After tea and water, it is the third most popular drink all around the world. Brewing industry is huge and global business includes many dominant multinational companies and various thousands of small manufacturers ranging from regional breweries to brewpubs. Today the world is highly competitive, in which companies must maintain continuous improvement, followed by product innovation and services in order to position itself in the market.
However, there are companies that enjoy not only high rankings but are also leaders of the market Nelson remains market leader in Canada and various other countries. It has started to expand its operations in Brazilian market, because emerging markets like Brazil, China and India are to offer the largest growth potential in 2013-2014. However it required effective marketing tool to attain growth in Brazilian market. This paper deals with a detailed discussion on marketing strategies for Nelson beer which would be effective for the company in attaining growth in Brazilian market.
Sales promotion, integrated marketing communication plan, direct marketing, marketing mix, SOOT, advertising and other marketing procedures of Nelson beer are to be discussed. Majority beer is flavored with hops with some bitterness and natural preservation is performed by adding some other flavors like fruits or herbs however they are included occasionally. Brewing industry is huge and global business including many dominant multinational companies and various are also leaders of the market.
In order to be recognized as a global brand, the product has to be available in markets of all countries in the world. Thus in this paper we are going to identify new prospects to market Nelson beer in Brazilian Market. Nelson beer is considered as one of the best beer in the world. AIM AND PURPOSE : The aim of this paper is to conduct research on Brazilian beer market and identify prospects for Nelson beer in Brazilian Market. Nelson beer is present in more 50 countries and currently Brazilian market is considered as a beneficial market for Nelson beer.
This paper is going to let readers know about various advantages of entering effectively marketing Nelson beer in Brazil. It is important to emphasize to readers that the Nelson Coors Breweries group does not guarantee the accuracy of the information. It is up to readers to verify the accuracy and reliability of the information contained herein. This report provides a concise overview of the market for those interested in its potential. Considerable efforts have been made to present accurate data.
METHODOLOGY: The project is entirely based on secondary data because of lack of time and resource collection of primary data. The data for this project is collected from different online research papers, web pages, online database Obsess. Moreover the marketing analysis is done on the basis of secondary data and knowledge collected from Melon’s website, text books and lectures. HISTORY OF BEER : The origin of beer is lost in the mists of time between stories and legends, those of ancient Egypt attributed its origin to the whim of Souris.
Many anthropologists say one hundred thousand years ago man primitive elaborated a drink made of corn roots and berries that chewed before to trigger the fermentation alcohol, the resulting liquid was consumed with delight to relax. People of early ages called beer as “a beverage obtained by fermentation of grain called Sirius”. 4000 years ago, ancient people expressed a formula of homemade beer, bread is baked, breaks into crumbs, a mixture is prepared in water and get yourself a drink that turns people into “cheerful, outgoing and happy.
At the end of the fifteenth century, the Duke of Riviera William IV promulgates the first law of German Beer Purity, prescribed the exclusive use of barley malt, water, hops and yeast in their manufacture. The real golden age of the beer started in late eighteenth century with the introduction of the steam engine and culminated in the last third of the nineteenth century, with the findings of Pasteur relative to the process of fermentation. NELSON BEER COMPANY The Nelson Coors Brewing Company is a North American brewing company, formed in 2005 by the merger of Nelson of Canada, and Coors of the United States.
It is the oral’s seventh largest brewer by volume. Founded in Montreal in 1786, Nelson Coors Canada is the oldest brewery in North America and continues to produce beer on the site of the original brewery. The company brews and markets a number of the most popular brands of beer in Canada. Domestic labels include Nelson Canadian, Nelson M, Nelson Export, Nelson Dry, Nelson Axel De-Alcoholisms beer, Old Style Pipeline, Rickrack’s, Ceremony Springs and Granville Island Brewing.
Through partnerships with other major brewers, Nelson Coors Canada also offers a diverse portfolio of beer brands, including Coors Light, Corona, Miller Genuine Draft, Heinlein, Foster’s Lager and Tiger. Nelson employs 3,000 people in Canada and operates five breweries in locations across the country (Vancouver, Toronto, Montreal, Monocot and SST. John’s), as well as the Ceremony micro-brewery in Ontario and Granville Island Brewing in British Columbia. Nelson Coors Canada is part of the Nelson Coors Brewing company.
