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SUMMARY
The project work has an objective to make management student familiar with real life business
situations and give an opportunity to the student to understand the theoretical concept of
marketing in practical way.
As the beer, market in India is growing at the rate of 30% approximate. The competition is
getting tougher day by day. This situation of tough competition and entry of global beer
companies in India promoted me to do the project work on this restricted trade of Beer.
The project work was a great challenge for me. It gave me an opportunity together to analyze
the entire situation.
In the project work, I have drawn zonal break up. It includes the preface given by the
consumers regarding their behavior towards global beer brands. I also analyzed the selling,
packaging and consumption of Beer and their perception towards Global Beer.
Project report on consumer behavior towards global beer brand is a detailed and
comprehensive study of the distinct consumer and their role and attitude towards the product.
In this report, I have tried to discuss the various topics regarding the consumer perception on
the basis of survey in a clear and understandable manner.
The respondents acted positively to me and all of them helped me to fill the questionnaire with
their best efforts.
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I have taken a sample of 100 consumers of Mumbai city, who drink beer. Although this sample
is very small to represent the whole, market but there is no choice because of time constraints.
Yet I have tried to take consumers from every age group, every income group, and every
occupation group. I have also taken responses from approximately all the areas of Mumbai in
order to minimize any bias.
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Chapter No.1 Introduction to Beverage Industry
1.1 Over-view of beverage industry
The beverage industry is extremely competitive, with private labels greatly influencing the
environment. A few global beverage giants produce many brands, but those brands fall into
selfcontained categories as well. Thus, the beverage market is not really one mark et; it is a
collection of markets with many different types of products, processes and requirements. The
beverage market includes several different products that can be grouped into two main
categories: alcoholic (beer, wine, spirits) and nonalcoholic (carbonated soft drinks, juice, water,
sports drinks, etc.). Each category, and often each type, of beverage have its unique issues and
needs.
1.2: Over View of Alcoholic Beverages
The alcohol industry is very important for the government. It generates an estimated Rs. 16,000
crore per annum in spite of the fact that the per capita consumption of liquor in India is the
lowest in the world. The total liquor industry is worth Rs. 2,000 crore. IMFL accounts for only a
third of the total liquor consumption in India. Most IMFLs are cheap and are priced below Rs.
200 per bottle. Alcohol sales proceeds account for 45% of the total revenue collection in the
country. Whiskey accounts for 60% of the liquor sales while rum; brandy and vodka account for
17%, 18% and 6% respectively. MNCs share is only 10% and they have been successful only in
the premium and super premium ranges. Post WTO the government may have opened India to
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foreign distilleries, but the duty has been increased from 222% to 464-706%. This is due to the
fact that there is a 100% customs duty, 150% contravening duty, local taxes, distributors
margin, and retailers margin and publicity charges. The cost is finally borne by the consumer.
However, the government claims that this is being done to protect the domestic liquor industry,
the domestic industry accounts for 99% of the market share. This protectionist policy could
prove to be counterproductive and lead to smuggling. As of now, only 45% of the sales are
through legal channels and only 25% of this is duty paid for.
Within India itself, the policy of alcohol retail differs from state to state. While some states like
Maharashtra. Uttar Pradesh, and Tamil-Nadu have a liberal policy, states like Haryana and
Andhra Pradesh have had very bitter experience in trying to make these states dry and have
eventually had to withdraw the policy.
1.2.1: Different Types of Alcoholic Drinks
WHISKYWhisky is amongst the most popular distilled liquor known all over the world. It is made
of malt and molasses spirit, which is obtained by distillation of mash or cereal grains like maize,
rice, barley and malt. Better, the malt better the whisky. Large quantities of IMFL are
manufactured in India and is the maximum sold alcohol. The alcoholic content in whisky is
42.8%.
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RUMRum is a distillated from the fermented juice of sugarcane of molasses. RUM is
characterized with its taste and aroma. Best rums are known to come from Jamaica, West
Indies etc. The alcohol content of Rum is 42.8%.
BRANDYBrandy is generally obtained from fruits, though the most commonly used fruit is
grapes. The best quality of brandy is cognac, which is made in France.
VODKAVodka is a sprit resulting out of distillation at very high proof. This result in virtual NPN
existence of flavor in the resulting spirit, which is neutral, even after dilution required for
palpability. The traditional source of making vodka has been potatoes.
BEERBeer is not a distillate like the drinks mentioned above but it is a beverage made by
fermentation of malt obtained from carbohydrate in rich material barley. Hops are used to add
taste while yeast is used to ferment the beer.
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Beer is of two types:
1. Lager2. Draught
Lager Beeris the most common bottled Beer found in almost all the retail shops in the country.
This Beer is served chilled and is of two types.
Mild Beer alcohol content is 6.75%.
Strong Beer alcohol content is 8.75%.
Draught Beer is served chilled in mugs and is generally available in Pubs only. It can be stored
for 72 hours only and does not have any brand name.
GINIt is sweetened or unsweetened grain spirit flavored with essential oil, juniper berries
and some other product including angelica roots, orange peel, cardamom, bitter almonds give it
a kick and taste.
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Chapter 2
Introduction to the Beer
What is beer?
Beer has been brewing for more than 8,000 years worldwide, and in olden days was considered
a food staple. Beer is an alcoholic beverage made from malted grains, hops, yeast, and water.
The word beer comes from the Middle English ber (e), and from the Latin bibere meaning "to
drink." Ancient Babylonian records indicate beer as being used in sacrificial rituals. All of the
ancient cultures have been making beer throughout the ages and have looked at it as a form of
medicine. Physicians and holistic practitioners of old used beer liberally in their cures as it was
considered safer than water. Thus, beer was often used to mix medicines and was used as the
liquid in recipes instead of water.
How is Beer Made?
Beer is one of the most popular drinks around the world. Beer is so popular is that is easy to
make and require few ingredients. In fact, there are only four ingredients in beer: water, barley,
yeast, and hops. All beers are made with the same ingredients; the only variation between
them is in the amount used of each ingredient, plus variations in brewing. For example, ale
must be fermented for 21 days, while lagers require 35.
The first step, where the wort is prepared by mixing the starch source (normally malted barley)
with hot water, is known as "mashing". Hot water (known as "liquor" in brewing terms) is mixed
with crushed malt or malts (known as "grist") in a mash tun. The mashing process takes around
1 to 2 hours during which the starches are converted to sugars, and then the sweet wort is
drained off the grains. The grains are now washed in a process known as "sparging". This
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washing allows the brewer to gather as much of the fermentable liquid from the grains as
possible. The process of filtering the spent grain from the wort and sparge water is called wort
separation. The traditional process for wort separation is lautering, in which the grain bed itself
serves as the filter medium. Some modern breweries prefer the use of filter frames, which
allow a more finely ground grist Most modern breweries use a continuous sparge, collecting the
original wort and the sparge water together. However, it is possible to collect a second or even
third wash with the not quite spent grains as separate batches. Each run would produce weaker
wort and thus a weaker beer. This process is known as second (and third) runnings. Brewing
with several runnings is called parti gyle brewing.
The sweet wort collected from sparging is put into a kettle, or "copper", (so called because
these vessels were traditionally made from copper) and boiled, usually for about one hour.
During boiling, water in the wort evaporates, but the sugars and other components of the wort
remain; this allows more efficient use of the starch sources in the beer. Boiling also destroys
any remaining enzymes left over from the mashing stage. Hops are added during boiling as a
source of bitterness, flavor and aroma. Hops may be added at more than one point during the
boil. The longer the hops are boiled, the more bitterness they contribute, but the less hop
flavor and aroma remains in the beer.
