD is brewed with preservatives and adjuncts including corn. This makes Genuine Draft a much lower quality of beer than anything Samuel Adams brews. Despite its downfalls, MGD does have a rather wide appeal, mostly due to its affordable price, extensive distribution network, and the fact that it targets consumers who are likely to be heavy users.

Its target consumer is simply men ages 21-54 that have a high school or college education and are employed in either natural resources, construction, and maintenance or management, business, and finance. Demand for MGD is somewhat regionalized, it does better in the North Central and West. Genuine Draft has a user share of 6. 2 and a volume share of 6. 2. In 2005, Miller spent $13,208,200 advertising its Genuine Draft brand beer. As you can see from the table below, MGD spends a large amount of its budget on spot TV, which is appropriate considering the somewhat regionalized demand for the brand.

As well as spot TV, Genuine Draft spends a large chunk on magazine advertising, a very appropriate medium to reach most beer drinkers through. Also, it is apparent that MGD is spending small chunks of its budget in media where the competition is not very active, such as syndication and spot radio. This strategy gives them a large share of voice in these media and can be more efficient that simply putting money in the same areas where competitors are strong. MediumMILLER GENUINE DRAFT Ad Dollars (000) Media MixShare of Voice Network TV1,907. 214. 44%2. 13% Spot TV5,877. 244. 50%37. 96% Cable TV1,380. 10. 45%4. 09% Syndication136. 81. 04%45. 16% Magazines3,427. 125. 95%32. 77% B-to-B 0. 00%0. 00% National Newspaper 0. 00%0. 00% Newspaper20. 20. 15%0. 34% Network Radio18. 80. 14%16. 39% Spot Radio304. 72. 31%20. 66% US Internet126. 40. 96%11. 01% Outdoor9. 30. 07%0. 13% TOTAL13,208. 4100. 00%7. 94% Miller High Life was put on the market in 1903 and is Miller Brewing’s oldest brand. High Life is grouped under the pilsner category of beers and is 4. 7% ABV. The prevailing slogan on current packaging is “The Champagne of Beers”, an adaptation of its long-standing slogan “The Champagne of Bottled Beers”.

Accordingly, this beer is noted for its high level of carbonation, making it a very bubble filled beverage like champagne. It was originally available in miniature champagne bottles and was one of the premier high-end beers in the country for many years. Most beer reviewers point to the high carbonation as a way to give body to an otherwise thin, watery beer. The brand’s current “Take Back the High Life” campaign includes TV spots featuring a High Life deliveryman removing beer from pretentious stores and restaurants, and honoring other bars and stores that reflect the brand’s authentic, unpretentious values.

Except for a brief period in the 1990s, High Life bottles have always been quite distinctive, as they have a bright gold label and are made of a clear glass that has a tapered neck like a champagne bottle. High Life has brought back its “Girl in the Moon” logo, which features by today’s standards a modestly dressed young lady that, by legend, is company founder Frederick Miller’s granddaughter. High Life beat out 17 other contestants to take home the gold medal in American-style Lagers at the 2002 World Beer Cup. As mentioned above, the brand’s high level of carbonation is the brewer’s attempt to add body to a thin, watery brew.

Like Miller Genuine Draft, High Life is brewed with preservatives and corn adjunct, which make it of a much lesser quality than Sam Adams, hence the lower price. However, the affordable price fits well with High Life’s target consumer group. High Life drinkers are less regionalized than Genuine Draft, but most are concentrated in the North Central region. It seems single African-American males are particularly fond of the brand, as most have a household income between $30,000 and $40,000 a year and are employed in natural resources, construction, and maintenance. Additionally, most have lived at their present address less than a year.

