Beer Market Essay Example for Free

Beer Market Essay The Market. How should one think about market definition in the U.S. beer industry? Is there a single â€Å"beer market,† or are there several markets? If there are two or more markets, how would you identify them? How does demand substitutability and/or supply substitutability affect market boundaries in the industry? How high is demand substitutability and supply substitutability across segments of the industry, and in particular across the different markets you have identified? We find two markets in the beer industry: Alcoholic beer market and Nonalcoholic beer market. The demand substitutability heavily affects the market boundary in the industry. People who cannot consume alcohol can never try alcoholic beer. On the other hand, people who can drink alcoholic beer generally do not like nonalcoholic beer because they want to enjoy drinking â€Å"alcohol†. It means that the demand substitutability between alcoholic beer and nonalcoholic beer is low. In the alcoholic beer market, the demand substitutability is high. There are difference of the taste between the products (lagers, ales and etc.), but we believe people can switch the product easily. There is price difference, but still the range is $3-$7 and people can try other products easily. I can imagine if lagers decreased the price by $2, people having ales would try lagers. People can get almost all types of beer in USA, so there is no geographical boundary. In terms of the supply substitutability, it does not affect the market boundary. All beer companies can produce any types of beer. If a beer company earned a lot of profit in the nonalcoholic beer market, others would jump in the market. There is no geographical boundary, neither. In summary, the demand substitutability and the supply substitutability are high, except for the demand substitutability between non-alcohol and alcohol. Large Firms. Anheuser-Busch and SAB-Miller/Coors use advertising as their main tool in fighting for market share. It has been argued that they advertise too much. (See â€Å"Beer: Price and Advertising Elasticities of Demand† in the reading package.) Do high levels of advertising make sense, or should they be scaled back? Should SAB-Miller/Coors rely more on pricing to compete with A-B? Why or why not? Spending a lot of expenses make sense in the beer industry. First, the demand substitutability is very high. Beer is relatively cheap though there is the $2-3 price difference. Beer has different tastes, but still it tastes beer. People can try another type of beer easily, seeing the advertisement. Second, the advertisement of beer can increase the pie of the demand. For example, if we was an advertisement of beer in summer, we just feel like drinking beer. An advertisement can not only get the customers of a competitor, but also can increase the pie of the demand. Finally, an advertisement is effective to make a long lasting brand. Branding and penetration in the market is important and the companies cannot build them in short-run. An advertisement helps the company to make the prestigious brand in long-run. 3. Antitrust Issues. Some economists opposed the Miller-Coors U.S. merger. They argued that it would create too much concentration in the industry, and lead to more market power and higher prices for consumers. Do you agree and think the merger should have been blocked by the DOJ? Why or why not? Explain briefly but clearly. [pic] According to Steven Newborn, an antitrust attorney with Weil Gotshal Manges in Washington, D.C. said, â€Å"Normally, a 30% market share would not create a problem, but when you have two companies controlling almost 80%, the government may think there is potential for anti-competitive effect.†1 Others have different opinion. I can see a price war breaking out if MillerCoors starts to gain share from Budweiser, says Roman Shuster, a research analyst in Chicago with Euromonitor International PLC. InBev is known to push back, and what they do will have a huge impact on the market.2 I believe the merger shouldn’t have been blocked by DOJ because of below two reasons: †¢ To avoid monopoly: If the merger is blocked by DOJ, then Anheuser-Busch may even capture more market share due to its cost advantages as the result of economies of scale. This may result in a monopoly. Merger gives MillerCoors more than 30% of the market share and a chance to fairly compete with Anheus er-Busch. †¢ Consumers may benefit customers due to price war: Joint venture of MillerCoors was expected to reduce the production and transportation cost of the company. Now both the companies can brew beers at the combined locations and save on transportation and other costs. When the operations merged then hundreds of employees may be laid-off which is expected to reduce employee-related costs.3 Reduced cost will enable MillerCoors to reduce price in the hope to gain market share. Consequent price decreases by Anheuser-Busch may start a price war which will benefit customers. 4. Small Firms. Craft brewing has been the fastest growing segment of the beer industry, but very few craft brewers have reached annual sales levels of 50,000 barrels or more. Magic Hat, however, has reached annual sales of over 150,000. Why has Magic Hat been relatively successful, and does it have the potential to keep growing? If you were to enter the craft brewing market next summer, what would be your sales objective over the following 5 years? What strategy would you use to achieve that objective? Key success factors of Magic Hat potential of growing: As Co-founder of Magic Hat, Alan Newman, says Magic Hat has gone from making kegs for a few Burlington bars to being the number 10 craft brand in the country4. Mainly there are two reasons for its success: †¢ Quality Product Delicious Taste: Magic Hat products are known for its uniquely delicious beers. They have understood taste of their customers. They provide quality product and respect their customer choices. †¢ Quirky Branding: Magic Hat is having a different way of advertising. Its webpage doesn’t ask whether you are 18 or above. But says – Splendor and glory are yours if you can answer one riddle: when were you born? They associate their product to Splendor and glory. Their commercials are equally quirky. Instead of showing people drinking beer and having fun, they show the brewing process and end the commercial by saying â€Å"A performance in every bottle†. Branding is very important to attract customers and their different way of advertising has given them a unique brand name. I believe that Magic Hat has the potential of growing further by focusing on innovation. In Magic Hats Vision and Values Statement, the company focusses on innovation, stating that †¦ideas cannot be limited by current perception. 4 They are expanding in new places and also in long-term markets. Sales Objective and Strategy: Currently total brewery market in U.S. is $27.6B. And it is expected to increase at the rate of 1.9% per year for the next five years to reach $30.3B. But much of this increase is expected to be in craft and premium beer segments. So I believe a growth target of 5% per year I reasonable. So starting at 50,000 barrels, my objective will be to at least increase sales by 5% per year. I will adopt below strategy to be competitive in the market: 1) Select geographic areas where it is appropriate and profitable to sell products. 2) Keep optimum debt level. 3) Establish a brand name by effective advertising and public relations. 4) By optimally utilizing capacity. 5) By controlling distribution arrangements so that they are optimal. By carefully planning links to wholesale stores, bars and nighclubs. 6) By achieving economies of Scale. If required, acquire or merge with another brewery. References 1http://www.beer-universe.com/beer-education-article/2012-07-06/Beer-Wars-Is-Big-Beer-Getting-Too-Big-/ 2http://www.stltoday.com/business/columns/lager-heads/price-war-coming-in-the -beer-industry/article_44619cea-1fb5-5d76-b55c-e7dcc0ee3722.html 3IBISWorld Industry Report 31212 Breweries in the US 4http://www.legalzoom.com/business-management/success-stories/microbreweries-found-macro-suc