After boiling, the hopped wort is now cooled, ready for the yeast. In some breweries, the
hopped wort may pass through a hop back, which is a small vat filled with hops, to add
aromatic hop flavoring and to act as a filter; but usually the hopped wort is simply cooled for
the fermenter, where the yeast is added. During fermentation, the wort becomes beer in a
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process which requires a week to months depending on the type of yeast and strength of the
beer. In addition to producing alcohol, fine particulate matter suspended in the wort settles
during fermentation. Once fermentation is complete, the yeast also settles, leaving the beer
clear.
Fermentation is sometimes carried out in two stages, primary and secondary. Once most of the
alcohol has been produced during primary fermentation, the beer is transferred to a new vessel
and allowed a period of secondary fermentation. Secondary fermentation is used when the
beer requires long storage before packaging or greater clarity. When the beer has fermented, it
is packaged either into casks for cask ale or kegs, aluminum cans, or bottles for other sorts of
beer
2.1: Different Types of Beer
StrongStrong beer is a term referring to a type of beer with high alcohol content. In legal statutes, the term
often includes any alcoholic beverage not lower than 5% alcohol by volume made with malted barley. In
common parlance, however, it is used for high-alcohol beers (67% and more) or beer-derived mixes
made with ingredients and processes resembling those in American-style lager.
StoutStout and porter are dark beers made using roasted malts or roast barley, and typically
brewed with slow fermenting yeast. There are a number of variations including Baltic porter,
dry stout, and Imperial stout. The name Porter was first used in 1721 to describe a dark brown
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beer popular with the street and river porters of London. This same beer later also became
known as stout, though the word stout had been used as early as 1677. The history and
development of stout and porter are intertwined.
MildMild beer has a predominantly malty palate. It is usually dark coloured with an avg of 3%
to 3.6%, although there are lighter hued mild as well as stronger examples reaching 6% avg and
higher.
WheatWheat beer is brewed with a large proportion of wheat although it often also contains a
significant proportion of malted barley. Wheat beers are usually top-fermented (in Germany
they have to be by law). The flavor of wheat beers varies considerably, depending upon the
specific style.
http://en.wikipedia.org/wiki/Porter_(carrier)http://en.wikipedia.org/wiki/Malted_barleyhttp://en.wikipedia.org/wiki/Top-fermentedhttp://en.wikipedia.org/wiki/Top-fermentedhttp://en.wikipedia.org/wiki/Malted_barleyhttp://en.wikipedia.org/wiki/Porter_(carrier) -
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Chapter 3
Indian beer market
The beer industry is the biggest sector of the Alcoholic Beverage industry, with global annual
sales exceeding $325 billion USD. However, market saturation has been reached in much of the
developed world, which is limiting the industrys growth potential and forcing many companies
to focus on emerging markets. With so few options for growth, companies that operate in the
industry face considerable competitive pressures. Consequently, they must streamline their
processes in order to drive real, profitable growth all while ensuring that they effectively
meet the demands of both customers and consumers.
India is one of the worlds fastest growing consumer markets. A rapidly growing population, an
emerging middle class with rising percapita incomes and blossoming urban centers make India
a powerful emerging market. India has an established local beer industry and, although
percapita consumption is low, as the country becomes more westernized younger generations
have the potential to be highvolume consumers. However, regionalism, political unrest and the
potential for growing pains temper this markets attraction.
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3.1: Market Overview
In India, beer sales grew at nearly 90 per cent, compared to a less than 60 per cent growth for
other alcoholic drinks. Industry sources estimate that the Indian beer market is expected to
nearly double to 23.3 million hectoliters by 2012 from 12.5 million hectoliters at present.
In the last 9 years, beer consumption has been growing rapidly at a CAGR of 7%. Looking from
the industry perspective, the Indian beer industry has been witnessing steady growth of 10%
per year over the last ten years. With the average age of the population on the decrease and
income levels on the increase, the popularity of beer in the country continues to rise.
3.1.1: Drivers & Challenges
Drivers
Young population
Nearly 28% of Indian population lives in urban areas, which comes close to the
population of USA. Urbanization is happening at a very fast pace and about 40% of the total
population is expected to live in urban areas by 2020. Also people in India are relatively
younger when compared with global average. About 50% of the Indian population would be
under 30 years even in 2015.
Low per capita consumption
Indian per capita beer consumption is very low compared to global average. In the total
alcohol market in India, beer contributes only 4% of revenue. The low penetration in beer
consumption provides a substantial and sustainable growth in demand for beer in future.
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Rising income levels
India is one of the most attractive consumer markets the world with about one-sixth of
the global population. The rising income level has a direct positive impact on beer sales in India.
Also, urban consumers who are more exposed to the western culture socialize with beer. The
growing income level particularly in the urban earning class is a potential market for beer
manufacturers in India.
Dynamism in Beer market
Many foreign beer manufacturers have entered or plan to enter the Indian beer
market with their product line. The market is set to flourish with 15 new breweries and 10
international brands in the next 3 years. With the global markets experiencing low or stagnating
growth and focus shifting to India, the Indian industry is expected to witness fast growth in the
coming years.
Challengers
Bottling shortage
What often happens is people have more bottles at home than they drink on a weekly
basis because they tend to buy regularly and bring them back irregularly. SABMiller, which
manages Shaw Wallace Breweries Ltd, has warned that the country could face a beer shortage
in the approaching summer, the peak consumption season.
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Consumer choice and preferences
India is predominantly a hard spirits market and beer is a minority preference for those
who consume Alcohol Beverage. Beer makes only 4% by revenue of the total alcoholic market.
It would be pertinent to mention that while per capita consumption of spirits in India is 65% of
global average, in the case of beer it is a mere 3% of global average.
World over it has been identified that policy focus should not as much be on controlling
consumption but more importantly on reducing harm. Therefore, beer and wine dominate the
alcohol market in most countries. It is considered common mans drink and in many countries is
even priced in parity with soft drinks. However, in India things are different. The per capita
consumption of beer in India is just 1 liter per person per year as compared to the world
average of 22 liters. This is one of the lowest in the world.
3.1.2.1: Government Regulations on State Beer
India has 28 states and 3 union territories. A tangled web of tax and regulations across Indian
states remains a major barrier to beer market growth in the country. Differing regulations on
pricing and distribution, as well as fluctuating excise charges, foster inefficiency in the beer
sector and make it harder for brewers to attract consumers. One could easily produce the
amount of beer drunk in India with two to four breweries. The reason there are so many is the
legislation. Transporting beer is expensive, so you need breweries in the different states. Duty
Tax on beer in India is an average US $13 per unit of alcohol. Each state levies taxation on
alcohol at its own determined rates and excise duties, and controls distribution channels in its
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own way. It is a statebystate market and not a national market. Taxes a re levied, often at
higher rates in relation to world prices, on all alcoholic products crossing the state borders. This
makes it essential to have production centers in different states. The distribution system is
same for Beer as for Spirits and Wine. Operators of outlets like wholesalers, retailers, bars and
restaurants, and bonded warehouse operators must be licensed and should pay the varying
state license fees. Based on the current trend of consumption it is expected that Beer may
shortly be permitted to sell in more outlets in near future. South India is the largest consumer
of Beer. Beer is declining in the west due to high taxes, and the consumption in North is
increasing in Country Liquor and Beer in particular.