High Life has a user share of 5. 2 and a volume share of 6. 0 in the regular domestic category. The brand does a good job of targeting those who are likely heavy users. In 2005, Miller spent $14,626,900 advertising its High Life brand. High Life’s advertising strategy appears to be one of spreading an even SOV across network, spot, and cable TV as they have a similar SOV in those media. Also, from the table it is apparent that High Life spends a small amount in network radio in order to gain a large SOV in that medium, one in which the main competition isn’t as active. MediumMILLER HIGH LIFE

Ad Dollars (000)Media Mix Share of Voice Network TV9,022. 061. 70%10. 09% Spot TV1,659. 111. 35%10. 71% Cable TV3,780. 825. 86%11. 21% Syndication 0. 00%0. 00% Magazines 0. 00%0. 00% B-to-B 0. 00%0. 00% National Newspaper 0. 00%0. 00% Newspaper 0. 00%0. 00% Network Radio39. 50. 27%34. 44% Spot Radio 0. 00%0. 00% US Internet 0. 00%0. 00% Outdoor120. 00. 82%1. 67% TOTAL14,621. 4100. 00%8. 79% When Michelob was introduced, it accounted for less than one percent of the brewery’s production, and was only distributed in kegs, unpasteurized. There was a limited, two-barrel bottling in 1908.

Production of Michelob was, as with all beer in the United States, ceased during the Prohibition period, but even after Prohibition, the production of Michelob by the brewery remained around four percent or less of its total output. In 1961, a method was devised by the Anheuser-Busch brewmasters to produce a pasteurized version of Michelob which did not diminish flavor beyond acceptable levels. This allowed legal shipment of the beer across state lines. Bottled beer began to be shipped soon after, and the brand was introduced in cans as well in 1966. 1997 saw the introduction of several specialty beers under the Michelob name.

These include: OMichelob Amber Bock OMichelob Honey Lager OMichelob Pale Ale OMichelob Marzen OMichelob Pumpkin Spice Ale From the beginning, the specialty beers have had a very limited distribution. The chief outlet has been through a “holiday sampler pack” produced during the Christmas holiday season. Other specialty beers that are no longer in production include Michelob Hefeweizen and Michelob Black & Tan. Some (notably Michelob Amber Bock) have subsequently gone into larger production, while others have not (Marzen is still only available in the sampler pack).

The brewery continues to experiment with specialty beers???during the 2005 Christmas holiday, an oak-aged vanilla beer named Celebrate was sold under the Michelob logo, available in single pints. In 2006, Michelob added a chocolate beer to the oak-aged vanilla released a year earlier. Michelob also brewed Michelob Bavarian Style Wheat and Michelob Porter for its “holiday sampler pack. ” In 2007, Michelob launched its Seasonal Specialty Line, which includes: OMichelob Bavarian Wheat (summer) OMichelob Marzen (fall) OMichelob Porter (winter) OMichelob Pale Ale (spring)

While Michelob is of higher quality than the majority of other domestic beers, reviewers still say that it lacks hops and has a somewhat watery taste compared to Sam Adams and other premium beers. With the Michelob specialty beers, it offers more variety than most other comparable brands but still lacks the wide variety available from Sam Adams. Although it doesn’t quite stack up to Samuel Adams as far as quality, Michelob’s more affordable price makes it readily available to its target consumers, and in the regular domestic category it is probably the best overall value.

Michelob has a strong regional following amongst Southern African-Americans. It is popular with individuals who have attended college and are finding their way into the working world (HHI of $50,000-60,000) and who may have children less than six years of age. Most Michelob drinkers have lived at their present address for less than one year and have a home value of less than $50,000. It is clear that this target market is somewhat narrow, and this is a definite weakness for the Michelob brand. Combined with Michelob Amber Bock, Michelob has a 5. share of users and a 3. 0 share of volume in the regular domestic category. In 2005, Anheuser-Busch spent $7,362,400 advertising Michelob and Michelob Amber Bock. It is quite clear that Michelob doesn’t have a large advertising budget, and it’s hard to make sense of the strategy the brand is using. Such a large percentage of the brand’s budget is spend in network TV, where the competition is also spending large amounts. It may make more sense to allocate more to spot and cable TV where a larger SOV is possible.

