SKEMA Business School
MARCH 2010 - PARIS
Have you ever drink a glass of beer and try to recognize the
brand being blindfolded?
Because different studies proved that it is not that easy! It is in
fact difﬁcult and a lot of people failed this exercise! That is why
we chose the beer market; because it exists plenty of beer
brands in the world and they have only one way to differentiate
themselves from others: consolidate their images with a clear
positioning and a massive communication plan.
To lead our brand audit we ﬁrst gave a general picture of the
beer market in US, the leaders and the key ﬁgures. Then, we
tried to analyze the customer insights by understanding their
habits, their motivations and their emotions. And at the end we
analyzed the competition by focusing our researches on three
signiﬁcative global brands on the US market, which are,
Budweiser (domestic beer), Heineken and Corona Extra
(imported beers). We compared the brand strategies of AB-
InBev, Heineken USA and Grupo Modelo, the positioning of our
three targeted brands and their identities.
“Beer is the world's oldest and most widely consumed alcoholic beverage and the third most
popular drink overall after water and tea. It is produced by the brewing and fermentation of
starches, mainly derived from cereal grains—most commonly malted barley, although wheat,
maize (corn), and rice are widely used. Most beers are ﬂavored with hops, which add
bitterness and act as a natural preservative, though other ﬂavors such as herbs or fruit may
occasionally be included.
The basics of brewing beer are shared across national and cultural boundaries. Beers are
commonly categorized into two main types—the globally popular pale lagers, and the
regionally distinct ales, which are further categorized into other varieties such as pale ale,
stout and brown ale. The strength of beer is usually around 4% to 6% alcohol by volume (abv.)
though may range from less than 1% abv., to over 20% abv. in rare cases.” Wikipedia
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Accounting for 53% of the total sales in the
alcoholic beverage, Beer is the most popular
drink in the alcoholic beverage2, just before
wine (14.5%) and spirit (32.5%).
However, the overall US beer sales were down
2.2% in 20093. The industry seems to reach
its point of maturity with a light decrease in
the growth since 2004.
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Standard lager sales generated 35.7% of the
United States beer market's overall revenues.
Sales of premium lager generated 34.2% of the
market's aggregate revenues.
Supermarkets and hypermarkets form a leading
distribution channel in the US beer market,
distributing 55.8% of the total market volume.
Sales on-trade account for 22.5%, followed by
In 2008, the United States beer market grew by the specialist retailers which represent 14.9%.
0.8% to reach a value of $78.8 billion.
According to the following chart the market MARKET SHARE
growth has been decreasing since 2004. We The US beer market is dominated by 3 major
can observe the same phenomenon in volume. companies. Anheuser-Busch leads the United
States beer market, accounting for 50.9% of
However, in 2013, the United States beer
the total market volume according to
market is forecast to have a value of $82.4
Euromonitor. With 18.5% SABMiler steps in the
billion, that means an increase of 4.6% since
second position. Molson Coors is third.
Those three Groups hold many brands, but Anheuser-Busch by InBev. The company is
they are really focused on only two or three. All engaged in the production, distribution, and
their investments are made toward those sale of beer and soft drinks. It sells lagers,
particular brands, so it is very difﬁcult for premium beers, and specialty brews in several
smaller companies to enter the market. The countries across the world and operates
other beer brands that the major groups facilities in over 30 countries.
possess are being sold only in order to reach
The company offers a portfolio of over 300
every segment of the population.
brands that includes:
LEADING COMPANIES • Global ﬂagship brands: Budweiser, Stella
Anheuser-Busch InBev (ABInBev) is born in Artois and Beck’s
November 2008, with the acquisition of • Multi-country brands like Leffe and
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Hoegaarden The company’s business is divided into two
• Local brands such as Bud Light, Skol, segments: beer and non-beer. However, the
Brahma, Quilmes, Michelob, Harbin, company's reportable business is organized
Sedrin, Cass, Klinskoye, Sibirskaya into seven operating segments on the basis of
Korona, Chernigivske, and Jupiler, geographical areas: Latin America North,
among others Western Europe, Central and Eastern Europe,
North America, Latin America South, Asia
In addition, the company owns a 50% stake in
Paciﬁc, and Global export and holding
Grupo Modelo, Mexico’s leading brewer and
owner of the global Corona brand. The
company also owns a 27% stake in Tsingtao, a
Anheuser-Busch InBev generated revenues of The US segment produces, markets, and sells
$23.6 billion in the ﬁnancial year ended portfolio of brands in the US and its territories
December 2008 (FY2008), an increase of including Mexico and Caribbean. The company
11.6% over 2007. The company's net income has two production facilities in the US. The
totalized $1.9 billion in FY2008, a decrease of company sells its products to over 550
41.4% compared with 2007. independent distributors who distribute to retail
accounts. Molson Coors also owns three
SABMiller is one of the world's largest brewers distributorships in the US. The company’s
with brewing interests and distribution brands sold in the US include Coors Light,
agreements across six continents. The Coors, Coors Non- Alcoholic, Blue Moon
company's market presence ranges from Belgian White Ale and seasonal Blue Moon
developed economies in Europe and North brands, George Killian’s Irish Red Lager,
America to emerging markets such as China Keystone, Keystone Light, Keystone Ice, and
and India. Zima.