BEER MARKET IN BRAZIL According to the Brazilian Association of the Industry of Beer (Cerebrates), which brings together the four major Brazilian manufacturers (Amber, Brazil Karri, Henning and Petrol’s), the sector generates 1. 7 million direct and indirect Jobs and paid in average, more than U. S. $ 16 billion in wages. Every year, Brazil produces around 13 billion liters, serving more than one million points of sale throughout the country and has an industrial park with more than 50 factories.
The target audience for beer is 56% of men, ages between 20 and 35. Special beer market has maintained an average growth of 15% in recent years. These consumers, with differential profile, have financial stability and experience of tasting beers from international labels. The segment is distributed in a broad strategic chain that starts in agribusiness, passes y industry of capital goods (machinery and equipment) and processing (packaging), by construction, the supply chain and retail.
According to a survey from research company Minute, released in late 2012, the sales volume of beer “premium” – as they are called labels of foreign brands or craft – in Brazil rose 18% last year, compared to 2010. The rate of beer consumption per capita in Brazil (67. 4 liters) equal to major markets such as the United States (75 liters) and the I-J (64. 7 liters). The sector includes 200 microbreweries and accounts for 5% of total segment revenues, estimated at U. S. $ 39. 6 billion in 2012.
With annual growth four times higher than the market of traditional beers, specialty beers crave gain 10% market share this year and 20% preference 2015. The figures from the Ministry of Agriculture, Livestock and Supply (MAP) show the movement of special breweries towards achieving market: 31 new producers requested record in 2012, the greatest number of requests over the last 30 years. This achievement of shelf space is also verified in retail sector by supermarket shopping ROI South Zone, in which the premium beers already occupy of the space devoted to this type of drink.
WAYS TO MARKET NELSON BEER IN BRAZIL Above statically data shows that Brazilian beer market has potential growth and Nelson can be an effective part of Brazilian Market if it effectively markets its product in Brazilian market. Nelson beer can be effectively marketed into Brazil after doing company and industry analysis which will be done with the help of SOOT Matrix, Porter five force Model. After the analysis of these models specific strategies such as MIMIC plan, Direct Marketing m Sales Promotion and other will give to market Nelson in Brazil.
SOOT The SOOT Matrix is a conceptual framework for a systematic analysis that facilitates eating between external opportunities and threats with internal strengths and weaknesses of the organization. This analysis represents an effort to examine the interaction between the characteristics of your business and the environment in which it competes. Strengths are those positive elements that differentiate internal and the other program or project of the same class. Opportunities are those external situations, positive, which are generated in the environment and that once identified can be exploited (Ireland, 2010).
Weaknesses are internal problems, once identified and develop an appropriate strategy can and should be eliminated. Threats are negative situations, outside the program or project, which may damage it, so we come to the case, it may be necessary to design an appropriate strategy to get around it. In summary: Strengths should be used Opportunities should be seized Weaknesses should be removed and Threats should be bypassed Porter’s Five Forces Porter proposes a model of five “forces” can be used to understand the dynamics of competition in a sector.
Since every society strives to develop sustainable competitive advantages over others, the first four forces are helping to evaluate the fifth, which is he level of competition in the sector : Barriers to entry The bargaining power of customers The bargaining power of suppliers The threat of substitute products The intensity of intra-industry competition CHALLENGES AND OPPORTUNITIES: Brazilian tastes for alcoholic beverages seem to refine. The imported beer continued to gain weight relative to domestic sales increasing by 7. 8%.
By volume, imported beer has grown more than doubled in market share in the domestic relationship, being the current market share of 13% of the Brazilian beer market. Thus with great quality and refreshing taste, Nelson beer can become major layer in Brazilian market with the help of effective marketing. One of the biggest challenges for Nelson beer is the aging population that has yet to be renewed and is mostly concerned with health, and increased cultural diversity nationally. These changes are likely to contribute to the reduction of per capita consumption.
