You are on page 1of 19

Samuel Adams & the Samuel Adams BrewClub Mobile Application

Consumer Motivation and Behavior, MKTG 330-02

Group 7:

Berry, Omar; Birdlebough, Kathleen; Harris, Lawren; Nochta, Sophie; Spriggle, Ellen

Bloomsburg University

Professor Welliver

11/17/2016
Table of Contents

Product Overview ...............................................................................................................................1

Customer Analysis ..............................................................................................................................1

Competitive Analysis ..........................................................................................................................2

Pricing .................................................................................................................................................4

Distribution .........................................................................................................................................6

Promotion............................................................................................................................................8

Internal Influences on Consumer Behavior ......................................................................................10

Product Extension .............................................................................................................................11

Appendix ...........................................................................................................................................14

References .........................................................................................................................................16
1

Product Overview

Samuel Adams beer, also known as Sam Adams, is a beer brewed in Boston by The Boston

Brewing Company. It was founded in 1984 by Jim Koch and is named after Samuel Adams, one of

America's founding fathers. The Boston Beer Company was recently ranked number two in the top

50 U.S. craft brewing companies as of 2015, behind D.G. Yuengling and Son Inc. (Brewers

Association Lists Top 50 Breweries of 2015). Samuel Adams has over 30 award winning styles of

craft beers, including a tremendous variety of beers from their Brewmasters Collection, Seasonals,

and their Rebel IPA Family. The most popular beer they brew is the Boston Lager. The Boston

Beer Company has also been working on some new ideas, such as three new beers released into

Samuel Adams’ newest category, The Nitro Project. There are also more upscale, limited edition

beers in their Barrel Room Collection, Limited Release Beers, and their Small Batch Beers.

Samuel Adams is a brand that is respected in the craft beer community. They are also well known

by the mainstream community as flavorful handcrafted unique beers, which is what makes this

beer and company so successful.

Customer Analysis

The target market for Samuel Adams is beer drinkers, more specifically those who value

quality. Consumers who enjoy craft beer were initially the main target market. The Boston Beer

Company did not set out a specific gender. According to Mintel for the Brewers Association, the

sweet spot for craft beer consumers are between the ages of 25-34. About 50% of millennials drink

craft beer, while 43% of both millennials and Generation X says that craft brews taste superior to

regular beer (Brewers Association).


2

Psychographically speaking, Jim Koch’s aim was to provide the first alternative to flat

imported beers that had little taste. Millennials are more likely to spend money on craft and light

beers instead of regular lagers (Brewers Association). Overall, this generation is more likely to try

new things and views beer drinking as a way to do that in social settings with friends.

Millennials want the beer they’re drinking to have the quality of a microbrew. This is

driven mainly by the quality and variety offered by these companies. The Boston Beer Company is

one of these companies who offer a high quality product. They are leading the industry with 60

different varieties.

Samuel Adams satisfies the need for exceptional, quality beer, all while being one of the

first of its kind in the United States. With this need for a quality brew satisfied, consumers showed

interest in cooking with the different brews. As a result, The Boston Beer Company made several

recipes using their different types of beer.

Constructive processing is the approach consumers’ use while purchasing this particular

beer. With quality being the main selling point instead of price, consumers will put more effort

into their choice since it costs a bit more than a beer coming from a large corporation (like miller).

There is perceived risk involved. Consumers may decide that they don’t like the beer they

purchased, and may even fear that their peers will judge them for choosing a microbrew.

Competitive Analysis

Samuel Adams, along with other beer companies, indirect competitor include wines,

liqueurs, and distilled spirits. The most frequently bought spirits are vodka, whiskey, rum, and

tequila. These drinks are commonly manufactured by being aged in wooden casks and fermented
3

with grain mash. The most favored distilled drink and beer’s highest competitor worldwide is

vodka. This beverage is so popular because of its usage in numerous mixed drinks and cocktails.

