Beer and Heineken

"Many of life`s failures are men who did not realize how close they were to success when they gave up" - Thomas Edison

Introduction

Anheuser-Busch Inc. is a strong and dominating company that is a leader in the beer market. They are a company that is rooted in values, ethics, and sheer determination. Anheuser-Busch targets consumers who are interested in alcoholic beverages that provide the best taste and quality.

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Their targets are anyone from the lower class of society, all the way up to the upper class. They have a wide range of brands and beverages to offer that are appealing to each social class.

Brief History

Anheuser-Busch Companies, Inc. traces its roots to 1852 and the Bavarian Brewery in St. Louis. Adolphus Busch, a successful German businessman, joined his father-in-law in the business in the 1860s and took on increasing responsibility. Budweiser was the first national beer brand, introduced in 1876. In 2008, Anheuser-Busch and InBev combined to become Anheuser-Busch InBev.

The new company is the world’s largest brewer and one of the top 5 consumer goods companies in the world. 6. Introduction The Heineken family entered the beer business in 1864, when Gerard Adriaan Heineken bought a brewery in the heart of Amsterdam. Over the past 140 years, four generations of the Heineken family have built and expanded the brand and the company in Europe and around the world. It is thanks to the leadership of Gerard, Henry and Alfred Heineken that Heineken is one of the world’s leading brewing groups.

At the end of 2007, Heineken has expanded to a number of 119 brewers in more than 65 countries all over the world with a number of 50,004 employee in the year of 2007. (Heineken N. V. , 2008).

Product Definition

General

Good, idea, method, information, object, service, etc. , that is the end result of a process and serves as a need or want satisfier. It is usually a bundle of tangible and intangible attributes (benefits, features, functions, uses) that a seller offers to a buyer for purchase.

Product: Budweiser Anheuser

• Budweiser Anheuser-Busch is an American-style lager and is one of the most popular beers in the United States.
• Budweiser is made up of large proportion (up to 40%) of rice in addition to hops and barley malt.
• Budweiser is produced in various breweries located aound the United States and the rest of the world.
• It is a filtered beer available in draught and packaged forms.
• Introduced in 1982
• It was one of the first light beers in the world
• Bud Light is the best-selling beer in the U. S. and the #1 beer in the world
• It’s brewed at all 12 Anheuser-Busch U. S. based breweries. Bud Light is brewed with all-natural ingredients – water, barley malt, rice, premium hops and yeast.
• A blend of two and six row malt and cereal grains give bud light its clean, crisp, smooth taste.
• There is 110 calories, 6. 6 grams of carbohydrates and is 4. 2 % alcohol by volume in each 12 OZ. serving

Product: Bud Select

• Bavarian hops and an extended brewing process combine to give the Budweiser Select its distinctively full flavor-despite weighing in at only 99 calories.
• Dark gold in color and pleasingly aromatic, Budweiser select is impressive from any angle.
• The Exception to the Rule.
• Bud Light Lime is a premium light beer that combines the superior drinkability of Bud Light with a splash of 100% natural lime flavor.
• A light beer with 4. 2% ABV and 116 calories per 12 ounce serving

Product: American Ale

• Debuted in September 2008.
• The beer offer complex taste without much bitterness.
• It is the first beer under the Budweiser name that is brewed as an ale rather than a lager.
• The beer has a darker color which is a departure from other Budweiser brands

Product: Bud Dry

• Bud Dry was introduced in the U. S. in 1990 with the slogan of “Why ask why? Drink Bud Dry. ”
• It was originally successful in the test markets and was expected to be a popular beer with the rise in lager popularity.
• However, with the introduction of Bud Ice in 1994, Bud Dry began to decline in the mainstream popularity and no longer receives attention.
• Introduced in 1994 as “Ice by Budweiser”.
• Contains more alcohol (5. 5%ABV) more than Budweiser.
• Bud Ice Light was introduced in 2007.
• Contains 4. 1% ABV and 110 calories.

Product: Clamato Chelada

• A blend of Budweiser or Bud light and Clamato. This beverage became available nationally in late 2007 due to overwhelming popularity during test marketing.
• In its most basic form, the chelada is a fairly innocuous mixing of beer with lime and salt. Miller's new product, Miller Chill, incorporates these flavors in their new product, which they have slotted as a super premium light beer

Marketing Mix

Product Keegan and Schlegelmilch define a product as a collection of physical, psychological and symbolic attributes that collectively yield satisfaction, or benefits, to a buyer or user.

When we interpolate the above definition into Heineken, we see that all three parts mentioned above, i. e. Physical, Psychological and Symbolic apply to Heineken products.

Brief Summary

When looking at the marketing mix of Heineken, we see that they have only a limited amount of products as they have a large diversity of brands. Their main product is of course, ‘the beer’. Currently, they have only four kinds of beer:

• Heineken Pilsener
• Heineken Premium Light
• Heineken Tarwebok
• Heineken Oud Bruin

The last two are specialty beers available only in USA and Netherlands. Of course they have a large variety of other brands to compensate.

