Q.1) Should MMBC introduce a light beer? Why?

The idea of MMBC extending its product line seems to be alluring however; it has its own
pros and cons. Considering the decline in sales predicted for strong beer and estimated
growth in demand for light beers strongly supports the proposition of introducing light beer.
The advantages and disadvantages are:
Pros:

Extension of product range

Increase in revenue
Estimated annual growth &
Serves a potential market with no established brand loyalty
Light beer is the need of the hour.

Cons:

Possibility of cannibalization of Mountain Man Lager

Huge amounts to be spent for marketing
Dilution of market equity
Heavy competition

Considering Chriss estimation of achieving breakeven sales in two years, the introduction of
MMBC Light seems to be feasible. The main reason to consider this option is decline in
market for Lager beer. If Light beer is not introduced, the estimated decline would lead to
end of MMBCs era. However, introduction of light beer will have an impact on the lager
where extensive work is required to keep it minimal.
MMBC carries the advantage of its unique bitter taste which can be used for light beers too,
and also have an established brand value which will aid in the process of introducing a new
product. It is the perfect time to expand their product range and cater the needs of
population with expected annual growth of 4%.
All these factors suggest that MMBC should introduce a light beer in order to revive its
market. Even though Light beer does not fit the culture of Mountain Man, the middle to low
income men over age 45, who are major consumers of lager beer are declining and the
trends suggest that the younger generation are unlikely to switch to lager beer.

Q.2) Assuming the launch of Mountain Man Light is financially viable, if you were
Chris, which market segment would you target? Why? How it would be launched,
promoted, and positioned to the target segment?
Target population:
While Mountain Man Light is mainly made for young demographics and females, in-depth
analysis of figures also suggests the following target segments:

Mountain Man Light should target demographics of age groups 25-34, 35-44.
Reason: Major consumers of domestic light beer.
Demographics with household income of $25k-49.9k, $50k-74.9k and $75k-99.9k.
Reason: These income groups are highest consumers of domestic light beer.

However the main emphasis is to be placed on age groups of 21-27 and females
Launch plan:
If I were Chris, I would introduce the Mountain Man Light under the same name, not as a
new product. Even though it solves the problem of cannibalization of lager brand, it requires
building of brand from scratch and requires huge economic resources which are currently
unavailable.
Mountain Man Light should be introduced through a communication program which carries
the legacy of original Mountain Man, while describing the attribute of the new product and
how it differs from the lager. In that way the erosion of customer base could be minimized.
Much emphasis has to be placed on acceptance from existing customer base as Mountain
Man has a very special relation with its customers, any failure in attaining this would have a
dramatic impact on the Lager.
Packaging and promotion:

Packaging of Light beer should be different from the lager as it targets different
population who doesnt wants to be associated with the blue collars. A new
packaging should be used which would be more appealing to the young males and
females, while keeping the bold flavour of the brand intact.
Use of colourful labels and retro cool images will be more appealing to target
customers.
Use of bold colours and mentioning of award winning producer would help to
penetrate the customers.
Bottle of different colour is to be used which helps in differentiating from Lager and
also alcohol content is to be mentioned on the label so that young drinkers can come
out of misconception that all Mountain Man beers are strong.
Promotion of new product is to be started at root levels with pubs, restaurants as its
stakeholders.
Use of regional authenticity of Mountain Man would help the Light beer to establish
quickly in the competitive market.

Positioning:

Major challenge lies in using the sales force to convince the retail stores to obtain a premium
shelf space which will boost the brand image. Success of new product hugely relies on
obtaining extra shelf space without effecting Lager. Working with restaurants and bars would
help in increasing the visibility of the product. On premise sales would boost the success of
Light beer.
Pricing:
Pricing should be competitive as the product is new and yet to establish in the market.
Having high competition from the counter parts, pricing plays a key role in reaching out to
customers who havent yet established loyalty to any brand. Lucrative offers to restaurants
and pubs would help to obtain incremental shelf space without alienating the Lager.
Campaigning:
Along with regular advertising on the television and the print media, programs that involve
participation from customers would help to spread the brand more effectively. Programs like
summer camps, road trips, youth sponsorships, visitor centres and beer cocktails are to be
implemented. Promotional materials to be used extensively like bar mats and merchandise.
Use of grass root marketing which was instrumental in the success of Lager should be
employed.