Frosts Use of Simple Everday Subjects :: essays papers

Frosts Use of Simple Everday Subjects "Robert Frost is a poet of genius because he could so often make his subtleties inextricable from an apparent availability." Frost uses simple everyday subjects such as nature, man, and home to get his point across in his poetry. Robert Frost was born on March 26, 1874, in San Francisco California. His father, William Prescott Frost, was a journalist who worked for the Daily Evening Post in San Francisco. His mother, Isabelle Moodie Frost, came into the United State when she was 12 years old. Frost was born a year after his parents had gotten married. After Frost's father had died in 1885, he moved with his family to New England where he attended Lawrence High School. "Frost had published several poems in the school magazine and was named class poet." "He graduated in 1892, sharing valedictorian honors with Elinor White, to whom he became engaged." Frost then went onto Dartmouth College, he ended up dropping out of school after one semester. "He instead pursued a variety of jobs , including teaching at his mothers private school and working in a textile mill. In 1894 he published a few poems in The Independent and began corresponding with its literary editor." (Bloom p.12) In December 1895 he married Elinor. "In the early years of there marriage, Frost attended Harvard as a special student but withdrew in 1899 and took up poultry farming to support his growing family. The Frost's family life, often strained by emotional and financial anxieties, was marked by a series of tragedies. Their first child, Elliott, died of cholera at age three. Another child, Elinor Bettina, died two days after birth. Of the four children who lived to adulthood, Frost's daughter Marjorie died of childbed fever at age 29, and his son Carol committed suicide at age 39. Another daughter, Irma, had to be institutionalized for mental illness, as did Frost's sister Jeanie." Frost moved with his family in 1912 to England so he could focus more on his poetry and book publication. "A Boy's Will was published by the London firm of David Nutt and Company in 1913, and was reviewed favorably by American poet and critic Ezra Pound, a highly influential figure in modernist letters. Nutt published North of Boston a year later." As Frost was continuing to write poetry, he began to pursue what would be a life long career as a part-time college teacher.

