The Beer Market in Spain Essay Example

The Beer Market in Spain Essay Group 6- Jennifer, Priya, Ricky and Barbara Beer market in Spain 1. Environmental Analysis: Porter’s 5 Forces: Buyer Power: Buyer power is relatively strong in the beer industry. The recent financial crisis showed us that buyers are price sensitive. Also, the presence of many different brands and products give buyers a lot of choice. Therefore, sellers must differentiate their products or offer very competitive prices to remain profitable. Supplier Power: Beer is made from malt, hops, water and yeast. These ingredients are relatively commoditised and are readily available . There are many suppliers offering generic products. Suppliers have relatively little bargaining power. Threat from new entrants/ Barriers to entry: The initial investment in beer production is large as plants and production technology are complex and take time to establish. Furthermore, establishing a brand identity and establishing relationships with retail outlets is time consuming and can be difficult. Because of the presence of a few market dominating firms, threat from new start-ups is small, except in niche markets. Therefore we can conclude that barriers to entry are moderate. Substitutes: The alcoholic beverage found to be the closest substitute to beer available on the market is cider. The cider industry is growing rapidly and it is becoming an increasingly popular choice among beer drinkers. Rivalry: The market leader in beer sales is Heineken, which holds 32% total volume share in 2010 (Euromonitor International, April 2011, page 3). This closely followed by Mahou with 30% total volume share. In this respect, the beer industry is not particularly competitive. However, amongst smaller brands competing for niche market share, there is fierce competition. . Who, What, How analysis: Functions or needs: Thirst, social needs, relaxation (WHAT) Customer Groups: (WHO) Teens adults Students, friends, families retirees Product varieties / Technologies: Premium Lager Beer, Standard Lager Beer, Non-alcoholic Beer, Light Beer (HOW) 3. Identification of key trends: Beer sales were affected by the 2008/09 financial crisis. Consumers decreased spending on going out and other leisure activities. Therefore on trade (drinking when out) fell by 7% in 2010 and off trade (staying in and drinking) rose by 1%. We will write a custom essay sample on The Beer Market in Spain specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on The Beer Market in Spain specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on The Beer Market in Spain specifically for you FOR ONLY $16.38 $13.9/page Hire Writer This follows the growing trend to stay in and socialise rather than going out to bars etc. The increase in price sensitivity of consumers has also contributed to an increase in supermarket and hypermarket market share for beer sales. Many Supermarkets and Hypermarkets have created their own beer labels that they offer at a discounted price to take advantage of this increased price sensitivity. However, the majority of sales are still ‘on trade’, due to the Mediterranean climate and the Spanish culture of going out for a drink, especially during the warmer months. Furthermore, 30% of beer sales in Spain are made by tourists. Beer sales levels are extremely sensitive to fluctuations in tourism. The economic crisis caused a decrease in the tourism industry, and thus in beer sales. In the south of Spain, lighter beers are more popular while in the North heavier beers with more body are more popular. Beer consumption in general is also strongly linked to the season, with more beer being consumed in warmer months. In 2010, the only beer product to achieve a total increase in sales growth was non-alcoholic beer. This could be the effect of an increase in health awareness and/or a reaction to stricter driving restrictions. Finally, the economic downturn has caused an increased demand for 330ml and 500ml canned beer relative to the traditional 330ml bottled variety. 4. Competition Analysis: Heineken is the market leader in beer sales, with 32% total volume sales in 2010. Second is Mahou, with 30%. However, in 2010, Heineken’s strategy to focus on premium lagers caused it to lose share, while Mahou’s standard lager and promotions focus caused them to gain market share. In third is Damm (Estrella, Voll, Xibeca Damm) with 12%. A large number of smaller labels share the remaining sales volume, with many of these brands focusing on niche product markets. To combat the sharp decrease in on-trade sales, major label have increased advertising to promote going out. For example Mahou introduced the ‘Get out the home! ’ campaign, offering small bottles of San Miguel or Mahou and a tapas dish for a low price. 5. Interpretation of results We conducted an online survey consisting of both multiple choice and short answer response questions designed to provide a level of quantitative and qualitative analysis. We received 20 responses to the survey, and 90% of these respondents selected ‘student’ in answer to the question ‘what best describes you? ’. 55% of respondents were male, 45% female. The combination of small sample size and a sample heavily skewed towards the student segment means that our research has not yielded result that are representative of the target population. However, we do believe that some of our findings are valuable to our analysis of the market. The survey revealed quality to be the most important influencing factor to our sample in choosing beer (48%). Following were price (32%) and brand (20%) and there were no votes for alcohol content. This indicates that the student segment looks for a quality beer that is reasonably priced and perhaps a recognisable or appealing brand. They do not necessarily drink beer just to get drunk. Our sample did not show a preference for the major Spanish beer labels, with 75% choosing ‘other’ as their preferred beer over Estrella, San Miguel and Heineken (the market leaders). This may be linked to the high percentage of international students completing the survey who prefer their native countries’ brands. As for where and when our sample consume beer, the responses were split between home and bars for location and showed preference for weekends and with friends for when and with whom. 40% of respondents drink beer 1-2 times a week. We can interpret these responses as showing a trend towards casual, social drinking. 