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Mountain Man Brewing Company: Bringing Brand to Light

Submitted to Prof.Srabanti Mukherjee


1. What are the critical success factors for MMBC? What are its competitive advantages? The critical factors for MMBCs success are listed below: MMBCs Products o It is highly revered because of its consistent quality, which the company has been maintaining since its inception o Its distinctive bitter taste and slightly higher than average alcohol content contributes to its toughness, which makes it popular o The companys rich history as a family owned brewery highlights itsAuthenticity o The Packaging also plays a very important role in the brand identity. Its 1925 design of the label containing a crew of coal miners subscribed to its appeal to the blue collar customer base o Multiple accolades wonby the company have helped to strengthen the brand image. Awards like Americas Championship Lager Award, Best Beer in West Virginia award are won by the brand. MMBCs Customers o From the very beginning, the Target Market for Mountain Man has been the working class population. The toughness associated with its taste and its brand image made it very appealing to them, resulting in a very high degree of brand recognition o The predominant customer base of Mountain Man consists of Blue collar workers, mainly people above the age of 45. The customer base is a very specific one where Mountain Man holds a very high position regarding popularity o The customers of the company always showed a very high degree Brand Loyalty o The company never lost its Regional Focus, which shaped its identity and helped it develop the loyal customer base in that region of USA MMBCS promotion o Grass-root marketing is the key mode of marketing for the company which chiefly relies on the word of mouth publicity. It helps the company to make its brand stronger o The Small Sales Force of the company helped the company to get market share of off-premise locations, thus sustaining its sales

2. Elaborate on the factors influencing brand equity of MMBC. Social Group Strong Beer Working-class-Blue collar Customers Tough Down-to-earth Regional beer Not Corporate but local, authentic brand with strong culture

3. In spite of strong brand equity why did MMBC faced decline? o Overall beer market share of MMBC was very low as amongst its competitors from the major domestic producers(e.g. Anheuser Busch), second tier domestic producers, import beer companies and craft beer industry which together accounted for about 99% of beer shipments in Mountain Mans region in the year 2005. o Decrease in per capita beer consumption in U.S.since 2001, which was 2.3% . This was due to the competition form the wine and spirit based drinks, an increase in the federal excise tax, increasing health concerns and initiatives to encourage moderation and personnel responsibility. o Though MMBC had survived the pressure from large national breweries due to its strong brand brand presence and even though it was still profitable the sales were on decline. The prospects continued pressure on revenue would put in stake the companys profitability. o Due to change in consumer segments for beer market and hence, their preferences MMBC saw a decline of 2% of annual growth. o Overall shift of market to light beer whose major consumers were adult population , accounting for more than 27% of the total beer consumption and was still growing 4. Is launching light beer a feasible proposition?

5. Do you feel MMBC should introduce light beer? We evaluate the MMBC light beer on the basis of the advantages and disadvantages it will bring to the company Pros: 1) As Mountain Man is a known brand it will be readily accepted. 2) MMBC already has good supply and distribution network so it is easy to convince retailers to stock and promote. 3) The introductory marketing campaign need not to create awareness. 4) It has advantage in terms of packaging and labelling efficiencies and it can leverage on its 1925 design for new beer. Cons: 1) New brand may dilute lager equity which is known as strong beer. 2) The existing consumer base might shift to new beer resulting in cannibalizations of lager brand 3) MMBC has limited budget and resources and there are already international players in this market. The projected 0.25% market share by the end of 2006 may put more constraints on existing budget 4) The cost of production for new product is higher than the existing product and as the selling price needs to be maintained constant it may decrease the profit margin.

The financial projections also show that introducing light beer will be a good move considering declining sales of existing product and increased consumption of light beer.

Mountain Man Workings_SectionE_Group8.xlsx