Discuss Research Into the Nature of Relationships in Different Cultures Essay

Relationships Discuss research into the nature of relationships in different cultures. (9 marks + 16 marks) In Western Cultures, it has been found that relationships are voluntary, temporary and focus on the needs of the individual as due to the predominantly urban settings in which we live in, we are able to (on a daily basis) interact with a large number of people. Western cultures therefore appear to be characterised by a high degree of choice in personal relationships and a greater ‘pool’ of potential relationships. Non-western cultures however, have less choice about whom they interact with on a daily basis, meaning that interaction with strangers are rare and relationships are frequently tied to other factors, such as family or economic resources. In societies with reduced mobility, (predominantly non-western cultures) arranged marriages are common as love is expected to grow due to the fact that it is not seen as necessary for marriage. Arranged marriages seem to work well and make good sense as divorce rates are low and Epstein (2002) found that perhaps about half of them report that they have fallen in love with each other. Myers et al. , (2005) studied individuals in India living in arranged marriages and found no differences in marital satisfaction in comparison to individuals in non-arranged marriages in the US. This is also supported by Gupta and Singh (1982) who studied 100 degree-educated couples living in India, 50 of who had chosen their partners and 50 of who had their marriages arranged for them. The couples were asked to indicate how much they liked/loved their partners and it was found that love and liking was high in love marriages but decreased whereas love increased in arranged marriages and after 10 years exceeded love marriages. However, this study is difficult to generalise as it studies only a small sample and so cannot be generalised to the wider population. It therefore lacks validity. However, in some adapting cultures such as China, there has been a noticeable increase in ‘love matches’ as the Chinese are currently attempting to move away from traditional ‘arranged’ marriages. Instances in which parents dominate the process of partner choice in china have declined from 70% prior to 1949, to less than 10% in the 1990s. Xioahe and Whyte (1990) studied women in love marriages and found that they were more satisfied than those in arranged marriages. Western cultures are also seen as individualistic due to their focuses on individuals rather than groups, with individual happiness and pleasure seen as fundamentally important. On the other hand, non-western cultures are seen as collectivist cultures as people are encouraged to be interdependent rather than independent. Moghaddam et al. (1993) claim that the cultural attitudes of individualist cultures, are consistent with the formation of relationships that are based on freedom of choice, whereas collectivism leads to relationships that may have more to do with the concerns of family or group. Norms and rules act as guidelines for behaviour and influence how we act out any given relationship. One such norm that plays a key part in personal relationships is the norm of reciprocity. Ting-Toomey (1986) found that in individualist cultures, reciprocity in personal relationships tend to be voluntary. In collectivist cultures however, it is more obligatory. In such cultures, failure to return a favour is seen as a failure of one’s moral duty. In Japanese culture, for example, there are specific rules about gift-giving and reciprocating, whereas n such formal norms exist in Western cultures. Argyle et al. ’s cross-cultural comparison of relationship rules in different cultures did find support for some predictions but failed to support others. However, a problem with this research is that the list of rules was formulated in the UK and may have failed to include rules that are specific to a particular culture such as Japan. Research on cross-cultural differences in norms and rules is important to be able to conduct cross-cultural relationships successfully. Knowledge of the norms and rules underlying cross-cultural relationships is an important aspect of any attempt to understand and improve relations between different cultural groups within a host country. Finally, relationships are difficult to study scientifically. Laboratory experiments, through the manipulation of isolated variables, are seen as the most rigorous way of establishing cause and effect, and he best way of furthering our understanding of the processes involved in human relationships. However, as Hogg and Vaughan (2008) point out, people do bring their cultural ‘baggage’ into the laboratory. Although cultural background may be seen as a problematic extraneous variable to some researchers, it is clear that culture itself is an important variable that influences the relationship processes being studied.

The Progressive Movement Of American Society - 2848 Words

Question # 1 Intro 1) Background-The Progressive Movement was an effort to cure many of the ills of American society that had developed during the great spurt of industrial growth in the last quarter of the 19th century. Progressives were mostly middle-class citizens who saw corruption and wanted change in society. 2) Topic 1- The frontier had been tamed, great cities and businesses developed, and an overseas empire established, but not all citizens shared in the new wealth, prestige, and optimism. 3) Topic 2- A major push for change was the First Reform Era, occurred in the years before the Civil War and included efforts of social activists to reform working conditions and humanizes the treatment of mentally ill people and prisoners. 4) Thesis- In the view of progressives, they believed that American society was undergoing complete corruption. Because of this, they advocated women s suffrage and urged the Temperance Movement. 1st paragraph 1) 1st sub-topic- Progressives believed that the American society was ill due to unjust with the workers and farmers, in other words corruption. 2) Evidence 1- The Progressives saw early industrialists built mansions and live in luxury while millions of workers and farmers struggled to earn a living. 2- They also saw that private business was controlled by monopolies and trusts. 3- Progressives wanted better and fairer competition and they wanted every citizen to participate in the social unjust. 4-They wanted better workingShow MoreRelatedThe Successes of Progressive Era Reformers800 Words   |  4 PagesThe Successes of Progressive Era Reformers The Progressive movement was very influential in many ways to early twentieth century America. Businesses became safer, and much more respectful towards their employees. Society accepted moral changes, and became safer communities. 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