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Lecture

Mountain Man Case Marketing.pdf

12 Pages
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Department
Marketing
Course Code
MKTG 1021
Professor
Salisbury

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For the exclusive use of C DELGADO2069MAY 28 2007HEIDE ABELLI Mountain Man Brewing CompanyBringing the Brand to Light It was February 20 2006 in the New River coal region of West VirginiaChris Prangel a recent MBA graduate had returned home a year earlier to manage the marketing operations of the Mountain Man Beer Company MMBC a familyowned business he stood to inherit in five years when his father Oscar Prangel the president and owner retired Mountain Man brewed one beer Mountain Man Lager also known as West Virginias beer Due to changes in beer drinkers preferences the company was now experiencing declining sales for the first time in the companys history In response Chris wanted to launch Mountain Man Light a light beer formulation of Mountain Man Lager in the hope of attracting younger drinkers to the brandOver the previous six years light beer sales in the United States had been growing at a compound annual rate of 4 while traditional premium beer sales had declined annually by the same percentageEarlier that day Chris met with a regional advertising agency about a marketing campaign to launch Mountain Man LightBack in his office he watched an agency videotape from a focus groupHe observed a halfdozen participants 21 to 55 years old showing various reactions to proposals to extend the Mountain Man brand to a new light beer product A man in his fifties leaned into the facilitator and declared Mountain Man Light Come on Im not interested in light beerJust dont mess with Mountain Man LagerA man in his early thirties dressed in jeans and a camouflage shirt stared at a mock advertisement and shouted Fancy barbecue parties with puppies running around What do they have to do with Mountain ManA man in his midtwenties and fashionablydressed said Sounds pretty corporate I think the beer is too strong for me anywayIll leave it to these guys to drinkA woman in her early twenties wearing lowrise jeans and a trendy Tshirt commented Mountain Man is kind of retro coolI like light beer and Miller Lite is so passI would definitely try Mountain Man LightHeide Abelli prepared this case solely as a basis for class discussion and not as an endorsement a source of primary data or an illustration of effective or ineffective management Heide Abelli is a former consultant with the Monitor Group a strategy consulting firm based in Cambridge MA where she consulted to a variety of consumer products companies on marketing issuesThe author thanks the following executives from the brewing Industry their help was indispensable in refining the case Brent Ryan of Newport Storm Rob Schimony of YuenglingSon and Charlie Storey of Harpoon BreweryThis case though based on real events is fictionalized and any resemblance to actual persons or entities is coincidentalThere are occasional references to actual companies in the narrationCopyright2007 President and Fellows of Harvard CollegeTo order copies or request permission to reproduce materials call 18005457685 write Harvard Business Publishing Boston MA 02163 or go to httpwwwhbspharvardedu This publication may not be digitized photocopied or otherwise reproduced posted or transmitted without the permission of Harvard Business SchoolThis document is authorized for use only by Chantz Delgado in MK021 Marketing Principles taught by Linda Salisburyfrom January 2013 to May 2013For the exclusive use of C DELGADO2069 Mountain Man Brewing CompanyBringing the Brand to Light Chris switched off the videotape and glanced up at a photograph of his father with a group of rugged middleaged men from the Coal Miners UnionAlthough Chris firmly believed that the window of opportunity for introducing Mountain Man Light was closing Oscar had warned Look at what new product lines get you 90 more products 90 more chance youll kill your core brandChris wondered how the men in the photograph would react to a billboard picture of yuppies consuming Mountain Man LightCould Mountain Man command as much pride for the brand from his generation as it had from his fathersMoreover could he reposition the brand to drive sales of Mountain Man Light to young people without eroding the core brand equity of Mountain Man LagerAs Chris prepared to discuss the brand extension with Oscar he knew that whatever strategy Mountain Man pursued it would have dramatic implications for the brand the company and his family Mountain Man The Company and the Brand Guntar Prangel founded the Mountain Man Beer Company MMBC in 1925Mr Prangel had reformulated an old family brew recipe using a meticulous selection of rare Bavarian hops and unusual strains of barley resulting in a flavorful bittertasting beer which the Prangel family launched as Mountain Man LagerBy the 1960s Mountain Man Lagers reputation as a quality beer was 1well entrenched throughout the East Central region of the United StatesMountain Man Lager was a legacy brew in a mature business By 2005 Mountain Man was 2generating revenues just over 50 million and selling over 520000 barrels of Mountain Man Lager beer primarily to distributors in Illinois Indiana Michigan Ohio and its native West VirginiaSee Exhibit 1 for MMBC income statement It had held the top market position among lagers in West Virginia for almost 50 years and had respectable market share for an old school regional brewery in most of the states where the beer was distributedTo accentuate the beers dark color it was packaged in a brown bottle with its original 1925 design of a crew of coal miners printed on the frontMountain Man Lager was priced similarly to premium domestic brands such as Miller and Budweiser and below specialty brands such as Sam Adams Its price was typically 225 for a 12ounce serving of draft beer in a bar and 499 for a sixpack in a local convenience store Brand played a critical role in the beerpurchasing decision When selecting beer consumers considered several factors taste price the occasion being celebrated perceived quality brand image tradition and local authenticityMMBC relied on its history and its status as an independent familyowned brewery to create an aura of authenticity and to position the beer with its core drinkersbluecollar middletolower income men over age 45Exhibit 2 provides profiles of the average Mountain Man Lager consumer in contrast to average profiles of premiumbeer and lightbeer drinkersIn a recent study in West Virginia this audience had rated Mountain Man Lager as the bestknown regional beer with an unaided response rate of 67 from the states adult populationIn 2005 Mountain Man Lager won Best Beer in West Virginia for its eighth year straight it also won Best Beer in Indiana and was selected as Americas Championship Lager at the American Beer Championship Brand awareness was one cornerstone of the brands success with bluecollar consumersMarket research showed that Mountain Man was as recognizable a brand among workingclass males in the East Central region as Chevrolet and John Deere The other cornerstones were the perception of quality in Mountain Man Lager and the brand loyalty it cultivated There were ranges of subjective1 The East Central beer region of the United States consisted of seven statesIllinois Indiana Kentucky Michigan Ohio West Virginia and Wisconsin 2 One beer barrel31 US gallons2 halfbarrel 155 gallon kegs1378 cases of 24 12ounce bottles 2BRIEFCASESHARVARD BUSINESS SCHOOL This document is authorized for use only by Chantz Delgado in MK021 Marketing Principles taught by Linda Salisburyfrom January 2013 to May 2013
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