Marketing Plan for Horoscope Craft Beer

Company Name & Logo: Horoscope Beer Master S.R.L

Submitted in partial fulfillment of the requirements

For Master of Business Administration Degree

Tiffin University at University of Bucharest

MKT 523 Marketing Management

Professor : Dr Danielle Pfister-Foster

By

Mihai Voicu

Adriana Aruxandrei

Cristian Donciulescu

Mihai Petrisor

Cohort 15

December 1st, 2016

Table of Contents

1. Company Description

a. Product and Service Description

b. Strategic Mission and Vision

c. Strategic Goals

2. Sustainable Competitive Advantages

3. Competitor Analysis

4. SWOT

5. Market - Product Focus

6. Marketing Program

7. Financial Data

8. Marketing Plan Audit

 1. Company Description
Our company (Horoscope Brew Master SRL) is a microbrewery, 6.000 hl/year production

capacity – a producer of high quality craft beer for connoisseurs and high end consumers. It was

incorporated with five stakeholders (the authors of this project and our partner, the master

brewer). Its purpose is the production and distribution of craft beer in Romania.

a. Product/Service Description

Our main and single product line consists of twelve unique beers, each of them relating to a

sign of the horoscope. Each beer type has its own flavor, packaging and a story behind it. Each

beer story will be part of the packaging so whenever a beer is sold the customer will have a high

quality beer and something to read and enjoy.

b. Strategic Mission and Vision

Our Mission is to produce unique and top quality beers that will meet our consumers

favorite taste and personality. Our Vision is to become the most loved and consumed Craft Beer

in Romania.

c. Strategic Goals

Our value proposition is offering to our consumers refreshness and enjoyment, at

reasonable prices and top quality liquid. Our Strategic Pillars are:

 Customer first, not the product

 Ensure customer and consumer satisfaction

 Develop long term relationships with our trade partners

 Market the Company/Brand on Media Channel

 2. Sustainable Competitive Advantage
Our belief is that we have a strong position in the market from the very beginning even if

starting a new brand. First, Romania is one of the highest placed countries in the world in terms

of beer consumption per capita (Kirin Holdings Company, Limited, 2015). The market also had a

steady increase in consumption over the last two years. It is also notable, that compared to other

higher placed countries in the per capita consumption where there are hundreds or even

thousands of microbreweries active, Romania only has 11 ( Euromonitor International, 2015).

This purports that there is a place in the market for new such enterprises.

Our sustainable competitive advantage is based on the ingredients we will use: we will

have the highest placed spring water source in the country (1500m in altitude) which will

provide very pure, untreated water. Romania has a natural freshwater reserve unlike anywhere in

Europe, with in fact 60% of Europe’s mineral water reserves being in Romania (Watercoolers

Europe, 2011), so there is plenty of potential for later expansion. We intend to use only high

quality malt and because we are producing twelve beers we will also have the most diverse malt

assortment.

Ours will be the largest and most diverse beers grouped under the same brand in Romania.

We will cover all possible tastes and characters for both our final consumers and our trade

partners.

Because our beer stories are related to the Zodiac signs, distribution will be guaranteed

across the whole portfolio. In fact, each trade partner will have to buy stock for all twelve beers

in order to cater to each customer. Customers themselves will demand their personalized beer

when vising our distribution partners.

 In terms of know-how our brew master (one of the stakeholders) is the most experienced

and rewarded from Romania and Eastern-Europe. We also rely on the experience of one of the

most well connected sales managers in the beer market, with over 20 years of experience in the

field.

From a marketing potential standpoint, our beers linked to the zodiac signs offer a

tantalizing array of possibilities oriented in two main directions:

 Zodiac sign related - including time-of-year promotions (based on the current zodiac

sign and related zodiac signs), cross-linked promotions with other retailers,

personalized ad campaigns based on each zodiac sign

 Superior quality – featuring and highlighting Romania’s spring waters and imported

high quality malt

3. Competitor Analysis
From the Competition point of view, out of 11 microbreweries, only 9 are active, 2 of them

waiting on equipment or authorization to start. There is no national coverage, all of them acting

as a local producer with very limited distribution. Only 2 brands, Sikaru and Zaganu, manage to

have presence in Modern Trade (International Retailers like Carrefour, Mega Image or Auchan),

all the rest being distributed in HoReCa, or via Online. Their Price Index strategy is 250% vs

Core Segment and their Marketing Communication is mainly via digital or via Music Festivals.