The brewing industry is one of the most regulated industries in Brazil. Nelson must obtain licenses. In general, they provide full control of their system of distribution, retail, labeling, advertising, marketing techniques, import and costing. They also decide on the number and type of beers that will be on the market. However, Nelson must take into account the federal laws of ingredients, packaging, labeling and radio and television advertising. The price of beer is largely determined by the taxes. On average, the domestic consumption of beer, Nelson while marketing has to take care their behavior.
In short they should show responsive behavior towards the market. Competition for market share for Nelson beer is will be intense in Brazil. Nelson must change consumer perception that beer contains more calories than other products. The alcohol taxes are among the highest in the world, so the beer in Brazil s expensive and local laws prohibit their sale beyond provincial boundaries. Nelson can take this as an opportunity. Moreover reductions in trade barriers on imports and the globalization of the sector have stimulated competition in the Brazilian market for beer.
BUSINESS PLAN Human Resource: Some of the most important HER policies in Brazil for the company are as follows, aspects of recruitment policies, working hours and termination policies will be mentioned below. Working hours & employee benefits Brazilian labor authorities drew up a standardized working schedule for all employees of 8 hours per day and a maximum of 44 hours a week (I. . Many people in Brazil work on Saturday mornings). However, employers and employees can agree upon stretching the working hours (common in the offshore industry for instance).
Workers are paid a 50% surcharge on the regular hourly rate for overtime (2 hours overtime per day Max). When workdays last more than 6 hours, employees are entitle too 1 hour break minimum. Apart from a monthly salary, other substantial benefits are provided to staff members. In general, these include a thirteenth salary, which should be paid mid- November and is equal to the salary of December and a 30 day holiday pay, to be aid 2 days before leave at the latest. Sometime other benefits apply, like housing allowances and health insurance Finally, official holidays are paid leave.
If an employee should work on a holiday, he should be compensated in the same month, otherwise he is entitled to a 100% surcharge on the regular hourly rate. In case of illness and work-related accidents, the employee is entitled a 15 day sick leave after confirmation of a physician. If absence takes longer than 15 days, the employee should report to the Social Security Administration which will cover paid leave until the employee is able to return to work. An employer cannot dismiss an employee prior to the 12th month following the return from a paid work-related accident leave.
In case of childbirth, in Brazil female employees are eligible to get a liberal maternity leave of 120 days, beginning in the 8th month of pregnancy. Males are entitled too 5 days paternity leave, starting at the day of birth. An employer cannot dismiss a pregnant employee prior to the 5th month following the childbirth. Termination policies In Brazil an employment agreement can be terminated by either the employee or the employer. However, the termination policies are quite formal and the company has to allow a certain procedure in order to make it official.
It is possible to terminate an employment agreement before the expiry date by the employer. It is compulsory however paying the employee a certain amount of compensation. This applies to a lesser extent also to situations in which the employee violates the crucial duties and company policies. In order to enjoy all the official benefits, an employee is bound to provide a 30 days’ notice to the company before finishing the Job. Usually all the intrinsic details and conditions of the termination mentioned in the settled agreement.
Ethics: Business ethics is the applied ethics discipline that addresses the moral features of commercial activity. The way international business ethics seeks to address where ethical norms are in conflict due to different cultural practices and which ethical norms should guide ones business in other nation and cultures. One common approach in international business ethics is to refer to or to construct lists of norms that ought to guide transnational business conduct. Thus, for example, the United Nations’ Universal Declaration of Human Rights or, more recently, the United Nations
Global Compact, is advanced as a guide to conduct. The UN Global Compact enjoins business firms to support and respect internationally recognized human rights, avoid complicity in human rights abuses, uphold freedom of association and collective bargaining, eliminate forced and compulsory labor, eliminate child labor, eliminate all forms of discrimination in employment, support a precautionary approach to environmental challenges, promote greater environmental responsibility, encourage the development of environmentally friendly technologies, and work against corruption in all its forms, including extortion and bribery.
International business ethics has taken on a new urgency with the emergence of globalization. Low transaction and communication costs, driven by advances in computer and telecommunication technologies, have made the global market, once a metaphor (and at least for some, an aspiration), truly global. Nowhere has this urgency been felt more acutely than in the debate over so-called sweatshop labor – the hiring of workers in less developed countries, usually at wages and under work conditions prevailing in those countries, to manufacture products for the developed world.
