Creating a New Brand in a Competitive Environment

EXECUTIVE SUMMARY The purpose of this document is to evince how the foodstuff has removed to align to the late valet, and international companies work to offer the silk hat services and crossroad, competing with other firms. Some Marketing tools maintain varied depending on the flak this is wherefore nearly companies prefer to use a dissimilitude of elements to attract customers and retain them, offer well-nigh added value. In the research it is achievable to find contrasting theories applied to historical examples, and taking companies such(prenominal) as Diageo, Louis Vuitton Moet Hennesy (LVMH), and SABMiller like an example, to throw in a natural crop in an un whapn plane section.Beginning with a short background explaining how the main troupe industrial plant, their star yield and direct and indirect competitors. Also, it has discussed about the challenges that this companies realise been facing and how they solve these issues, implementing some strat egies. The Swot allow be explained more(prenominal)(prenominal) in detail, which is important to last the internal and external forces, atomic number 18 influence the company st world power. The unlikeiation is in like manner important, because this gives to the company uniqueness, originality and authenticity part that consumers see it like added value.After an intensive study, the recommendations to key out a successful product ar made to implement in a new commercialize, overturning imitations and confusion in customers, receivable to the huge set of arguments in the corresponding sector. Diageo is al substances caring about their customers they support campaigns to avoid underage alcohol addictioners. INDEX Page Introduction3 1. Case Background 4 2. central Findings 5 2. 1. What is the real challenge that Guinness mettles at the securities industry? 5 2. 2. to a greater extent than a neediness 5 2. 3. A big competition5 2. 4. Marketing bring 6 2. 5. Finding main challenges in the competition6 . 6. Segmenting Markets7 2. 7. SWOT7 2. 8. Designing a merchandise plan8 2. 8. 1. Opportunities in the UK market 8 2. 8. 2. Tar vanquish Market 9 2. 8. 3. The modernistic 4 Ps 9 2. 9. Creating stigma value 10 2. 10. targeting 11 2. 11. Differentiation strategies 11 Recommendations 12 Conclusions 13 auxiliary Bibliography INTRODUCTION The main purpose of this assignment, it is to explore contrastive marketing approaches in current markets, apply a disparity of theories studied at consort and break perspectives from both sides in the market, consumers-companies.In general, this project pass on guidance in how to launch a product in a competitive market, where the beer will be the main competitor. Introducing companies such as Diageo, which has a short flight but its markings a long hereditary pattern word report, Louis Vuitton Moet and Hennesy is recognizing for their lavishness products and SABMiller, the variety is the buckram part . 1. CASE BACKGROUND Diageo is one of the market leaders in amplitude beverages companies they provide a huge range of pelter drinks, for example, spirits, beers and wines.They embroil brands such as Johnnie cart, Crown Royal, J&B and among some(prenominal) other. Besides this, it is contingent to find this company in roughly 180 markets, employing more than 25. 000 replete(p) deal with 80 offices. Its company structures and orientation is classified in Geographic, this is why Diageo desires shell out the adjust product to the right customer, and therefore certain products atomic number 18 change according to the demand of each country. In UK, Guinness is the most popular beer in Bars and Pubs, and it is not only its taste, is to a fault the way to happen the localise message, which I will discuss in more detail.Apart from this, it has been rated one the height tasting beers around Great Britain. Additionally, having a long inheritance makes this brand stronger and p laceworthy for drinking heap. However, positioned companies, like Louis Vuitton Moet Hennesy (LVMH) and SABMiller, do not facilitate its dissemination and selling, so to discover each company has worked in the strategic marketing plans, taking into account that LVMH is the indirect competitor in the alcoholic beverages market. 2. light upon FINDINGS 3. 1. What is the real challenge that Guinness faces at the market?A long hereditary pattern brand could be fractious to revitalize in a modern and competitive market, due to a huge range of brands trying to reproduce the taste and the shape, but how does Guinness take for being recognized by people all of ages without losing their well-know brand and their main features? This question is one of the big challenges that Diageo presently faces. 3. 2. More than a want Historically, beers have been the drinks for people who want to esteem and celebrate any mo, devising them particular(prenominal) and unforgettable, and these fac ts make beer more than a want, a demand which is covered for a lot of companies around the world.Nowadays, the Guinness Brand has become more popular and desirable for everyone, because Diageo honourable do not want to reflect a beer, but also an entire history of a community that has grown with it. 3. 3. A big competition In this days and age, the competition in this sector has increased, which make more difficult the inclusion of new product. There are more than 40. 000 companies worldwide, offering different alcoholic beverages, new contrast, and new messages. According to Euromonitor International (2011), in the UK scorn of crises, unemployment and economic downturn, Guinness is still the most popular beer.Nevertheless, in this industry firms such as LVMH and SABMiller, keep doing very well and creating a diverse way to differentiate from the competition. 3. 4. Marketing channels in Guinness compared with SABMiller and LVMH Guinness SABMiller LVMH Communication Distribution re break dancement As it has been point outed in the previous table the different method to keep in touch with their consumers and, even better, attracting new ones, is the only way to differentiate amongst the competitions.Guinness authenticity and originality tries to parley the moment drinking beer, into joining these special moments into all their history. However, while Diageo tries to keep in the traditional way, SABMiller is gaining the younger market and LVMH is taking advantage of the weakness in Diageo, and forgetting that luxury wines and spirits are a strong part of their competition. 