GROUP ASSIGNMENT GROUP 1 BUDWEISER COMPANY ANALYSIS BUDWEISER COMPANY ANALYSIS

GROUP ASSIGNMENT GROUP BUDWEISER COMPANY ANALYSIS Lecturer: DUONG THANH HANG Subject: ADVERTISING AND PROMOTION Class: MKT 359 A MEMBER: Nguyễn Thị Thảo Nguyên (5834) Nguyễn Thị Như Thảo (6338) Lương Nguyễn Quốc An (8610) Mai Hồ Chi Bảo (8898) BUDWEISER COMPANY ANALYSIS TABLE OF CONTENTS Part Part Part Part Part 2|Page Introduction page Competitors page SWOT analysis page 3.1 Strength page 3.2 Weakness page 3.3 Opportunities .page 10 3.4 Threats .page 10 Recommendation page 11 Preferences page 13 BUDWEISER COMPANY ANALYSIS INTRODUCTION In the 19th century, in a place known as Bohemia - a small land in Western Europe Brewing in Bohemia dates back many centuries, but in 1845 the town of Plzen had a breakthrough in beer production At that time, beers were usually just stout or foam ale, but the brewers of Plzen town refined it in the process of making a transparent beer called “blonde” beer At this time, Bohemia belonged to the Austrian kingdom of the German-speaking region In German, when denoting something that comes from a region, the suffix "er" is often added So brewers also use this to indicate the origin of their beer, signifying that their beers come from a town Not long after Plzen's breakthrough, another Bohemian town also refined in the process of making another beer, which was sweeter and more golden in color The town is called Ceske Budejovice or Budweis in German In keeping with local practice, beer produced in the town tends to refer to the town's country of origin and Budweiser to the product's name, with the town derived from "Budweis" At that time, most of the breweries at Ceske Budejovice were able to produce beers using the name “Budweiser” for their product The town is also home to the Royal Court of Bohemia brewery – the brewery that officially supplies the royal family with beer The connection to the royal family makes this brewer's beer known as the "Beer of the Kings" Within a quarter of a century, the Pilsener style of beer had reached as far afield as America, a brewing industry that was rapidly evolving The desire to produce a beer was widespread, many American breweries began to develop beer in the style of brewers in Bohemia, referencing Pilseners One of those breweries is Bavarian The Bavarian brewery was founded in 1852 by George Schneider However, Schneider failed in the brewery business and in 1860 sold it to Eberhard Anheuser In 1865, Anheuser's son-in-law Adolphus Busch joined the company In 1913, Adolphus died and his son August took control In 1919, the company was renamed Anheuser-Busch, the name by which it is known today In 1876, still under the original name of Bavarian Brewery, it was engaged in the production of another beer in America in the style of 'Bohemia' The new beer was developed by Adolphus Busch, in association with a local restaurateur named Carl Conrad Adolphus Busch is someone who can anything to sell his beer, from a salesman to an advertising strategist… One of those strategies is the use and development of the Budweiser brand 3|Page BUDWEISER COMPANY ANALYSIS Anheuser-Busch's Budweiser beer quickly dominated the market and became their flagship brand Thus, in 1897, Anheuser-Busch sought to build the Budweiser brand Unfortunately, they were blocked from worldwide protection of the "Budweiser" trademark because Budejovicky Budvar had claimed it in advance, through use For four years, Anheuser-Busch tried to get worldwide trademark protection for its Budweiser brand but could not come to a satisfactory agreement with Budejovicky Budvar Finally, in 1911, Anheuser-Busch decided to cut its losses and signed an agreement with Budejovicky Budvar, whereby the agreement determined how the parties could use the brand Under the terms of the agreement, Anheuser-Busch obtained the rights to use the Budweiser name only in North America and the United States, and Budejovicky Budvar obtained similar usage rights in Europe and Russia This agreement is satisfactory for both parties, as it means that each side will focus on its territory without fear of conflicts of interest However, during the second half of the 20th century, Anheuser-Busch increased its market share in its home country to the maximum, making it difficult to continue growing domestically As a way to maintain their growth, the brand has begun to push their beer beyond traditional markets In particular, they began to look at new profits in the European markets Anheuser-Busch InBev SA/NV (abbreviated as AB InBev) is a multinational brewing and beverage company headquartered in Leuven, Belgium It is the largest beer producer in the world and has a 25% share of the global market AB InBev was formed through the merger of three uninterrupted c corporation international beer brewing: from the Belgian Interbrew, AmBev from Brazil, and AnheuserBusch from the United States The group has 16 code brands each generating more than $1 billion per year in revenue out of a portfolio of more than 200 brands (2014) This portfolio overall includes brands Budweiser, Corona and Stella Artois, international brands Beck's, Hoegaarden and Leffe and domestic brands such as Bud Light, Skol, Brahma, Antarctica, Quilmes, Victoria, Modelo Especial, Michelob