Three Points Innovation group project

1. D I S T R I B U T I O N
N I K K I G U N D I M E D A, E V A N M C C A R T H Y,
B E N S A N D L E R, & C H E N X U A N S H E N

2. T A S K
● Develop a strategy to begin the distribution of 3
Points Brewery craft beers in a fifty-mile radius
around Pendleton
● 3 Overarching Goals:
○ Incremental revenue 2020 goal: 400,000/yr
○ Brand awareness — where should we play?
○ Leverage full capacity of brewery resources

3. C U R R E N T S I T U A T I O N
● Beers sold at brewery and partnered restaurants
● 2 week turnover per $165 keg
● 25 accounts around Cincinnati area
● 12 craft beers on tap in taproom
● Brand mostly built through word of mouth,
events in taproom

4. P R O B L E M I N S I G H T S
Currently seeing low
ticket sales, likely
because customers
have to drive and must
limit their alcohol
intake.
Distribution is currently a
secondary focus to taproom
activity, despite the fact that
the brewers have capacity to
produce more beer.
Brand awareness
contingent upon events
that drive traffic to
taproom. 3 Points has not
taken an active approach
to building and publicizing
their brand across
Cincinnati.
3 POINTS NEEDS TO TAKE AN ACTIVE
ROLE IN DRIVING THEIR KEG SALES
SO THAT THEY CAN MEET SHORT
TERM REVENUE GOALS, OFFSET THE
LIMITATIONS OF THEIR TAPROOM,
AND BUILD A SALIENT BRAND THAT
THEY CAN GROW THROUGH
CANNED DISTRIBUTION WHEN THE
TIME IS RIGHT.

5. 3 - P R O N G E D S T R A T E G Y
S T R A T E G Y 2.0
Build retail partnership
with Jungle Jim’s —
improve keg sales, build
brand awareness, &
obtain customer data
that will help with
canning/bottling
distribution
S T R A T E G Y 1.0
Website — add “where you can find us”
page to improve bar sales
Bartender edu — brewer goes to 25 bars
before hours and helps runs educational
tastings so that they are better equipped
to sell 3 Points
Free kegs for Cinci Startups — improve
keg sales, taproom traffic, and builds
brand awareness
S T R A T E G Y 3.0
Distribution of Cans/Bottles —
With a strong brand rooted in
Cincinnati, take advantage of
mass-production abilities and
higher market ceiling. A/B test
pricing, packaging of small
batch of cans
(canned/packaged through
co-packing service)

6. CINCINNATI STARTUP ECOSYSTEM
● 16th best startup city in America
● 200+ startups, many of which serve
alcohol to their employeeS
● Office drinking culture on the rise
(Netflix, Yelp, Google, etc.) according
to Forbes
● Startups try to find office perks since
employees do not work 9-5 and
struggle to find work-life balance
● Cincinnati already has strong craft
beer culture
3 POINTS BRAND AWARENESS
● Interviewed a few customers, who say
they loved the beer but only learned
about 3 Points through an event.
● Position 3 Points as a Cincinnati-born
startup that enjoys city-wide support
● 62% beer consumers rarely stray from
brand favorite (Marketing Week), so 3
Points has to enter spaces where
there aren’t a wide selection of beers
to choose from
S T R A T E G Y 1.0 — B U I L D I N G A C I N C Y B R A N D

7. S T R A T E G Y 1.0 — B U S I N E S S C A S E
Secondary: Taproom Sales
● With each keg,
attach coupon (via
QR code on branded
cups) for free 4 oz
beer in taproom
● Acquires new
customers; drives
taproom sales
Primary: Keg Sales
● Plenty of startups
keep kegs in the
offices; when (not if)
employees fall in love
with 3 Points beer,
companies may
purchase kegs on
regular basis
● Improves keg sales by
expanding keg
accounts beyond just
bars and restaurants
Campaign & Costs
● For one month,
deliver a free keg to
5 different startups
a week for a month.
● Estimated
opportunity cost —
$4,400
● Estimated revenue
generated — $7,100

8. S T R A T E G Y 1.0 — E X E C U T I O N

9. S T R A T E G Y 1.0 — E X E C U T I O N
● By offering free keg & QR-coded cups, we
create brand awareness and drive site traffic
● By offering a free 4 oz beer, we improve
customer conversion rate
● By creating new customers who enjoy 3 Points
beer in either their office or in the taproom, we
can leverage a Lifetime Customer Value that
exceeds its Customer Acquisition Costs.
● QR code facilitates data analytics that can
improve other marketing efforts

10. S T R A T E G Y 2.0
● Begin to build a retail brand through on-tap sales
in grocery stores
● 3 Points should leverage Professor Heuer’s
connections to Jungle Jim’s and seek to
understand what metrics it must hit to become
one of the craft beers on-tap at both Jungle Jim’s
locations
● JJ’s likely sees more foot traffic a day than all 25
bars/restaurants with 3 Points on tap combined
● Once 3 Points is on tap at JJ’s, 3 points will likely
be able to count on JJ’s as an early customer for
canned/bottled beer
X

11. S T R A T E G Y 3.0
Long Term — Canning /Retail Distribution
● Ultimately we believe this is the most significant opportunity, as the long
term growth potential is significant
● With a strong Cincinnati following established, 3 Points can begin to sell
cans and bottles to specialty retailers in Cincinnati as well as nearby cities
● Before large-scale rollout, A/B Test optimal pricing/packaging
● To mitigate the capital expenditures and working capital costs associated
with such a rollout, we highly recommend a co-packing model

12. A P P E N D I X
The appendix includes the data and assumptions
used to create our pro forma revenue and cost
projections. We also offer additional insights and
recommendations that go beyond our primary task
related to distribution.

13. BUSINESS CASE COSTS & REVENUE PROJECTIONS
Cost Projections Revenue Projections
Assumptions: 20 Kegs given away with 60 cups per keg. ⅓ of all codes will be redeemed. Average in
house ticket of 15 dollars per customer. ⅓ of startups will reorder a keg.

14. MORE INSIGHT — OTHER RECOMMENDATION
ART before BEER
We understand the importance of
art in the branding. But we also
think if the main business is for beer,
the beer section on the website
should be in front of the art; instead
of the existing format.

15. MORE INSIGHT — OTHER RECOMMENDATION
BEER
In the beer section, the layout makes
people want to click to see more
details about the beer. However,
when we get in to the detail page,
we can only see the display of art. It
is great but we think that would be
better to have more information in
it.