Budweiser is one of Samuel Adams’ top competitors in the beer market. Their ingredients

include rice and barley malt, which set them apart from the traditional beer making. These

ingredients also help create the light taste along with a clean finish to their brews. To create the

smooth savoriness, Beachwood chips that have little to no flavor are added to the maturation tank.

Although there are a number of consumers who do indeed desire the light taste, numerous beer

critics have expressed Budweiser as being a bit too bland for their liking. Their target market

consists mainly of men within the ages of 18-54 years old. These men may not have any education

past high school, but could also have a college degree. As for occupations, they target consumers

who usually work in construction or some type of handy work. Compared to Samuel Adams,

Budweiser has an advantage of having a more affordable price, as well as an aim for customers

who drink beer heavily.

Winning both awards of World Columbian Exposition in 1893 and Great American Beer

Festival in 2004, Coors Brewing Company is most definitely high in ranks when it comes to

flavor. Reviewers stated that Coors, compared to their competitors, have more flavorful taste while

still remaining light. Similar aspects to Samuel Adams include having a fruity whiff, faint smell,

and as well as a sweet grain. Also in comparison, Coors is known for their robust flavor, unique

quality and numerous varieties while being more affordable; and because of this it takes the role of

being Samuel Adam’s #1 top competitor (Gonzalez, 2015). Coors target market consist of affluent

white males who usually resident in the Northeast Region. These men normally have incomes

ranging from $60,000- $150,000, along with having college degrees and commonly work in
4

business occupations such as management and finance. Although their consumers are not

considered to be heavy users, the target market helps make up for it.

Miller Genuine Draft beers have also accomplished awards of American Style Premium

Lager at World Cup Beer in 1999 and a silver medal at American Beer Festival in 2003. Although

they have these awards, critics describe their beer of having a bland watery taste with no good

attributes other than it is known to for pleasing thirst quenchers. Miller’s brewing technique uses

ingredients that include preservatives and supplements of corn that makes Miller a less quality

product compared to Samuel Adams. Their beer targets men within the ages of 25- 40 years old

that usually have either a high school or college education and work in construction or business

(Miller Genuine). Several advantages that differ them from Samuel Adams is their affordable cost,

expanded distribution network, and ability to target heavy users.

Compared to their competitors, Samuel Adams has the highest quality ingredients which is

why it is ranked above other beer companies. Due to the fact that the company produces a

substantial amount of different varieties, and it continuing to create more, helps create flavors

based on preference that leads to an increase of their consumer popular. An interesting

fundamental of this Samuel Adams is that it is mandatory for all employees to dedicate a day of

work to go to Boston and brew beer in the facility. By educating their employees, it gives them

absolute knowledge and a better understanding of the brand they represent, which will also lead to

an increase in product quality.

Pricing of the Product

Depending on the type, the most popular Sam Adams beers are priced between $7.99 and

$9.99 for a six pack, which is higher priced than most light beers such as Coors Light or Bud Light
5

These less expensive brands sell at around $4.99 for a six pack (W., 2016). Samuel Adams beer is

a higher priced product because of the higher quality the consumer is getting. The Boston Beer

Company put an emphasis on their research and development stages to make sure that their

product keeps achieving the highest quality in order to justify their high prices and stay successful.

Sam Adams set their prices almost 50% higher than other beers on the market but with the amount

of Sam Adams lovers out there, there are more than enough people that are willing to pay the

higher price for a higher quality. In the mind of a consumer, if they want high quality beer, they

pay for it because it is worth it.

The Boston Beer Company has also created a number of product extensions through

Samuel Adams to reach other markets. They have a number of beers in their Barrel Room

Collection which are sold for $10.99 per bottle and $7.99 per bottle for their Small Batch Beers

(W., 2016). To reach a different kind of consumer, Sam Adams made a Limited Release Beer

extension. They are constantly thinking and experimenting with new flavors and ideas in their

brewery through trial, and error, and at times they brew up their favorite batches yet and decide to

release them as a limited edition to share their favorites. The most popular Limited Release Beer

from Sam Adams is, Utopias. This limited release beer sells for $300 per bottle and the price can

go up to $599 per bottle for the most recent edition released in 2016 (W., 2016).