3. 5. Finding Main Challenges in the disceptation As a Global Firm, the role of SABMiller has some challenges that still face nowadays. Their main issue is competing with local brands and the inclusion of new orbicular brands.As a result they always keep practicing their main strategies, in which Nick dismiss (2011), SABMillers Marketing Director, mention that we believe is key to s ustaining our competitive edge. Our ability to nurture and grow brands that consumers want is one of our most important business organization assets. Meanwhile, LVMH is a luxury brand company which always wants to offer the unclutterper quality in a gamy price. Despite the financial crisis in the last hoary age in Europe, LVMH has grown in the previous years (Lucy Shaw, 2012), this appears to show that the strategies to keep the high prices in the offering luxury products, have worked.Beyond price and luxury products, brand trust is also important (Kapferer, 2012), because it provides more certainty. They are taking advantage of their brand creating value for consumers. Nevertheless, at the same time, LVMH are forgetting a big part of the market the youngster. Due to high prices and long heritage history, the products near have covered a subaltern part of the market as a result Louis Vuitton Moet and Hennesy are making the same mistakes that Guinness made. Taking into accoun t the previous examples, the diffusion of innovation possibility (Rogers, 1962, cited in Kotler & Keller, 2011, p. 84) describes five types of consumers, 1) Innovators, 2) Early adopters, 3) Early majority, 4) Late majority, and 5) Laggards, the last fellowship just refers to 16% of people who still buy the same product for a long time, and they believe and trust in the brand consequently, these companies are covering roughly less than 20% of the market. 3. 6. Segmenting Markets Regarding market segmentation each company and brand identifies a group of customer with similar involve or wants to satisfy. All different companies have different approaches, taking SABMiller for example, which is segmented geographically depending on the country region.In that way they canister operate impending to their customers, develop some programs or activities to compete with local stores and concentrate in reacting in any variations of their business competitor. Either way, the grassroots mar keting(REF) is a well-grounded scheme to implement, when it has been considering including a large part of the market. In addition, it is important to mention that the aforementioned company has an approach in business to business, which it also works as a channel distribution.As well as SABMiller, Diageo uses the same global segmentation strategy in local markets, but simultaneously dissever the market demographically in accordance with gender and age. In this case, Guinness has been segmented by age and behavior, which belongs to age group in 20 to 35, and people who want to enjoy a moment, taking some time, and relax without worries. Having discussed SABMiller and Guinness segmentation strategies, it could expose the LVMH segmentation strategies. Spirits and wines sold by LVMH have been segmented demographically, which includes income and kind status, people who want to feel sophisticated in a luxury market. . 7. SWOT (Strengths, weaknesses, opportunities, menaces) Strengths * Strong structural companies, powerful brand extensions and long heritage history. Diageo has all the variables to succeed in a market where it already has launched some products. It also has a long history with brands such as Guinness, Johnnie Walker or Buchannan. Even when the company is relatively new, it has more than 80 offices around the world, this would indicate huge market knowledge. Weaknesses * Venture in a totally new segment. This could be a huge growth opportunity but, if it the new brand fails, the reputation of the other brands can be affected.Opportunities * Low competitions in a new market. The UK is famous for its beer, some whiskeys and cider, but all of them focus on men, disregardless the female of what wants and demands are. The growth of women markets is a chance to speculation in a new segment. Threats * Big companies and big brands. The weighty competition in well-known brands and the ease of imitations can become a threat to the beer product in the UK . Coupled with this, is the entry of this substitutes products (Porter, 1985, cited in Ranchhod and Gurau, 2007), like cider (Bulmers, SABMiller) or wines (LVMH), which are located in the top percentage of drinks aimed towards women. . 8. Designing a Marketing Plan As give tongue to by Kotler and Keller (2011), a marketing plan has two levels Strategic and tactical, which include target market, value proposition and product strategy respectively. 3. 9. 1. Opportunities in the UK market According to Alcohol Concern (2008), approximately 90% of British women drink at least once per week, while men drink 21 units of alcohol per week, women drink 14 units. These facts make the female segment a strong one, to penetrate this forgotten sector.So, due to this huge demand in the alcoholic beverage market and thinking in the female sector, Diageo has interpreted the initiative to launch a special product for women and their wants and demands. Besides, studying this segment, it has found tha t the competition offering beer for women is really low. In the graph below, it shows the amount in units drinking of each gender Fig 1. Office for National Statistics (2005) Units per week Medium Online Available at http//www. alcoholconcern. org. uk/assets/files/Publications/Women%20factsheet. df (Accessed 22 February 2013) Following this short but requirement research, it is promising to say that the women are an unexplored market, where companies like Diageo have a great opportunity to venture in this segment. 3. 9. 2. Target Market Diageo brands have a long heritage history with strengths make easy to get into unknown segment, and consequently reaching a position in the alcoholic drinks market. Diageo realizes this area of the market occupied by women market is an ideal segment to launch a product, which caters to their wants and demands.This product is addressed to young professional women, who just want to enjoy life in any given moment, regardless of worries. So, FEM-Ale is targeted to young women, who are aged between 21 to 35 years old, and women just want to relax after a long hard day at work. To be more specific, it will target the market according to the income of women, the hourly pay rates are between 6 and 10 pounds per week (BBC, 2012). 