MKTG
Marketing 305
Marketing Audit and YouTube Video Production
GENERAL—TEAM PROJECTS (Worth 400 points or 40% of your grade)
1. Groups will comprise 3-5 students each.
2. Teams will stay together for the remainder of the class and be responsible for completing all team/group related material.
3. If you get “fired” from your team due to lack of participation, you will be responsible for completing all aspects of team work, on your own as a team of 1. Don’t get fired.
TEAM PROJECTS—MARKETING AUDIT AND YOUTUBE PROJECT COMPONENTS/SECTIONS
I. MARKET RESEARCH/SECONDARY DATA AND SOURCES
1. Review topics incorporated in Audit Questions (see below) and Exam Study Guide.
2. Meet with your team and choose product for Team Project
a. You will address all questions in the Audit from the perspective of the product you choose.
3. Create a Googledoc, copy the Audit question list into the Googledoc that you create and invite me and the other members of your group to edit your Googledoc. My email address is rljsolutions@gmail.com.
a. There are a total of 20 questions. Decide as a group how you are going to assign the questions. Write the responsible team member name (first and last) next to each question.
4. Create a Googlesheet, copy the Exam Study Guide into the Googlesheet that you create and invite me and the other members of your group to edit your Googledoc.
5. For each generic term (highlighted in green) in the Audit, write a definition in the Exam study template (Excel file), and provide at least two (2) YouTube examples for each, see example.
6. For the Audit, under each question (Googledoc), find 2-3 online sources (reports, videos, other) that speak to each question for the product your group has chosen. Read/review each source to confirm that it applies. Copy/paste each applicable URL under the respective question.
a. Then, summarize in 2-5 sentences your response to each question.
7. Marketing Audit Research and Exam 1 Study Guide are due at 2:00pm on Wednesday, September 27, 2017.
Marketing Audit Questions: Initiating the Marketing Process (Chapters 1, 2, 3 and 4)
1. Company mission statement Allegra Macedo
a. What is the company mission statement?
A: The company’s mission statement is as follows: “Inspired by the nearby Sierra Nevada Mountains, our beers are designed to be as bold, wild and unwavering as those storied granite peaks. With respect to tradition and an unbridled passion for innovation, Sierra Nevada beers are inspired by the philosophy that anything is possible. We are committed to pushing the boundaries of craft beer and we look forward to the day that flavorful beers are the standard throughout the world.” ( http://www.sierranevada.com/brewery/about-us/why-we-brew )
b. Is the product you chose to analyze in line with the company's mission statement?
B: The product we chose to analyze is the Sierra Nevada Pale Ale. As the current leading contributor in its market by 40%, reviews and statistics show that it does in fact contribute to Sierra Nevada’s mission statement that they are committed to their craft. Sierra Nevada describes their Pale Ale as “A home brewer’s dream, grown into an icon, and inspired countless brewers to follow a passion of their own.”
2. The present status of the company/product Fahad Alqattan
a. How is the company/product positioned in terms of its competencies, customers and competitors?
A: Positioning is the perception or the image that customers have of the pale ale sierra nevada and its products. It is the customer's beliefs regarding the pale ale sierra nevada products being of high quality, or low price, or durable. This perception has been the main stimulus of customers’ attitude as well as behavior towards the pale ale sierra nevada products. According to Bleier et al. (2013), customers’ positive perceptions will drive the business of the company and negative perceptions will sink it. In terms of competition, pale ale sierra nevada company is performing better than its competitors as it has established a difference as well maintaining it.
3. Product(s) position within the company. German Diaz
a. Is the product a star, question mark, cash cow or dog in terms of the BCG matrix?
This product is a cash cow. Sierra Nevada Pale Ale is their number one seller. There are roughly 500,000 barrels brewed each year which account for about 60% of the company’s sales.
4. Company/product growth Allegra Macedo
a. How will the company/product grow in the future? Use the Market Product Strategy Matrix (Figure 2-5) to determine future growth. Products grow in multiple ways.
