Brewing companies face a changing, challenging market. Large brewers like AB InB
ID: 353868 • Letter: B
Question
Brewing companies face a changing, challenging market. Large brewers like AB InBev, MillerCoors, and Heineken still hold the majority of market share around the world, but their sales are beginning to slip due to competition from wine, hard liquor, and consumers’ rapidly growing preference for artisanal craft beers. Even in this declining market, there is one exception—MillerCoors’ Coors Light. This beer recently overtook Bud Light as the second-best selling beer in the U.S., and is the only top ten selling beer to post consistent growth in the past decade. This has contributed to sustained success for MillerCoors, which has seen revenues climb 4.3 percent in the past year to $2.2 billion.
What is the secret to the success of Coors Light? It’s not a change in the product, since the beer tastes the same and has been manufactured the same way as it has for decades. The success of Coors Light can be wrapped up in one word: cold. It’s the core message of the promotional campaign surrounding Coors Light; that it is the coldest, most refreshing beer in the market. According to CEO Andrew England, “We literally said, 'Okay, we're going to do nothing but focus around cold.’”
On one level, MillerCoors’ focus on cold is a bit silly, since any beer of any brand will only be as cold as the refrigerator in which it’s stored. Yet, the campaign has worked, as evidenced by the growing sales of Coors Light. According to Tom Pirko, president of the consulting firm Bevmark, the irrationality of the promotion is what makes it such a great marketing strategy. “What they have is this Pavlovian thing, where an image goes deep into your psyche," he says. "It's emotional, not intellectual.”
Nicholas Kusnetz, “MillerCoors Took Taste Out Of The Equation And Made Cold Unique,” Fast Company, September 12, 2012, www.fastcompany.com/3000877/millercoors-took-taste-out-equation-and-made-cold-unique (Accessed March 26, 2013).
. (30 points)
Why does Coors Light’s claim as the coldest beer on the market represents a competitive advantage?
Most people already know about Coors Light. Does the company’s “cold” campaign serve to primarily inform, persuade, or remind consumers? Why?
What stage of the product life cycle is Coors Light in? What should the goal of its advertising be?
Explanation / Answer
Q1) Beer is expected to be cold by the consumers but none of the companies stress on this critical and important factor as they consider this as a default attribute. Coors Light has focused on this critical attribute and registered its place in the minds of consumers strongly by highlighting itself as the coldest beer in the market.
Q2) The company's "cold" campaign served to primarily persuade the consumers to purchase the products by highlighting the most critical and common attribute of chillness for beer. By including 'cold' in the core message of its campaign the firm continuously pushed the message to the consumers.
Q3) The stage of the product life cycle Coors Light in is current in is Maturity phase as it has witnessed a growth in sales of 4.3 % in the past year.
The goal of its advertising should be reminding the consumers of the beer brand by highlighting its core competence.