Ultra, Harbin, Sedrin, Klinskoye, Sibirskaya Korona, Chernigivske and Jupiler As a global leader in beer and among the top consumer product companies in the world, total sales for all 200 AB InBev brands in 2014 were more than 47 billion dollars The group employs more than 155,000 people in 25 countries Following the merger of US companies Anheuser-Busch in 2008, headquartered in Saint Louis, Missouri, the company began reporting its financial results in US dollars 4|Page BUDWEISER COMPANY ANALYSIS Known as the "King of Beers" Budweiser is Adolphus Busch introduced and Bases to the first time since 1876, it has become kind of beer sold in the world since 1957 and distributed in over 70 countries family Budweiser is the leader in premium American beers, acquiring all other premium beers in the country Budweiser beer is the world's number most expensive beer brand, produced using premium malt and hops from the United States and Europe It is then aged for month in an oak barrel for a fresh clean and crisp taste Budweiser is brewed with only one of the finest double and six row barley malts, selected from over 2,500 plants grown in the US and Canada Budweiser products are produced under extremely strict quality control and brewing processes Premium Budweiser beer is made from 70% malt 30% rice and uses an original yeast preserved from more than 140 years ago to provide the perfect balance between gentle bitterness and gentle sweetness unmistakable sophistication with other beer brands In Vietnam, before officially inaugurating the brewery, Budweiser has been imported to consumers Believing in the acceptance of users and the great potential of the market, AB InBev has chosen Budweiser is one of the main products for investment in Vietnam “We not only sell beer, we also brew it here,” said Michel Doukeris, AB InBev's president in charge of Asia-Pacific The brewery will bring to Vietnamese consumers the freshest Budweiser beer with the same premium quality since 140 years.” COMPETITORS  Heineken: Nearly 150 years ago, from a small brewery in Amsterdam, the Netherlands, Heineken has grown into a global business with the world's most valuable international premium beer brand, present in 192 nation One of the key factors that makes Heineken famous flavor is the unique Heineken A - Yeast Developed in the late 19th century by Dr Elian, a student of the famous French scientist Luis Passter This special yeast from Heineken helps to balance intense flavors and delicate aromas, creating a homogeneity for every glass of Heineken beer for over 140 years, unchanged from the first time Completely natural ingredients and yeast Heineken A - Yeast is one of the survival secrets that create Heineken's signature beer flavor Heineken beer bottles not only stop for fun or parties but also show the personality and trendy lifestyle of consumers This is considered a strong point of this beer company in expressing the brand's core values through packaging design Understanding the thoughts of beer fans that enjoying beer is an art from taste 5|Page BUDWEISER COMPANY ANALYSIS enjoyment to packaging design to product perception, Heineken has succeeded in cleverly change the packaging design by capturing the customer's psychology during the experience, maintaining all the familiar images, refining some small details but bringing big surprises One of the strengths of Heineken that brings great success to this famous beer brand comes from Advertising Heineken is very famous for its television commercials with metaphorical content that arouses curiosity and discovery of viewers, interspersed with subtle messages Heineken's advertisements often focus on the actual experiences of consumers when enjoying beer, bringing everyday problems around people to the side of the image of a beer bottle, showing closeness and intimacy care about the customer experience Typically in 2016, Heineken sent out the message "Moderate Drinkers Wanted" to urge people to drink less beer and be more moderate, more responsible for their actions In addition, Heineken has done a great job in co-producing musical and sporting events such as the UEFA Champions League, the European Rugby Cup, organizing events such as the Heineken coutdown to celebrate the new year These events affect all human senses from sight, hearing, touch to smell and taste They promote their brand through real experiences that consumers have, it is close and highly effective Once again, Heineken succeeds in reaching consumers through the experiences they perceive It can be seen in the eyes of the fans of this brewery brand and the majority of young people, Heineken has shown that selling as many beer bottles as possible is not their goal, but rather the image, the brand's influence is spread to a wide range of consumers around the world through the messages they bring, through the connection with the consumer's experience  Tiger: Launched in 1932, Tiger beer became Singapore's first beer brewed in the island nation To date, Tiger is brewed in 11 countries, consumed in more than 75 countries worldwide Tiger beer is constantly evolving to become one of the premium, loved, and imported beers around the world and Tiger are known globally for their authentic Asian flavors and recipes Instead