A: Volume sales of Pale Ale are down 5.8 percent year-to-date through September 4, 2016. As a result, Sierra Nevada is introducing new product development strategies to differentiate themselves and remain competitive in the brew market. Sierra Nevada’s leading signature Pale Ale already contributes to 40% of the segment in it’s market, however, they are expecting new growth after introducing new core products.
Sidecar Orange Pale Ale, Tropical Torpedo, and Golden IPA were introduced into the market in January of 2017 in hopes to “breathe life back into their brand” while simultaneously bringing “more growth to the craft segment.”
Sierra Nevada’s IPA dollar sales have more than quadrupled over the last five years, from $191.4 million in 2011 to $829 million in 2015. Sales of IPA currently make up 75 percent of total craft volume growth year-to-date. These new products are intended to be longer-term successes that Sierra hopes will help it double in size over the next decade. Sierra nevada is expecting to bring around $20 million of combined sales in IRI-tracked food stores and growth is expected to continue well through 2017.
5. Environmental scan (5 environmental forces) Kohlden Hochhaus
a. How will the following environmental forces affect your company/product? Describe them in terms of opportunities and threats to the company/product.
1) Demographic shifts and cultural changes.
2) Demographic conditions and consumer income.
3) Changing technology and technology’s impact on customer value.
4) Type of competition faced in company’s/product’s industry and how this might change in the future
5) Regulation impact on the industry/company/product
1) According to America’s Beer Distributors, the legal drinking age population ratio has risen to 73.2%, which is a 3.2% spike since the year 2000. This is large in part because millennials are now becoming of age. Millennials are also shifting to higher end beers which is exactly where Sierra Nevada Pale Ale have placed themselves in the beer industry.
2) Graduated millennials with established jobs are the main demographic for Sierra Nevada. These are young adults with increased incomes looking for a sophisticated beverage. Older consumers preferred wine but Millennials decided not to follow the same trends as their parents and grandparents. Wine is out and draft beer is in.
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs
3) Sierra Nevada mission is to remain authentic. Any new technology that may compromise the company's values will probably not be used. Not to say SNBC does not take advantage of new tech. All breweries have set up solar panels at their facilities and use biopros that convert vegetable oil into biodiesel. This is then used to fuel all vehicle equipment at the breweries.
https://www.youtube.com/watch?v=6CcQqqUTLlw
4) Small, locally owned microbrews, are the main competition for Sierra Nevada. While SNBC continues to grow on a national scale, it loses that feel of a craft beer. SNBC is beginning to realize that people tend to be more attracted to craft beer that was made in their own region.
5) In recent news, the state of Utah may decrease the legal alcohol limit to .05%. This can pose a problem for the beer industry because it may result in loss of business. Americas average intake of alcohol has already been at a slow but steady decline. If other states follow suit, than that trend will inevitably continue.
http://www.latimes.com/nation/la-na-utah-alcohol-limit-20161231-story.html
6. Situation analysis for strategic marketing Fahad Alqattan
a. What are the company/product strengths, weaknesses, opportunities and threats? Provide a SWOT matrix for your company for your product specifically. The SWOT for Nike Free would be different from the SWOT for Nike golf. How has the company used strengths to take advantage of market opportunities?
|
Strengths |
Weaknesses |
|
Loyal audience: Conversations surrounding Sierra Nevada over social media channels are overwhelmingly positive. Continuous expansion: Sierra Nevada is growing in sales each year.
|
Lack of distribution: The company has not made their products available in every state.
|
|
Opportunities |
Threats |
|
Additional locations: As Sierra Nevada continues to expand, it would be advantageous to open an additional brewery on the east coast. Sierra Nevada Brewing company expanded in this way and has made their product available to many more consumers. • International sales: If Sierra Nevada opened up an additional brewery on the east coast, this would make less ground to cover for international distribution. |
Product Quality: While Sierra Nevada products are met with outstanding positive feedback, I did see tweets where customers questioned if they were drinking a bad batch of beer. Competition: There is a lot of competition for craft breweries in America, nearly 2,000 different breweries distribute their own line of beers.
|
· Sierra Nevada has been using their strengths to take advantage of market opportunities, and to identify and work on weaknesses that have been inhibiting their ability to take advantage of those opportunities.