SABMiller offers brand such as: Molson Coors generated revenues of $4.8
billion in the ﬁnancial year ended December
• Pilsner Urquell, Peroni Nastro Azzurro 2008 (FY2008), a decrease of 22.9% over 2007.
and Miller Genuine Draft in the premium The company's net income totaled $388 million
beers category in FY2008, a decrease of 22% over 2007. The
• Local brands such as Aguila, Miller Lite, US accounted for 33.3% of the total revenues
Snow and Tyskie. SABMiller is also one in FY2008. Revenues from the US reached $1.6
of the largest bottlers of Coca-Cola billion in FY2008, a decrease of 45% over
products in the world. 2007.
The company’s operations are primarily divided
across beer manufacturing and soft drinks There are many beer brands on the market,
business. However, SABMiller’s reporting is but a very interesting fact is that those
primarily based on geographical operations: brands are actually hold by only a few
North America, Latin America, Europe, South companies. The three major companies
Africa and Africa and Asia. SABMiller operates managing the leading brands do not
in North America through its subsidiary, Miller
differentiate themselves through their
Brewing Company (Miller), which is the second
products. Indeed, they all have in their
largest brewer in the US.
portfolio a light beer, a lager beer… Instead,
Molson Coors is one of the world's largest what matters in the beer industry is to
brewers. The company has 18 breweries in compete on the positioning: target, image,
more than 30 countries. It has a portfolio of communication…are the aspects on which
over 40 brands including Molson Canadian, the companies are playing in order to win
Coors Light, Extra Gold, Zima XXX and Carling. market share.
The company’s operating subsidiaries include:
Coors Brewing Company (US); Coors Brewers
Limited (UK); Molson Canada (Canada).
T h e c o m p a n y o p e r a t e s t h ro u g h t h re e
geographic segments: the US, Canada and the
Notes before reading: in a bar or at home. We can see it that beer is
Results based on a survey made on 60 really related to social links and enjoying the
Americans from 5 to 12 march and from moment. According to this result, we can see
Surveys results from websites (available in that drinking beers while watching a game is
sources) and from observation made on beer indeed associated with a man behavior. But we
consumption in the US. should not let that leading us to think that
drinking beers is only a man activity. Many
We will study now deeply who are these women are now assuming that they like beers
customers in order to really understand and they drink beer regularly. With the
what are their motivations and emotions. increasing number of lights beers or no-alcohol
What are their habits? Where, how and when beer the numbers of women consuming beer is
are they drinking beers? And the most increasing as well. Even if men too are very
important, why are they drinking this, what kind of light beers which are having a really big
are the emotions they are looking for? success in the US. The beer drinker wants to
enjoy his moment but he is as well taking care
The beer clients are very different from one about his image and his health. The country of
beer to another. But beer drinkers have several origin of the beer is as well important for the
similar “features”. customer; it is easy to identify where a beer
comes from. On this, brands can do a lot of
WHAT ARE THEIR HABITS ?
work, emphasizing their country of origin or in
They are drinking in a bar to be with friends
contrary making it smaller. This element can be
(50%) or at home still to be with friends (35%).
a very strong brand equity.
