How Different Beer Companies Engage with Customers - Coursework Example

Marketing Principle By + Introduction The Alcohol industry is a large sector that makes many governments raise a lot of revenue, owing many of its profits to the beer industry within the sector. The beer industry makes a staggering $ 325 billion in worldwide sales. Over the last few years, the industry in some parts of the developed world experienced a market overflow of more investors in the industry, making it saturated. The markets grow thin everyday making many investors move to new markets in order to create room for their expansion (Deloitte, 2005).There is little growth left in the already saturated market, which means that the industry is highly competitive. The competitive nature of the market forces companies to be innovative and to find new ways to remain relevant in the ever-competing industry. The challenging part of marketing is that even though companies produce different types of alcoholic drinks with the aim of retaining its customers; the drinks fall into another category and still there is stiff competition. To ensure their longevity in the market, these companies strive to look for strategies that will make them relevant in future. They can unsure their survival by looking at the market trends that are already in the use for them to project the future trends (Deloitte, 2005). The companies face different trends that are all necessary for their growth like the systems under which the products reach the market, the safety of the product, the retailer power, competition from different companies and the lifestyle and demography of the consumer. How Different Beer Companies Engage with Customers Beer companies are constantly facing numerous challenges within the industry among these challenges the most taxing is that of maintaining and growing their customer base. In order to do this beer companies have to be willing to evolve and adapt to trends that will assist them to draw clientele to their products. The nature of this industry is marked by stiff competition both from local and imported brands and therefore for any beer company to survive it has to create a demand for its products within the consumer pool. This is no easy task because more and more investors are looking to indulge in this growing business venture. Already existing beer companies have to work round the clock to ensure that their customer loyalty remains unchanged even in the light of all these new emerging products (Sankrusme, 2011). Beer companies employ heavy marketing strategies to reach out to the consumers. This concept known as the “pull strategy” is where companies directly get through to the customers. They achieve this through advertising to the consumer. The companies put up adverts that show how relevant their products are to their customers day to day lives. For instance, a beer company may run an advert portraying their ice-cold beer on a hot summer day and depict how rich and standardized their product is. If adequately executed this move can help move masses into trying out their products (Sankrusme, 2011). Beer companies can also execute promotions as a means of engaging their customers. Beer companies identify certain products within the market that they wish to push up demand volumes among consumers and come up with promotional strategies that will push consumers into discovering these earmarked products. Such promotional packages may include offers for instance reduced prices on products or the occasional buy one get one set ups that invoke customer curiosity into buying their targeted products (Sankrusme, 2011). More consumers are developing a keener palate and emphasize on the quality and taste of the beer they purchase. This fact has forced beer companies to develop brands that carter to these different preferences. Beer companies have gone into developing a wide variety of products to entice a wider target group and avail the customers with the luxury of choosing what they drink according to their taste preference (Pontinen, 2011). For instance, beer companies manufacture both light and regular beer brands to achieve diversity within the customer base. This ability to provide diverse products enables beer companies to grow their customer numbers and maintain their existing customers by indicating their ability to meet its customer’s needs (Pontinen, 2011). The current economy status has drastically affected negatively on the purchasing power of the consumer, however, this has not stopped beer companies with coming up with strategies to still push their products into the consumers hands. Beer companies produce affordable, quality brands that the customers can afford even with a constrained budget. Beer companies manage to maintain and engage their customers by availing beer brands that are of quality and are pocket friendly. This move has even favored beer companies that execute this strategy efficiently with the ability to shift customers from brands that retain their steep prices to their products that offer quality at affordable prices (Sankrusme, 2011). The beer industry is growing and new trends in technology are being incorporated within the production process aimed at coming up with products that are convenient for the customer. Concepts such as canned beer products are being released that attract customers due to the convenience they provide while still ensuring the quality of the beer. The Coors beer company for instance came up with the idea of the “cold activated can” which enables customers to know whether the beer being purchased is cold or not, or the “home draft” beer produced by the Millers beer company that allows consumers to have beer on a tap at the comfort of their refrigerators. Such technological advancements help beer companies to grow their demand within the market and customer loyalty levels (Pontinen, 2011). Beer companies are also shifting with the technological era with the hope of engaging and captivating the new generation. They have had to establish new methods of reaching out to their customers within the younger generation bracket who view television, newspapers and radio media avenues as outdated. Beer companies have had to invest in advertising within websites that frequented by this targeted group to ensure that they can reach out to them on a more personal level. They have also had to come up with video advertisements that are accessible via mobile devices at the touch of a button. This is necessary to ensure that the younger generation clients are enticed to try out the products they offer (Sankrusme, 2011). Beer companies also implement branding strategies to re brand their products and build their image as a company. Product development allows them to package their products in packaging that attracts the customer while appropriately representing the image of the company. Re branding helps in invoking renewed interest on products within the customers and attract new customers to the brand. Branding strategies also give the company a fresh chance at building an image for itself within the consumer market, a step that is essential in gearing up towards growth and increase in demand of products (CISCO, 2009). Consumer incentive is also a strategy that beer companies come up with to increase the demand of their products within the market and to push customers into interacting with the target product. For instance, a beer