Restriction of Movement of Beer
For the movement of beer from one state to another, an export license and an import license
is required. Export fee is imposed in the state where beer is manufactured and import fees on
the State where it is sold. In some states, only beer manufactured in that state can be sold. Few
states like Tamilnadu have strict rules of selling only beer manufactured within the state.
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3.1.3: Characteristics and Trends
Growing demand for barley and evolving contract farming
Barley accounts for one-sixth of the cost of making beer. Increase in domestic consumption
and export demand has pushed the barley prices up by 20% from Jan 08 - June 08. Moreover,
Increase in barley prices has let to 10% increase in cost of beer. The protein content in barley
crop in India is 13-15% compared to 7-10% in developed nations and this high protein content
in Indian barley is not suitable for making beer. Rajasthan is an ideal place where barley can be
grown under suitable climatic conditions for having lower protein content required by the beer
industry. SAB Miller India is encouraging farmers in Rajasthan to cultivate a type of malt barley
required by the industry. The company launched a programme called Saanji Unnati for
educating farmers to sow the right type of certified seeds and practices.
Rise of premium beer sector
Premium beer segment is outpacing the mainstream beer market touching a growth rate of
between 40-50%. The Indian beer industry is moving towards premium category of beer.
Lifestyle changes and increasing western culture in India are some of the factors driving the
premium segment. Many domestic and foreign premium brands are finding the interests of
young urban working class. Premium beers are priced about 30% higher than regular brands.
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Inorganic Growth in the Industry
Players are growing inorganically through joint ventures and acquisitions. The entry of foreign
players will expedite the consolidation of beer market in India. Setting up a Greenfield brewery
takes about 18-24 months, thus companies are looking at joint ventures or acquisitions. In
2007, Anheuser-Busch International, USA acquired 50% stake Crown Beers Ltd, Carlsberg
acquired 52% stake in Parag Breweries. In 2008, Cobra Beer acquired 76% stake in Iceberg
Industries Ltd. In 2009, Yuksom Breweries acquired 100% stake of Rhino Breweries. The big
players have grown inorganically mainly due to huge entry barriers.
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3.2: Top Indian Beer Brands
Picture 3.1- kingfisher bottle picture 3.2 Haywards bottle
Picture 3.3- Royal challenge bottle Picture 3.4- knockout beer bottle
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3.2.1: Kingfisher Beer
Company Profile
Kingfisher beer is an Indian beer brewed by United Breweries Group. With a market share of
over 36%, it is India's largest selling beer, with 1 out of every 3 bottles of beer sold in India
being a Kingfisher brand. It is currently available in 52 countries outside India.
History
It all started with 5 breweries in South India, the oldest of which, Castle Breweries, dated back
to 1857. In 1915, these 5 small breweries decided to join forces to become United Breweries.
And, soon afterwards, the people of South India were astonished by the sight of bullock carts
carrying huge barrels or hogsheads containing beer. These carts trundled their way to
customers, including British troops, living in and around Chennai, Bengaluru and the Niliris.
Soon, the brew from United Breweries became a favorite, especially among the British troops,
for it was as good if not better than any beer they had ever tasted. So began the history of
United Breweries in India.
In 1944, United Breweries were the first to launch beer in bottles under the brand name UB
Export. Then, in the 80s, it became the first to launch canned beer and draught beer.
The company was bought over by late Mr. Vital Mallya in 1947, and since then has never looked
back. Today each one of the 32,000 Beer outlets in India sells one brand or the other from
United Breweries.
Quality and hygiene have always been the key elements of the United Breweries'
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manufacturing philosophy. To this end, the Central Scientific Laboratory (CSL), headquartered
at Bangalore sets standards for all its breweries. Quality Management Systems laid out along
the lines of ISO 9000 are strictly adhered to, controlling quality at every stage of production,
from raw materials to the end product. Also, besides controlling the production process, the
CSL analyses the Company's beer present in shelves all over the country, the competition's
beers and beers from across the world. These beers are tested as per the standards laid down
by the European Brewery Convention on 40 different parameters. By these standards, United
Breweries' beers don't just equal, but even surpass, several Dutch and American beers.
Today, United Breweries has a portfolio of several brands spread across all segments of the
market. Moreover, beers from United Breweries command an incredible 51% of the Indian beer
market. Kingfisher Strong is the largest selling beer in India and one of every three bottles of
beer sold in India is a Kingfisher.
As a result of the tremendous efforts in enhancing consumer experience, United Breweries
growth has outpaced that of the beer industry in India. In addition, continues to grow steadily.
Different Beer Brands of kingfisher
Kingfisher Strong: The brand was launched in 1999 to cater to the growing strong beer
segment in the country. Today, Kingfisher Strong is Indias largest selling beer brand. It is
available in four SKUs- 650ml & 330ml bottles and 500ml & 330 ml cans.
Kingfisher Strong Fresh: Kingfisher Strong Fresh is the first ever-strong draught beeravailable in the Indian market. It is packaged in a 500 ml cans.
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Kingfisher Draught: It is packaged in a 500 ml cans. Kingfisher Ultra: It was launched in Mumbai on 18 September 2009. It is an entry in the
premium beer segment in the country to compete with international players like
Carlsberg, Heineken and Budweiser. Kingfisher ULTRA is available in Thane, Pune and
Bangalore and will be extended to other cities of the country soon. Currently, Kingfisher
ULTRA is available in two SKUs: 650ml and 330ml bottles.
Kingfisher Blue:The brands core target group is the young male population. KingfisherBlue tries to occupy an imagery of adventure sports. It contains under 6% alcohol.
Kingfisher Blue is packaged in metalized blue color labels and cans. It is available in 4
SKUs- 650ml & 330ml bottles and 500ml & 330 ml cans. The brand has been launched in
key markets like Karnataka, Pondicherry, Maharashtra, Delhi, Rajasthan, Haryana, and
Kolkata and will soon be a national brand.
Kingfisher Red:It is marketed as Indias first ALL SEASON beer.
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3.2.2: Haywards
Company profileHaywards 5000 is one of the largest selling strong beer brands in India, which perfectly
combines strength with quality credentials that meet the high expectations of todays
demanding consumers.
History
Launched in the year 1983, Haywards 5000 is synonymous with strong beer in India.
Haywards 5000 is brewed with the choicest of malts and hops lending itself to a unique flavor
profile to suit the Indian taste and preference. Haywards 5000 is the hallmark of original and
authentic strong beer, which other beer brands aspire for. With such credentials, it is not
surprising to see men get together over Haywards 5000. It is the language of friendship
amongst men who are proud of their masculinity and look forward to a great time with their
friends and peers.
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Different Beers under Haywards Brand
Haywards 2000 H2K is India's only beer with an ABV of 5.5%, whilst the rest of the beers are
either less than 5% or greater than 7.5% - 8%.
Brewed especially to suit the modern palate, Haywards 2000 H2K uses a fine selection and
careful blending of malts to ensure a rich, golden look and clean crisp flavor. The cold-filtered
brewing process lends it a well-appreciated flavor, body and aroma.
Haywards BlackIndias first genuine stout beer , is handcrafted from a rich blend of the world
famous Caledon valley dark roasted barley malt along with a blend of imported and locally
produced pale malts. New Zealands super alpha hops give Haywards Black a unique and
pleasantly bitter taste with a hop like aroma. The Dark Roasted malt provides a rich dark
coloring along with a unique smoky taste and aroma. The Slow brewing process, which
incorporates specially managed yeast, creates the creamy head and the rich smooth taste that
stout is so much loved for.
