Mountain Man Brewing Company: Bringing The Brand To Light

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Mountain Man Brewing Company: Bringing the Brand to Light
The light beer sales have been increasing in the U.S. market at an annual rate of 4%. At the same time, the traditional beer sales, like MM Lager have been declining by the same percentage. The clients for light beer range from 25-44 years. This is beyond the current core age group for MM Lager which is individuals above 45 years. The light beer category has a male-to-female ratio of 4:1 while the light beer category is 3:2. The sales for MM Lager will continue to decline. Looking at the current state of the beer industry, it can be projected the decline will increase in the coming years. While there has been a decline in the sale of MM lager, Mountain Man Brewing Company (MMBC) should not go ahead and introduce a light beer category.
Over the years, MMBC has built its core competency by selling the MM Lager. The company has also earned multiple accolades as consumers consider the product to be of high quality. The bitter flavor and higher than average alcohol content has made consumers to perceive MM Lager to be of high quality. The combination of the perception of high quality and brand loyalty has made MMBC make more sales in MM Lager. Additionally, the reliance on the word of mouth to undertake marketing has enabled the company to create brand awareness and maintain brand loyalty. While there have been unfavorable market conditions in the beer industry, MMBC has managed to grow its sales during the last five years before the set back at the beginning of 2006. The idea to introduce Mountain Man Light does not align with the core competency of a company. It is unlikely that the new product will achieve the same quality and brand loyalty as the old one. If MM Light turns to be of lower quality, then it will damage the reputation that MM Lager has enjoyed over the years. This may, in turn, affect the sales of MM Lager which is the core product of the company.
The “first-time drinkers” that Chris thinks of targeting are unreliable. The core consumers for MM Lager has been blue-collar and individuals above 45 years. These clients have remained loyal to the brand because they appreciate the history of the company and the authenticity is has shown over the years. MM Light seeks to target clients with opposite traits. The “first-time drinkers” that the company targets are less likely to show the same loyalty as their counterparts. These younger beer drinkers are more vulnerable to influence from other brands. Hence, targeting these younger drinkers do not guarantee MMBC success in the future as Chris imagines.
Launching MM Light would be costly to the company because it has not made such a huge investment in the past. While MMBC will not incur capital expenditures due to the existing facilities, the move will cost the company in the long-term. The cost of advertising would be very high for the company. If MMBC decided to launch the product on a national level, it would cost the company up to $20 million. Although the company is planning to do the ...