The brand is strong, however, in the B-to-B category, where only Sam Adams has an opposing presence, they might also allocate more spending to this area in order to persuade more bars and restaurants to serve the brand. MediumMICHELOB Ad Dollars (000)Media MixShare of Voice Network TV4,216. 957. 28%4. 72% Spot TV0. 10. 00%0. 00% Cable TV1,009. 513. 71%2. 99% Syndication 0. 00%0. 00% Magazines1,707. 523. 19%16. 33% B-to-B25. 60. 35%9. 72% National Newspaper 0. 00%0. 00% Newspaper36. 60. 50%0. 62% Network Radio 0. 00%0. 00% Spot Radio 0. 00%0. 00% US Internet13. 10. 18%1. 14% Outdoor353. 14. 0%4. 92% TOTAL7,362. 4100. 00%4. 43% Coors, the “Banquet Beer,” also known as “Coors Original,” is a 5% ABV pale lager. It is said to take its flavor from the pure water of the Rocky Mountains. This is the oldest brand in the Coors portfolio, first brewed in 1874 and has been given awards at the World’s Columbian Exposition in 1893, and at the Great American Beer Festival in 2004. It wasn’t until 1981 that consumers east of the Mississippi River could find the beer in their markets; so average Joes would haul Coors across the country, road tripping to Golden, Colorado just to find the beer.

This iconic status was reflected in pop culture: in 1977, the movie Smokey and the Bandit centered around an illegal shipment of Coors from Texas to Georgia (in reality there was no law against transporting the beer across state lines). Also, Boston Red Sox great Carl Yastrzemski was such a big Coors fan that when he once loaded up the team plane with multiple cases of Coors for the return trip to the East Coast, some of his teammates jokingly wondered if the plane would be able to successfully take off. Beer reviewers consistently rate Coors Original as having more taste than other major beers in the category, such as Budweiser and MGD.

Common characteristics are the smell of faint, sweet grain, and a fruity whiff as well. The taste is light with well-balanced light hops and malts, probably the most robust of any of the big three (Bud, MGD, Coors). It has no off-putting taste and a bubbly, crisp, and tangy mouthfeel. While this is true, it still trails Sam Adams in robust flavor, quality, and variety. Coors Original has the benefit of the Coors Brewing Company’s vast distribution network, a relatively affordable price compared to Sam Adams, and a large and easily reachable target market.

As far as the target market is concerned, Coors’ most closely resembles that of Samuel Adams. Coors drinkers are primarily well-off white males from the Northeast region. With household incomes ranging from $60,000 to $150,000 a year and home values between $200,000 and $500,000, most Coors drinkers have a college degree and are employed in management, business, and finance. While this segment may not contain most of the heaviest users, it is made up for by the sheer size of such a target. Coors Original has a 5. 1 user share and a 3. volume share, and despite these less than stellar numbers, Coors is probably one of Sam’s most dangerous competitors simply because of the market overlap between the brands. In 2005, Coors spent $3,374,700 on advertising for the Coors Original beer brand. From the table below, it is apparent that Coors Original has the smallest budget out of all competitors. Despite the small budget, there are some changes that might be made to better reach the target consumer. Perhaps they could allocate more dollars to cable TV, where it is likely more Coors drinkers would be present.

The brand’s strength lies in the outdoor advertising category, where they have a 32. 73% SOV. This is a good move considering that Coors Original is often viewed as a thirst-quenching beer that people can enjoy outdoors during the hot summer months. MediumCOORS ORIGINAL Ad Dollars (000)Media MixShare of Voice Network TV687. 520. 37%0. 77% Spot TV72. 02. 13%0. 46% Cable TV19. 40. 57%0. 06% Syndication 0. 00%0. 00% Magazines156. 84. 65%1. 50% B-to-B 0. 00%0. 00% National Newspaper 0. 00%0. 00% Newspaper11. 80. 35%0. 20% Network Radio 0. 00%0. 00% Spot Radio79. 2. 35%5. 38% US Internet 0. 00%0. 00% Outdoor2,347. 869. 57%32. 73% TOTAL3,374. 7100. 00%2. 03% Samuel Adams Brand Strengths At the core of Samuel Adams’ success are three strengths that set the brand apart from the rest of the beer industry. These key strengths are as follows: OSamuel Adams uses only the highest quality ingredients to produce a product that is superior to any other beer available on the market today. OSamuel Adams produces a variety of different beer styles, with each being among the best in the world in that particular style.

OAn overwhelming sense of respect for the Boston Beer Company and its practices from those both inside and outside the industry. Samuel Adams’s rise to the top had stronger foundations than simply a flurry of interest generated by a clever ad campaign. Boston Beer made a quality product. The company used only four age-old ingredients???hops, malt, yeast, and water???a time-honored four-vessel, all-malt process, and a secondary fermentation process called krausening to create a smoother brew. Use of relatively rare European-grown hops further sets Sam Adams apart from the pack.