company may come up with an incentive that involves lottery tickets under bottle caps that customers can turn in for an array of gifts ranging from trips to exotic getaways or sums of money. This incentive usually entices consumers to increase their purchase on the brands with the hope of claiming these tokens. This exposes the customers to the brand. It also serves to attract new customers to try out these products (Pontinen, 2011). These strategies implemented by beer companies aim to engage their customers and reach out to new customers that can grow their demand within their market and consequently their relevance within this competitive industry. Consumer Decision-Making Process and the Relevant Theories Understanding consumer behavior is a complex process that makes many marketing professionals run many companies to the ground since they do not know what the consumer wants. The factors that marketing professionals look at are; is it personal, psychological or due to circumstances then shortly after they easily discard them. Beer companies all over the world use a lot of money to get to know the mind of the consumer. Many companies have failed to get new products in the market and statistics show that only two products out of ten products get into the market. The consumer undergoes different buying stages during the decision making process where every stage stimuli affects the decision-making process, which eventually will make them chose to buy or not to buy a product. Need Recognition Need recognition is the first stage that the consumer passes through. Marketing professionals look to tap into the urge that lies in the consumer to buy a product and hence try to stimulate the consumer. The stimulation can happen in two conditions either from one self (internally) where one has had the urge to do something for some time or it can be external where a friend can influence an urge or even a situation at work. In all these scenarios a marketer can easily know where to strategically place the product or when, where and how to advertise their products to elicit a response from the consumer (Saylor, 2009). In this case, the utility theory proposes that consumers will buy a product with the mindset that it will cater for their expectations. It also explains that the consumer has a certain outcome if they pick a certain product (Richarme, 2005). In the case of Heineken, adverts shown during commercial breaks in soccer matches appeal to the viewer since the sport is associated with the drinking culture and many supporters want to relax and enjoy the game and in places like the U.K, beer is readily available in the stadiums. Seeking information There are circumstances like when a consumer buys a product and likes it under which companies find themselves in which reduces their workload since the consumer has found a brand that he or she can trust. The consumer does not need any more new information but goes directly to a trusted brand. However there are some instances where a consumer was not satisfied with the particular product in this case the information search is the way forward for the consumer. The consumer then goes to seek the relevant information in order for them to satisfy their desires. They have increased attention to electronic and print media advertisements with the hope of landing what they need. They can search for the information from internet sources and friends to get the tips that will help them make the right decision. Internet sources like friends provide a unique source of information since it is independent and comes directly from someone with experience of the product (Saylor, 2009). The satisficing theory elaborates on it because many consumers do not do thorough research of their products and end up taking or choosing the one that is closer to what they require which later makes them unsatisfied with the outcome (Richarme, 2005). Evaluation of the Product In the marketing field, the professionals know that if they bombard the consumer with many different products at one go the consumer will not purchase any of the products since there will be too much information which will overwhelm the consumer. Having this in mind, the consumer normally finds a way to sift products using particular traits, which are important especially to them. In the utility theory, the consumer would evaluate the product linearly using the constants and the variables in the equation to come up with a rational and logical conclusion (Richarme, 2005). These traits are prices, taste, brand but these companies would want to prove to the consumer that their product meets their needs. Guinness is a world known beer that in its advertisements they show that it is more than beer and that the beer has a rich taste that cuts across different races and cultures with pocket friendly prices. In addition, the prospect theory can help shed light on the matter since it a hybrid of both the utility and the satisficing theory. It replaces the utility part of the utility theory with value, which helps in calculating if it is cost effective or not (Saylor, 2009). The product decision and purchase stage At this point, the consumer is ready to make the decision of buying the product. The consumer could actually be ready to purchase the product but there are hindrances that are there at times. The intention could be there but it does not mean that it is the decision. At times, there is the debate of where the purchase will take place (Saylor, 2009). The utility theory helps in making the decision since there is the prior calculation of where one would like to purchase the product (Richarme, 2005). After the purchase In this stage, the consumer looks, evaluates the product, and sees if they liked it. If there is the buyer’s remorse then it is bad for the company and they can tell others not to purchase the product again (Saylor, 2009). Conclusion Many marketers are still trying to figure out the consumer’s behavior. There are different theories that try to make their work easier. The problem is that some of these theories relay on probability and the chance that most consumers would use logic instead of emotion to but a product. In the beer industry marketers are working to improve the taste and quality of their drinks. They do this because more and more consumers are looking for quality more than quantity. In essence, many factors govern the customer’s decision-making in buying beer either logical or emotional. Some go for the brand, while others prefer taste. The mind of the consumer is still on the road of discovery and marketers are looking for definitive solutions. Bibliography CISCO, 2009. Heineken Extends Brand Equity with First "Experience Store". Success Story, 1(1), pp. 1-7. Deloitte, 2005. Profitable Growth and Value Creation in the Beer Industry. Research. New York: Deloitte Deloitte. Pontinen, J., 2011. Beer Brewing Industry. Research. Duluth: University of Minnesota University of Minnesota. Richarme, M., 2005. Consumer Decision Making Models, Strategies, and Theories, Oh My! Decision Analyst, 2(3), pp.1-3. Sankrusme, S., 2011. Marketing Strategy Competition Among Beer Companies Before Liquor Liberalization. Journal of Marketing Development and Competitiveness, 5(6), pp.65-82. Saylor, 2009. Saylor.org. [Online] (1.2) Available at: HYPERLINK "http://www.saylor.org/courses/bus203" http://www.saylor.org/courses/bus203 [Accessed 19 October 2014]. Read More