7. Ethical and social responsibility German Diaz
a. Does the company have a published/visible code of ethics? From that code, what appear to be the important values of the company?
b. What ethical issues face the company/product?
c. What would a social audit tell us about the company/product?
A. The company currently doesn’t have an official code of ethics. The company values being known as a clean energy company. In Chico, the company made an environmental impact a priority. Installing more than 10,000 solar panels, the brewery can produce up to 20% of their electrical usage. They have received several awards from the US Green Business Council, Association of Energy Engineers along with other environmental agencies.
https://www.sierranevada.com/brewery/about-us/sustainability/energy
B. An ethical issue that the company faced was in early 2017. Where there was a flaw that could allow a chip of glass to fall inside the bottle. The flaw would only affect .01% of the bottles but the company felt is was enough issue a recall to ensure the safety of the consumers. https://www.cnbc.com/2017/01/23/sierra-nevada-brewing-recalls-bottled-beer-due-to-hazard.html
C. A social audit would reveal that the company has effectively used their resources to reach their goal on expanding their products. The company currently produces 21 different beers.
https://www.sierranevada.com/beer
Marketing Audit Questions: Understanding buyers and markets and targeting market opportunities (Chapters 5, 6, 7, 8 and 9)
8. Consumer decision process Allegra Macedo
a. Assume you were a new buyer of your audited product. How would you go through the five steps of the purchase decision process (Figure 5-1)?
A: As a new buyer of Sierra Nevada Pale Ale, I would go through the five step process of a purchase decision by first perceiving the need or want for beer for whatever the occasion or reason. When walking into a grocery store or looking over a tap menu you are both seeking information about the pale ale and what kind of ale it is, while assessing the value of the product by its characteristics of being bold, piney, and grapefruity. You then make the purchase decision after determining whether these characteristics have value to you and are appealing. After consumption, you would determine whether you enjoyed the flavor and experience and if consuming the Ale brought value to you in some way whether you feel refreshed or just enjoyed the experience overall.
9. Involvement with product Allegra Macedo
a. What type of purchase process would you use to buy the product (see Figure 5-3)?
A: As a consumer you would go through the different types of the purchase process by recognizing the problem of not having that product, In this case recognizing the need for a beer because you are thirsty. In this product’s case you might not go through the information search process because it is a very low risk investment. However you would strongly consider the many alternatives to a Pale Ale because there are several substitutes. The purchase decision process comes after considering the different alternatives and deciding on the Pale Ale because the qualities of the beer have value to you and therefore make the decision to purchase.
b. Are there lower and higher involvement groups for the product? Who are they and how do they differ from you?
B: There certainly are both low and high involvement groups for the Pale Ale. Low involvement groups would certainly be anyone who is under the age of 21 and can not legally consume alcohol and therefore would not be involved in the purchase decision group. This also includes anyone who does not consume alcohol for personal or religious reasons. This differs from our demographic as college students who are of age and consumers of these kinds of products. High involvement groups for the Pale Ale pertain to people who are of age, are avid beer drinkers, or are frequent bar goers.
10. Other influences on consumer behavior Fahad Alqattan
a. Examine any psychological, sociocultural or situational factors that influence the purchase of your product.
A: Psychological factors affecting my purchase decision include motivation, perception, learning, beliefs and attitudes. Social-cultural factors influence my purchase decision for pale ale sierra Nevada. Cultural factors includes consumer’s culture, subculture and social class (Keller, 2000). These factors are often inherent in our values and decision processes. On the other hand, social factors include groups aspirational groups and member groups, family, roles and status. This explains the outside influences of others on our purchase decisions either directly or indirectly.
11. Global marketing presence German Diaz
a. What type of global presence does your company/product have?
b. What is the overall importance of global sales to the company/product? Be specific,
c. Is your product marketed differently in different countries? How is it different?
A. Sierra Nevada pale ale doesn’t really have a global presence. The downfall of using hops is that beers can only remain fresh for 150 days after packaging. That is the shortest period in the industry. It takes longer to ship beer to foreign markets and many countries have different standards as far as expiration dates.
