Case Analysis Questions MKT 523
Marketing Corona in Japan
Marian Stefan
Tiffin University
Case Analysis Questions MKT 523
Marketing Corona in Japan
1. How aligned are Modelo’s, EBI’s and NS’s short and long-term interests ?
In recent times, the market changes affected the short and long-term interest of Modelo, Export Brands International and Nippon Spirits. It was clear that the big picture was extremely difficult to see from the same united perspective as in the past, thus making the Japanese Corona business quite uncertain.
Corona had a success of almost one decade in the Japanese market also due to the clear and structured partnership between Modelo, Export Brands International and
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Let’s say that the situation will continue like it is now, none of the 2 mentioned dangers happening, other thing can become a real “pain” for Export Brands International: I am referring here at the fact that consumers are increasingly shifting away from mass-produced beers towards high quality, classier, and locally produced craft micro brews. Or the fact that Japanese consumers will be tempted to buy affordable domestic brands due to the economic downturn. As because Corona is the top seller in the Export Brands International portfolio, their revenues and profitability will be seriously affected.
Not to say the fact that right now, Corona is not the only Mexican beer present in the Japanese market, now being under direct attack by a series of other Mexican beer that have high marketing budgets. To maintain the position, Export Brands International is forced to pump heavily in the investment marketing budget , much more than the others as Corona must change and reinvent itself. Export Brands International must come with something new trying once again to differentiate as in the beginnings, now being a lot harder.
The situation can even explode for Export Brands International, as large beers conglomerates with tremendous power, are targeting the same segment and are creating similar beers. We have the real example of Anheuser-Busch new Bud Light Lime which was selling extremely well in the United States attacking Corona position and following the traces of the
Cerjugo SA is the largest manufacturer and distributor of beer in a country in Latin America.* Started in 1960, Cerjugo currently sells 360 million bottles of beer annually with revenues last year in excess of $200 million. Cerjugo employs 2500 employees and its four beer brands account for 98 percent of the market share. The beer manufacturer has been growing steadily with the GDP of the country thanks to little competition and no new entrants in the market. Cerjugo has its own distribution fleet and manufacturing facility, its entire customer base is local, and customers are loyal to the flagship brand.
The American company Anheuser-Bush (AB) cannot market its beer using their trademark name Budweiser in every country around the world. This is due to the fact that there is an European brewing company that uses the same trademark.
High cost of entering new markets International growth is expensive. Entering new markets with a new brand
When entering the Canadian market, Guo faced multiple problems that halted the process. These problems included; high duties and taxes, non-Chinese Canadian consumers not knowing Yanjing’s products, and Canadian prices compared to the Chinese market prices. Although there are many present problems with selling this beer in Canada, immigrant entrepreneurs can avail services and are able to stay in the market. As long as one stays vigilant and was willing to take high risks, the success in importation of beer to Canada could be achieved.
SABMiller and Diageo are two largest beer producer in Africa. ”SABMiller, if combined with its partnership with France's Castel Group, sells roughly 60% Africa’s beer by volume. Diageo’s also expands its operation successfully that Senator Keg, its supercheap beer, is also now number two most popular beers in Kenya. As these giant brewers monopolized Africa’s beer market, it can be said that the market has an oligopoly market structure, and both pursue identic operations, so the market can be labeled as competitive. The interdependence that is happening between both brewers makes the competition happens. As SABMiller produces Impala that is half price from its previous beer Manica, Diageo produces Senator Keg to balance it. Diageo
This case describes the various aspects of carbonated soft drink industry and the focuses on Squirt’s annual advertising and promotion plan in 2001. Squirt is a brand under the Dr Pepper/Seven Up, inc. The brand manager was concerned about the market targeting and product positioning and consulted advertising agency, Foote, Cone & Belding. The case also focuses on the entire industry structure and the marketing techniques used by the various leading companies so the Squirt’s annual advertising and promotion plan can be successful, and proper techniques to be used to target the growing Hispanic community in the markets where Squirt was popular. . The main aspect for the marketing planning for the brand, Squirt, is to focus on
Import beer companies have a similar market share of 12% and have a common denominator with the regional brewers; their beers tend to have bitter taste. Demands for these beers are on the rise.
iii. Import beer companies: These companies include Beck’s(Germany), Heineken (Holland) and Corona (Mexico). They control about 12% of the region’s market. However, these companies are seen to operate at disadvantage due to higher shipping costs, weaker distribution networks and an inability to control product freshness
* Some of the objectives of creating this union is to create a better flow on the circulation of goods, capital, people and services within the union. Once a good or service is accepted within the union it is protected from customs, taxes and import quotas as long as they remain within the union.
Coca-Cola is sold in over 200 countries and had for years done very well in Brazil. A closer look at Coca-Cola's Brazilian market is presented in an article in the Thunderbird (published by the Garvin School of International Management), which delves into the profit problems that Coca-Cola had in Brazil in the early part of the decade of the 2000s. The article, published in 2004, points out that the fast growth of "off-brand" soft drinks, called tubainas, has taken away profits from Coca-Cola, and created huge marketing problems for the giant soft drink corporation. This review of the article, "Coca-Cola's Marketing Challenges in Brazil: The Tubainas War " written by Gertner, et al explores the issues that Coca-Cola has had to deal with in attempting to gain a bigger share of the soft drink market in Brazil.
Such cross border deals have provided significant benefits to the brewing giants. This has given them ownership of local brands propelling them into dominant market positions around the world as global brands sell at significantly higher prices and the margins are much better as compared to the local beers.
In global context, CUB increased their performance compared to the previous years in Latin America by Lager pricing, major increase in premium and mainstream categories along with strong growth in soft drinks sales. In Africa also CUB along with its parent company showed strong growth in lager and soft drinks sales. However, in Asia pacific regions like China and Australia, mainly because of depreciation of currencies against US dollar, the sale of beverage was declined compared to the previous years. (Sabmiller.com,
The right international strategy for Grolsch going forward is a transnational strategy, though there are strong elements pushing this toward a global strategy. In reviewing strategy within the beer industry, either generally or through frameworks (see exhibits), it appears the optimal path currently involves both multi-domestic elements and global
Based on the case “ The Espresso Lane to Global Markets”, this memo will look into Illy's core capabilities and analyze its international strategy in light of CAGE distance, RAT, CAT, and foreign market entry mode.
A long-term strategic management issue for GM is the increasing global competition due to the mergers and acquisitions of its competitors. The partnership of Heineken and FEMSA (Mexico’s second largest beer company in terms of market share) was formed for the sole purpose to dethrone Corona as the best-selling import beer in the United States. To make matters worse, there were also rumours of large mergers and acquisitions of mid-tier brewers in order to better compete and expand globally. In addition, with the introduction of NAFTA, Canadian and U.S. competitors were slowly beginning to penetrate the Mexican market, which had the potential to chip away at the majority market share GM enjoyed.