We promote responsible use of our products by adults of legal drinking age. Even the appearance of condoning underage drinking, drunk driving or other irresponsible activity is unacceptable. While working, entertaining for the company, or otherwise representing Nelson Coors, our behavior reflect positively or negatively upon our reputation and our brands. So, if we choose to consume or serve alcohol beverages, we are expected to set a positive example Logistics Direct Store Delivery (DADS) business models is going to be applied for distribution in Brazil.
It can optimize DADS with an integrated planning and execution solution, they will have the opportunity to synchronize the salesperson, the merchandiser, and the livery truck in the most efficient manner possible. The activity that takes the most time away from working the shelf is associates waiting to receive product at the store, this can be solved by using DADS model. Some of the challenges associated with DADS are as follows, Balancing DADS territory assets against customer demand fluctuations. Neutralized fleet assets. Improving collaboration of sales, operations, planning, execution and the retailer.
Compliance of store visits by sales and merchandisers, as well as delivery routes. Inaccurate fill rates due to unique promotional driven pallet configurations required by the retailer. And among the complexities The move from static routes to dynamic routes creates a new set of business process changes. In-stock replenishments depend on harmonious synchronization between Sales and Operations. Getting retailers to share point-of-sale (POS) data. HUMAN RIGHTS AND CODES OF CONDUCT: Employees have the right to have their dignity respected and protected. Working conditions and practices will not infringe on the inherent dignity of employees.
Physical, sexual, racial, religious, psychological, verbal or any other form of harassment, threat or abuse, whether manifested in behavior, language or gesture is tryingly condemned and will not be tolerated . Employees have the right to make political choices and to exercise these rights outside of working hour . Labor standards: Employees will not be subjected to any forced labor. Overtime will be voluntary and restricted to the national permitted level. Employees have the right to freedom of movement and accordingly their movements will not be unreasonable or unnecessarily restricted.
Where accommodation is provided for employees, they will have reasonable freedom of movement within the accommodation, including access and egress as they wish. Guidelines: No persons allowed in non-designated tasting room areas. No discount pricing will be given on any product. Bribery and corruption: We’re a global company and must also follow anti-corruption laws of other countries as well as the Canada Corrupt Practices Act. These laws bar us from promising, offering or making any payment in money, products or services to foreign government officials in exchange for favorable treatment.
The company and the members we represent take our responsibility to the communities we serve seriously. Beer should be marketed in a responsible and respectful manner. Research: Research has shown that team has high standards on everyday things, such as reports and records really excel at implementation of new ideas and process. Product localization: Adapting our product to the particularities of the country of destination, ranging from legislation and functional requirements to language, customs and cultural barriers.
Marketing localization: Coupled with heavy governmental intervention, which includes distribution laws, taxation, advertising restrictions, production and health standards, anti-trust laws, and indirect laws and ordinances, beer producers have found an increasing nominative environment due to regulatory forces. Environmental guidelines: Nelson Coors has set challenging long term targets to improve energy and water efficiency by 25% and 20% respectively by 2020 from 2011 levels. We have also adopted an ambitious target of reducing our carbon intensity by 15% by 2020.
The combined effect of these targets is to drive lower consumption of natural resources in a way that has the maximum impact in mitigating and adapting to climate change Communication: Engage in communication that is not only legal but also ethical and sensitive to cultural values and beliefs. Engage in truthful, accurate and fair communication that facilitates respect and mutual understanding. MARKETING PLAN THE NELSON “LIVING OUR LIVES” MARKETING STRATEGY: Vision: Our ambition is to be a top global brewer.
We have four strategic goals to help us get there: a net profit goal, increasing returns from our strategic brands, engagement of our employees, and recognition for world-class corporate responsibility. Goals: At Nelson, our goal is to provide consumers with products they most prefer; and at the same time be the leading producer of malt liquor products in the world. Mission Statement: At Nelson Coors, we desire to produce the best products and services for consumers in the world market. In the process, our employees and managers will utilize the newest technology and innovation to ensure profits for shareholders and growth for the company .