When looking into the prices of all the different Sam Adam beers that The Boston Beer

Company brews, two major pricing strategies stand out. The first is the Psychology Pricing

strategy (Maguire, 2016). In this strategy, all of their beers, no matter the size of the pack the

consumer is purchasing, the price is set ending with .99 cents. Having a price that ends with .99

looks more attractive to a consumer rather than raising the price up to the next dollar amount. The

second major pricing strategy used is the Bundle Pricing strategy, they use this type of pricing for
6

their most popular beers. For beers such as the Boston Lager, they sell a 6 pack for $9.99 which

makes each beer individually cost $1.67 however when they sell a 24 pack of Boston Lager, the

price is $29.99 which makes each been individually cost $1.25. The same strategy is used with the

Rebel IPA selling a 6 pack for $9.99 ($1.67 each individual) and a 24 pack for $31.99 ($1.33 each

individual beer.) This strategy gets consumers to purchase more of the product at once because it

increases the value perception in the eyes of the consumer (Maguire, 2016). The Bundle Pricing

strategy makes the consumer believe that they are essentially getting something for free. This

strategy is also great for moving mass amount of unsold products in a timely fashion so that they

are not left just sitting on the shelves.

Distribution of the Product

When The Boston Beer Company was founded in 1984, they did not have an original plan

for distributing the product. Since they were known as a small craft brewery, Jim Koch had

difficulty finding a distributor that would be responsible for getting their product into the market.

Many people that Koch talked to said that they were too small and it would be very expensive to

distribute the Samuel Adams brand (Kallman 2016). This actually ended up working in their favor,

because it took away the middle man and allowed Koch and his co-founder to grow relations with

buyers and show their passion for their brews. Back in the 1980’s it was legal to deliver your own

beer in Massachusetts, so that’s exactly what they did. Koch and his co-founder Rhonda Kallman

rented a truck and delivered shipments of beer to local bars and stores that wanted to sell their

product. Each location that sold Samuel Adams was adorned with signs that read “Sam Adams

proudly served here” (Kallman 2016).


7

As the company grew and gained popularity among the American culture, it became

apparent that The Boston Beer Company would need to alter their distribution strategy. Today,

Samuel Adams can be found in bars, grocery stores, and numerous other locations all over the

United States, Canada, parts of Europe, and even Japan. After Prohibition was repealed in 1933, a

three-tier system of distributing alcohol was created (Weaver 2012). This system works by a

brewer selling their product to a distributor or wholesaler, who in turn sells to individual retailers.

Even though this has forced The Boston Beer Company to compete with all other brewers trying to

sell their products to distributors, their sales have not been hurt because of the love for their high

quality product (Chen 2013). In order to effectively get a product from the brewery to a retailer,

crafter breweries need to be able to negotiate well with potential distributors (Weaver 2012). Every

state has different laws regarding the sale of alcohol, so having good relations with distributors

makes it easier for The Boston Beer Company to get their product out on the market.

The Samuel Adams brand is currently being sold throughout the United States, Canada, as

well as a number of countries in Europe. In most cases, this product can be purchased from

distributors or retailers. There are over 3,000 facilities in the United States alone that are

responsible for the handling and sale of alcohol (What Is a Beer Distributor?). Once the distributor

has sold the beer to a retailer, it is then available for consumer purchase. Examples of retailers

include supermarkets, beer distributors, liquor stores, convenience stores, and certain restaurants as

well. In most cases, Samuel Adams will be sold either as cases, 12-packs, or 6-packs. This will

depend on what kind of store is selling the product and what state it resides in.

In addition to year round offerings, Samuel Adams also has seasonal offerings. The spring

season, which starts in January and ends in March, offers the Cold Snap and Escape Route.