Haywards Black is brewed under the special care of renowned brew masters with many years
of brewing expertise and rich experience from the SABMiller stable , One of the largest brewing
companies in the world with a brewing heritage of over a hundred years.
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3.2.3:Royal challenge
Company profile
The brand has moved from strength to strength since it is relaunched by SABMiller and has set
itself on a growth momentum that is well ahead of the mild beer industry
History
Launched in the year 1993, Royal Challenge Premium Lager is the second largest selling mild
beer in India. Royal Challenge is brewed with the choicest 6-malt barley. Its long brew duration
provides it with a distinct, smooth taste and rich flavor. It has all the hallmarks of a great
beer Color that is golden honey, taste that is smooth and crisp, lace that sticks to the wall of the
glass. Royal Challenge Premium Lager is the beer for the discerning who has the confidence to
make their choices based on their superior taste and knowledge rather than follow the crowd.
Royal Challenge Premium Lager is now the largest selling mild beer brand in many large beer
markets, including Andhra Pradesh, Uttar Pradesh and Orissa. Besides being available across
most states in India, Royal Challenge Premium Lager is also exported to USA, Europe, Middle
East, Australia and Hong Kong.
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Brewed from select malts and imported hops, on a specially developed recipe by the brew
masters from SABMiller, one of worlds largest brewers with over a hundred years of heritage,
Royal Challenge symbolizes a perfect harmony between the high art of brewing and the
assurance of modern technology.
Royal Challenge Premium Lager offers a difference with an edge. Besides its international class
packaging, premium image and path breaking advertising, what sets the brand apart is the long
brew cycle which lends it a distinctly smooth and easy flowing taste.
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3.2.4:Knock Out
History
Ever since its launch in 1984, Knock Out has evolved its brand
positioning from strength to cold refreshment to establish
itself as one of the largest selling strong beers brands in the
Country.
Today, there are millions of consumers in the States of
Karnataka, Maharashtra, Andhra Pradesh for whom the brand
Has come to acquire an iconic status.
Company profile
Knock Out today comes with an innovative thermo chromic
label (A label that changes color when it becomes cold) in the
States of Maharashtra and Karnataka.
The popularity of the brand can be gauged by the fact, that
despite being available only in limited markets, around 7 lakh
bottles of Knock Out are consumed every day.
Knock Out is brewed in modern, state of the art breweries to
ensure consistent conformance to the highest international
standards. Automated and modern techniques help to ensure
that the beer is produced under hygienic conditions, free from
any external impurities.
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Chapter 4
Global Beer Market
Beer is the most popular alcoholic beverage in the United States, manufactured by more than
1,500 breweries, which range in size from industry giants to brew pubs that sell their beer only
on premises. Home Brewing is very popular in the US. The United States produces about 230
million hectoliters (about 6 billion gallons) of beer annually and leads the world in beer
production with regards to volume. The number of breweries in the United States ranks first in
the world.
Brewing has historically been a local industry with only a few companies having a substantial
international presence. However, the last couple of decades have seen increasing consolidation
within the industry, a development which initially took off in Western Europe and North
America. More recently, the consolidation began to include brewing companies in the growth
markets of Eastern Europe, Asia and Latin America.
The global consolidation process has accelerated in the past ten years. The top ten brewers
accounted for 34% of the global beer market in 2000. In 2010, this figure had grown up to 59%.
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4.1: Global Beer Trends
During the past five years, on a pure alcohol-equivalent basis, beer has increased its share of
total alcohol consumption by more than 200 basis points (bps) to 41.1%. In 2008 the trend
slowed somewhat and beers year-on-year share of total alcohol consumption remained flat. In
emerging markets, beer has generally shown higher growth than other alcohol categories as
consumers gradually switch from local, generally high-alcohol, subsistence products towards
attractively packaged, higher quality, commercially produced beer. In South and Central
America, beers share of total alcohol consumption is now 51.5% with increases in Colombia
partly offset by recent declines in Mexico and Brazil. In Eastern Europe, beer has been gaining
share from spirits for some time and now accounts for 48.0% of alcohol consumption. The past
five years have also seen consistent gains in Africa and Asia where beers share of commercially
produced alcohol now stands at 49.0% and 32.8% respectively thanks, partly, to a greater
emphasis on quality and accessibility. In more mature markets, a wider variety of alcohol
products compete in a sophisticated marketing and retail environment. In North America, beer
has been losing share as spirits have benefited from more extensive marketing and greater
availability in certain states. That said, beers share stabilized at 56.3% during 2008 as the
economy slowed and brewers introduced innovative products, new packs and marketing
initiatives. In Western Europe, where beer now claims 36.8%, the wine category has increased
its share as lower-cost offerings have become more widely available.
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Beer growth trends
Over the past five years, the beer category has maintained a compound annual growth rate
(CAGR) of 4.8% globally. During this period, Eastern Europe saw
a high single-digit CAGR as personal disposable incomes increased. In Western Europe, the
prevalence of competitive categories and a shift in beer consumption
Away from on-premise outlets meant that, CAGR was negative. More recently, consumer
spending in Eastern Europe has also slowed an indication, along with
Already high per capita consumption that the beer category is maturing. Central and South
America grew at a CAGR of 6.3% over the period while North America
Had modest growth at a 0.5% CAGR. Africa shows strong levels of growth with a five-year CAGR
of 6.4%. Asias growth in beer over the past five years remains the highest of any region,
averaging 8.4%. China in particular has seen growth in beer averaging 10.7% per year, fuelled
by the growing economy and the increasing availability of beer. Looking forward, there is a
significant opportunity for the beer category to grow at the expense of non-commercial forms
of alcohol, particularly in Latin America, Africa and Asia. In Africa, per capita levels are still
relatively low but accelerating, and local players are expanding their portfolios in all segments.
Asia, in general, is seeing rising incomes and higher levels of beer consumption. In parts of Latin
America, efforts by brewers to transform the beer category should boost per capita
consumption.
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Beer segment trends
Over the past five years, the beer industry has seen a trend towards consumers trading up to
more expensive beers. As a result, premium beer has gained more than 40 bps and now
constitutes 17.9% of total beer sales. For mainstream beer consumers, particularly in emerging
markets, the most common trade-up proposition is to attractive, local, premium brands. In
markets such as North America and Western Europe, premium beers share of total sales is
already well above the global average. On the other hand, premiums share of 10.1% in Central
and South America and 3.0% in Africa shows the significant opportunity that still exists for
premium beer sales in these regions. There is sizeable potential in Colombia and Brazil where
premium beers respectively claim 3.7% and 5.6% of total sales. The trend towards premium
beer consumption has slowed somewhat in the recent economic downturn. However, down
trading is limited and there are notable instances of consumers continuing to trade up, both
into beer and, within the category, into premium products.
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4.1.1: Consumption Patterns
Brewing has historically bee
There are clear differences across markets in the types of beer consumed depending upon,
among other things, the historical brewing traditions within a given country and the markets
maturity level. In most markets, there are one or more mainstream lager brands as well as
discount brands at the lower end of the market. At the higher end of the market, there are
premium brands, super-premium brands and imported brands. Because beer is often consumed
in a social setting, brand image is very important. Marketing plays a major role in creating and
reinforcing a brands image and typically becomes increasingly important in highly
differentiated markets. Domestic and regional brands can establish a strong base while the
premium brand category becomes popular as consumers look for a better image or new tastes.
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Figure 4.1- Consumption of beer
4.2: Global Beer Brands
.