In the last twenty years, the brewery has won more awards in international beer tasting competitions than any other brewery in the world. Samuel Adams Boston Lager, the Company’s flagship brand, is brewed using the same recipe and techniques that Jim Koch’s great-great grandfather used in the mid 1800s. The result is a beer renowned by drinkers for its full flavor, balance, complexity, and consistent quality. Including seasonal brews, Sam Adams produces over 20 different styles of beer. Beer lovers can enjoy many styles of Samuel Adams beers that range from light-bodied to bold, traditional to extreme.

Jim Koch was once quoted as saying, “we will continue to search for new and different styles of beer, but we will never produce a beer that isn’t the best in that particular style. ” Among that brand’s top competitors, only Michelob boasts a line of beers that can even begin to rival that of S. A. This impressive portfolio of beers gives the brand an unquestioned advantage, allowing Samuel Adams to reach into new markets beyond just the traditional American beer drinker. As the top micro/craft brewer for much of the past decade, Boston Beer Co. has not taken this responsibility lightly.

The company strongly believes that it has a duty to keep spirit of craft brewing alive, the same spirit that led founder Jim Koch to cook up the first few batches on his kitchen stove and then hit the streets in a door-to-door marketing effort. Koch used a personal approach by encouraging bartenders to sample their product and explaining why Samuel Adams was a higher-quality brew from a better company. Nowadays, the company’s sales staff personally contacts customers, and is well trained in brewing techniques???all company employees are required to spend a day brewing beer in Boston.

Company salespeople continually educate retailers about the quality of their products. Boston Beer continues to foster the craft brewing spirit with programs such as the World Homebrew Championships. In its position as microbrew industry leader, Boston Beer encouraged cultivation of the brewmaster’s art. In 1995, it organized the first annual World Homebrew Championships, a summer gathering of 60 judges entrusted with the task of choosing the best among brews from around the world. Along with the Homebrew Championships, recently Boston Beer has taken measures to ensure the survival of the microbrewing industry during difficult times.

The following comes directly from the samueladams. com website: “Lately, everyone has been facing the unprecedented hops shortage and it’s affected all craft brewers in various ways. The impact is even worse on the small craft brewers???openings delayed, recipes changed, astronomical hops prices being paid, and brewers who couldn’t make beer. So we looked at our own hops supplies at Boston Beer and decided we could share some of our hops with other craft brewers who are struggling to get hops this year. We’re offering 20,000 pounds at our cost to brewers who need them.

The purpose of doing this is to get some hops to the brewers who really need them. So if you don’t really need them, please don’t order them. And don’t order them just because we’re making them available at a price way below market. Order them because you need these hops to make your beer. We’re not asking questions, so let your conscience be your guide. ” It’s quite obvious that despite its ranking as one of the top ten brewers in the United States, Boston Beer prides itself on being a small fish in an ocean containing a few large sharks; in the mid-1990s, the combined sales of the entire U.

S. microbrewery industry accounted for less revenue than the total sales of Michelob Light in any one year. In a market dominated by a handful of giants, tenth-ranked Boston Brewery is, in the words of Koch, “like being the 12th largest car company. ” It’s this attitude of “caring about the little guy because we are one of the little guys” that has gained the Boston Beer Company the respect of beer drinkers across the country.

Continuing the quest to provide consumers with the best beer possible, in March 1996, Boston Beer petitioned the Bureau of Alcohol, Tobacco, and Firearms to request “full disclosure” on all beer labels. This would end the widespread use of encoded freshness dates and require point-of-product origin to be clearly identified. Boston Beer had been among only a handful of brewers to print clear and concise freshness dates on their products, so that consumers could evaluate their freshness, a practice it initiated in 1989. The company also started the practice of accepting product returns after expiration dates had been reached.

Boston Beer’s move to raise industry accountability to its own standards quickly received the nod from Consumer Reports, which praised both the company’s packaging and product by voting Samuel Adams the best in the United States in its 1996 craft-brewed ale taste test. Samuel Adams Brand Weaknesses Despite such a high quality product and outstanding company reputation, there are inevitably some chinks in the armor of the Samuel Adams brand. There are four key weaknesses facing the brand: OHigh price relative to other brands in the category.