Summer’s seasonal offerings are from April to August, with beer like Summer Ale and Porch
8

Rocker. Autumn’s seasonal offerings start in August and end in October, and highlight beers like

Oktoberfest and Pumpkin Batch. The winter, also known as holiday specials, include beers such as

Winter Lager and White Christmas.

Promotion

Even though The Boston Beer Company is one of the largest craft beer brewers in the

United States, it still implements numerous forms of promotional tools in order to market Samuel

Adams. There will always be a need for eye-catching, expressive advertising that draws consumers

in and creates a desire for their products. Numerous forms of advertising have been implemented

to try to reach even more customers and increase sales for the company.

One promotional tool that The Boston Beer Company uses to show off their Samuel Adams

products are television advertisements. Over the years these ads have become more focused on

informing consumers and creating trust in the product rather than simply being humorous. A series

of commercials have been created that emphasize different processes involved in the creation of

craft beer. These commercials, which are called “chapters,” range from discussing the choice of

hops used in the product to the benefits of the color glass that the beer is bottled in. The use of

informational advertisements allows consumers to gain knowledge about the brewing process

itself, ingredients, and even the history of the brewery (Burns, 2016). This specific form of

advertising is appealing to customers because it allows them to have a greater understanding of

how the product they’re consuming is made. These type of television advertisements give

consumers a sense of closeness with the company and the product that they’re consuming. Samuel

Adams is a product that The Boston Beer Company prides itself in, so they believe that

showcasing every positive aspect of their product is beneficial for both consumers and the
9

company as a whole. For example, The Boston Beer Company produced a television advertisement

titled “Chapter 7 - Hops: The Soul of Beer” as one of the ads in the series mentioned above. In this

specific advertisement, founder Jim Koch discusses the process of choosing which hops they use in

their brew. Koch also mentions how important hops are in the brewing process and how different

types can affect the taste of the product (BeerAdvocate, 2005). A screen capture of a television

advertisement can be seen in Appendix B.

Another tool that is implemented to promote Sam Adams is the use of billboards. While

this method of advertising isn’t nearly as popular as television advertisements, it still provides a

competitive edge. The first billboard created by The Boston Beer Company ever created to

promote Samuel Adams was located along the highway by Logan Airport in Boston, MA (Kallman

2016). These billboards, which can be found in areas that surround Boston primarily, boast the

numerous flavors that are produced at the brewery. As a craft beer maker, The Boston Beer

Company focuses on displaying pride in the products they produce. Their billboards reflect this

with slogans that uplift the brand and encourage consumers to only drink top quality brews. An

example of a Samuel Adams billboard can be found in Appendix A. Billboards are appealing to the

target market because they showcase the importance of a quality brew in a large, colorful display.

Personal selling is something that founder Jim Koch implements heavily to spread the word

about the Samuel Adams brand. This method of advertising focuses on spreading the word about a

product through channels such as salespeople or through word of mouth. Interacting directly with

customers allows for a much more personal connection, which can result in brand loyalty and

satisfied consumers. For example, Koch himself would make trips to bars at least twice a week and

talked to patrons to see what they did and didn’t like about different brews (Kallman, 2016).

Methods such as elevator speeches or setting up tents at different events are just a few other
10

examples of personal selling. It is imperative to try to get on a personal level with consumers in

order to relate to their personalities and needs. This type of advertising is appealing to the target

market because it shows a sense of caring on a level that bigger corporations don’t show (Kallman,

2016). Making the extra effort to fully educate individuals and guarantee they know what they’re

investing their money into is something that a large amount of consumers value.

The Boston Beer Company also put radio advertisements into action in an attempt to reach

a larger customer base. These ads are not very lengthy but still do a good job of stressing the

importance of choosing a brew that is well-crafted. Since Sam Adams is a brand that exemplifies

quality, the radio advertisements discuss the factors that go into creating a high caliber beverage.