These results show that drinking beer is
principally a social activity. They do this when WHO ARE THE BEER DRINKERS?
they feel well surrounded with friends. In some It is hard to establish a proﬁle of this beer
cases they can be inﬂuenced in making their drinker, as there are different proﬁles for all the
choices. When their friends are drinking beers, different types of beers. The most general thing
they will feel to drink beers rather than other that we could say is that the beer drinker wants
kind of drinks. Either at home or at one of their to enjoy the moment. Nevertheless we can
friends’ place, drinking beers attempts to be deﬁne what he is looking for. 38% are looking
easy for them. Indeed it is easy and cheap to for fr iendshi p m o ment s, 11% for t he
bring a 6-pack, you can ﬁnd it in any experience and 4% for the brand. According to
supermarket and it cost much less than a good these numbers we can assess that managing
wine or hard alcohols. However, even though the brand is really important. Indeed if you
beers are consumed most of the time during manage to communicate that your brand is the
the weekdays, the customers don’t want to be friendliest and provides a really enjoyable
drunk but just to enjoy the good moments. experience and if you manage to create loyalty
So it is fair to say that beers are more favored around it so you already got 53% of the
customers. 22% are looking for a good taste
than hard alcohol in the mentioned situation.
and 16% for refreshment.
WHEN AND HOW ARE THEY
WHAT KIND OF EMOTIONS ARE THE
CUSTOMERS LOOKING FOR?
You can ﬁnd a beer drinker in the US during
Drinking beer is an experience. Customers are
lunchtime with a sandwich but mostly after
looking for a special moment to share. Deeply
work in a bar or at home. 15% said they
they want to create social links.
consumed beer while watching a game on TV
Having a beer it is saying “cheers”, it is the
promise to spend the next 15 minutes drinking
a not too strong but tasty drink that you will not
pay a lot, that is available in a bar or in a
supermarket. Buying beers to bring to a party it
is the knowledge that it will always be a right
choice contrary to the wine, complicated to
choose or the hard too expensive. It is not a
surprise that in the countries where it is legal
b e e r s a re s p o n s o r i n g s p o r t c l u b s o r
competitions. It is the same spirit that clubs
and beer brands want to convey: friendship
and enjoyable moments. The events like
Oktoberfest (the world's largest beer festival )or
visiting a series of different pubs “Barathon” are
the peak of the research of emotions : many
people consuming beers in the same time and
enjoying the moment.
In this part, we will ﬁrst analyze the brand architecture of three major brewery groups, then
we will focus our study on the global positioning of the major beer brands in US and more
precisely on Budweiser, Heineken and Corona Extra. And ﬁnally, we will ﬁnish our brand audit
by doing an analysis of the three selected brand’s identities to prove that even if they propose
the « same » product (a lager beer), they really have a clearly different image due to a distinct
positioning and targeting.
BRANDS ARCHITECTURE AND • More generally, should there be a
PORTOLIO different name for the company and the
To understand the brand identities of • Should the same architecture apply
Budweiser, Heineken and Corona Extra, let’s around the world?
ﬁrst have a look at the brand architecture to
see the brand strategies adopted by AB-InBev, The branding strategies are structured along
Heineken USA and Grupo Modelo, their two axes according to whether the value
respective companies. sought by the brand relates more to power and
stature on the one hand, or personalisation,
Here comes ﬁve types of question when we differentiation and identity on the other (beer
talk about brand architecture : market).
• What to call new products ?
• How many brand levels to adopt ?
• How much visibility to give to the
corporate name, group name and the
see the scheme below
company name itself?
AB-InBev Brands Portfolio
If we have a look at the AB-InBev brand But in the case of AB-InBev, the brand portfolio
architecture we can see that in the beer extension has also its limits. By creating
category they own 60 brands organized under something for everyone, the company attracted
nine lines or « families » (as they call them) new constituents but it comes at the expense
which have all their own positioning. By of the company’s core brands. For exemple, we
adopting a line-brand strategy, AB-InBev saw that by launching the Michelob Ultra line (a
responds to the concern of offering one recent line focused on the light beer), AB
coherent response under a single name by removed customers from a long-term and
proposing many complementary products. stable brand such as Bud Light. We can also
call this, brand cannibalism or brand dilution.
The line involves the exploitation of a The customers are lost because the positioning
successful concept (for instance, Budweiser)
of each brands from the same company
by extending it but by staying very close to the
become less clear.
initial product (Bud Light or Budweiser Select).