Our breweries and production processes will operate with a concern for employee livelihood sustainability, environmental protection, and community commitment. We will continue to provide our value chain with the best value possible . Our philosophy towards innovation and product sustainability displays a ointment to our company and will ensure progress in the industry for the short and long term . Market-product Focus: The Brazilian beer market provides ample business expansion possibilities, because they are a large consumer of the product and their populations are growing. . Creating more strategic alliances with other companies reduces risk as they move into foreign operations 2. Provide more environmentally friendly packaging, improve pollution prevention goals. 3. They can produce a line of Organic Beer, Gluten free beer, or move into the higher priced market of beers. Marketing Mix Market position Nelson beer is the largest selling brands in Canada it shown 28% growth in 2009 thus it has the potential to diversify its product in Brazil. Target Market There are different market segments for two different products of Nelson. . Nelson Mild (% of alcohol less than 4) This category of the brand targets youth who Just drink beer for fun. It is also for first time drinkers who want to have experience. In addition urban women are also targeted especially those who like to have light drinks. 2. Nelson strong (% of alcohol more than 4) This category of Nelson brand is for those who are regular drinkers and prefer throng flavors. Nelson Beer is for both male and female, both regular and first time drinkers are targeted that is why two different products are offered by the company.
They mainly focus on working class and university students. As Nelson beer contains alcohol and therefore it is aimed at people over 18. Our goal in specific market is 20 to 38 years, because it reflects Melon’s market research. Product 1. In its segment Nelson is the most famous selling brand 2. Raw material of good quality is used to maintain the quality standards of the brand and the company 3. The quality of Nelson beer is high and consistent 4. Nelson beer always tastes fresh because of well developed distribution network and good quality 5.
There are very less chances of hangover even after heavy consumption. Nelson for different markets launched different line of products: 1. Nelson Blue Beer 2. Nelson Draught Beer 3. Nelson Canadian Beer 4. Nelson M Beer 5. Nelson Coors Nelson Beer is good for convenience, I. E. , a tangible product, which the consumer knows enough before buying and that comes with minimal effort. Other features are: impulse buying and little or no planning, quite common and does not involve a significant outlay of money, and the need is met immediately. Place 1 .
The distribution channel is strong because of which it is available throughout the Brazil particularly, it is dominant in west and south Brazil. 2. Nelson is available in 52 countries 3. With the passage of time and advanced technology Nelson has started its online marketing system which is considered as an effective marketing strategy. Customers can but online beer by going to website (www. Molestation. Com). A customer can but a minimum of six bottles which would be home delivered. 4. There are around 1600 shops excluding bars and pubs. In near future advanced and better retailing outlets are to be open under the Brand of Nelson.
Nelson can have association with some up-market, classy, and stylish lounges and bars that goes hand in hand with its brand image. For retailer its beer, Nelson should have tie-ups with huge departmental stores in Brazil. Price Competitive pricing strategy is used by Nelson in both Strong and mild segment. 341 ml can of Nelson beer is worth 30 R$(Real) and 330 ml bottle is worth 20 R$ only. While Nelson Blue Beer ranges from R$. 20-80, Nelson Draught Beer ranges from 40-70 R$. Making low price in Brazil will help consumers on purchasing decision.
Thus Nelson will enter in new market; it has to give away discounts on bulk orders. For customers of the brewery, the premium price is a variable when deciding to buy, therefore, “Nelson beer” should use a penetration pricing strategy in Brazil because the prices of other domestic or international beer are high in Brazil. Promotion 1 . “King of good times” is the tagging of Nelson which is the most successful and popular tagging in Brazil. 2. Surrogate advertising methods like using sodas and water are used by the company because of ban on liquor advertising in Brazil. 3. Aggressive advertising is done at pubs and outlets .
Nelson has started to merchandise trendy and sports clothing and accessories under the Brand name of Nelson. 5. Every year new calendars featuring top models in swimwear are launched by Nelson 6. The promotion of Nelson is also done by sponsoring events like fashion shows, sports , charity events. 7. For Brazilian market, Nelson will focus on pubs bars and mainly supermarkets, in supermarkets they will have a catchments area where consumers in Brazil will be given a portion of the new beer and feedback will be taken. Also Nelson will mobile to different sites fairs where they will promote their product.