Just like the television ads, radio promotions also discuss the ingredients of beer and how

important they are when brewing Sam Adams.

Internal Influences on Consumer Behavior

The flagship brand of Boston Beer Company is Samuel Adams, named after the American

revolutionary and founding father Samuel Adams. The Boston Beer Company use the name,

Samuel Adams, as an opportunity to connect with the people of Boston and American citizens in

general. Founder Jim Koch said “I named my beer after Samuel Adams because the name is

assertively American, he was a patriot and a brewer who dreamed of establishing independence.”

Jim Koch made the public debut of his beer on April 1985, on Patriot day (which is also

internal influences). The beer also won best beer in America 4 times. This product is deeply

embedded in the community of Boston because the location of the company, as well as the

connection it holds with its name. The specific internal influence in this case would be lifestyle,

because Samuel Adams drinkers are known to be very proud of where they’re from.
11

When brewing Samuel Adams, the goal is to craft a full-flavored, balanced and complex

product .To achieve their goal, Jim Koch travels the world to hand select each ingredient that goes

into each brew. They also use their brewery as a site for devoted drinkers to come taste brews and

see exactly how they’re made. This is another marketing tool that’s been implemented to enhance

customer loyalty and satisfaction.

Samuel Adams used Product line extension to introduce the Sam Can to improve the

drinking experience and convenience of drinking out a can, without compromising the taste of the

beer. The Sam Can fits in a specific demographic because of its appeal of being a more on the go,

convenient product. A sporting event would be an ideal location to make use of the Sam Can.

Product Extension

Our group felt that a good product extension for the Samuel Adams brand would be a

smartphone application that keeps consumers up to date and connected with many aspects of Sam

Adams. This app would be available on Android, Windows, and iOS devices. In order to access

the features of this app, users must be at least 21 years of age. Age will be confirmed by scanning

the user’s driver’s license or another authorized form of ID with a camera function within the

application.

There will be three main interactive areas of this application, with all of them

providing new and exciting aspects of the craft beer movement. The first section, titled “Current

News & Events,” will update users with the latest happenings of The Boston Beer Company and

the Samuel Adams brand. For example, if a new product is being tested or released into the

market, consumers with the smartphone app may be aware of this way before non-users. If local

restaurants or bars are holding events that showcase the Sam Adams brand, users will receive
12

notifications on their devices if they are within a certain mile radius with specific details of the

occasion.

The next section, which is named “Beer Profile,” is the most interactive section of the

application. This portion of the app will consist of a series of questions involving preferred flavors,

alcohol content, appearance, and aromas that the user will create responses to. Once the individual

has answered all the questions, a profile will be created that lists the top Samuel Adams brews that

fit their preferences. A photo of the labeled beer will be provided as well as a description of the

characteristics listed above. An option will be available to tag and save your favorite brews from

the list provided.

The last section of the application will be a membership section where users can sign up to

become a member of the Samuel Adams BrewClub member. In order to receive benefits of this

membership, users will need to scan a barcode of every Samuel Adams product that they purchase

at participating locations. These locations may include beer distributors, grocery stores, or online

purchases. After making ten purchases, a 10% discount will be applied to the next purchase

recorded with the app. Another neat feature of the membership section of the application is that

users will receive the option to get a free 6-pack of their brew of choice on their birthday. When

new products are being released, smartphone users will have the option to enroll in a program

where they receive free samples in the mail to an address they provided.

The advertisement that our group created to promote our product extension is eye-catching

and uses bright colors (see Appendix C). We believe that this ad could be used in magazines or on

social media platforms to promote the Samuel Adams mobile application. Not only does this ad

highlight the benefits of downloading the mobile app, it has the Samuel Adams logo across the top

which will instantly attract loyal customers. Another eye-catching part of our advertisement is the
13

smartphone with the application on it. This shows consumers that this app is compatible with

numerous types of smartphones, making it easy for anyone to connect.

