Reassessment of SABMiller Products - Essay Example

? Reassessment of SABMiller products Repositioned target market demographics for SABMiller in the United s The market demographics for individuals consuming SABMiller’s products in the US are vital for its repositioning. A critical analysis of the company’s market demographics is an element that will be utilized to boost its image as one of the top beer companies in the US. The total US population as at 1st November 2012 stands at approximately 311,591,917 (Rosenberg 2012). Current statistics show that nearly 50% of the US population consumes beer. Of this population, SABMILLER controls 23% of the beer consumers. Intensive competition has made SABMiller to reposition itself strategically in order to have a competitive edge in the US beer industry. With respect to gender, 80% of beer consumers using SABMiller products are male. Women account for 20% of SABMiller’s products consumed. The company’s market segments in the US are dived into 21-27 year olds. The Latin America population segment, the African Americans population segment and finally the 50 years or older population (SABMiller 2010). The target market for SABMiller has grown steadily in the past. 9% of the Latin Americans consume SABMiller products. SABMiller has positioned itself in the market to expect a 13% growth in consumption of beer by 21-27 year olds, a 32% increase in consumption of its beer products by Latinos, 15% increase in consumption by African Americans and 25% increase in consumption by individuals who are 50 years and above. As at September 30th 2012, the company’s sales rose by 4 percent in Latin America (Geller, 2012). This shows that the company has positioned itself strategically to solidify it position as the number two brewer world wide. The company has adopted a strategy to promote its products in the existing markets in the US and avoid markets that are either too volatile or too small. Types of research needed to reposition SABMiller products Branding research SABMiller requires to embark on branding research in order to reposition its beer products. Branding research is instrumental in creating a brand that has a positive and rusted image in the mind of customers and stakeholders. Branding research enables the company’s products to be structured in a way that reflect the products as the best in the market. Through this research, SABMiller will put strategies to make its customers see, hear, experience and believe the company’s products are the best in the market. Branding research provides information that is utilized to increase brand awareness, brand recognition, and improve the perceived quality and credibility of the company. SABMiller needs to undertake branding research to position its brand strategically and ultimately increase the company’s sales and profits (Vernom research group 2012). Business forecasting research. It is paramount for SABMiller to undertake business forecasting research to focus accurately on business trends. This is vital for the company to reposition itself as one of the best brewing companies in the world. This type of research assesses the opportunities for new technologies as vital elements to reposition the company’s products. Business forecasting provides information on how the company is supposed to use its resources. The resources are used to identify the market that is vital with respect to the company’s operations. Through business forecasting research, SABMiller will understand the customer’s acceptance of SABMiller’s products and customer’s likelihood to purchase its products (Vernom research group 2012). Image and advertising research According to Vernom research group (2012), SABMiller’s repositioning among the fierce competitor should focus on boosting its image in the beer industry. This information should be obtained through conducting image and advertising research. This type of research aids the company to put more emphasis on its brand image when repositioning. Image and advertising research provides vital information on the current health of the company. This information is significant to enhance the company’s image in the industry. Furthermore, the information obtained ought to be used to increase the company’s strength and effectiveness in the minds of consumers. This type of research is instrumental when repositioning the company. Methods used to promote adoption The company intends to invest is marketing and brand relate activities in order to promote the adoption of its products. To make this possible SABMiller plans to squeeze all possible efficiencies from non- market facing operations. These operations include promoting adoption through taking advantage of the early adopters as a significant market segment. The company aims at building a large consumer circle to increase the number of early adopters. This will ensure that the company’s products penetrate and extend beyond the targeted consumer segment by its competitors. In addition, SABMiller intends to focus its marketing attention on establishing an initial pull on its on trade activities. This will promote the adoption of its products by driving on trade and off trade penetration into the wide existing markets. This strategy will ultimately lead to large number of consumers adopting SABMiller’s products. The company expects to fund its marketing activities to drive demand and generate high adoption rates. Lastly, the company aims at developing attractive brand portfolios that will boost adoption rates by meeting consumer needs in each of the market segments and drinking occasions. By strengthening the company’s main stream brands, SABMiller aims at building a differentiated portfolio of both global and local premium brands. These brands are generally for different market segments to diversify the adoption rate. New service component that provides new interest in SABMiller’s products. Free festival and sports events are a vital service component that has the ability to generate interest in SABMiller products. Free sporting events provide customers with past time activities that make them enjoy their drinks and feel appreciated. Key SABMiller outlets that have provided free entertainment and sporting facilities for its customers have achieved a 20% increase in Sales (SABMiller 2010). The Company needs to partner with quality vendors who have a proven track record in maintaining high standards. During major sporting events, customers have the opportunity to watch their favorite sports for free. This service component is an integral part of SABMiller in ensuring that customer loyalty and customer retention are achieved. Challenges Faced by Beverage Distribution There are potential problems that SABMiller may face. SABMiller may find it difficult to stay organized in its distribution activities due to the increase in the number of suppliers such as craft beers and micro brewers. The company may find it difficult to have every product it produces in multiple locations and when the customers require the products. Streamlining the picking operations may also be a big challenge. Keeping on top of the company’s salability may prove to be a crux for the company. Due to the many outlets that the company has, having a proper racking system may also pose as a great challenge. This is because, lack of a proper racking system affects the picking efficiency for the company. A poor case flow rack affects the productivity when poorly utilized. The challenges that SABMiller faces can be addressed by training its chain of suppliers to ensure that they are conversant with its distribution activities. The suppliers and agents need to be trained to ensure that there are no delays in delivering the company’s products to retailers. Further, the company needs to streamline the picking operations to ensure that goods are picked at designated points close to the suppliers. In addition, the company intends to rack out its facilities with modern technology to improve functionality, productivity and return on investments for its operations. In addressing the above challenges, SABMiller will increase the efficiency of its operations and ensure that its products are conveniently available at picking points. This will provide its customers’ with an opportunity to enjoy the company’s products at their regions conveniently. This will create customer loyalty that accompanies the availability of products when customers need them (Geller, 2012). References Geller, M. (2012). SABMiller brews faster growth in Latin America with soft drinks. Retrieved on 22 November 2012 from http://www.msnbc.msn.com/id/49826034/ns/business-stocks_and_economy/t/sabmiller-brews-faster-growth-latin-america-soft-drinks/#.UK_QdlKCWSo Rosenberg M (2012).The Population of the United States of America. Retrieved on 22nd November 2012 from http://geography.about.com/od/obtainpopulationdata/a/uspopulation.htm SABMiller (2010). Plc Annual Report. Retrieved 22nd November 2012 from http://www.sabmiller.com/files/reports/ar2010/2010_annual_report.pdf Vernom research group (2012). Types of Studies. Retrieved on 22nd November 2012 from http://www.vernonresearch.com/typesofstudies.aspx Read More