Entrepreneurial Marketing Issues - Essay Example

Entrepreneurial marketing Entrepreneurial marketing Introduction Hobson’s brewery was established in the year 1993 and isamong the leading brewers in Shropshire and the most sustainable in the United Kingdom (McFarland 2009). It is famous for the production of cask ales and bottled beers from its brewery in the Cleobury Mortimer. This brewery has seventeen full-time staff members. Their products are brewed using local ingredients from barley growers and hop farmers who are located in a distance of thirty miles from the breweries. The brewery is committed to producing quality and having the finest ingredients locally. They also strive towards safeguarding the environmental safety by reducing the carbon print of the breweries and introducing various green technologies. These green technologies have earned them both local and international awards. The brewery can maintain a great sense of sustainability, community, and passion for the best ale. The recent industry trends report over the last five years produced by various independent bodies including SIBA indicates that there is a continuing success that is visible in the Ale sector with yearly growth and emerging categories often gaining their market share. One emerging market sector is in the growth of the 330ml packaged beer bottle. This is attracting a younger audience. Since Hobsons is in need of venturing into this market with a sub-brand, it requires ample market research and analysis. This paper seeks to fulfill that by developing a sub-brand that is not detrimental to the other brands of the brewery. It also seeks on the target audience and means of engaging them and marketing the product this new product in the market. Aims and Objectives The main consideration of this project is to come up with a sub- brand for Hobson brewery, which is not detrimental to the existing brand of the brewery. This is due to the emerging growth of the market for the 300 ml bottle of beer. This beer is attracting a younger audience of above eighteen years and considering that they make a high percentage of the total population in the area, tapping into this market is beneficial for the company. The brewery company has to come up with the best strategies to market and engage their target audience. They also aim at knowing what additional beer styles to create to maintain a competitive advantage. Moreover, they aim at coming up with a communication activity where they would gather the required feedback from the targeted market. The brewery also aims at coming up with promotional activity to ensure that they attract and retain more customers in their targeted audience. Another aim is to ensure that they create a domain name for selling their new products. Their domain names ought to be catchy and memorable for their targeted audience. The company also aims at having the required advice on their website layout, colors and content of their website. The other aim of the company is to ensure that they gather evidence on potential markets overseas and legislative issues of their selected countries. Representation of the increase of sales of the new product with time (Hague 2009) Market share representation if the brewer incorporates the right strategies (Howarth 2011) Discussion Market analysis Market size Consumption of beer in the UK is booming with over 25 million drinkers generating an income of euro 18 billion per year. Considering that there is an arising opportunity for the 330ml bottled beer, it is likely that the market size is likely to increase. Shropshire has a total population of 306100, which a third is composed of the young population. Thus, the market size in Shropshire is about 12033 individuals. However, considering that the brewery also conducts online business, it can amass more of the overall UK beer consumers, which constitute the 25million. Thus, in approximation, the total alcohol market is estimated to be euro 22 billion per annum. To determine the market size, a survey was conducted where a sample of all the potential customers were interviewed on a one-on-one. Market trends There has been a record of the need for the 330ml beer among the young people. As a result, there is an expectation of an upward movement in the market trends despite the current decline beer market due to consumers tending to go out less often. There is an expectation of the beer to record a 23% increase in the number of consumers of the product. Market profitability It is recorded in terms of: 1. Buyers’ power- if the brewery comes up with the bottled beer in accordance to the preferences of the potential customers’ then the buying power will increase thus increasing the overall profitability of the venture. 2. Supplier power- the suppliers of the raw materials for the production of the bottled beer should not exaggerate their prices due to the incoming demand. Some of the suppliers may chose to supply to rival firms that pay more or overprice the current firm that they are supplying. This may affect the profitability of the brewery negatively. 3. Barriers of entry- the government should ensure that they come up with regulations to prevent many firms from entering into the market. This would result into increased supply but reduce the demand thus declining the profitability of the brewery. Moreover, the government should make it easy for existing but unproductive firms to exit the market. 