of going in the direction of promoting image cooperation with football events like Heineken or Budweiser, Tiger focused on promoting in smaller locations but in large numbers Tiger beer is found in more than 8,000 bars, luxury clubs and retail outlets throughout major cities as well as luxury places such as the Sanderson Hotel, OXO Tower, and Harvey Nichols in London and Crazy Bear in 6|Page BUDWEISER COMPANY ANALYSIS Oxford Tiger works selectively with a number of partners in the fields of art, fashion, music, film and design such as exhibitions or displays Combined with a much more affordable price compared to European and American beer brands, this origin brewery has attracted a large number of consumers who are young and have active personalities Tiger's "Uncage" advertising campaign has turned into a highly influential advertising campaign This is a campaign with the message that wants to awaken the bravery of young people in both Asia and Europe Each story is characterized by the constraints that young people have to endure when living in a society full of demands and challenges standard It can be seen that this campaign of Tiger shows their sympathy to the minds of young people around the world, as well as the target customer class that Tiger targets Since then, Tiger has consolidated its brand image as a strong, young and modern Asian brewery Tiger Crystal product line is produced from an extremely unique cold fermentation technology called Cold Suspension Each line of beer is refined with Crystal Cold deep cooling technique so that the beer will not be mixed with any yeast during the brewing process and retains its characteristic aroma and excellent taste This is a special product line that Tiger has launched to exploit the target customers who cannot drink the high alcohol content and too bitter taste, which is typical of other traditional beers As can be seen from the advertising campaigns and the scale of the brand, Tiger focuses on mainly Asian consumers and the mid-range price segment, always focusing on building a youthful and energetic brand image As a result, Tiger has gained a certain high position in the Asian market as well as a market share in Europe SWOT ANALYSIS 3.1 Strength - Budweiser is a long-standing beer brand so it has a strong position in the market and is loved and trusted by many customers This makes its brand awareness high Budweiser beer brand has a global presence: Including Budweiser, Anheuser Busch sells about 100 different brands of alcohol to about 80 countries around the globe They have a strong beer presence, and their top brands are Budweiser, Bud Lite, Busch Beer, Stella Artois, etc 7|Page BUDWEISER COMPANY ANALYSIS - Reliable suppliers: Budweiser has a strong base of the reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks Having such success is mainly based on quality, the entire batch of Budweiser beer is produced by the manufacturer and brewed with a rigorous process And the American brand Budweiser uses only the highest quality and most expensive hops in the world Therefore, Budweiser is one of the few brands that can conquer difficult markets such as Korea, Japan, Dubai - Promotion: The promotional campaigns, as well as public relations initiatives of Budweiser, have been the strong reason for the success and popularity of the brand The beer sponsors key sporting events as well as sports teams The brand sponsored the US Olympic Team in 1984 and the recent 2014 Olympics in Brazil It also became the “official” beer of the FIFA World Cup since 1986 until 2022 At present, Budweiser sponsors 28 NFL teams and was named as the official beer of the NFL, until at least 2022 These events and sponsorships garner a lot of publicity By sponsoring famous sports teams and major sports events, the brand automatically becomes famous by association In addition, Budweiser launched its own live events—the Made in America Festival and The Budweiser Country Club In the Made in America Festival, the brand collaborated with Jay-Z’s Roc Nation to attract 80,000 fans - High level of customer satisfaction: the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction between present customers and good brand equity among the potential customers Budweiser always care about the customer, they try to research and provide things what customer’s needs and wants Americans have always been into football and another thing is apps and technology According to Monique Danao (2020), she said “In fact, statistics show that Americans downloaded an average of 88.7 apps in 2016 and used an average of 7.6 apps in a day” Interestingly, Budweiser decided to combine what Americans loved the most in its new advertising campaign The brand launched an interactive game called “Bud Bowl” in Snapchat’s Discover panel - Strong dealer community: It has built a culture among the distributor & dealers where the dealers not only promote company’s products but also invest in training the sales team to explain to the customer how he/she can extract the maximum benefits out of the products Over the years Budweiser have built a reliable distribution network that can reach majority of its potential market 8|Page BUDWEISER COMPANY ANALYSIS - Creative idea and meaningful messages: Budweiser always brings humanistic