MOUNTAIN MAN BREWING CASE WRITE-UP Problem Statement: Mountain Man Brewing (MMB) has been successful with only one beer, Mountain Man Lager, but consumption has decreased. The decrease in sales for this beer has caused a decrease in profits, since it is their only product. Mountain Man needs to consider a change in their positioning strategy to increase sales and profits to keep the business successful. Alternative #1: Create, promote and sell Mountain Man Lager Light Pros: It gives them the use of their name that is already well known and liked in their current market area.
It creates a light beer for the younger target market that drinks light beers. Cons: It could result in customers switching from regular to light, which would decrease sales of the Lager even more to cannibalize that product. It could also make customers disappointed with them following the trends. It would not even put a dent in the competition for the major name brands. They risk losing their current reputation for being unique with a good stand-alone product, which may also push dedicated customers away.
Alternative #2: Create, promote and sell a new light beer, but use a different name Pros: It won’t take away from the name of the Mountain Man Lager. It still gives them a product that is more common for a new market of younger drinkers. It gives them the ability to purse the larger market for light beers that has greatly grown. Cons: It may still take away from their own Lager beer with current customers switching to the light beer. It still would hardly put a dent in the power of the major competitors, if at all, so it is not likely to pull away a large amount of their competitors’ sales to their own product.
Alternative #3: Keep only the Lager beer and broaden the target market into more States Pros: It keeps their product focus on their successful beer and keeps them unique. It keeps them from having to create something new and start from scratch with promoting the new product. Cons: There will be increased costs with marketing in the new regions and major efforts to get the name known in new locations. They will face a higher production demand if they do increase sales to more areas.
There will be more importance and expense on distribution due to having to make the sales with businesses in more distant States and with having to provide them with the product in a timely and dependable manner. Recommendation: Mountain Man Brewing should choose alternative #3 to keep the Mountain Man Lager beer as their only beer and work to grow it into a larger market by moving into additional States. Doing so keeps them focused on the strength of their unique and successful beer, rather than trying to move toward something more common to follow behind competitors.
If they were to pursue the light beer, it may increase revenue, but not likely to be by that much. Even though the consumption of the light beers has grown significantly in the younger market segment, it is still most likely that they will usually choose the common, major brands, such as Bud Light and Miller Light. They could not get into true competition with the major brands, and would most likely take away sales from their current product due to customers either switching to the light beer or losing dedication to their unique offer.
Even though it may leave out the younger consumer market, they can still draw interest from those individuals as they get older and become more likely to trying specialty beers. They could also look for ways to market for any younger consumers that are or would be interested in something more than a light beer. The young girl in her 20’s already commended on wanting to try it because it was unique. So, they need to find that target market within the younger generation for the lager beer.
As noted in the article, brand awareness has been a cornerstone of their success with blue-collar consumers for the lager beer. So, they need to use that strength to spread it further into more geographical areas for the blue-collar consumers. To do so, however, they must work on brand awareness in new regions. They should start with regions that are closer, rather than trying to go country-wide immediately, since much of their success is on locals knowing and supporting their brand.
Basically, spread the word farther and farther, but do it gradually. It already has a strong brand that can stay in the market with the big name national players, so it needs to focus on that strength rather than shifting focus to trying a new beer that will not be as unique. They can do this and still pursue the younger drinkers that are interested in stronger, more flavorful beers. They can create a marketing strategy to target younger drinkers for the lager, as well as maintain the market with the middle-aged drinkers.