Daniel Green02/22/10

Prof. McCarthyJ610

Case Study #3: Mountain Man Brewing Company

As was illustrated in the article, Should You Launch a Fighter Brand, there are five questions ChrisPrangel needs to ask himself prior to launching a new light beer to expand the reach of his company'sofferings while simultaneously challenging market share of existing competitor brands withouthijacking the profits of the established Mountain Man Lager.

A concern among many of the MMBC execs is that Mountain Man Light {Light) wouldcannibalize Mountain Man Lager {Lager) revenue. However, according to the data this is anunfounded concern. Light would target a completely different market than Lager does. Light would becatering to the tastes of a younger, growing population:Drinkers, 2J-27 years of age. This group ismade up of the covetecTgroup of first-time drinkers. Also, this group hasrT't yet formed brand loyalties,which makes it even more important to reach them at an earlier age. Further, this population containsthe only beer category demonstrating consistent growth. Lager, on the other hand, already has anexisting loyal following, primarily made up of older, blue-collar men. Therefore, Light and Lagerwouldn't be competing for existing MMBC market share.

The second point to consider when creating and launching a 'fighter brand' is whether or notthe new product will bury orjail to bury the competition. However, this isn't the goal of Prangel.Prangel wants to ensure the long-term~stability and growth of MMBC, not necessarily the obliteration / (/ £of his competition. Thelntrociuctiorrof Light would take market share away, even if minimally in theshort-term, from the existing light beefbfewers. This can only be viewed as a benefit for MMBC. Inthe long-term, Light may create an easy transition for younger drinkers to make the transition fromLight to Lager when their tastes become more discerning.

The venture into the light beer arena could lose money if the plan isn't conservative in itsapproach. A slow introduction to the local market in West Virginia in order to build momentum and afollowing ambng^n almost captive audience would benefit MMBC. As the Light brand gains marketshare locally it would grow in popularity through untraditional advertising: grass-roots marketing. AsMMBC has known for some time, word of mouth advertising is more effective than the traditional,lifestyle advertising other national beer brands have used to reach young drinkers.

As the data shows, 13% of the adult population is made up of younger drinkers, 21-27 yearsold. Yet this same population makes up more than 27% of total beer consumption. Additionally, thelight beer category accounted for 50.4% of beer sales in 2005 and that percentage has continued tosteadily grow. If MMBC's Light beer introduction maintains some of its core Lager principles -quality, brand image, tradition and local authenticity - MMBC will maintain its position as a reliablebeer for the blue-collar set as well as creating a niche within Gen X and Y as an anti-establishmentsource of adult-themed refreshment. It would be simple, in this case, to hit the mark with youngcustomers.

MMBC should target younger drinking aged adults at sports venues - especially extreme sportsevents - concerts, and events popular with this segment. Sponsoring events where young drinkers arefound would increase the likelihood of grass-roots marketing through word of mouth advertising afterthe event. It's cheap and effective. Additionally, the marketing campaign would need to maintain the"tough" standard its Lager created while reaching a younger audience. "Mountain Man Light: 21st

century tough, " or "Mountain Man Light: ltfh century tough. 21st century taste. " Once an establishedmarket has been tapped in West Virginia Light would need to make its way to other locales whereLager is already popular: Illinois, Ohio, Kentucky, etc. The key to this approach is creating a light beerthat tastes good, is inexpensive enough for younger drinkers to afford, while branding itself as a "cool"alternative to the same, boring light beers that have been around since your parents began drinking.