messages to customers through its advertising campaigns Typically, Budweiser has released a short video that does not have any images of beer but only talks about the beautiful friendship between Golden Retriever dogs and Clydesdales horses According to Hai Yen, “the clip was shown during the Super Bowl football final (2104) - the most popular live show in the US every year, so the video clip has the opportunity to appear in front of 100 million people across the US” Contrary to the exciting atmosphere of the match, "Puppy Love" is a gentle and profound story about friendship, so it has made a deep impression on viewers - Excellent marketing strategy: Recently, it was reported that Budweiser canceled the Super Bowl ad, spending $ 5.6 million to raise awareness about the Covid-19 vaccine Recently, it was reported that Budweiser canceled the Super Bowl ad, spending $ 5.6 million to raise awareness about the Covid-19 vaccine It was a wise move when Budweiser used its marketing budget to fund activities to promote awareness about the Covid-19 vaccine The public will realize that Budweiser is a brewery that always cares and upholds the interests of its customers Budweiser's move has more to with building a long-term brand than generating short-term revenue 3.2 Weakness - Grabbing the millennial market: In comparison to the older generations, Millennial prefer the craft beer and Budweiser are still to break into the millennial market failing which its sustainability in the years to come will be a question According to Kate Taylor (2018), Budweiser, once the best-selling beer in America, is no longer in the top three best-selling brands in 2017 One reason for Budweiser's drop in the list of best-selling US brands is that the beer has failed to capture millennials' interest in the same way it won over Gen X-ers who came of age in the '80s UBS data has shown that millennials are less likely than the general population to recommend Budweiser - Not very good at product demand forecasting leading to the higher rate of missed opportunities compare to its competitors One of the reasons why the days inventory is high compare to its competitors is that Budweiser is not very good at demand forecasting thus end up keeping higher inventory both in-house and in the channel 9|Page BUDWEISER COMPANY ANALYSIS - The marketing of the products left a lot to be desired Even though the product is a success in terms of sale but its positioning and unique selling proposition is not clearly defined which can lead to the attacks in this segment from the competitors - High Day Sales Inventory: The time it takes for products to be purchased and sold is higher than the industry average, meaning that Budweiser builds up on inventory adding unnecessary costs to the business 3.3 Opportunities - Increased awareness of foreign brands: Online and social media marketing, as well as increased exposure to the internet, has increased global awareness of foreign brands of alcohol and current clients in pubs even in India and Malaysia ask for Budweiser or Bud Light This is helping such brands look for business in Asia - E-commerce: There has been a new trend and a growth in sales of the ecommerce industry This means that a lot of people are now making purchases online Budweiser can earn revenue by opening online stores and making sales through these - Social Media: there has been an increase in the number of social media users worldwide The three social media platforms; Facebook, Twitter and Instagram, have shown the greatest number of increase in monthly active users Budweiser can use social media to promote its products, interact with customers and collect feedback from them - Technological developments: technology comes with numerous benefits among many departments Operations can be automated to reduce costs Technology enables better data to be collected on customers and improves on marketing efforts - Globalisation: Increased globalisation does not restrict Budweiser to its own country It can extend its operations to other countries, entering into these markets and making use of the opportunities that lie in these markets - Expanded consumer market: Difficult markets such as Korea, Japan, Dubai; North Korea, Japan, and China and Vietnam in Asia are increasingly interested in American Budweiser beer According to the Association of American Businesses in Vietnam, Budweiser beer is quite competitive in foreign markets If it was previously difficult for this product to compete with Czech Budweiser or high-end 10 | P a g e BUDWEISER COMPANY ANALYSIS Belgian beers, German beers have a long history Now it is very popular in fastidious countries 3.4 Threats - Increasing competition: there has been an increase in competition within the industry putting downward pressure on prices This could lead to reduced revenue for Budweiser if it adjusts to the price changes or loss of market share if it doesn’t Budweiser and Anheuser Busch face a lot of competition from Miller, Fosters, Heineken and Molson Coors - New entrants: there are already a lot of companies entering the market and are gaining market share by taking market share from existing companies This is a threat to Budweiser as they could lose customers to these new entrants With customers tending