4. Threat of substitute product- if the bottled product becomes more expensive than a substitute product that produces equal results, then the consumers can turn into the substitute product resulting into a negative impact on the profitability of the brewery. With fewer customers than it is expected, the brewery can realize losses considering that they have already undergone the cost of production. Distribution channels The brewery makes direct distribution to its customers. However, in some instances, they require distributors to enhance effective distribution. The brewery is contemplating new distribution channels to increase their competitive advantage. Success factors For the brewery to achieve its intended objectives, there are various success factors they should consider. This includes access to distribution channels, which enables them to amass more customers (William Winston 2013). Access to unique resources and methodologies of production is also important since it will ensure that they produce quality beer for their customers. Considering that their beer is often traditionally brewed, they are likely to come up with the best product for their customers adding to their success factor. SWOT analysis Strengths Weaknesses Presence of an already existing market High number of older generation in the area Recognition due to community work Presence of an emerging market for the new brand Opportunities Threats An emerging market for the new brand Threat of competition Threat of new entrants into the market resulting into market saturation PESTEL ANALYSIS Political factors: the government may intervene in the economy by taxation, tariffs, and trade restrictions. It provides these interventions to control the economy and to ensure that the local investors are better suited than foreigners in the economy are. They prevent the market from saturation with foreign investors. Economic factors: they include economic, interest, exchange, and inflation rates. The economic rate and interest and exchange rate determines how the business operates. For instance, the interest rate affects the capital of the firm resulting into affecting the extent to which the business expands. Social factors: include the cultural aspects and health consciousness, growth rate of a population, age distribution, and emphasis on safety. Social factors affect the demand of the products of a company and the operations of the company. For instance, the presence of an older population in the area could result into decreased labor force for the brewery. Technological factors- the brewery has to move with the changing technology to determine the entry barriers and influence the decision for them to outsource. Legal factors-they affect the operations of a company. The factors will affect the cost of production and demand for the new product. Environmental-include ecological factors such as weather and climate it is important for the brewery to determine the impact of climatic change to enable creation of new markets and avoid diminishing the existing ones (Nevin 2014). Representation of the increase in sales of the new product with time (Charles D. Kirkpatrick II 2010) The brewery has to choose a mode of engaging its target audiences and marketing their products. Considering that the area is a rural setting, they ought to come up with creative means of attracting their population. However, based on their online store, they should ensure that the marketing strategy they choose is accommodative enough for all their targeted population all over the United Kingdom. It is important also for the brewery to come up with additional beer styles to create that do not outdo their current brands. From their history of ensuring their customer’s satisfaction, things should not be different in this new product. They should ensure that their customers get the best from this new product by ensuring that the product is of very high quality. This will ensure that they attract and maintain more clients thus adding to their venture of more profit making (Hague 2009). The additional beer styles they come up with should be creative to ensure that they maintain a competitive advantage over other brewers in the region. One of the given reasons is because their customers   are the young population. For them, attractiveness is the key. Communication with their target audience will ensure that they come up with beer styles that are up to the preferences of the audience. Moreover, it will ensure that they improve on their products in the future in case the tastes and preferences of their customers changes. They should also ensure that they promote their products in the required manner. Promotion will create awareness to their products and even ensure that their targeted audience has a tease of what they are going to get (Beall 2010). With proper promotions, the brewery is in a position to ensure that if a new product is not up to the requirements of their consumers, and then they can change it accordingly. Promotion is also likely to give them a chance to interact with their targeted market on a one-on-one basis thus ensuring that they get their feedback and also get a glimpse of their non-verbal reactions to the new product. The reason is that there are individuals out there who are fond of saying what they want the listener to hear. They can pronounce that the product is of the required quality though their non-verbal reactions indicate a different phenomenon. Thus, it would be easier to deduct the quality of the product according to the consumers’ perspective. The brewery also needs to choose a domain name for selling their product. The name ought to be attractive and memorable for their population. As earlier mentioned, this young population is attracted to catchy situations or brand names since they can identify with them (Wenzel 2012). Memorable brand names make it easier for them to remember