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Heineken Final Report. What marketing strategy should Heineken undertake to standardize its brand image and advertising worldwide?

Extracts from this document...

Introduction

CASE ANALYSIS: Heineken Submitted in Partial Fulfillment Of the Requirements in MARKETING MANAGEMENT Presented to Dr. Antonio V. Concepcion Prepared By Group 5 Allan Montoya Ces Ventura Jayson R. Sardido Maja Serag Mia Rodriguez Myla Molon I. Case Background Heineken was founded in 1864 when 22-year-old businessman Gerard Adriaan Heineken purchased the "The Haystack" brewery located in the heart of Amsterdam, the largest in the region. In 1869 Gerard Heineken decided to switch from traditional top fermentation to the Bavarian method of bottom fermentation, a totally different technique that produces a clearer, purer beer, which keeps longer. The new beer is known for its quality and is called 'Gentleman's Beer' as opposed to 'Workman's Ale'. A decade of fierce competition begins, with several new breweries competing for the high-quality beer market. A few years later in 1873, Heineken's Bierbrouwerij Maatschappij N.V. (Heineken Breweries or HBM) is incorporated. Gerard Heineken is appointed President and the name 'Haystack' is replaced by Heineken. The brewery stops producing 'workman's beer' and focused on improving the quality and taste of its 'Gentleman's Beer.' A breakthrough happened in 1886 when Doctor Elion, a student of Louis Pasteur, developed the A-yeast strain, still used today to give Heineken its characteristic flavor and special taste. Heineken's innovations begin to pay off: the brewery is awarded the gold medal of honor at the World Exhibition in Paris in 1889, where Heineken beer is supplied to the Eiffel tower restaurant. This award crowns the quality-focused policies of Gerard Heineken and director Wilhelm Feltmann. Over the past 140 years, three generations of the Heineken family have built and expanded the brand and the company in Europe and around the world. Heineken has become the second largest brewer in the world with the world's most international brand. The core values upon which it was built - consistent top quality, engaging people through their own culture, and also its social awareness - have allowed the company to renew itself over and again. ...read more.

Middle

There are four stages in the market evolution: emergence, growth, maturity and decline. Heineken is in different stages of the market evolution depending on the country it is in as shown in Exhibit 1 in the case. V. ALTERNATIVE COURSES OF ACTION (ACAs) Alternative Courses of Action Market Strategies Applicable to Heineken Advantages Disadvantages 1. Position its brand in amore narrowly defined group seeking a distinctive mix of benefits (single-niche marketing) 2. Position brand next to the first competitor (mass market strategy) 3. Position brand in different or unoccupied niches (multiple-niche strategy) No No Yes * More focused positioning * Would position Heineken as a strong market challenger (next to market leader Anheuser Busch) * It will be easier to strengthen brand image per region/country * More focused marketing strategy per region/country * It would be easier to identify competitors per region/country * Heineken is perceived differently depending on the country it is in (e.g. market leader in Netherlands, premium imported beer in U.S, etc.) * Might typecast the Heineken brand in a particular niche * Heineken might loose perception of "premium taste" from its loyal consumers * Has to compete head on with leading beer brands per country/region * Additional cost * Might dilute brand's perception of "premium taste." Recommendations * Create a global image for the brand based on its core values Heineken should be marketed globally based on its premium taste. Emphasis should be on its legacy of quality and premium taste. * Decentralized implementation of global advertising strategy This can be done by hiring a global agency with strong regional partnerships. * Create regional strategies and improve marketing management by doing the following: North America * Advertisement should emphasize that Heineken is the number one premium imported beer brand in the US South America * Advertisement should emphasize that Heineken is the number one Premium imported brand in South America Asia * Since local brands (e.g. ...read more.

Conclusion

The local management and brewing, operations and technology teams will ensure that each Heineken bottle that will be produced locally will meet its global strict quality standards. Second, Heineken will have a strong marketing platform, including innovative advertising, top-notch sports sponsorships and contemporary music promotions. We will also target the official sponsorship of the 2008 Olympic Games in Beijing and we're also looking in making it the official beer of the China Olympic team. These sponsorships will enable Heineken to connect with adults in China who enjoy beer. Third, the company will develop a strong wholesaler distribution network modeled after the company's Europe distribution system and modified for the Chinese beer market. NORTH AMERICA Heineken in USA Since Heineken is the leading exporter of premium beer in the US, the group plans to expand its portfolio here by introducing a new product subcategory. We will launch a new brand "Heineken Premium Light Beer" which idea is similar to San Miguel Beer's San Miguel Light, except that Heineken's is on the premium category. 1. SPONSORSHIPS Heineken could sponsor events, personalities, etc that reflect Heineken's core values. * Heineken-sponsored events (i.e. October fest) * Sponsor TV shows (Friends maybe to enhance one of its core value - friendship) Sponsor Hollywood movies. A sample promotional campaign could include a competition in which the winners will get the chance to 'experience what it is like to be a real life Hollywood player.' Competition winners from local promotions, for example, will win 5-star accommodation, entry into top restaurants and nightclubs, among other prizes. FINANCIALS Heineken is one of the ten largest brewers in the world, with production facilities in five continents. In 2002, the company had net revenues of $11.2 billion, an increase of 10% in the previous year. The company sells its products in over 150 countries under a vast number of brand names inclusive of Amstel and Tiger. The company has more than 110 breweries in over 50 countries and export activities all over the world. Five-Year Sales Value Forecast VI. ...read more.

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