OSomewhat regionalized demand, mostly restricted to the Northeast. OLow volume/user index, the brand targets mostly light to medium users. OLow share of voice in network & spot TV, magazine, Internet, and outdoor media. While Sam Adams doesn’t perform badly in any of the four regions, there is definitely room for improvement outside of the northeast, and in recent years the brand has begun to gain more of a following in the west, south, and north central. The north central region is probably the most intriguing market, as it contains a relatively large number of heavy users.

Expanding advertising efforts in this region might also help with the issue of low volume/user index, if the brand can successfully reach some of the heavy users that reside there. Sam Adams may also want to consider expanding the target consumer to include the following demographic groups, which are more likely to be heavy users of the product: OSingle young men ages 21-34. OResidents of the North Central region. OResidents of small to medium sized counties. OIndividuals with a household income of between $50,000 and $75,000/year. As far as SOV goes, there are several areas where Samuel Adams needs to catch up with the competition.

With only a 5. 06% SOV in the network TV medium, the brand may want to look at advertising options during nationally televised sporting events on network TV. This type of advertising would capture more of the single young men demographic. Also, the spot TV medium (1. 19% SOV) might be looked into if the brand is serious about opening up markets in new regions, such as the North Central U. S. Furthermore, the Sam Adams brand has a less than stellar SOV in the magazine medium as well (1. 21%). S. A. might consider allocating more ad dollars to magazine ads, where competing brands like Budweiser, MGD, and Michelob are all very strong.

Currently, the brand does not advertise on the Internet, where Bud and MGD have a dominant share. Internet can also be a valuable tool for reaching single young males. The Sam Adams brand currently doesn’t have any of its budget allocated to outdoor advertising either, where Budweiser and Coors have a stranglehold. Stepping up resources to this area might be a wise decision, as this is a medium that would best be suited to push the Summer Ale seasonal brew against summer thirst-quenchers Bud and Coors Original. Samuel Adams Brand Opportunities

In order to compensate for the weaknesses Sam Adams is faced with, the following opportunities will be incredibly valuable to the future of the brand: ODominant SOV in the B-to-B advertising medium. OBifurcated demand among consumers of regular domestic beer brands. OThe “trading up” trend among consumers of regular domestic beer brands. OA new generation of young, legal-age drinkers is embracing craft-style beers, whereas in the past this style has tended to skew older. Such a dominant SOV in the B-to-B medium (90. 8%) is vital to penetrating new markets and expanding the target market. This will allow the brand to slowly grow the consumer base by getting bars, restaurants, and stores to push our product for us. By advertising to businesses and getting new and existing locations to stock the brand, it in turn makes it more likely that the brand will be recommended or given premium shelf space in grocery and convenience stores. The bifurcated demand that exists among beer drinkers is beginning to erode the user share for most of the category’s top sellers.

This type of demand is drawing beer drinkers away from middle-tier premium beers and towards either value brands or super-premium brands. Michelob is the only other super-premium brand among Sam Adams’ top five competitors, and the trend towards the extremes (value brands & super-premium brands) will no doubt help S. A. to increase its consumer base. In addition to the bifurcated demand factor, consumers have increasingly shown a willingness to pay premium prices for beer brands that have more variety and are perceived to be of a higher quality. This “trading up” trend also bodes well for the Sam Adams brand.

Younger aged drinkers are beginning to enjoy super-premium and craft-style beers, however, the potential of this new market has yet to be fully tapped. This user segment has the possibility to be a very profitable one for brands within the category. Samuel Adams Brand Threats The following are serious threats to the future of the Sam Adams brand, and they must be properly dealt with in order to ensure continuing brand equity: OThe Budweiser brand’s enormous advertising budget threatens to drown out any smaller voices in the category. OThe majority of U. S. eer drinkers still prefer American light lagers as opposed to those with more flavor. In 2005, Samuel Adams’ advertising budget was only 16% of Budweiser’s. This represents a major concern that could very well drown out any competitive messages within a particular medium. Also, while more and more consumers are starting to prefer robust, full-flavored brews, that majority of Americans still prefer light, low-calorie beers. Recently, Sam Adams has countered this trend with a light beer of its own, but this fact still poses a serious threat to the brand’s long-term profitability.

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