to experience new products differently, Budweiser must ensure to retain its customers with product quality and changing campaigns constantly - Changing consumer buying behavior from online could be a threat to a supply chain model driven by existing physical infrastructure Brands must make sure to capture the consumer trends of online customers and provide products and services to them - Increased promotions by competitors are a threat to Budweiser In most media, there is more clutter than ever before and customers are bombarded with multiple messages This reduces the effectiveness of Budweiser's promotional messages - The tastes of consumers are constantly changing, and this puts pressure on companies to constantly change products to meet the needs of these customers - Epidemic: In recent years, businesses have suffered heavy capital losses because of the Covid-19 pandemic Budweiser is no exception According to Moc Tien (2021), "AB InBev stock - Budweiser's parent company fell 14.5% last year, bringing the company's market value down to $113 billion Despite beer consumption in Budweiser's home sales increased due to the pandemic, but the closure of a series of bars, restaurants and sports stadiums caused a 6.8% decrease in revenue for the first months of 2020." RECOMMENDATION Because the world market is such a large market, it is impossible for our team to make recommend at that level So the recommend here are only domestic or Asian 11 | P a g e BUDWEISER COMPANY ANALYSIS - The first of Budweiser's weakness is the Latecomer The lack of attention from the millennial market has caused a decrease in Budweiser's revenue in markets, especially in Vietnam, Budweiser has faced great competition from brands that have gone before and have been trusted by millennial market in Vietnam since long time ago For example, in the South it is 333 and Beer Saigon, in the Central is Huda and in the North is Beer Hanoi Some other competitors are also ominous, including Tiger, Larue for the mid-range segment and Heneiken for the high-end segment My team thinks that Budweiser should not focus too much on this market anymore but should focus on making images in more potential new markets, such as Gen Z or Alpha later Recommend for this is to make viral videos with famous KOLs conveying the company's message This will greatly affect the image and impression of the beer company in the eyes of young people Young people today are more and more interested in their idol's image and life such as streamers, actors, football players and the allowed age to use alcohol in Vietnam with the year of birth from 2002 to 1990 are increasingly interested in the use of foreign beer These two factors can create success in terms of image and customer confidence in the product based on the reputation of the selected KOLs A good example of this model was made by Budweiser last year when it released the short film "The Say", making Lionel Messi a brand ambassador on a global scale, it created a fever at the time and made a big splash around the world - Budweiser should also develop its franchise, such as offering promotions or discounts to restaurants and beer dealers in the medium and large segment to advertise its image more broadly - The fact that reputable restaurants and Beer agents use Budweiser's signs, names and products will attract everyone's attention - Regarding e-commerce, my team found that Budweiser currently does not have an official website in Vietnam, most of their online sales are sold through e-commerce platforms such as Shopee, Lazada, Tiki, Bachhoaxanh They should invest more in online to be able to receive feedback from customers directly, quickly and handle them effectively 12 | P a g e BUDWEISER COMPANY ANALYSIS REFERENCES Hai Yen Budweiser beer and the touching story of “Puppy Love” https://marketingai.admicro.vn/bia-budweiser-va-cau-chuyen-puppy-love-camdong/?fbclid=IwAR1j8K-dDx4ONJsJODQRdafDrmvs_BHkoQqZ4mnMlt8YdDpshvZCX_V1PU Kate Taylor (2018) End of an era: Millennials brought about the downfall of one of America's most iconic beer brands https://www.businessinsider.com/millennials-drag-down-budweiser-beer-sales2018-1 Moc Tien (2021) Marketing wise like Budweiser: 'Take a break' from advertising during the Super Bowl, spend that $ 5.6 million to raise awareness about the Covid-19 vaccine https://cafebiz.vn/marketing-khon-ngoan-nhu-budweiser-nghi-quang-cao-trongsuper-bowl-danh-56-trieu-usd-do-de-nang-cao-nhan-thuc-ve-vaccine-covid-1920210126122826898.chn Monique Danao (2020) How Budweiser Maintains Itself as America’s Best Beer Brand https://www.referralcandy.com/blog/budweiser-marketing-strategy/ 13 | P a g e BUDWEISER COMPANY ANALYSIS 14 | P a g e ... Opportunities .page 10 3.4 Threats .page 10 Recommendation page 11 Preferences page 13 BUDWEISER COMPANY ANALYSIS INTRODUCTION In the 19 th century, in a place known... Covid -19 pandemic Budweiser is no exception According to Moc Tien (20 21) , "AB InBev stock - Budweiser' s parent company fell 14 .5% last year, bringing the company' s market value down to $11 3 billion... domestic or Asian 11 | P a g e BUDWEISER COMPANY ANALYSIS - The first of Budweiser' s weakness is the Latecomer The lack of attention from the millennial market has caused a decrease in Budweiser' s