of 0.37% is needed to break even in 2006 and 0.45% in 2007, which seems in line with the projected 0.25% first year market share and subsequent 0.25% growth. This is reflected in Exhibit 6A, where in 2006 MMBC is not projected that market share and is showing a projected loss, but by 2007, MMBC should have 0.50% of the market and meet the above breakeven unit calculation. The loss of sales of premium beer to the new light beer market is estimated between 5 and 20%. The analysis shown in Exhibit
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What is distinctive about MMBC’s product, customers and brand equity? Reasons why MMBC has been successful: * MMBC used their history and status as an independent family owned brewery to enhance the feeling of authenticity of their brand, which resonates with its core drinkers – blue collar, middle to low income men over the age of 45. * MMBC has very high brand awareness – in a recent study, MMBC Lager was rarted as the best known regional beer, unaided response rate of 67% from the
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What has made MMBC successful? The company has stayed true to its core customer base. Its product focuses on quality. Brand Loyalty Older working class, blue collar Effective marketing Sales team - "Grass roots" marketing 70% consumed at home higher alcohol % Since 1925, this traditional and regional family owned brewery has cultivated its brand loyalty by sticking to its core customer base, offering to them an attractive product and offering them a brand building product with great price
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Table of Contents What is the current situation? 2 What has made MMBC successful & distinguishes it? 2 What enabled MMBC to create such a strong brand? 3 What has caused MMBC’s decline in spite of its strong brand? 3 Should MMBC introduce a light beer? 4 Is MM Light financially feasible for MMBC? 5 Break-Even Point (BEP) Analysis 6 MM Lager Cannibalization 6 MM Light Marketing Strategies 7 Exhibit 1 – SWOT Analysis 9 Exhibit 2 – Financial Data and Assumptions 10 Exhibit 3 – Break-Even
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increase in the profits. MMBC has used its brand supremacy to influence consumer buying traits. Their brand has played the most significant part in the decisions they make while purchasing beer. Some of the deliberations that customers make when selecting their preferred beer are based upon; the beer’s taste, the pricing strategy that is being used, the event that is being celebrated, recognition of the brands quality, and the supremacy of the brand. The pricing used by MMBC is not so high and is thus
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(74% in Region): Few companies who compete in economies of scale in production and advertising. 2. Second-tier domestic producers (12.5% in Region): Mid-size companies that distribute nationally and smaller companies that distribute regionally like MMBC. Compete on product
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Central Region and will increase sales and create profit within 2 years. Rationale: 1. Light beer sales will be profitable within 2 years. The first year MMBC will lose $486,374. However, in 2007, the second year, MMBC will gain $1,520,341 in profit. See Appendices 6 and 7. 2. Currently, MMBC can afford the line extension. If MMBC were to wait a few years, there might not be any profit to pay for a line extension. 3. Light beer sales are growing at a 4% CAGR. In 2001, light beer accounted
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Company (MMBC) was founded in 1925 by Chris Prangel’s father with one flagship brew, Mountain Man Lager. For the first time in its history, the brewery is facing declining sales. In light of this decline, Chris Prangel, a second generation brewer, is considering launching Mountain Man Light beer. The light beer market has experienced a 4% annual growth over the past six years and represents an opportunity to boost sales by entering a previously untapped market. Background: MMBC relies on
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Mountain Man Brewing Company (MMBC) Case study 1. What has made MMBC successful? What distinguishes it from competitors\ * Brand Loyalty * Older working class, blue collar * Effective marketing * Sales team - "Grass roots" marketing * 70% consumed at home * higher alcohol % * 2. What has caused MMBC’s decline in spite of its strong brand? Think in terms of the beer market in general, as well as the market MMBC serves. * Alternate
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Central Region and will increase sales and create profit within 2 years. Rationale: 1. Light beer sales will be profitable within 2 years. The first year MMBC will lose $486,374. However, in 2007, the second year, MMBC will gain $1,520,341 in profit. See Appendices 6 and 7. 2. Currently, MMBC can afford the line extension. If MMBC were to wait a few years, there might not be any profit to pay for a line extension. 3. Light beer sales are growing at a 4% CAGR. In 2001, light beer accounted
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