Picture 4.1 -Anheuser Busch Picture 4.2 SAB Miller
Picture 4.3 -Heineken bottle Picture 4.4 Fosters bottle Picture 4.5 Carlsberg
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4.2.1: Anheuser Busch
Company Profile
Anheuser-Busch operates 12 breweries in the United States. Anheuser-Busch's operations and
resources are focused on adding to life's enjoyment through the responsible consumption of
beer by adults. Based in St. Louis, Anheuser-Busch is the leading American brewer, holding a
48.9 percent share of U.S. beer sales to retailers. The company brews the worlds largest-selling
beers, Budweiser and Bud Light. Anheuser-Busch is a major manufacturer of aluminum cans
and has been a leading aluminum recycler for more than 30 years.
The company is a wholly owned subsidiary of Anheuser-Busch InBev, the leading global brewer,
and continues to operate under the Anheuser-Busch name and logo. Anheuser-Busch InBev
ranked No. 2 among beverage companies and No. 1 among beer companies in FORTUNE
Magazine's Worlds Most Admired Companies list in 2010.
History
Anheuser-Busch InBev is a publicly traded company (Euronext: ABI) based in Leuven, Belgium,
with an American Depository Receipt secondary listing on the New York Stock Exchange (NYSE:
BUD). It is the leading global brewer and one of the world's top-five consumer products
companies. A true consumer-centric, sales driven organization, Anheuser-Busch InBev manages
a portfolio of well over 200 beer brands that includes global flagship brands Budweiser, Stella
Artois and Becks, fast growing multi-country brands like Leffe and Hoegaarden, and strong
local champions such as Bud Light, Skol, Brahma, Quilmes, Michelob, Harbin, Sedrin,
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Klinskoye, Sibirskaya Korona, Chernigivske, and Jupiler, among others. In addition, the company
owns a 50 percent equity interest in the operating subsidiary of Grupo Modelo, Mexico's
leading brewer and owner of the global Corona brand. Anheuser-Busch InBevs dedication to
heritage and quality is rooted in brewing traditions that originate from the Den Hoorn brewery
in Leuven, Belgium, dating back to 1366 and the pioneering spirit of the Anheuser-Busch
brewery, which traces its origins back to 1852 in St. Louis, USA. Geographically diversified with
a balanced exposure to developed and developing markets, Anheuser-Busch InBev leverages
the collective strengths of its approximately 116,000 employees based in operations in 23
countries across the world. The company strives to be the Best Beer Company in a Better
World. In 2009, the company realized revenue of 36.8 billion USD.
One of the most famous beers from this company is Budweiser.
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4.2.1.1: Budweiser
The Great American Lager
Introduced:
1876
Beer Category/Style:
Premium Regular American-style lager
Taste Profile:
Fresh and subtle fruit notes, a delicate malt sweetness and balanced bitterness for a clean,
snappy finish. Budweiser is a medium-bodied, flavorful, crisp and pure beer with blended layers
of premium American and European hop aromas, brewed for the perfect balance of flavor and
refreshment.
Ingredients/Brewing:
Brewed using a blend of imported and classic American aroma hops and a blend of barley
malts and rice. Budweiser is brewed with time-honored methods including kraeusening for
natural carbonation and Beech wood aging, which results in unparalleled balance and
character.
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Advertising Highlights:
Budweiser was advertised with spectacular, electric billboards in New York Citys Times
Square as early as 1902, and was the first brand to sponsor a network TV show (The Ken
Murray Variety Show on CBS in 1951). More recently, the brand has created advertising icons
such as Frank and Louie, the Budweiserlizards, and the Whassup! guys, a campaign that won
the Grand Prix award in 2001 at the 48th Annual International Advertising Festival in Cannes,
France. The brand also highlights the world-famous Budweiser Clydesdales in its advertising.
Sponsorship Highlights:
Budweiser has been an Olympic supporter since 1984 was the Official International Beer
sponsor of the Beijing 2008 Olympic Games and was the Official Beer of the 2010 FIFA World
Cup in South Africa. Other sports sponsorships include Major League Baseball (including 26
domestic teams), 28 National Football League teams, Major League Soccer, the Ryder Cup, the
National Hot Rod Association (NHRA), the U.S. and Mexican National Soccer Teams and major
boxing events. The brand also sponsors driver Kasey Kahne on the NASCAR Sprint Cup Series
and Brandon Bernstein on the NHRA PowerAde Top Fuel Series.
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Community Highlights:
Budweiser family promotions have raised millions of dollars for community and charitable
causes. Habitat for Humanity, the Muscular Dystrophy Association, Big Brothers Big Sisters,
Susan G. Komen Foundation, Paralyzed Veterans of America, America Supports You and the
Hispanic Scholarship Foundation are just a few of the causes that have benefited. Additionally,
the Help Budweiser Help the Outdoors program has raised more than $8 million over the past
seven years for wildlife and habitat conservation efforts.
Interesting Facts:
Budweiser was introduced in 1876 when company founder Adolph us Busch set out to create
the United States first truly national beer brand - brewed to be universally popular and
transcend regional tastes.
Each batch of Budweiser follows the same family recipe used by five generations of Busch
family brew masters.
Samples of Budweiser are flown into St. Louis every day from each of A-Bs 12 regional
breweries. There, in a special tasting room, the beer is sampled and judged by the brew
masters to ensure its quality and consistency.
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Brands under Budweiser
Budweiser Bud light Budweiser select Bud light lime Bud light golden wheat Budweiser American ale Select 55 Bud dry Bud ice Bud ice light Budweiser calmato chelada Bud light calmato chelada
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4.2.2: SABMiller
Company Profile
SABMiller is a global brewing and bottling company headquartered in London, United Kingdom.
It is the world's second-largest brewing company measured by revenues (after AnheuserBusch
InBev) and is a major bottler of Coca-Cola. Its brands include Grolsch, Miller Genuine Draft,
Peroni Nastro Azzurro and Pilsner Urquell It has operations in 75 countries across Africa, Asia,
Australasia, Europe, North America and South America and sells 213 million hectolitres of larger
per year.
Its primary listing is on the London Stock Exchange and it is a constituent of the FTSE 100 Index.
It has a secondary listing on the Johannesburg Stock Exchange.
History
The Company was founded in South Africa in 1895 as South African Breweries (SAB): the
business operations were mainly limited to southern Africa, where it had established a
dominant position in the market, until 1990 when it began investing in Europe.
After listing on the London Stock Exchange in 1999 to raise capital for acquisitions, the group
purchased the Miller Brewing Company in North America from the Altria Group in 2002, and
changed its name to SABMiller.
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Following this, the groups next major acquisition was of a major interest in Bavaria S.A., South
Americas second largest brewer and owner of the Aguila and Club Colombia brands in 2005
Brands under SABMiller
Haywards 5000 Fosters Fosters strong Royal challenge Knock out Miller highlife Peroni
4.2.3: Fosters
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Company Profile
Foster's Lager is an internationally distributed Australian brand of 5.0% avg pale lager, (4% in
the UK.) It is a product of Foster's Group brewed under license in several countries, including
the U.S. and Russia. The European rights to the beer are owned by Heineken International, who
brew and distribute Foster's in most European countries, including the United Kingdom,
Greece, France, Belgium, Portugal, Poland, Finland, Germany, Spain, Sweden, Ukraine and
Ireland. In the United States and India, SABMiller owns rights to the brand. In Canada, Foster's
is brewed by Molson Canada under license from Forster's Brewing International
The Foster's brand is also used on several other beers, including Foster's Premium Ale, and
Fosters ESB (Extra Special Bitter) which has been discontinued.