B, C. Sierra Nevada would like to have foreign markets but are currently marketing in
The US.
http://goodbeerhunting.com/sightlines/2017/4/18/stone-australia-date-codes-exports
12. Marketing research Allegra Macedo
a. What types of marketing research is the company involved in?
b. How will the research affect the marketing activities of the company?
A,/B: Sierra Nevada is mainly involved in test marketing research where they will create a new product or idea, put it on the market and see how it affects profits. For example, sierra nevada came out with a brew called “Sidecar” which is similar to Pale Ale but with a twist of orange. They put this new brew on the market and will overtime see how it sells and profits to learn more about what their consumers are looking for and what ideas they could use in the future.
13. Market segments and product positioning Kohlden Hochhaus
a. How is the market (buyers) for your product segmented?
b. Who is the main target market for your product?
c. What is the size of the target market? What is the size of the other market segments?
d. What is the potential for growth of the company's chosen markets?
e. How is your product “positioned” in the minds of consumers? Write a positioning statement for your product.
f. How are the competitors’ products positioned compared to your product?
g. What would a positioning map look like for your products compared to competing products (provide at least one positioning map as an exhibit)?
h. What is the market share breakdown for your product and your competitors?
I. What is your company/product competitive advantage in the marketplace?
A. According to Brewbound, the craft beer market is largely segmented by regions by which what brewery is popular in that region. An example of this is shown by the top two craft beer companies in Samuel Adams and Sierra Nevada. Samuel Adams dominates the Eastern U.S. and Sierra Nevada dominates the West.
B. Sierra Nevada’s main target is Millennials that are just entering into the workforce. They’re looking for something that shows off sophistication.
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs
C. Millennials is the target market and in the past few years they have surpassed Baby Boomers as the largest generation in terms of population. According to Fact Tank, Millennials are at a population of 75.4 million people.
http://www.pewresearch.org/fact-tank/2016/04/25/millennials-overtake-baby-boomers/
D. According to Brewbound the potential growth in this chosen market shows no sign of slowing down anytime soon. As more young adults become of legal age to drink the market will grow.
https://www.brewbound.com/news/video-brewers-discuss-market-segmentation-at-2014-gabf
E. Sierra Nevada Positioning Statement
To: Young adults who want something more than cheap draft beer from their college days.
We are a brand of: High end craft beer.
That provides: A sophisticated alcoholic beverage.
That's because unlike: Conventional beer companies.
We have: Pale Ale, which is:
1. Made with the newly introduced cascade hops.
2. Authentic American style pale ale.
3. A major contributor to the craft beer movement in the U.S.
http://www.sierranevada.com/beer/year-round/pale-ale
https://gurulocity.com/aveeno-brand-positioning-statement-examples-great/
F. Anheuser-Busch and Coors are the largest sellers of beer in the U.S. Their product position is not much different from Sierra Nevada. Through their media advertising they still target the millennial demographic. The difference is, is that they show their product as being fun. Bud Lite is a beer that will get you friends and guarantee a great night.
http://www.anheuser-busch.com/beers.html
H. According to Brewers Association in 2016 the market share in terms of beer produced by Sierra Nevada was 0.05% of U.S. beer production. Over all, Sierra Nevada is the 7th largest beer manufacturer in the country and second largest in the U.S. craft industry.
https://www.brewersassociation.org/statistics/national-beer-sales-production-data/
http://www.foxbusiness.com/features/2013/05/24/top-10-us-craft-breweries-by-sales-volume.html
I. Sierra Nevada and its founder have strong belief in producing a high quality beer. They have developed a culture within the organization and with employees that take pride in making high quality beer. What gives them their competitive advantage is their sustainability. The CEO wants to refrain from advertising their efforts in quality because it’s already established in their product. As Ken Grossman said, “Our advertising comes out of a 12-ounce bottle.”
https://www.thefreelibrary.com/Sierra+Nevada+Brewing+Company's+thirty-year+journey+toward...-a0224863664
Marketing Audit Questions: Developing, managing and pricing products (Chapters 10, 11, 12, 13 and 14)
14. Classification of products Kohlden Hochhaus
a. Is your product a good, service or idea? You should use the goods-services continuum to help you classify the product.
b. In what category would you place your product: convenience, shopping, specialty or unsought?
c. How is your product classified within the company in terms of the company’s product line and product mix? Provide an exhibit that illustrates this.
