Introduction
Bebeta Enjoyment intends to become a local, United States-based producer of non-alcohol wines. After the company becomes competitive on the local marker, it is seriously considering possible alternatives for nationwide, and, in the long-run, international expansion of the firm.
Thus, this report pursues multiple objectives. Firstly, it seeks to provide a comprehensive, yet accurate description of the most recent trends in the United States and global wine markets, focusing on Bebeta Enjoyment areas of specialization (non-alcoholic wines). Secondly, this report provides a SWOT analysis of the firm, deeply delving into its strongest and weakest features, as well as accentuating potential improvement strategies.
The Product, Mission and Vision
The product of Bebeta Enjoyment is a variety of non-alcoholic wines. Wine have one of the most pleasant flavors and nutritional characteristics. In contrast to other non-alcohol drinks, it has the lowest rate of flavoring admixtures, thus many dietitians consider it a healthy alternative to juices, carbonated beverages and soda.
Accordingly, the company mission is to produce world-class, high-quality rich non-alcoholic wines of highest quality and rich flavor. It is closely intertwined with the company vision and strategy. In particular, wine is a favorite drink of many Americans. At the same time, drinking this beverage excessively leads to intoxication, which is neither pleasant, nor healthy. Bebeta Enjoyment seeks to combine the pleasures of wine consumption with the possibility to drinking as much, as a drinker wants.
Overview of the Market
Today’s market of non-alcohol beverages is extremely dynamic. During the recent financial recession 2008-2010 it was the only segment of economy that did not reported significant drops in sales. In the meantime, it is important to highlight the fact that the sales of premium non-alcohol beverages – those, which price starts from US$ 95 fell on more than 22% in 2009, showing that the customers became oriented on buying cheaper products, but the total volumes of non-alcohol wines (Trends in Alcohol Industry 2015). Alcohol products in the USA increased on 12% nationwide during this period, while the market of non-alcohol wines progressively rose on 14%.
After the recession gradually retreated slowed in the first quarter of 2010, the elite segment revived again. In the second quarter of 2012 average national sales of this product have reached pre-crisis volumes, and starting from the first quarter of 2013 annual 4% increase was observed. An eminent marketing analyst professor Kiechel argued that. At the same time, the market is expected to recover in full by 2020 only (Kiechel, 2014).
Distinguishing Features of the Product
The main marketing strategy employed by the company is known as ‘overall cost leadership’. The primary element of this strategy is making the prices, which are considerably lower than average market prices for this product (Levinson et al, 2007). Therefore, the company focuses on selling its products to the wide range of customers, the majority of whom have median American income.
In the meantime, the marketing campaign of the company should be discernible from the companies, which sell non-alcohol beverages. Thus, its advertising materials emphasize not only refreshing qualities of the product, but its relaxing characteristics as well (Thomson, Strickland & Gamble, 2010). Specifically, it should accentuate that it helps to relieve stress and have a good time with their friends.
Distribution Channels
The research shows that the best distribution channels for low-cost non-alcohol wines are large supermarkets and coffee shops. The majority of buying decisions to buy non-alcohol wines are made during evening shopping tours, because the main customers are married middle-aged men, and young bachelors. The both categories are known to make their shopping by evenings in large-shopping malls.
The second distribution channel is special alcohol retailing shops. These centers are frequently visited by the targeted groups on weekends and business day evening.
In general, the combination of these distribution methods is expected to produce high sales figures. This approach has been employed by many regional alcohol producers, as well as by the internationally renowned behemoths of this market (Armstrong & Greene, 2007).
Risks and Mitigation
Trading in high-spirited drinks is one of the most profitable, but at the same time risky ventures. The first risk is potential increase in the excise duties levied by the government. If the government decides to increase these duties, the best, and the only available response strategy is price adjustments.
The second potential risk is extremely intense competition in the industry. If the company is not capable of beating the competitors with prices or with quality standards due to limited budgets, the most effective scenario is creative advertising campaigns, or shift to the web-space (Levinson et al, 2007). The company may start selling its products online, thus adding an extra distribution channel, and spanning larger market than the competitors do.
Thirdly, the popularization of healthy lifestyle persists to be a serious threat to the entire alcohol market. The USA becomes more and more health-oriented. In order to deal with this concern, the company should apply creative advertising mechanisms, underscoring that sport is not necessarily compatible with casual weekend drinking.
SWOT Analysis
SWOT analysis is one of the most marketing solutions, which helps to evaluate financial, organizational and managerial soundness of the company (Abrams, 2014). The SWOT of Gebeta Enjoyment shows that although the company is still in a nascent state, the company has wide growth and development opportunities.
Conclusion
Several conclusions are inferable from this report. Firstly, the company has chosen the most appropriate model of promotion and distribution on the local American markets. Secondly, in the light of the gradual market recovery from the outcomes of the global financial crisis 2008-2010, the company has large prospects of entering international markets. Finally, the SWOT of Gebeta Enjoyment shows that strong and weak features of the firm are rather balanced, yet further investments are necessary to boost productivity and innovation of the firm.
References
Abrams, R. (2014). Successful Business Plan: Secrets & Strategies (6th ed.). Palo Alto, CA: Planning Shop.
Kiechel, W. (2014). The lords of strategy : the secret intellectual history of the new corporate world. Boston, Mass: Harvard Business Press.
Levinson, J., Levinson, J. & Levinson, A. (2007). Guerrilla marketing : easy and inexpensive strategies for making big profits from your small business. Boston, MA: Houghton Mifflin.
Scott Armstrong and Kesten C. Greene (2007). "Competitor-oriented Objectives: The Myth of Market Share". International Journal of Business 12 (1): 116–134
Thompson, A., Strickland, A. & Gamble, J. (2010). Crafting and executing strategy : the quest for competitive advantage : concepts and cases. Boston: McGraw-Hill/Irwin.
Trends in Alcohol Industry. (2015). Available at: http://www.usdrinksconference.com/assets/files/agenda/U.S.%20Beverage%20Alcohol%20Trends.pdf