Foster's United Kingdom web site claims "Brits drink over 30 pints of the Amber Nectar every
second". While international marketing of the beer often focuses on its Australian connections,
Foster's does not enjoy widespread popularity in Australia.
History
Foster's Lager has been imported into the UK from Australia in its distinctive blue, white and
gold cans since the early 1970s.
Awareness of the brand was spread in Britain by the satirical political magazine "Private Eye"
which ran a cartoon series "The Adventures of Barry McKenzie", featuring a bumbling Foster's
swilling Australian "ex-pat", from about 1964 onwards.
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In Britain, the Courage brewing group was acquired in 1986 by Australian businessman John
Elliott. Perceiving the increasing popularity of imported Foster's Lager, it was decided to
commence local brewing of the product by Courage.
Variants
Scottish & Newcastle has also launched Foster's Twist, a beer with a hint of citrus that is
marketed as a refreshing alternative to other heavier beers and Premium Packaged Spirits such
as Smirnoff Ice. Foster's Twist is 4.5% avg.
There is also Foster's Super Chilled, which is served at a colder temperature and is available in
pubs and bars.
In 2008, Foster's was introduced with a widget called a "scuba" placed into the can to ensure
good mixing. This variant is only currently available in the UK.
In the UK, customers are also able to purchase a keg of Foster's for private parties, collecting
and returning the keg at a participating store or public house.
4.2.4: Heineken
Company profile
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Heineken International is a Dutch brewing company, founded in 1864 by Gerard Adriana
Heineken in Amsterdam. As of 2007, Heineken owns over 125 breweries in more than 70
countries and employs approximately 54,000 people. It brews and sells more than 170
international premium, regional, local and specialty beers, including Cruzcampo, Tiger Beer,
ywiec, Starobrno, Zagorka, Birra Moretti, Ochota, Murphys, Star and of course Heineken
Pilsner. Heineken claims that the original Heineken recipe has not changed since the beer was
first produced nearly 150 years ago. With an annual beer production of 139.2 million
hectoliters, Heineken ranks as the third largest brewer in the world after Anheuser-Busch InBev
and SABMiller, based on revenue. Heineken's Dutch breweries are located in Zoeterwoude's
Hertogenbosch and Wijlre. The original brewery in Amsterdam, closed in 1988, is preserved as a
museum called Heineken Experience.
History
The Heineken Company was founded in 1864 when the 22-year-old Gerard Adrian Heineken
bought a brewery known as De Hooiberg (the haystack) in Amsterdam. In 1869, Heineken
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switched to the use of bottom-fermenting yeast. In 1873, the brewery's name changed to
Heineken's Bierbrouwerij Maatschappij (HBM), and opened a second brewery in Rotterdam in
1874. In 1886 Dr. H. Elion, a pupil of the French chemist Louis Pasteur, developed the
"Heineken A-yeast" in the Heineken laboratory. This yeast is still the key ingredient of Heineken
beer.
The founder's son, Henry Pierre Heineken, managed the company from 1917 to 1940, and
continued involvement with the company until 1951. During his tenure, Heineken developed
techniques to maintain consistent beer quality during large-scale production. Henry Pierre's
son, Alfred Henry "Freddy" Heineken, started working at the company in 1940, and 1971 was
appointed Chairman of the Executive Board. He was a powerful force behind Heineken's
continued global expansion, and while he retired from the Executive Board in 1989, he
maintained involvement with the company until his death in 2002.
After World War I, the company focused more and more on export. Three days after
Prohibition ended in the United States, the first Heineken shipment landed as the first legal
shipment of beer. From that day on, Heineken has remained one of the most successful
imported beer brands in the United States.
4.2.5: Carlsberg
Company profile
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The Carlsberg Group is a Danish brewing company founded in 1847 by J. C. Jacobsen after the
name of his son Carl. The headquarters are in Copenhagen, Denmark. The company's main
brand is Carlsberg Beer, but it also brews Tuborg as well as local beers. After merging with the
brewery assets of Norwegian conglomerate Orkla ASA in January 2001, Carlsberg became the
5th largest brewery group in the world. In 2009 Carlsberg is the 4th largest brewery group in
the world employing around 45,000 people.
History
J. C. Jacobsen founded Carlsberg; the first brew was finished on 10 November 1847. Exportation
of Carlsberg Beer began in 1868; foreign brewing began in 1968 with the opening of a Carlsberg
brewery in Blantyre, Malawi. Some of the company's original logos include an elephant (after
which some of its lagers are named) and the swastika. Use of the latter was discontinued in the
1930s because of its association with political parties in neighboring Germany. Carlsberg
founder J. C. Jacobsen was a philanthropist and avid art collector. With his fortune, he amassed
an impressive art collection, which is now housed in the NY Carlsberg Glyptotek in central
Copenhagen.
Jacobsen set up the Carlsberg Laboratory in 1875 which worked on scientific problems related
to brewing. It featured a Department of Chemistry and a Department of Physiology. The species
of yeast used to make pale lager, Saccharomyces carlsbergensis, was isolated at the Laboratory
and was named after it. The concept of pH was developed there as well as advances in protein
chemistry. The laboratory was part of the Carlsberg Foundation until 1972 when it was
renamed the Carlsberg Research Center and transferred to the brewery.
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The old brewery in Copenhagen is open for tours and famous visitors have included Winston
Churchill and Queen Elizabeth II.
Carlsberg acquired Tuborg breweries in 1970 and merged with Tetley in 1992.
Carlsberg has two breweries in China Huizhou and Shanghai. Carlsberg's Shanghai brewery
started production in 1998. Carlsberg formerly had a brewery in Taipo, Hong Kong, but shut it
down in 1999 due to high costs.
Brands
Brands held by the Carlsberg brewery group:
Carlsberg a 5% avg pale lager with a global distribution; marketed as Carlsberg Exportinthe UK to avoid confusion with the UK Carlsberg lager which is brewed at 3.8% avg
Aldaris (Latvia) Mythos (Greece) Elephant Special brew Tuborg (Regional) Astra (Germany) Bosman (Poland)
http://en.wikipedia.org/wiki/Mythos_Breweryhttp://en.wikipedia.org/wiki/Greecehttp://en.wikipedia.org/wiki/Tuborghttp://en.wikipedia.org/wiki/Bosmanhttp://en.wikipedia.org/wiki/Bosmanhttp://en.wikipedia.org/wiki/Tuborghttp://en.wikipedia.org/wiki/Greecehttp://en.wikipedia.org/wiki/Mythos_Brewery -
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4.3: European Beer Market
Beer is one of Europes favorite drinks, best enjoyed and savored in a convivial atmosphere.
Behind your average glass of beer though which many of us take for granted are figures
providing a deeper insight into this fascinating sector. These numbers are part of the essence of
what keep Europes almost 4,000 brewers in business. They allow brewers and third parties to
visualize the overall state of the sector, monitor trends in production and consumption, keep
abreast of the levels of imports versus exports, and illustrate the socio-economic importance of
brewing also in terms of employment.
2010 edition of THE BREWERS OF EUROPE covers the years since our last edition in 2003,
outlining data for the most frequently asked categories.
The figures and associated graphs illustrate trends for most of last decade in terms of
consumption and production in
The European Union.
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Chapter 5
Consumer Buying Behavior
Consumer Buying Behavior is the behavior that a consumer display while buying the product or
a service. Each consumer has his/her own buying behavior that he displays it during purchase of
different products. This behavior displayed by the consumer is the result of a number of
influences, which he/she receives from the environment. These influences can be categorized
into four factors viz. Cultural factors, Social factors, Personal factors and Psychological factors.