100% of respondents indicated that they would not purchase a non-alcoholic beer and do not consider health factors when purchasing beer. This does not support the growth in market share of non-alcoholic beers. Interestingly, 42% of respondents did indicate that light beer was their preferred variety. This could be linked to female drinkers’ preference towards lighter, sweeter beverages. Our qualitative analysis revealed a recurrent theme in word associations the respondents made with beer consumption. Phrases such as ‘chilling with friends’, ‘relaxing on the weekend’ and ‘out with friends at a bar’ were most common. This supports our quantitative analysis that beer is consumed primarily in non-formal, social situations. 6. FCB Matrix [pic] 7. Decision-making Process Buying beer substantially is a low-involvement process since beer is not a very expensive product. We usually buy a certain brand of beer, try it for the first time, make evaluation on the product, then decide whether or not to buy it in the future. The low-involvement decision-making process in fact is a learning as mentioned. We decide whether or not to repeat the purchase by learning from the buying experience. The graph below depicts the â€Å"Think-Do-Feel† theory. This diagram below is an elaborated version of the simplified model above:[pic] 8a. Segmentation Variables Possible options from our questionnaire survey: (i) occupation (full-time worker, part-time worker, student) and age (ii) consumption rate (high, medium, low) and consumption situation (home, bar, restaurant) (iii) purchase driver (brand, price, quality) and consumption companion (family, friend, alone) All these options are chosen from the questions we set for our survey. However, we finally decide to use option (ii), i. e. consumption rate and consumption situation as the segmentation variables. We eliminate option (i) and (iii) because of these reasons. For option (i), we feel that the segment with certain kind of people with certain age will be too large for us to focus on in terms of marketing strategy. Different people in the same age with similar occupation may possess different attitudes towards beer. For option (iii), purchase drivers, i. e. the purchase tactics, change over time in different situations since it is a low-involved buying activity. Therefore, it is difficult to predict the precise opportunity to do marketing for a new kind of brand, hence very difficult to target a very special target. The graph below shows the variables we use for segmentation, as well as some definitions of the variables. [pic] 8b. Various Segments Identified Below are some photos depicted the segments identified, as well as description of each segment. [pic] 7c. Segment Selected[pic] Target Light Beer Drinker based on the following reasons: i) Highest potential growth rate: can easily shift to the right to have medium usage rate, which means higher consumption of beer. That brings more revenue. (ii) Sophisticated drinkers have much experience on beer, which means that new brands like us could be eliminated easily in their consideration sets. (iii) Sophisticated drinkers could be brand-loyal to certain brands, which make it hard to make them shift to our brand. However, the column â€Å"light beer drinker† still leaves us three options . As a new company, we could like to do concentrated marketing so that we put all our effort into one single segment. Therefore, we need to decide which segment we would like to get involved from the variable â€Å"usage situation†. We decide that from our survey based on the response and from other considerations including secondary research. [pic] However, the results of â€Å"bar† and â€Å"home† occupy the same percentage. Therefore, we made our decision based on both our qualitative research and secondary research. From â€Å"What activities, emotions or adjectives do you associate with drinking beer? †most respondents associate beer with socialising with friends and relaxing at home or at a bar. However the market trend is showing a growth in home beer consumption. 7d. Positioning We have defined the position strategy for light beer using positioning maps. Since our survey depicts that most beer drinkers do so for socializing in bars, we have zeroed in on price and quality as the preferred attributes (and not necessarily variety, as youngsters feel comfortable with any light beer that has a good taste and reasonable variety). We see that Light Beer ranks moderately high on quality and low on price (only more expensive than non-alcoholic beer). Hence our product is positioned as a moderately low priced Light Beer that ranks medium to high on quality. 8. Product Concept We came up with two different product concepts: a light and cheap beer to be consumed in bars and a light cheap beer to be consumed at home. Both beers are competitive from a price point of view but the beer that has to be consumed in bars should be in a glass bottle of 330ml whilst the beer addressed to the off-trade should be a 500ml glass bottle or can to push further the price competitiveness. We decided we will further develop the off-trade beer because it is more coherent with our qualitative research results and with the market trends. Furthermore the decision to target a niche market, such as home beer consumption, is a better decision for a firm just entering the market, and therefore not ready yet to compete with established beer firms on the open market. Appendices [pic] [pic]