them easily when making their orders even in locations outside Shropshire. There should also be a website for the brewery in case it wishes to export. The designed website should enable the users to navigate easily and should incorporate content that is easy to comprehend. The reason is a complicated website could deter potential customers from navigating through thus being a disadvantage for the brewery. In case they are willing to diversify to overseas markets, terms and consideration of the legislation of such overseas countries should be in place. Recommendations The brewery should come up with a sub-brand that does not diminish the original brand of the brewery the brand name that they should incorporate is Dolchi. They should come up with a website: www.dolchi.co.uk. The brand they have chosen deals with 330ml bottled beer. Since their beer is traditionally brewed, and they are keen on conservation of the environment, they will not have a problem with branding. The main thing they should do is ensure that they come up with the best marketing strategies. They should follow the porter’s generic strategy and use the strategy of focus. Here, they apply the strategy of differentiation of both their products and the market to ensure that they attract and retain customers. They should also ensure that they come up with an affordable pricing in relation to their competitors and the ability of their customers to pay. To identify what additional styles of beers to create, they should pay attention to the consumers preferences and feedback. They should also consider what their competitors are offering to ensure that they do not lag behind in comparison with their competitors. Their beer styles should be captivating and they should ensure their theme colors reflect their motive of environmental conservation. Despite them looking to amass profits, they should ensure that they consider their customers’ satisfaction. If the new beer styles are at par with customers liking, then they are in a position to retain more of the targeted customers. In terms of communication, they should ensure that they make use of modern forms of communication that are famous among the young population. They should ensure that they create social media platforms to ensure that more of their targeted population can communicate with them. In conducting promotions, they should ensure that they reach as many of their targeted market as possible. They should ensure that they give free small samples of their new product for their targeted consumers to sample before they put them in the markets. They should also ensure that they diversify their online shops to include other individuals beyond the borders of the United Kingdom. The choice of their domain name should be catchy and at the same time conservative to ensure that, it does not offend any of their targeted population. They should come up with a domain name that their targeted market can identify with and which is memorable. They should also ensure that their website is visually appealing and professional. It should have an appropriate color scheme with either two or three colors, which blend well (Burmester 2011). The text used should be readable with easy to read fonts. The graphics used should be meaningful with quality photography and a sense of simplicity. If they consider venturing overseas, they should study the legislation of those countries to avoid undergoing unnecessary fines. Conclusion Hobsons brewery is a leading brewer in Shropshire in the United Kingdom. It produces cask ales and bottled beers from its major brewery in Cleobury. From its recognized demand for the 330ml bottled beer among the young population, it has come up with the need to conduct market research and analysis to venture into the new product. To do so, they have to consider their consumers preferences to determine what is best for them. Moreover, they have to consider what their competitors are offering to prevent them from losing its current competitive advantage. From the study conducted, it is evident that most of the population in Shropshire is composed of the aging population; the market in that region will not be that good. However, since they serve the whole of the UK, then they have the added advantage because most of the young population resides in urban centers. The brewery should come up with the best domain name that is catchy and memorable. They should also ensure that they identify the legislation of various countries that they would wish to diversify in to avoid unnecessary fines and losses. They should also consider having a communication network that is acceptable among the chosen market, and their beer styles should also be creative and catchy. With all these factors into consideration, the brewery is in a position to come maximize on their potential market thus amassing more profits. As a result, they will be better suited to deal better with the available competition in the targeted market Bibliography Beall, A. E, 2010. Strategic market research. New York: iUniverse. Burmester, M, 2011. Information security. Berlin, New York: Springer. Charles D. Kirkpatrick II, J. D, 2010. Technical Analysis. Business and Economics, FT Press. Hague, P, 2009. Market Research in Practice. London: Kogan Publishers. Howarth, L, 2011. The Home Brewers Recipe Database. Cooking, 366. McFarland, B, 2009. Worlds Best Beers. Cooking, 288. Nevin, M, 2014. The strategic alliance handbook. Farnham, Surrey: Gower Publishing Limited. Wenzel, A. M, 2012. The entrepreneurs guide to market research. Santa Barbara: Calif. William Winston, R. E, 2013. Market Analysis. Business and Economics, 240. Read More