A. Sierra Nevada Pale Ale is a good on the goods-services continuum.
https://conceptdraw.com/a999c3/preview
According to this continuum line, Pale Ale would fall to the far left on the pure commodity goods. It would fall along the lines of salt and soft drinks.
B. Sierra Nevada has the reputation of a high quality beer among the U.S. population. Since it’s higher end, it is categorized as a shopping good. Consumers take the time and effort to shop between higher end products and inevitability the one to their liking.
http://www.businessdictionary.com/definition/shopping-good.html
C. Pale Ale with Sierra Nevada is considered to be the cash cow of their production line. It has remained and still remains as their number selling product.
http://www.sierranevada.com/
15. Type of new product --- German Diaz
a. How would you characterize your product when it was introduced in terms of its innovativeness (Figure 10-2)?
b. How did the degree of innovativeness of the product impact how the product was first marketed?
c. Did your product, when it was first introduced, meet expectations?
d. Were there any problems with the introduction of your product?
A. When Sierra Nevada Pale was introduced, it was an innovation because it was one of the first beers to use Cascade hops. Cascade hops were a new release of hops released by the Department of Agriculture since the prohibition. Those hops were the final piece to the recipe that gave the pale ale its signature pine and citrus aroma.
http://allaboutbeer.com/article/sierra-nevada-pale-ale-a-cascading-effect/
B. There was not much impact on the way the pale ale was marketed. Marketing was done solely by word of mouth. There was not much marketing done in the early stages of
Production. Ken Grossman believed craft drinkers were after variety and new
Experiences that helped his product grow.
C. Sierra Nevada Pale Ale did not meet expectations when it was first released. It was a new kind of beer that was the hoppiest beer that many were not used to. “It wasn’t an easy sell for many that were used to watery domestic lagers,” Grossman spoke in an interview 2016.
https://firstwefeast.com/drink/2016/02/sierra-nevada-pale-ale-brewers-beer
D. There was no problems with the product itself when it was introduced. The company did face expansion problems as they couldn’t keep up with demands after their products became to be known.
16 Managing the product
a. Where is your product in terms of the product life cycle (Figure 11-1)?
b. Use the PLC graph of Figure 11-2 to describe how the stage of the life cycle impacts your product in terms of marketing activity
c. Where is your product in terms of the life cycle of consumers (Figure 11-5)? Who were the innovators and early adopters of your product?
d. How has your product been modified or repositioned to better serve customers? Did the company try to go after different customers by a modification of the product or a repositioning campaign?
e. Describe your product’s brand personality?
f. How has your product created brand equity?
g. Describe your product in terms of its present and past branding strategy(s).
h. Are there any packaging qualities that distinguish your product (provide exhibits and web links to illustrate your product’s packaging.