Key Facts About the War on Drugs

Key Facts About the War on Drugs What Is the War on Drugs? The War on Drugs is a general term used to refer to the federal governments attempts to end the import, manufacture, sale, and use of illegal drugs. Its a colloquial term that does not refer in any meaningful way to a specific policy or objective, but rather to a series of anti-drug initiatives that are vaguely directed towards the common goal of ending drug abuse. Origin of the Phrase War on Drugs President Dwight D. Eisenhower began what The New York Times then called a new war on narcotic addiction at the local, national, and international level with the establishment of an Interdepartmental Committee on Narcotics on November 27, 1954, which was responsible for coordinating executive branch anti-drug efforts. The phrase War on Drugs first came into common use after President Richard Nixon used it at a press conference on June 17, 1971, during which he described illegal drugs as public enemy number one in the United States. Chronology of Federal Anti-drug Policy 1914: The Harrison Narcotics Tax Act regulates the distribution of narcotics (heroin and other opiates). Federal law enforcement will later incorrectly classify cocaine, a central nervous system stimulant, as a narcotic and regulate it under the same legislation.​1937: The Marijuana Tax Act extends federal restrictions to cover marijuana.1954: The Eisenhower administration takes a significant, albeit largely symbolic, step in establishing a U.S. Interdepartmental Committee on Narcotics.1970: The Comprehensive Drug Abuse Prevention and Control Act of 1970 establishes federal anti-drug policy as we know it. Human Cost of the War on Drugs According to the Bureau of Justice Statistics, 55% of federal prisoners and 21% of state-level prisoners are incarcerated on the basis of drug-related offenses. This means that over a half million people are presently incarcerated as a result of anti-drug laws- more than the population of Wyoming. The illegal drug trade also sustains gang activity, and is indirectly responsible for an unknown number of homicides. (The FBIs Uniform Crime Reports describe 4% of homicides as being directly attributable to the illegal drug trade, but it plays an indirect role in a much larger percentage of homicides.) Monetary Cost of the War on Drugs According to the White Houses National Drug Control Strategy Budgets, as cited in Action Americas Drug War Cost Clock, the federal government alone is projected to spend over $22 billion on the War on Drugs in 2009. State spending totals are harder to isolate, but Action America cites a 1998 Columbia University study which found that states spent over $30 billion on drug law enforcement during that year. Constitutionality of the War on Drugs The federal governments authority to prosecute drug-related offenses theoretically stems from Article Is Commerce Clause, which grants Congress the authority to regulate commerce with foreign nations, and among the several states, and with the Indian tribes- but federal law enforcement targets drug offenders even when the illegal substance is manufactured and distributed only within state lines. Public Opinion Regarding the War on Drugs According to an October 2008 Zogby poll of likely voters, 76% describe the War on Drugs as a failure. In 2009, the Obama administration announced that it would no longer use the phrase War on Drugs to refer to federal anti-drug efforts, the first administration in 40 years not to do so.

File Sharing and Burning CDs Essay Example | Topics and Well Written Essays - 500 words

File Sharing and Burning CDs - Essay Example He is now known as the media man. All the videos and movies in our circle of friends come from him. He writes freeware software for us, whenever we need any and then posts them to us. He has all the latest movies and videos that we could want. He however became very possessive about his computer system and didn’t allow others to enter without his permission. Once I tried to log on to his computer without his permission and there was an outbreak from him. He was really upset and called it ‘invasion of privacy’. I however apologized and explained that it was totally unintentional. This experienced opened up a new world of computers for me. Prior to this experience I had always considered computers as a tool which was used to perform work. The closeness that my cousin felt towards his computer created intrigue towards this feeling. I wanted to learn and understand this feeling. The first step was setting up a personal computer which was similar to my cousin’s, only less powerful. Using a fast internet connection I downloaded some movie and share them using torrents. It was indeed a magical experience. There were thousands of people who downloaded from my link and gave thank you notes. Some of them went ahead and asked for other movies which they really wanted to watch. I was flattered this experience gave me an insight into the personal side of file sharing. This practice does not only give you sense of purpose but also gives great joy. The reason for people to engage in this practice is indeed different for different people. Some share file just to earn money through advertisement. This is a hefty amount and many take it up as a full time job. Others however find it joyful to be of service to other and to be liked. It all depends on the psychological contract of individuals. The feeling of sharing and finding a connection with thousands of people all around the world is indeed priceless. Many people find it