3. 9. 3. The cutting 4 Ps (Marketing Mix) It has been mentioned that the old marketing has changed, and not all the tools are still use to develop attracting strategies.This is because of people behavioral change and also the world has been affected by some forces such as globalization, consumerism and commercial agreement involving governments. One of the initiatory authors that mention the marketing-mix tools was McCarthy (1960), who determined different activities of marketing Product, price, locate and promotion. However, in this coeval world it is necessary to look at some changes as to the persuasiveness of this tool, which encompasses market communications, value and other variables that make the outcome more productive.Trying to adapt the modern world to traditional tools, authors like Piercy (2012) and Kotler and Keller (2011) have tried to draw the new four Ps. Kotler believed that the new 4 elements of the marketing mix should be people, processes, programs and performance, taking into account that these components are more closely identifiable to the real needs in a company. Meanwhile, Piercy highlighted that the tools do not need to change at all but give them a different approach, for object lesson the roduct and pricing policies ought to be foc employ in value offering, while place and promotion should be used like marketing tools. To describe the strategies used by Fem-Ale, Piercy is the author chosen to explain each one. The Value oblation To begin with Product Policy, there are a lot of variables that can affect the offering by the brand and they will be describe as part of the product strategy * Brand name the name of the beer, want to show the rude side of bo ys but the female and frangibility of girls, Fem-Ale. Product variety currently Diageo has a lot of brands that could be used by them to show the same reliability and trustfulness, for instance, at the beginning the beer will be an original sweet flavor and depending on the product musical arrangement will launch a disparity of flavors and varieties. Comparing the product transition with SABMiller, the direct competitor, they have more than 80 options and flavors, which some of them are targeted at women, such as Redds beer, a brand which was launched successfully in Colombia and the UK (Fernandez, 2008), without success with only the Colombian market showing success. Design and case Kotler (2011) has mentioned packaging like the fifth P. It is really important because is the first achieve with the customer it is a moment of truth, in which the marketer may know if this product strategy works. The beer will come in two different packages a can and bottle, with a pink-black col or label, which describes the name, because in line with Madden, Hewwet, and Roth (2000, cited in Dibb, 2006), colors are a good strategy to attract consumers and communicate what they truly expect, do not attract teenagers market to confuse them, due to the huge problem that the UK have with underage drinkers.Establish pricing strategies is also important, because this is where the company can expect to gain a good profit. Fem-ale beer is a product for any women with a special flavor and taste tailor to their specifications, Fem-ale beer is also aimed towards any women who want to relax. That is why Diageo should keep the same price as other brand extension in the same sector. This would be a competitive price. Marketing tools Places or Distributions are all the channels to sell, lurch and offer the product. Initially, Fem-Ale would start offering some samples in pubs and retail stores.At the beginning, the reportage will be small towns close to London, because it is an easy way t o sneak in a new product, where people are more flexible and depending on peoples acceptance, it will be introduced to other towns. The last elements are promotional strategies or marketing communications. These are a method to introduce the product to the consumers, inviting them to try the innovations, attracting through services and promotions, and retaining loyalty customer offering some value. Within marketing communications strategies will be a web-site, describing recipes of dishes or cocktails that could accompany the new brew.As well as this some events and concerts would be sponsor by FEM-ale, a big campaign showing why this beer will satisfy the womens wants, and using Guinness well-known brand, to incite trust and confidence to people who are already committed to the long heritage history of Guinness, and by means of co-branding (REF) like a promotional strategy. 3. 9. Creating Brand value It is good to show that not just young women may be sexy, self-sufficient and do not depend on anyone else to be happy, because Diageo just want to show that there is no discrimination between genders, and in this modern world women need a place to shine.This approach will be focused to make women feel strong and they just have the entire world in them hands. Diageo is creating an approach totally different from traditional beers, and giving support to the female side. (REF) 3. 10. Branding 3. 11. Differentiated strategies kill and POD On the other hand, SABMiller are using the dual adaption strategy (Keegan, 2005), in which communications as well as product has to be adapted to the local markets facts, including packaging, colors, name and taste. In this case, they are sure that their customers are satisfied with the cultural facts of each country. . 12. Supporting campaigns to avoid underage drinkers RECOMMENDATIONS Nowadays, the world has changed and consequently people minds have changed as well. The consumerism, globalization, big competitions in markets, crises downturn, and among many other reasons, they are some forces that affect(REF) people choice at the moment to buy a product and make people desire more goods with more specific requirements. Not all is about low prices, good quality, offers a good service, but communicating the correct message to the right consumers it is the easy way to create a product-customer connection.CONCLUSIONES Bibliography Pag 82 Market-led Author Nigel F. 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