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Mountain Man Beer Company (MMBC) has been experiencing a downfall in sales for the first time in the history amounting to a 2% decline in revenue as compared to previous year. The revision of this decline, by combining the launch of Mountain Man Light Beer as a brand extension to cater to the changes in beer drinkers’ preferences. The plan was to maximize market coverage while minimizing brand overlap and preventing any brand equity damage. It is recommended that the company needs to pitch a fresh strategy that caters to the interest of young consumers. The MM sales force needs to strategies an expansion of distribution channels those operate on-premise locations for introduction of the Light Beer to capture the gennext market. This paints a brand extension by sourcing new consumers leading to additional revenue and expanded market share.
Lighter beer accounted for 50.4% of volume sales in 2005 as compared to 29.8% in 2001. This is in converse with Lager beer that has fallen by 4% for each of six preceding years. Light beer is predicted to attract younger demographic drinkers. There is space to create brand loyalty for Lighter beer as compared to Lager beer that has a loyal consumer base of Blue Collar customers. The risk of canalization of the core brand and shelf space is also averted as the introduction of MM Light bear is not expected to alter the sales of the existing product lines respectively. The existing strong brand recognition will create a market for the new product at reduced marketing costs aiding the competition with peers and ultimately increasing MMBC’s market share. However, the main challenge is that if this brand extension is not strategized to offer brand positioning and identity, the risk of brand image dilution exists. This may result in reduction of revenue and hence loss to the company.
The company should strategically place the same logo and identity with fresh packaging and marketing plan for the new product. Attraction and higher recall rate is associated with vibrant colors and the bottle should use a lighter shade that differentiates the product from the darker tones of MM Lager. Strategizing economic sources, the company could utilize ‘dual marketing strategy’ with the online media marketing channels, specifically considering the youth to be target demographic. The product requires a well-established presence on social media sites, like Facebook, Instagram, and Twitter, with interactive schematics. Product authenticity and patriotism are strong factors to influence purchase on social media. A strong supply chain is required as the product would be mostly sold on-premises among bars, pubs and restaurants in close proximity to college campuses and other premises. A launch strategy that is woven around distribution and points of sale is essential before launching the product in order to avoid the new Light becoming a substitute for the Lager leading to a negative brand equity. Hence, in summation we could state that while pricing strategy needs to be volume based to implemented for success of the MM Light beer. But a major drawback would be an increase costs in expansion of an additional distribution channels to on-premises.

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