With this offensive brand strategy designed to Also, with a line-brand strategy, the company
occupy the whole market and thanks to its name is always different from the brand name
impressing brand portfolios, AB is able to cover that is why the company communicate under
different needs and expectations (light, lager, the Budweiser brand or others when it talks to
ﬂavoured etc...). its ﬁnal consumers instead of AB-InBev – which
is only used when they do corporate
HEINEKEN Brands Portfolio
Grupo Modelo’s Brands Portfolio
By looking at the Grupo Modelo (13 brands) To c o n c l u d e o n t h o s e t h re e b re w e r y
and Heineken USA’s (10 brands) brand companies’ brand strategies, we can say that
architecture, we noticed that they have the they all have adopted pretty the same strategy
same branding strategy which is a product- to be able to ﬂow the beer market with various
brand strategy. brands answering each a speciﬁc need. All of
When the segments are closely related, which them follow that strategy by hidening the
is the case on the beer market, choosing one company name and insisting on the brand
name per product helps customers to perceive name which answer a speciﬁc positioning.
better the differences between the various
brands. (Heineken vs Heineken Premium Light)
The main positive point of this product-brand POSITIONING STRATEGY / A KEY
strategy is that since each brand is FACTOR FOR BEER COMPANIES
independent to the others, the failure of one of The battle for market share and marketing
them has no impact of negative spillover on the advantage in the US beer industry has never
others, or on the company name, in cases been keener. Beer outlets have never had so
where the company name remains relatively many offerings. Beer actors playing for the
unknown to the public and different from that of same audience.
any of the brands which is the case for In this context, the beer companies need to
Heineken USA and Grupo Modelo. identify and claim a distinctive spot in the
When we analyze the Heineken USA’s brand minds of beer consumers and have true
Architecture we saw that it is globally meaning for them to develop a strong
consistent, coherent, disciplined and rigidly competitive position. And this is the paradox,
how brands can adopt a “differentiate” brand Relationship, Intimate-Casual, Domestic-
position when they are all starting to look the Imported, For Fun-For Experience, Friends-
same? They need to trade off personality and Self…
brand image rather than product beneﬁt.
When mapping out the beer landscape, we can Lets focus now on the positionning strategies
observe through several criterias, the positions of our three brands, organized by nature
that a beer brand could take based on the ads. (domestic or imported), target (young to older)
by consumption (everyday to occasional) and
Follow, are some possible positions a beer by quality.
could choose: Youthful-Mature, Hedonistic-
BRAND IDENTITIES First, we analyzed for each brands the
evolution of the taglines and the commercials
Now we understood the brand strategy of each from the begining to today and then we tried to
groups, let’s have a look at the brand identities build an identity prism for each of the brands.
for Heineken, Corona Extra and Budweiser.
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By analyzing the various criteria of the brand This analysis highlights one major thing, those
identity (physique, relationship, reﬂexion, three brands of beer, which propose the same
personality, self-image) and the evolution of the product (a lager beer) on the same market (in
taglines for each of our three brands, we US and globally), differenciate themselves
conclude that Heineken focus its image on thanks to their unique image, positioning and
enjoyment, Corona Extra on a laid back lifestyle communication rather than with a distinct taste.
and Budweiser on the American spirit.
That is why beer brands invest a lot of money
in marketing and advertising.
Through this brand audit it is important to keep in mind that the
key success factors for the brands in the beer market are the
ability to have a strong brand image and a clear positioning.
Indeed, brands do not differentiate through the product itself
(the taste is fairly the same for all beers in the same category),
they need to invest in massive communication plan to
consolidate their positioning in consumer’s mind.
By developing a lot of innovative beers, big companies are
facing a tough situation since they are not always clear on the
positioning of each of their brands (risk of canibalism). It can
create confusion for the consumers and affect the sales of the
companies’s core brands.
Heineken, Budweiser and Corona Extra understood very well
the rules of the game : billion of dollars are spend every year in
advertising in order to stay and act in the consumer’s mind and
keep their compétitive advantage on the beer market.
« The New Strategic Brand management » by Philip Kotler
Datamonitor : The beer market in US
1. What is your nationality?
What is your nationality?
2. How old are you?
How old are you? 18/25
more than 65
3. Are you:
Are you: A woman?
4. What are you frequently drinking?
What are you frequently drinking? Soda
5. Why do you prefer this drink?
Why do you prefer this drink?
6. How much Beer do you Drink?
How much Beer do you Drink? 3+ per day
1 - 2 per day
3 - 4 per week
5 - 10 per month
7. What is your favorite place to drink Beer?
What is your favorite place to drink Beer? Bar with friends
Bar with a game (football,...)
Home with friends
Home with a game (football,...)
Alone on the couch
8. How do you prefer to drink beer?
How do you prefer to drink beer? On draught
9. Why do you drink beer?
Why do you drink beer? Taste
It is fashion
To be with my friends
With a meal
10. Please grade from 1 (worse) to 6 (best) the following beers: