1. PROBLEM/KEY ISSUE
How can Boon Rawd Brewery maintain its competitiveness in Thailand’s alcoholic beverages market as the legal enforcement of total ban regulations on alcoholic drink advertisements become effective?
PORTER’S FIVE FORCES ANALYSIS OF BEER INDUSTRY IN THAILAND (AS CONSOLIDATED INDUSTRY)
THREAT OF NEW ENTRANTS – LOW
Entry barriers (i.e. huge capital investments in breweries) are high resulting in low threat of new entrants.
THREAT OF SUBSTITUTE PRODUCTS – HIGH
Other types of alcoholic beverages such as wine, spirit and liquor represent the substitutes of beer, though not perfectly substitutable.
THREAT OF BUYERS’ GROWING BARGAINING POWER – LOW
Wholesalers and agents are considered as buyers for Boon Rawd Brewery in which they have to follow the predetermined prices.
THREAT OF SUPPLIERS’ GROWING BARGAINING POWER – LOW
Suppliers who mainly provide key ingredients for beer (i.e. hops and bottles) tend to be not powerful since they are neither concentrated nor organized and the costs of switching suppliers are not high.
THREAT OF INTENSE SEGMENT RIVALRY – HIGH
Beer market in Thailand contains some strong and aggressive incumbents such as Boon Rawd Brewery, Thai Beverage and Thai Asia Pacific Brewery.
BOON RAWD BREWERY CO., LTD. TOWS MATRIX
The Business plan on Boon Rawd Brewery Company
Throughout the years, Boon Rawd has diversified into an award-winning brewer and beverage maker, exporting its globally recognized products worldwide. The key to success and also be a mission statement is “Transparency! We do the right things. We live as a good citizen and don’t cut corners.” This principle is one of many that have helped Singha obtain the largest market share ...
STRENGTHS
In-depth beer industry experience and insight
Well-managed and established distribution channels
Top quality ingredients used to produce Singha beer
brand image strength associated with “International Thai” identity
WEAKNESSES
High production costs of Singha beer
Singha beer is priced higher than economy beers
OPPORTUNITIES
Taxation according to alcohol degree
Overseas markets
Light beer trend
Offer premium beer (i.e. Kloster) to capture premium segment (S1, S2, O1)
Foreign markets expansion (S1, S3, S4, O2)
Develop light beer (i.e. Singha Light) and price lower than Singha (W2, O1,
O3)
THREATS
Total ban regulations on alcoholic drink advertisements
Adverse economic recession
Importation of foreign beers due to FTA agreements
Full-line forcing strategy adopted by Thai Beverage
Utilize color and symbolic forms which are associated with Singha’s brand identity to do IMC (S4, T1)
price war (S1, S2, T1, T2, T3, T4)
Develop fighting brand (i.e. Leo) to compete with economy beers (W1, W2, T4)
BRAND IDENTITY AND POSITIONING FOR THAILAND’S BEER INDUSTRY
The above figure shows the positions of these “virtual images” on the perceptual map. Note how Heineken and Kloster represent well the Master European Brewer “space”, while Carlsberg appears slightly off-center in the Cosmopolitan World Traveler space. Singha appears on the edge of the International Thai space while Leo represents the Heritage Thai dimension. Chang does not seem to be able to be explained by any of the images. As a low-priced brand and the cheapest on the market, sold in bulk with a whisky product via a predominantly rural market, Chang seemed to compete mainly on price. As several focus group participants mentioned: “You drink Chang to get drunk!” The Modern Thai space does not appear to be served by any product.
The Essay on The Stock Market is a Example of Perfect Competition
The stock market is perfectly competitive because there are a very large number of groups in the market. The stock market, as we know it, is a global community that consists of four different groups: public corporations; market makers; buyers; and sellers. Public corporations are businesses that offer shares, or ownership, to anyone willing to pay money for them. Buyers are investors who want to ...
In addition, the brands towards the top of the Established-Contemporary dimension had a more modern, new, up-to-date, fresh, and present or future image, as compared to the brands at the bottom, which were perceived as traditional, established, and consumed by older and more conservative people. However, the brands towards the left of the Head/Heart dimension were perceived as more logical, and serious, while those towards the right were perceived as appealing more to the heart.