Cultural Factors
Culture, subculture and social classes are particularly important in buying behavior. Culture is
the fundamental determinant of a persons wants and behavior. Each culture consists of
smaller subcultures that provide more specific identification and socialization of its members.
Subculture includes nationalities, religions, racial groups and geographic regions.
Social Factors
In addition to cultural factors, a consumers behavior is influenced by such social factors as
reference groups, family and social roles and statuses. A persons reference group consists of
all the groups that have a direct (face to face) or indirect influence on the persons attitudes or
behavior. Groups that have direct influence on a person is called as membership groups. Some
membership groups are also called as primary groups, such as family, friends, neighbors and
coworkers with whom the person interacts continuously and informally. People also belong to
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secondary groups such as religious, professional and trade union groups, which tend to be more
formal and require less continuous interaction. Aspirational groups are those a person hopes to
join; dissociative groups are those whose values and behavior an individual rejects. The family is
the most important consumer buying organization in society, and family members constitute
the most influential primary reference group. A person participates in many groups-families,
clubs, organizations. The persons position in each group can be defined in terms of role and
status. A role consists of the activities a person is expected to perform. Each role carries a
status.
Personal Factors
A buyers decisions are also influenced by personal characteristics. These include the buyers
age in the life cycle, occupation, economic circumstances, lifestyle and personality and self-
concept. People buy different goods and services over a lifetime. They eat baby food in the
early years, most foods in the growing matured years and special diet in the later years.
Occupation also influences consumption patterns. A blue-collar worker may buy work clothes,
work shoes and lunch boxes. A company president may buy expensive suits, air travel and
country club membership. People from same subculture, social classes and occupation may
lead quite different lifestyles. A lifestyle is a persons pattern of living in the world expressed in
activities, interest and opinions.
Psychological Factors
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A persons buying choices are influenced by four major factors viz. motivation, perception,
learning, believes and attitudes.
5.1: Importance of Consumer Buying Behavior
The study of consumer behavior focuses on how individuals make their decisions to spend their
available resources (time, money, effort) on consumption related items or consumption related
aspects (What they buy? When they buy? How they buy?). It is also the study of individuals, or
organizations and the processes consumers use to search, select, use and dispose of products,
services, experience, or ideas to satisfy needs and its impact on the consumer and society.
The consumer buying decision goes through the following stages:
Problem recognition
Information search
Evaluation of alternatives
Purchase decision
Purchase
Post purchase evaluationBuyer behavior is deeply rooted in psychology with dashes of sociology thrown in just to make
things more interesting. Since every person in the world is different, it is impossible to have
simple rules that explain how buying decisions are made. However, those who have spent many
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years analyzing customer activity have presented us with useful guidelines in how someone
decides whether to make a purchase. The evaluation of marketing concept from mere selling
concept to consumer oriented marketing has resulted in buyer behavior becoming an
independent discipline.
The growth of consumerism and consumer legislation emphasizes the importance that is given
to the consumer. Some consumers are characterized as being more involved in products and
shopping than others. A consumer who is highly involved with a product would be interested in
knowing a lot about it before purchasing. Hence, he reads brochures thoroughly, compares
brands and models available at different outlets, asks questions, and looks for
recommendations. Thus consumer buying behavior can be defined, as heightened state of
awareness that motivates consumers to seek out, attend to, and think about product
information prior to purchase. Consumer behavior is important to successfully market to
different market segments to survive in the market.
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5.2: Consumer Perception
It is selection, organization, and interpretation of marketing and environmental stimuli into a
cohesive picture. Perception is a mental process, whereby an individual selects data or
information from the environment, organizes it and draws significance or meaning from it.
Perception is basically a cognitive or thinking process and an individuals activities, emotions,
feelings etc. are based on his perception of his perception of his surroundings or environment.
Perception being an intellectual and cognitive process will be subjective in nature. This means
that different people may perceive the same environment differently.
Characteristics affecting perception:
Characteristic effecting perception can be divided into sensory elements and structural
elements. The sensory elements are as follows.
Colour:Colour has important sensory connotations. Evidence suggests that red is regarded as
warm, sensual and not intimidating. Blue is seen as conforming and is regarded to be colour
that attempts to convey friendlier image. Pepsi attempt to cash on the blue colour of the Indian
cricket team during the recent World Cup cricket matches has received a similar response.
Many retailers in Mumbai call it Ghaslet Pepsi. This is because Indians are more used to
identify blue with kerosene and their long-term association with blue colour of kerosene led to
call blue Pepsi as Ghaslet.
Taste: Taste is another sensory factor that will condition consumers brand perceptions. The
importance of taste is illustrated by P&G blunder when it first introduced Pringles potato chips.
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The chips were packed in an easy-to-stack cylindrical can to avoid breakage of chips. The
consumers responded by saying that the packaging resembles a tennis ball can. Further
consumers felt that the chips tasted like tennis ball.
Smell: Smell is important for food products and cosmetics products. In one study, two
fragrances were added to the same facial tissue. Consumers perceived one facial issue as
elegant and expensive and the other as a product to use in the kitchen.
Sound: Sound is another important sensory stimulus. Advertisers have traditionally used
accent to convey status and authority. Even in case of serials, voice is being used to create an
impact on the masses.
Feel: The feel of certain products will also influence consumers perceptions. Softness is
considered a desirable attribute in many paper products. Feel is also a means of determining
quality. Consumer often use of a textile fabric, clothing, carpeting, or furniture to evaluate
quality. For example, a smooth, velvety feel in textile fabrics is considered an indication of
quality.
The structural elements are as follows:
Intensity and Size:The brighter and advertisement and larger the size, more it is able to attract
the attention of potential consumers. Such large advertisements can be in the form of full-page
advertisements in newspapers or in the form of large hoardings on the road.
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Position: Attraction towards and advertisement depends largely on the place where it is
positioned. Positioning includes the page of a newspaper. Similarly, the placement of product
for display on shelves at the retail outlet plays an important role in attracting the attention of
the consumers.
Contrast:A black and white advertisement with a small spot used by Jet Airways is likely to
attract attention. A quite commercial after a loud program can attract attention like the
advertisement of De Beers diamond after listening to a frantic rock show.
Novelty: It is observed that anything, which is different from what is normally expected, tends
to attract attention like an unusual bottle shape or different packaging material.
Repetition: Advertisements are repeated often to enable consumers to brand recall as well as
stimulate them and create a strong desire for interest in the purchase of the product.
Repetition is particularly important in case of low involvement convenience goods like soaps
and toothpastes.
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5.3: Consumer Attitude
Consumers attitude is a hypothetical construct that represents an individual's degree of like or
dislike for an item. Attitudes are generally positive or negative views of a person, place, thing,
or event- this is often referred to as the attitude object. People can also be conflicted or
ambivalent toward an object, meaning that they simultaneously possess both positive and
negative attitudes toward the item in question. Attitudes are judgments. They develop on
the ABC model (affect, behavior, and cognition). The affective response is
an emotional response that expresses an individual's degree of preference for an entity.
The behavioral intention is a verbal indication or typical behavioral tendency of an individual.