Heineken Pilsener

This is Heineken’s regular beer which is the same as the original Heineken started with. Its mildly bitter taste, fresh, fruity aroma, bright color and exceptional clarity are obtained using only the purest water, hops and barley malt. Alcohol: 5% vol.

Heineken Premium light

Heineken’s Premium Light is a beer brewed by Heineken mostly for the US market. It was introduced in 2005 and took them 10 years of market research, and was chosen from twenty options.

The introduction of this beer was a big step for Heineken. Alcohol: 3. 3% vol.

Products Heineken Tarwebok/Special Dark (USA)

Traditionally brewed and drunk in autumn, this aromatic, strong beer has a full-bodied, spicy taste derived from unique malts made with roasted spring barley and wheat. It is available only in Netherlands and in US under the name Special Dark

Products Heineken Oud Bruin

One of the most traditional Dutch beer types, ‘Old Brown’ derives its rich, dark color and taste from its dark malt and hops.

Natural sugar gives it a mildly sweet, caramel taste. It is available only in the Netherlands.

Draught BeerTender

A joint venture between Heineken and the electronic company Krupps resulted in the BeerTender which is a beer tapping system for use at home. It uses small lightweight 4-5 Lt. kegs. It is a closed system meaning that only available beer is from Heineken itself. It was first introduced in Netherlands in 2004 and found its was to eight other countries by 2008. In 2007 there were already 300,000 BeerTenders sold

DraughtKeg

DraughtKeg Another similar product that is developed and engineered is the DraughtKeg. It is a 5 Lt keg that has the entire tapping system built into it. The keg is portable, disposable, 100% recyclable and is manufactured in lightweight steel. It was first introduced in France in 2005. In 2007, it was available in 90 countries and sold more than 10 million units.

Today, most of these promotional programs are represented only on the 16 ounce aluminum bottle container. However, many major league baseball and NFL teams also promote 24 ounce cans marked with team logos.

NFL team-specific packaging for 28 National Football League teams from Budweiser and Bud Light.

Anheuser-Busch domestic breweries will be involved in the team specific packaging campaign, which will produce more than 78 different packaging combinations on 12 million cases of Budweiser and Bud Light aluminum cans.

Styling and Packaging

• Packages are sometimes tailored to local customs and traditions
• In St. Mary`s County, Maryland, ten ounce cans are the preferred package.
• Chicagoans widely prefer the 16 ounce can.
• Michigan prefer the eight ounce can.
• Presently, Budweiser is distributed in four large container volumes: half-barrel 15. 5 gal, quarter-barrel, 1/6 barrel and beer balls (5. 2 gallons). In smaller consumption volumes, Budweiser is distributed in eight, ten, 12, 16, 22, 24, 32 and 40 ounce containers. Smaller containers may be made of glass, aluminum or plastic.
• The Budweiser bottle has remained relatively unchanged since its introduction in 1876.

The top label is red and currently read Budweiser. The top of the main label is red with a white banner with a pledge on it, which has changed three times. Below the banner is a coat of arms of sorts, which features an Anheuser-Busch stylization. Below that is a large white box.

Styling and packaging is critical and very important for Heineken. They also emphasize this by saying the following in their annual report of 2007: “ Packaging is a key element in Heineken’s marketing and innovation strategy. New pack types create new consumption moments, build excitement around our brands, improved margins and higher volumes. ” In this way, Heineken moves beyond from selling just beer to selling experiences by augmenting their product. We will see some examples of the creativity and innovation of Heineken when it comes to packaging. Beer is typically served in two main types of packaging, bottles and cans.

Paco Bottle In 2004 Heineken introduced the Paco bottle which is made out of striking green aluminum to reinforce the brand’s premium positioning. With the Paco bottle, Heineken was the first beer brand to win Frontier’s Star Product of the Year award in 2005. “ Heineken has succeeded in creating a brand new high value subcategory without cannibalizing from existing sales.

The product, placement and price are all well adjusted to the travel retail environment. Paco creates a premium perception in a category that has never been perceived as premium”. DraughtKeg The DraughtKeg mentioned earlier caused a disruption in the beer market. Its unique functionality, offering real draft beer from a keg that is scaled down for convenience, improves the customer experience. What makes this so special is that it is done by a revolutionary packaging instead of a new flavor or a new style of brewing.DraughtKeg It took 15 years to develop and an investment of $15million in a new production line. It results in 12-14 beers and costs only slightly more than a regular 12-pack. Because Heineken is a premium brand, this light increase in price will not bother the consumers since they get a better and fresher taste from the DraughtKeg. Since the margins on low-end beer are too slim to support this type of delivery system, Heineken has managed to use its creative packaging abilities to disrupt the commodity beer market.

Heineken WOBO

In 1963, the then chairman , Alfred Heineken visited the Caribbean and noticed beaches littered with beer bottles and a shortage of building materials. This gave him the idea to use the beer bottle for another purpose then just hold beer and came up with the Heineken WOBO (World Bottle). The specially designed bottle was meant function like normal ‘brick and mortar’ construction. However, only 100,000 bottles were produced and now they have become a treasured collector’s item.