2. ALTERNATIVE ACTIONS
Utilize color and symbolic forms which are associated with Singha’s brand identity to do IMC
Foreign market expansion
Compete on price (Price war)
3. EVALUATION OF ALTERNATIVES
Utilize color and symbolic forms which are associated with Singha’s brand identity to do IMC
PROS
Conform the government regulations while maintain corporate brand awareness
Reduce the negative perception towards the company
CONS
Might not be as effective as product-oriented advertisements
Foreign markets expansion
PROS
Increase sales from foreign markets
Go beyond the limited market opportunities due to the small size and fierce competition in domestic market
To reduce production costs as Singha beer can be locally brewed in foreign markets
CONS
Does not bolster the competitiveness of Boon Rawd Brewery in Thai market
Sales from overseas market can be minimal comparing to sales from domestic market
Compete on price (Price war)
PROS
Can utilize the resources elsewhere (i.e. advertising budget) to do price cutting
Boon Rawd Brewery can survive in Thai beer market
CONS
Brand image erosion
Product quality must be worsen off to be a low-cost leader
4. RECOMMENDATION
STRATEGIC INTENT
To be the Thailand’s leading portfolios of beer brands and the Thailand’s leading brewers in terms of sales volume and profitability domestically and internationally
STRATEGIC MISSION
To maintain the competitiveness in Thailand’s alcoholic beverages market as the legal enforcement of total ban regulations on alcoholic drink advertisements become effective
KEY RESULTS AREAS
The Essay on How Far Was Hitlers Foreign Policy To Blame For The Outbreak Of War In The 1939
In this essay, I am going to discuss about whether Hitler was to blame for the outbreak of war in the 1939 or not. Hitlers foreign policy did had something to do with the outbreak the war, but the USA, Britain, France, the USSR, Japan and Italy also had to do with it. The main reason why there was a war was that Hitler and other countries started invading other countries and disobeying the Treaty ...
Firm’s market share
Integrated Marketing Communication (IMC)
STRATEGIES
Utilize color and symbolic forms which are associated with Singha’s brand identity to do IMC [Alternative 1]
Foreign markets expansion [Alternative 2]
OBJECTIVES
Conform the government regulations while maintain corporate brand awareness
Reduce the negative perception towards the company
Increase sales from foreign markets
Go beyond the limited market opportunities due to the small size and fierce competition in domestic market
To reduce production costs as Singha beer can be locally brewed in foreign markets
IMPLEMENTATION PLAN FOR BOON RAWD BREWERY CO., LTD. (2007-ONGOING)
DOMESTIC MARKET (2007)
For beer drinking areas, replace the brand “Singha” with Singha logo and use yellow color theme
Generate new TV commercials with the emphasis on corporate brand
Do event marketing to current beer drinkers with symbolic and color marketing
Place more attention on Corporate Social Responsibility (CSR)
INTERNATIONAL MARKETS (ONGOING)
Expand to US and Europe markets by first adopt Thai restaurants as marketing channels
Expand to Supermarkets where Asians live
Expand to modern trade stores
In conclusion, marketing strategies for year 2007 are considered as the fulfillment for the brand “Singha” to remain in the market. However, if the government regulations are altered, the marketing strategies can be adjusted according. In the worse case, the firm may have to enter the price war and adopt the cost-leadership strategy.
References
BrandAge Megazine. (Yr. 7, vol. 9).
_Tipping Point Global Brand._ Retrieved April 17, 2007, from http://www.brandage.com/issue/cs_detail.asp?id=1911
BRANDAGE MEGAZINE. (YR. 7, VOL. 12).
BEER WAR 2007 SYMBOLIC WAR. RETRIEVED APRIL 17, 2007, FROM HTTP://WWW.BRANDAGE.COM/ISSUE/CS_DETAIL.ASP?ID=1991
MANAGER MEDIA GROUP PUBLIC COMPANY. (2003, SEPTEMBER 2).
RETRIEVED APRIL 17, 2007, FROM HTTP://WWW.GOTOMANAGER.COM/NEWS/DETAILS.ASPX?ID=7746
MANAGER MEDIA GROUP PUBLIC COMPANY. (2007, JANUARY).
RETRIEVED APRIL 17, 2007, FROM HTTP://WWW.GOTOMANAGER.COM/NEWS/DETAILS.ASPX?ID=55510
The Business plan on Market Structures and Pricing Strategies
In Economics, market structures are broken down into four main structure types, Perfect Competition, Monopolistic Competition, Oligopoly and Monopoly. This paper will elaborate on how they are broken down by variables, such as how many buyers and sellers, cost and direct competition. The price for the consumer is affected under these structure types and this paper will explain the four different ...
Orient Pacific Century Market Research. _BOON RAWD BREWERY: Researching beer brand image and strategy options._ Retrieved April 17, 2007, from http://www.brandingasia.com/cases/case5.htm
Internal Factors
External Factors
Orient Pacific Century Market Research. BOON RAWD BREWERY: Researching beer brand image and strategy options. Retrieved April 17, 2007, from http://www.brandingasia.com/cases/case5.htm