We as a group believe that loyal consumers of the Samuel Adams brand will take to our

product extension for a number of reasons. First, this mobile app will allow them to become even

more associated with the brand and benefit from it in numerous ways. Instead of simply

consuming the most popular brews in the market, loyal customers can explore over 65 beers that

Samuel Adams creates with the help of the application. Based on the consumer target market,

those who love the Samuel Adams brand will be committed to doing whatever they can to enhance

their experience with the products available. This mobile app is the perfect way to stay up to date

with the latest news and events, so it will be something that they’ll value greatly.

Not only does our product extension help customers stay in the loop, it also

provides special benefits for becoming BrewClub members. Those who buy Samuel Adams

products often will be extremely excited about this perk of using the mobile application. They will

feel even more compelled to make purchases because of the discount they can get as rewards for

buying products. Birthday perks are also something that every consumer enjoys, and we plan to

offer a Birthday perk with the subscription to becoming a BrewClub member. Every year on your

birthday, you will receive a free six-pack courtesy of The Boston Beer Company. Loyal Samuel

Adams customers will be drawn to this aspect of our app as well. In general, we feel that this

mobile application will be beneficial for all loyal Samuel Adams consumers due to its user-

friendly, up to date features.


14

Appendix A

Samuel Adams billboard, courtesy of flickr.com.

Appendix B

Screen capture of Samuel Adams TV advertisement, courtesy of beeradvocate.com.


15

Appendix C
16

References

Burns, W. (2016, June 28). The Good And The Ugly: Beer Advertising. Retrieved
September/October, 2016, from
http://www.forbes.com/sites/willburns/2016/06/28/the-good-and-the-ugly-beer-
advertising/#4940e5ec3739

BeerAdvocate. (2005, March 30). Samuel Adams: Ads that actually educate. Retrieved
November 08, 2016, from https://www.beeradvocate.com/articles/636/

Brewers Association Lists Top 50 Breweries of 2015. (2016, April 5). Retrieved
November 15, 2016, from https://www.brewersassociation.org/press-
releases/brewers-association-lists-top-50-breweries-2015/

Chen, X. (2013, December 30). Why Boston Beer Company and peers’ beer distribution is
important. Retrieved November 15, 2016, from
http://marketrealist.com/2013/12/boston-beer-company-peers-beer-distribution-
important/

Gonzalez, L. (2015). MOLSON COORS BREWERY. Retrieved October 16, 2016, from
https://prezi.com/xxfokgeftvh2/molson-coors-brewery/

Kallman, R. (2016, November 3). Sam Adams Beer Founder: Brewing Up Success. Speech
presented at ZIPD Business Conference-Keynote in Gross Auditorium, Carver Hall,
Bloomsburg, PA.

Miguire, A. (2016). 6 Different Pricing Strategies: Which Is Right for Your Business?
Retrieved November 15, 2016, from http://quickbooks.intuit.com/r/pricing-
strategy/6-different-pricing-strategies-which-is-right-for-your-business/

Weaver, K. (2012, November 1). DISTRIBUTION IN AMERICA: An inside look at craft


beer and the middle tier. Retrieved November 15, 2016, from
http://allaboutbeer.com/article/craft-beer-distributors/

What Is a Beer Distributor? (n.d.). Retrieved November 15, 2016, from


https://www.nbwa.org/about/what-beer-distributor
17

W. (2016). Samuel Adams Boston Lager Beer, Massachusetts, USA. Retrieved November
15, 2016, from http://www.wine-
searcher.com/find/sam%20adams%20boston%20lager%20beer%20massachusetts%
20usa

Z. (n.d.). Miller Genuine Draft | SWOT Analysis | USP & Competitors | BrandGuide |
MBA Skool-Study.Learn.Share. Retrieved October 16, 2016, from
http://www.mbaskool.com/brandguide/food-and-beverages/4458-miller-genuine-
draft.html