Entertainment

Sponsorship of the world’s premier sporting events

• Maintains a high-profile presence with adult audiences through innovative marketing and sponsorship programs in sports, music and entertainment.
• It generates solid financial returns, supports Anheuser-Busch’s beer brands and enhances the Company’s image.
• Busch Entertainment Adventure parks;
• New shows and attractions (“Believe”)
• Wildlife conservation and commitment to guest service: Seaworld &Busch Gardens
• The company recognizes the importance of being a good environmental steward in the communities where it operates.
• Bio-Energy
• Wastewater into a renewable fuel source
• Recycles more than 97 percent of the waste it generates
• Projects with the National Fish and Wildlife Foundation

A positive lifestyle

Enjoy Heineken responsibly In 2004, Heineken became the first alcohol company in the world to link a responsibility message on bottles, cans and secondary packaging with a dedicated alcohol education website. This website, www. enjoyheinekenresponsibly. om , holds information on Heineken’s alcohol policy and provides information on the effects of alcohol and guidelines for responsible drinking. It also can redirect visitors to organizations dedicated to the subject.

• Heineken Alcohol Policy Statement Heineken formed an alcohol policy statement, Heineken Alcohol Policy Statement (HAPS), that contains eight ruling principles shown below (Heineken Alcohol Policy, 2008).
• Responsible consumption of beer is consistent with the maintenance of a balanced and positive lifestyle for most adults who choose to drink. The informed individual is responsible for his/her own behaviour
• Heineken is committed to raising awareness regarding responsible consumption
• We demand responsible behaviour of all employees in our family of companies around the world
• Heineken companies are charged with ensuring that their commercial activities meet legal requirements and do not encourage irresponsible consumption
• We want to help prevent abuse and misuse through dialogue and action
• Implementation of the Heineken Alcohol Policy is mandatory in all Heineken companies
• We will report on our actions related to our Heineken Alcohol Policy

Brand Image

We are all aware that it is very difficult to taste the difference between the varieties of available beer brands when given it unlabelled, it is almost impossible for a common man to say for sure what brand is it, and there are several cases on this issue. Therefore the styling and, packaging and brand image is very important. In the world of brew, consumer loyalty is shaped by brand culture (Barnet, 2001).

Positioning

• Globally brewed and considered as leader on the market.
• Holding a 49% market share of US beer sales
• Quality product, best tasting, satisfying beer on market
• Target market is 21 years and older
• Fun loving
• Care free individuals
• Drink occasionally and or on daily basis

Brands can be eternal if nurtured well.

Budweiser feels that, the “white and red blood cells” of healthy brands are resilience and leveragability thus their brand custodians must always realize that maintaining long-term brand health is usually more important than the short-term $ gains, thus they try to promote the health of their product through sponsorship.

Meet you There” Heineken USA as leading importer of beer into the US, including the flagship Heineken beer. Alaska distributors is a wholesaler of malt beverages in Washington and Alaska. Heineken did not approve a proposed transfer of distribution rights to another wholesaler, and later terminated the existing wholesaler and appointed a new wholesaler, Alaska Distributors. The market area for the distributor was North of Seattle, Washington. Heineken total beer volume was made up- Heineken brand 18. 7%, Amstel 9. 1% and other beer brands 72. 2%.

Filip Wouters VP Marketing

Heineken is an iconic brand that represents heritage, premiumness, innovation and quality around the world and is the gold standard for imports in U. S Heineken is the world’s most valuable International premium beer brand. Heineken hopes to consolidate its position within the high growth Romanian beer and mineral water market by acquiring Transylvania-based brewer Bere Mures for an as yet undisclosed fee. As of 2007, Heineken owns over 119 breweries in more than 65 countries and employs approximately 54,004 people.

Building a winning brand portfolio centered around Heineken. Their brand strategy is to build a strong portfolio that combines the power of local and international brands and which has Heineken at its center. The consistent growth of Heineken requires solid creative brand management, which they always coordinate centrally. For the Heineken & Amstel brands, they develop and maintain central guidelines and standards for brand style, brand value and brand development.

Brand Strategy

Heineken applies the following global brand strategy: “Our brand strategy is to build a strong portfolio that combines the power of local and international brands and which has Heineken at its center. Heineken introduce a standard for measuring brand performance. Heineken brand Dashboard is a new system for measuring and reporting all essential keys performance indicators on sales, marketing and finance relating to the Heineken brand.

This tools will make it easier to diagnose brand health issues and to have a consistent vies of the most successful growth drivers for the Heineken brand across the business. The Company’s other brands with some international distribution are Amstel which sold 630 million liters, Buckler, a nonalcoholic beer, which sold 90 million liter and Murphy’s Stout, recently acquired. As a result of acquisitions, Heineken also oversaw the brewing of many local and regional beer brands marked by its subsidiaries, such as Bir Bintang, the leading Indonesian brand.

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