The paper "Corona and Apple" is a perfect example of a Management Assignment. The beer industry is the largest sector in the alcoholic beverage industry. It is estimated that the industry generates over $325 billion globally. However, one thing that must be noted is that the market for beer in the developed world has reached saturation as many companies have come into play with the quest to serve the already reached target markets. A good example of this situation is the one demonstrated by companies such as Anheuser-Busch, Heineken, Ambev, Miller Brewing, South African Breweries (SAB) and Interbrew.
These companies and many others have immensely contributed to the kind of the competition that is being witnessed in the industry currently. The market in some of the developed countries like the United Kingdom and the United States, growth potential has continued to become more and more limited. The end result has been for the companies facing these problems to pay attention to emerging markets (Czaban and Whitley 2000). This is what can be learnt from the two major importers of beer to America namely Heineken and Modelo.
In general, the ability to play in the competition is the key factor in operating in the industry. The high cost of investment The industry is one of the most expensive to penetrate and more especially in the market where there are already established companies. This can be learned from the establishment and control of Grupo Modelo. For example, when Modelo chose to renovate its facilities in order to increase its production and cover for the new demand, it could spend $300. This is just an amount for renovation and not in any way associated with the establishment of a new beer distributing company something that can be very expensive for any single individual to start.
This high cost can also be related to the distribution channel to other far or even foreign markets (Harris et al 2008). Marketing Marketing is always aimed at promoting the company brands in the market and is particularly important in attracting new customers as well as retaining the available market. For the beer industry, marketing is a major business activity especially for global companies that want to introduce their brands to new markets (IBIS.
2012a). This is the reason as to why Corona has given independence to the local distributors to take full charge of the marketing activities in their respective markets. The reason for giving this approach is to ensure that marketing activities are able to incorporate different preferences and tastes of the local market. This is because apart from providing quality beer, image is also very important and this can only be achieved from excellent marketing strategies. Based on your analysis of the global beer industry and Grupo Modelo’ s situation, what problems and issues does the company’ s top management need to address? Consumer tastes and preferences In any market, consumer tastes and preferences take a center stage as they are important factors that determine the demand for a given product and service.
This case is similar to the beer industry and more important here is that people of different cultures have different choices of which dictates what they will purchase and what they will not. This can be learned from the company case where some countries such as Italy and France mostly prefer wine taking while in the case of Germany and Ireland, beer is more preferred.
What this means for Grupo Modelo is that in going global, tastes and preferences of different target markets must be taken into account if it is to gain a relatively large market share in a highly competitive market (Harris et al 2008).
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