A. SNBC is experiencing the Growth stage of the product life cycle. They have recently opened two new breweries in the U.S. and is rising up in the ranks to be one of the top beer producers. SNBC has plans to expand in Europe markets as well. (Kohlden Hochhaus)
https://www.brewbound.com/news/video-brewers-discuss-market-segmentation-at ` -2014-gabf
B. SNBC is still in their growth stage, so there is no reason to change the way they advertise. There product has been proven it can sell itself. SNBC may consider adjusting their branding when they enter the maturity stage of the product lifecycle. Kohlden Hochhaus
http://www.quickmba.com/marketing/product/lifecycle/
C. Our consumers are also in the growing stage. They are millennials that are becoming of age to drink. Kohlden Hochhaus
http://www.quickmba.com/marketing/product/lifecycle/
D. SNBC has made great strides to make their product more readily available. Demand being greater than supply was an issue for the company. Consumers wanted good craft beers but they couldn’t find them at their convenience. They solved this by opening breweries in Chicago and North Carolina, strategically placing them in the mid west and the east coast. Kohlden Hochhaus
https://www.brewbound.com/news/video-brewers-discuss-market-segmentation-at-2014-gabf
E: Sierra Nevada’s brand personality reflects the American passion. They’re all about big bold personalities and sustainable innovation. They stay true to the traditions of brewing but aren’t afraid to push the boundaries and experiment new spins on traditional techniques. Allegra M
F: Sierra Nevada has created brand equity especially here locally in Chico, CA. Sierra Nevada is proud to support various agencies and organizations with the goal of bettering the society from sustainable agriculture, clean water and wildland protection to bicycle-related activities and events. This is a successful approach in today’s society and especially in a college location like Chico, CA, where there is a strong millennial demographic.This is what makes a local brand like Sierra Nevada successful in gaining equity and customer loyalty. Allegra M
http://www.sierranevada.com/brewery/about-us/why-we-brew
G: “Market differentiation, an obsession with quality, and rapid early hiring” grew Sierra Nevada in two decades from a small microbrewery to a powerful brand that produced nearly 25 million gallons of beer in 2012 . They started producing dark and flavorful recipes to help them stand out against the mainstream light beers that were dominating the market when they first began. They still use these same branding strategies today and that is why they have undergone such an “organic growth” in the market. Allegra M
http://www.businessinsider.com/how-sierra-nevada-went-from-microbrew-to-national-brand-2013-11
H.
17. Pricing strategies Allegra Macedo
a. How is your product priced compared to the competition? Provide an exhibit comparing your product’s prices to the competitors.
A: A six-pack of Sierra Nevada’s Pale Ale sells for $6.99 at BevMo, a large retail distributor of alcoholic beverages. This is a great deal when compared to its competitors of other American pale ales with similar quality and ratings.
|
Competitors |
Rating |
Price/Six-pack |
|
Sierra Nevada Pale Ale |
4.03 |
6.99 |
|
Deschutes Mirror Pond Pale Ale |
3.9 |
8.99 |
|
Lagunitas Dogtown Pale Ale |
3.94 |
9.99 |
|
Kona Fire Rock Pale Ale |
3.62 |
8.99 |
http://shop.bevmo.com/search?w=pale%20ale&view=grid
https://www.beeradvocate.com/beer/style/97/
b. What type of pricing policy did your product use: penetration pricing, prestige pricing, odd even pricing, target pricing, standard markup pricing, etc.
B: Sierra Nevada used both target and odd even pricing for its Pale Ale. They identified the price at which the Pale Ale will be competitive in the marketplace, defined the desired profit to be made, and computed the target cost for the product by subtracting the desired profit from the competitors market prices. The distributor sells the six-pack for $6.99 as opposed to $7.00 to use odd-even pricing as a strategy.
c. What are your products points of differentiation or points of difference? How have these points of difference affected the price of the product compared to the
competition? Provide an exhibit that compares points of difference.
C:
|
Competitors |
Qualities/Differences |
Ranking |
Price/Six-pack |
|
Sierra Nevada Pale Ale |
· Grapefruit and floral hop flavors · A touch sweeter and fuller of body |
#40 |
6.99 |
|
Deschutes Mirror Pond Pale Ale |
· A little bit less hop-forward but features beautifully complex malt flavors · Bready, biscuity · Little bit of unexpected, peppery spice and just a touch of deeper toffee maltiness |
#31 |
8.99 |
|
Lagunitas Dogtown Pale Ale |
· IPA qualities · Citrusy hops are very big on the nose, with lemon and sweet mandarin orange · more notably “hoppy” |
#22 |
9.99 |
|
Boneyard Beer Co. Bone-A-Fide Pale Ale |
· Huge hop aroma/flavor · Huge floral, tropical fruit and honey malt flavors · waves of tropical fruit (pineapple, passionfruit) · Peppery · Sweet |
#1 |
N/A |
Sierra Nevada describes their Pale Ale as being unique for its piney and grapefruit aromas. It is a classic, yet it remains new, complex and surprising to thousands of beer drinkers every day. These points of difference are what makes it one of the top leading Ales on the market. However, it is less “exclusive” and more obtainable than some of the higher ranked beers on this list. Sierra Nevada is found in almost every large retailer of it’s kind which is part of their target market strategy and makes the price slightly less than it’s competitors.
http://www.sierranevada.com/beer/year-round/pale-ale
d. Describe how your product creates value compared to the competition.