The cognitive response is a cognitive evaluation of the entity that constitutes an individual's
beliefs about the object. Most attitudes are the result of either direct experience
or observational learning from the environment
Attitudes can be changed through persuasion and we should understand attitude change as a
response to communication. Experimental researches into the factors that can affect the
persuasiveness of a message include:
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Target Characteristics: These characteristics refer to the person who receives and processes a
message. One such trait is intelligence - it seems that people that are more intelligent are less
easily persuaded by one-sided messages. Another variable that has been studied in this
category is self-esteem. Although it is sometimes thought that those higher in self-esteem are
less easily persuaded, there is some evidence that the relationship between self-esteem and
persuasibility is actually curvilinear, with people of moderate self-esteem being more easily
persuaded than both those of high and low self-esteem levels (Rhodes & Woods, 1992). The
mind frame and mood of the target also plays a role in this process.
Source Characteristics: The major source characteristics are expertise, trustworthiness
and interpersonal attraction or attractiveness. The credibility of a perceived message has been
found to be a key variable here; if one reads a report about health and believes it came from a
professional medical journal, one may be more easily persuaded than if one believes it is from a
popular newspaper. Some psychologists have debated whether this is a long-lasting effect and
Holland and Weiss (1951) found the effect of telling people that a message came from a
credible source disappeared after several weeks (the so-called "sleeper effect"). Whether there
is a sleeper effect is controversial. Perceived wisdom is that if people are informed of the
source of a message before hearing it, there is less likelihood of a sleeper effect than if they are
told a message and then told its source.
Message Characteristics: The nature of the message plays a role in persuasion. Sometimes
presenting both sides of a story is useful to help change attitudes.
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Chapter 6
Research Methodology
6.1: Research Plan
1) Title:Consumer Behavior towardsBeer Brands
2) Type of Research: Descriptive Research
3)Sources of Data Collection:
Primary Data collected through survey, using a structured Questionnaire Secondary Data through past data, cases related on this topic on Internet, articles
journals.
4)Objectives:- To study consumers behavior towards global beer brands in IndiaTo study the factors affecting buying behavior of beer
To find out consumer awareness towards global beer brands
To study consumption pattern of beer
To study Indian beer market
To study alternative ways of product promotion
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5)Need & Significance:The present study was conducted with a view to understand beer market in India, emphasis in
Mumbai. Undoubtedly, the markets are undergoing rapid and wrenching transformation.
Various studies conducted in the past have strengthened the above mentioned view.
The change in the scenario beer market is governed by two forces:-one is globalisation, the
extensive growth of global trade and international competition. In the present economic
scenario of country, howsoever developed it may be it can ever think of isolating itself from
world economy. If any country closes its market, its citizen will pay for inferior quality of goods.
But if it opens its market, it will have to confront severe competition and many of its internal
business will suffer. The other force is changing life style of consumers in ever- growing market
like Delhi, this force has a definite say. The paradox is that the globalization and changing life
style of consumers open up new opportunities even as the threaten the status quo.
Globalization is made it possible for Fosters, Carlsberg, Budweiser, Tuborg, Heineken etc. to sell
their beers all across the world. Changing lifestyle provoked the Shaw Wallace and Company
and united Breweries to come out with a number of brands (kingfisher, Royal Challenge,
Hayward 5000, Kalyani Black Label etc.) to cater to the needs of consumers having different life
style.
Todays market is changing at an incredible pace. In addition to globalization and changing life
style, we are witnessing new retail forms (e.g. bars, bistros, pubs etc.) and disconcerting erosion
of brand loyalty. These changes have created confusion in the mind of companies regarding use
of strategies.
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6) Research Design: Sampling unit - Bangalore Size of sample - The sample would consist of 40 respondents Target group - Beer Drinkers Age group - 21 and above Type of sampling - Convenience/ Random sampling
7) SampleStudied:
Sample Technique - A survey conducted with the help of structured questionnaire consisting of
close and open ended question. The question will be related to usage, perception, preferences,
attitude and experience of the consumer towards the products/ brand.
8)Limitation of the Research
- The research is restricted to certain parts of Mumbai and does not necessarily show apattern applicable to all of country.
- It is assumed that whatever information given by the consumer in the questionnaireholds true and correct.
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Chapter 7
Recommendations
1. Increase the consumption amongst women drinkers.2. Increase the number of times beer is consumed in a week by positioning beer as a
refreshing drink.
3. As the industry has the constraint of surrogate advertising, increasing BTL activities inbars, pubs, sports bars etc.
4. Providing tours to the distillery and making it into an event or an outing destination.5. Trying to build loyalty by creating communities online, sport bars, drinking friends etc.6. Creating a distinct and standardized taste as according to the research Taste plays a
pivotal role more so than Price.
7. Tuborg has created a niche for itself because of its Taste as well as the packing andKingfisher has created a niche by its distinct taste and brand image ,Other brands can
create a niche for themselves like Budweiser can promote itself as the most favorite
American past time.
8. Going ahead branding will play an important role, with so many Indian as well as foreignbrands coming in.
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Chapter 8
Conclusion
The alcoholic industry is at its nascent stages even though it has been here since a very long
time. Only two players UB group owned by Mr. Mallya and Shaw Wallace first dominated the
industry. India has always been the difficult market in terms of consumer behavior as well as
the difficulties in setting up a brewery due to the license raj. In the last couple of decades, the
industry has seen many positive changes with the growing middle class the opportunities for
the industries have only increased. India predominantly is a hard growing market, the beer
industry has made a lot of enrolls in the last few years with Kingfisher leading the charge.
With the population of one billion out of which 70% of the population, being under the age
group of 30 India is viewed as a potential hot spot for every product, beer being no different.
The global beer brands view India has the next growth market and a bringing their global
brands to India. The likes of Budweiser, Carlsberg, and Fosters want to get a good foothold in
the Indian market. SAB Miller has taken the charge by acquiring Shaw Wallace and getting other
small distilleries in the south. No global brand wants to lag behind in the race to create a space
for themselves in the huge Indian market
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Brands like kingfisher are the clear market leaders but there is a lot of scope for other brands to
come in and eat into the market share. Today with rise in the globalization, it has become
easier for the global brands to create a space for themselves.
Even though India is price sensitive market, the research suggest that taste is the most
important factor. This can work in the favor of the global brands as today an average Indian
would not mind paying a little extra if he gets a better quality.
All these factors tells us that global brands are here to stay but it will be a difficult task for them
to break into the Indian market and challenge the leaderships of Indian brands like Kingfisher
and this competitive situation will only work in favor of the consumer.
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QUESTIONNAIRE
1. Do you drink beer?a) Yesb) No2. How often, on the average, do you usually have a beer?a) every dayb) at least once a week but not every dayc) at least once a month but less than once a weekd) more than once a year but less than once a monthe) once a year or less3. When buying beer, you choose it on the basis of _____________? Fill in the blanka) Taste/Flavorb) Pricec) Alcohol percentaged) Brande) Other4. Where would you typically buy beer for consumption at home?a) Wine Shopb) Premium Liquor Storec) Bar&Resturantd) Super Markete) Other5. What kind of beer do you drink?a) Mildb) Strongc) Premiumd) Economy6. Which brands of the beer do you like the most?a) Millerb) Fostersc) K.Od) Budweisere) Heinekenf) Coronag) K.Fh) Others
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Consumer Behavior Towards Beer Brands7. Does cost of the product influence your purchase?a) YESb) NO
8. Are you willing to change the brand if you are given any offers?a) YESb) NO
9. Do you make up your mind before coming to the outlet?a) YESb) NO
10.Does visibility affects your purchase?a) YESb) NO
11.What influences your decision at the last moment?a) Visibilityb) Pricec) Offersd) Brands
12.What influences your decision at the last moment?a) Visibilityb) Pricec) Offersd) Brands
13.What makes you to try a new brand?a) Priceb) Offersc) Adsd) Influence by your friends