Boston Beer Company Pest & Industry Analysis Jonathan Klingenberg - PowerPoint PPT Presentation

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Boston Beer Company Pest & Industry Analysis Jonathan Klingenberg

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Presentation Transcript

  1. Boston Beer Company Pest & Industry Analysis Jonathan Klingenberg

  2. Boston Beer Company Company Overview

  3. Financial Information • The company went public in 1995, with a growth strategy of creating and offering the highest quality of full-flavored beers. • In 2010 their market value was 1,285 million dollars, which grew more than 8 times from their 147 million dollar value in 2000. • They have no bonds, preferred stock, or debt; and they have 13.6 million shares of common stock.

  4. Pest Analysis

  5. Pest AnalysisPolitical Factors Analysis

  6. Pest AnalysisEconomic Factors Analysis

  7. Pest AnalysisSocial Factors Analysis

  8. Pest AnalysisTechnological Factors Analysis

  9. Industry Analysis • The Boston Beer Company is in a very unique situation when it comes to defining their industry. They are an American craft brewer which requires them to be small, independent, and traditional:

  10. Industry Analysis

  11. Porter’s Five Forces Gray = low threat levelGold = moderate threat levelRed = high threat level

  12. Threat of New Entrants:Barriers to Entry

  13. Bargaining Power of Suppliers BBC has such high standards for their ingredients that they will only get two-row malted barely and their hops from small family owned farms along the “hop belt”, along the 48th latitude. BBC insists they will never lower their standards to save money so as a result:

  14. Bargaining Power of Buyers

  15. Threat of Substitutes

  16. Intensity of Rivalry

  17. Intensity of Rivalry

  18. Blue Ocean Strategy • Almost every bit of success that BBC has experienced over the years can be attributed to the fact that it was based on a complete blue ocean strategy idea when it was created in 1984. • When BBC started they marketed themselves as a domestically brewed premium beer, creating their own niche and allowing them to avoid direct competition with the giants of the beer industry. • They have kept this approach over the years and used it to become the largest US owned brewery.

  19. Conclusion

  20. Boston Beer Company Competitor & Market Analysis Jonathan Klingenberg

  21. Who is Boston Beer Company’s Competitors

  22. Percentage of Sales in US by Company What Beers are People Drinking? Bud Light Inbev Budweiser Inbev Miller Lite MillerCoors Coors Light MillerCoors Corona Extra Import Natural Light Inbev Heineken Import Mich Ultra Inbev Busch Light Inbev Miller High Life MillerCoors Guinness Import Sam Adams Craft Brew Most Popular Beers in US

  23. Domestic Beers

  24. Analysis

  25. Imported Beer

  26. Analysis

  27. Craft Beers

  28. Analysis

  29. Size of American Market This makes for a very large American beer market.

  30. Market Analysis • The US consumes the second most beer in the world. • In 2009 they consumed 2.877 billion cases, 80% of which was consumed by men. • They make up part of an expanding worldwide beer market expected to consume more than 2 billion hls by 2013.

  31. State by State Breakdown of Consumption Map of US Regional Drinking Groups. North Central, blue; New England, yellow; Middle Atlantic, orange; Pacific, red; South Coast, dark grey; Dry South, light gray. Groups are also identified as Wet, Moderate or Dry based on the % reporting 5+ drinking day in the past month and per capita apparent consumption of alcohol.

  32. Key Trends

  33. Target Market Although BBC’s regional sales are not disclosed they have been very open with the fact that the New England region still makes up for a large part of their sales and they continue to try and promote to that with their marketing efforts.

  34. Social Media

  35. Conclusion • The American beer market is fiercely competitive. It consists of three primary players: • Domestics • Imports • Craft Beers • Domestics account for the majority of this market with the two largest companies (Inbev and MillerCoors) accounting for roughly 80% of it. • This makes entrance into the American market incredibly difficult for smaller companies and virtually impossible if they have to compete with these larger companies on a direct level. • BBC has been able to be successful by creating their own unique market and minimizing their direct competitors.

  36. Conclusion • In this effort to minimize their competitors they have avoided strong points like: • The low price of domestics • The enormous amounts of money the larger companies have available to them • This means that BBC directly competes with higher priced imports and a select group of craft beers. • Which enables them to experience a market stronghold and continued success.

  37. Boston Beer Company Internal & SWOT Analysis Jonathan Klingenberg

  38. The Boston Beer Company has established itself as a powerhouse in their own niche market. They have been able to do this by: As a result of these efforts BBC has established Sam Adams as the leader in craft beers, a product that routinely wins award after award, and one of the most recognizable brands in America.

  39. BBC’s 5 Year Performance % increase 23.6% N/A 284.7% 61.1% *All numbers are in thousands *In 2008 a product recall occurred and is the reason for the lower numbers that year.

  40. Distribution Chain In the US, the alcohol is a 3-tier structure by law: producer, wholesaler, and retailer.

  41. History of Distribution Distribution Sam Adams does not specify sales by region but two things are known: Over 99% of their sales comes from the US A majority of their US sales comes from where the beer first started in the Northeast region Even though the majority of Sam Adams sales are in the US they still distribute to over 20 other countries 1987-Sam Adams first became available in Boston and the New England market 1988-They expanded to the New York Market 1990-They moved into the DC and Chicago markets 1992-Started distributing to the western states like Oregon and California 1996-Established itself abroad for the first time selling in places like Germany, Ireland, Japan, and Hong Kong Current Distribution

  42. Functional Analysis

  43. BBC’s Product Line • BBC will routinely both put out and retract one of their many varieties of beer they produce; they currently have 39 different varieties of beer including their two most popular Sam Adams and Sam Adams Light.

  44. Company Resources

  45. BCG Matrix High Market Growth Rate *The bottle of Sam Adams represents BBC within their small niche beer market. *The bottle of Sam Adams light represents BBC within the entire US beer market. Low Dogs High Relative Market Share Low

  46. BCG Matrix

  47. Value Chain Analysis

  48. SWOT Analysis

  49. SWOT Analysis