Sierra Nevada expresses their sensory attention to detail for their products. They claim that every day, a panel of trained Sierra Nevada sensory experts taste every beer scheduled to go into the market. They evaluate the flavors to ensure that every bottle meets our rigorous standards of quality at every step of the process from ingredient harvest all the way through bottling. This backs up Sierra Nevada’s mission of value and quality to the beer industry.
Paste Magazine referred to Sierra Nevada’s Pale Ale as “The beer, the myth, the legend, and the pale ale to which all other American pale ales are compared,” during a blind taste test and ranking.
http://www.sierranevada.com/brewery/about-us/why-we-brew
e. Is your product classified as price elastic or inelastic? Explain. Discuss the price sensitivity of different market segments for your product.
E: The price for Sierra Nevada’s Pale Ale is elastic because there are hundreds of substitutes for the product. It is a price sensitive product because it is easily substitutable and a relatively average priced product in its market segment as a large brewery.
f. Describe the product line pricing strategy for your product.
F: The product line pricing strategy Sierra Nevada used when developing their different beers was to create multiple products, such as the Pale Ale, and different variations of beers and brews to maximize profits. For example, if Sierra Nevada only produced and IPA then they would only appeal to consumers who like IPAs. In order to maximize profits Sierra Nevada has brewed dozens of different beers and ales to work in coordination with each other and appeal to more consumers.
Marketing Audit Questions: Managing marketing channels and communicating product ideas: Chapters 15, 17, 18, and 20
18. Channels of distribution Fahad Alqattan
a. How would you describe the distribution channel for your product (direct and/or indirect channel)? Provide an exhibit illustrating channel levels (Figure 15-3,4,5)
A: A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the end consumer. Sierra Nevada uses various distribution channels including wholesalers, retailers, distributors and even the internet itself.
b. Does your product have an electronic marketing channel? If so, describe it.
B: Pale ale Sierra Nevada have an electronic marketing channel. A unique feature of electronic marketing channels is that they combine electronic and traditional intermediaries to create time, place, form, and possession utility for buyers
c. Does your product have a dual distribution strategy? If so, describe it.
C: Pale ale Sierra Nevada have a dual distribution strategy. Dual distribution strategy also known as Multi-channel distribution involves a business using more than one type of distribution channel in this case, it involves the manufacturer and wholesalers.
d. If your company has a vertical distribution strategy, describe it.
D: Sierra Nevada has a vertical distribution strategy, which is one in which the main members of a distribution channel including producer, wholesaler, and retailer and work together as a unified group in order to meet consumer needs.
e. Does your product exhibit intensive, exclusive or selective distribution? Describe why your product was classified in one of the categories above.
E: Pale ale Sierra Nevada exhibit selective distribution as it lies between intensive and exclusive distribution. It involves using more than one, but lesser than all the intermediaries who carry the company's products.
f. Is there tension in the distribution channel for your product? Why?
F: There is no tension in the distribution channel for Pale ale Sierra Nevada. Tension in channels can be created by the contribution of each channel member.
g. In terms of supply chains, how does your product get to its final customers? Provide an exhibit to illustrate your supply chain (Figure 15.9)
G: A channel of distribution is the route a good takes from its original source to its final customer. From the producer to wholesaler to retailer and final consumer are segments of the supply chain that Pale ale Sierra Nevada go through.
19. Marketing communications and direct marketing -----German Diaz
a. Describe the push and pull channel strategies for your product.
A. The pull strategy for Sierra Nevada Brewery started off by selling beer off the streets. It also used word of mouth to get to consumers. Now that the company has grown,it uses strategies like Oktoberfest, Beer camp and other live music shows.
http://www.sierranevada.com/brewery/about-us/our-story
B. The push strategy the brewery uses is setting up several distribution channels to reach several consumers. Distributors are located in several states like Alaska, California and Florida.
http/://www.sierranevada.com/distributors
20. Advertising, sales promotion and public relations Kohlden
a. Does your product exhibit both “product advertisements” and “institutional advertisements?” Give some examples of each.
b. What media does your company use to advertise? Give some examples of each.
c. Based on your personal observations, what are some of the most effective ads for your product? Provide ad examples that illustrate your product’s position with a specific target markets. Why do you think these ads are so effective?
d. Does your company use consumer sales promotions for your product? If so, what promotions are used and are they effective? Provide illustrations.
e. Are public relations a part of the promotional mix for your product? If so, describe an example of a public relations piece and state how effective you think the piece was in terms of affecting
the target audience.
f. Describe your product’s social media platform.
A. Product Advertising: Selling of merchandise such as hats, posters, stickers, key chains, bottle openers, and their famous sweaters. Founder and owner, Ken Grossman’s statement on Sierra Nevada’s advertising, “Our advertising comes out of our 12-ounce bottle.”
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs (page 10)
B. Sierra Nevada’s strategy is not use media as a mean of advertising. Besides a youtube video, they try to stay away from the media and rely heavily on word of mouth for their advertising. http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs (page 10)
C. In my personal observation I have only heard of Sierra Nevada through word of mouth and merchandise that i’ve seen other people wear. They have established an effective way of advertising without the need of media and commercials. Sierra Nevada has the confidence that their product alone will sell itself. With the absence of media advertisement, they separate themselves from most of their competitors.
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs
D. Sierra Nevada does use consumer sales promotions. They are are renowned for unveiling seasonal beers year round. Examples are, Beer Camp for the spring, Summerfest for the summer, Oktoberfest for the fall, and Celebration for the winter.
http://www.sierranevada.com/beer
E. Public Relations is part of Sierra Nevada’s promotional mix. Their active at bike races and events, which targets that young middle class demographic. They also made endorsements with high end restaurants in the Bay Area. This opened them up to new markets and strengthen their image of being a high end product.
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs
F. Sierra Nevada is involved with Facebook. They use it as a platform when unveiling new beers and upcoming events that they are hosting. It is also a great way to receive feedback from customers as well as spreading that word mouth between consumers.
http://digitalcommons.calpoly.edu/cgi/viewcontent.cgi?article=1001&context=agb_cs
21. Personal Selling & Sales Management Fahad Alqattan
a. How does your company use personal selling?
· Personal selling is where businesses use sales force to sell the product after meeting face-to-face with the customer. The sierra Nevada sellers promote the product through their attitude, appearance and specialist product knowledge.
b. What kind of personal selling is used? Relationship? Order taker?
· Sierra Nevada uses trade selling as a kind of personal selling, which involves selling the product to the retailers and wholesalers trade sales personnel made regular contact to the wholesaler and retailers and received bulk order from them, trade sales personal work either for wholesaler or manufacturer (Bleier et al., 2013).
c. Describe the sales process (steps in the sale) for your product. How would you sell the product (face to face) to a customer? Is selling more or less important in other parts of your distribution channel?
· There are various steps of the sales process including product knowledge, prospecting, the approach, the needs assessment, the presentation, the close as well as follow up. Moreover, face-to-face help the seller with the ability to make a stronger and more personal connection with customers. This offers you a chance to become real and not just a voice on the other end of the phone. A face-to-face interaction creates a more personalized and vivid experience for potential buyers. In this case, face-t0-face may lead to more sales, which an important part of my distribution channel.
d. What is the USP (unique selling proposition) for your product?
· A unique selling proposition is the defining factor or characteristic that sets a company apart from its competitors. In this case, the USP for Sierra Nevada include online and offline retailers that aims at communicating their unique selling proposition to shoppers in marketing campaigns, product descriptions, and all other customer touch points (Ginsberg & Bloom, 2004).
e. How do your sales people “create value’ for the customer?
· Salespeople act on behalf of their companies by creating value for their firms’ customers. Whenever a salesperson goes back to her company with a customer’s request, be it for quicker delivery, a change in a product feature, or a negotiated price, she is voicing the customer’s needs.
Marketing Audit Research and Exam 1 Study Guide are due at 2:00pm on Wednesday, September 27, 2017.
Instructions for YouTube Script and YouTube Videos to follow