Media channel
Range of Distribution strategy
Volumes Price/unit communication
Brand Products ABV
(liters/year) (average)
(SKU) owned
digital festivals TT MT
pub Horeca Online
Terapia 200,000 2 4,7%-6% 6.3
Sikaru 75,000 6 5%-5,8% 8.4
Ground Zero 72,000 8 4,5%-9% 11
Zaganu 400,000 5 5,3%-9% 8.8
Others (5 microbreweries) 200,000 21
4. SWOT

Strengths

It is a common trend nowadays that consumers are more and more attracted by

natural and healthy products, whether we are talking about food or beverages. One of our

strengths is the fact that our production unit will be located in the mountains at a high

altitude, taking advantage of the mountain’s natural resource which is the pure and

untreated water. Our unique recipes will create a beer using spring water and a wide

range of malt. Using the recipes, we will produce the largest assortment of Craft beer in

Romania, which will ensure market coverage for all tastes and characters, for both

consumers and partners. When starting any business it is important to have a very close

relation with the domain you are about to enter and also when you plan to start a

production unit it is best to know in detail the process of production. From this point of

view, we have convinced one of the best brew masters in Romania to join our startup, as

being one of the shareholders. Using this approach, we were able to take onboard a very

skilled and rewarded brew master, which will ensure a quality product using his unique

experience. However it is not enough to have a good product, you have to know how to

place it in the market and how to promote it. Another key strength is that one other

shareholder is an experienced marketer in the beer industry, working in this domain for

more than 15 years. This shareholder business know how and contacts will be a key

advantage in the first months after starting the business, as we are going to approach the

market not only through retail stores but also through some exclusive HORECA

locations. As you will see in the positioning chapter, we want our beer to be placed as a

high quality product designed to target a niche of clients with exclusive tastes. From this
point of view, we do not want to create a large consumption product which makes profit

by its low price and average quality. Each type of beer will actually be a story, and each

assortment of beer will be uniquely linked to the native’s sign. By using this idea of 12

assortments of beer, one for each zodiac sign, we will ensure assortment listings in our

trade partner’s locations. The marketing possibilities will be multiple as we will be able

to target the customer by their own individual sign, or by zodiac elements using one of

the four existing zodiac elements: fire, earth, air and water.

Weaknesses

Discussing about the weaknesses, of course the first weakness we have to mention

is the fact that we are a startup. We have no brand awareness and no brand equity.

Besides creating a product that is welcomed by consumers, we will have to make

ourselves known in a market that we do not exist. Due to the fact that we want to create a

large assortment of beers, the process of production will be quite complex. The

production planning will have to be linked with each beer type’s consumption, and this

process we anticipate to be a complicated one. Also producing 12 beer types, some with

different ingredients than others will require a very complex supplying process to be put

in place, so we will not have any downtimes, both in the production or distribution

processes. Taken into consideration that we are a startup, we will not afford to pay listing

fees or exclusivity deals using on-trade or off-trade channels. Concluding the

weaknesses, besides the production process which will be quite complicated due to the

variety of assortments, entering the market and creating the brand on the market will be a

challenging task.
 Opportunities

Discussing about opportunities, we will start by mentioning that in a chart of beer

consumption per capita, the Romanians are in the top 10 worldwide consumers (number 7

actually). The beer market is a very dynamic and competitive one, so the potential of the

market is huge. Analyzing craft beer development trends in the world, we can see a solid

growth in countries from Western Europe and US, and a market just starting but with an

accelerated growth in the past 2 years in Romania, counting around 11 breweries in total.

From this point of view, entering a market with huge potential and little competition is

what every entrepreneur wants. From the point of view of distribution locations, pub

owners but also retail chains pay more and more attention to brands/products that offer

them differentiation or unicity from their own competitors. Listing in their locations a

product that is not available in the mass market, will surely create a differentiator for

them as well. Another opportunity that is worth mentioning is that from macroeconomics

point of view, Romania has this year the highest GDP growth in Europe and we can see

similar predictions for the future period, which most likely will generate higher level of

incomes and also higher level of consumption. Higher level of incomes, create also a

demand for higher qualitative products and more sophisticated ones. Entering the market

with a product positioned for the exclusivity segment can be a success strategy in the

current economics context.

Threats

Discussing about the threats, we identified as one of the main threats

multinational beer companies that are blocking on trade market with exclusive deals,

which means that we will not be able (at least when starting) to enter in some exclusive
locations. It is also worth mentioning that, although we have the highest economics

growth in Europe, the local legislation is unpredictable, as we see very often changes in

legislation that affect companies budgeting calculations which most of the time are

applied during the fiscal year. This changes affect tax rates and the excise rate, which

make it very difficult for small companies to stay in business. One of the paradoxes of

our Country is that although we have economic growth, we are still facing a very serious

demographics problem. The migration process, of people which are searching for a better

way of living in Western Europe or US, has started about 15 years ago and it continues

also today. What is actually even more of a threat, is the fact that while initially only

unqualified or less qualified workers were leaving, today we can see that a large number

of people that are leaving the country are from the middle class, which can be a problem

from the point of view of a marketer, that seeks to create and deliver a product to a target

segment that is continuously shrinking.

5. Market-Product Focus
Taking into consideration that we have the widest range of products in Craft Beer

Segment (12 different types of beer), we have a unique taste, a product story and a top

quality liquid, our packaging should communicate and look in the same way, being

unique and breathing quality from each component.

Our Bottles:

We will chose to have 4 color types of glass bottles, each one representing the

color code for zodiac elements and signs:

Fire – Red Bottle used for the beers type under the signs of Aries, Leo and

Sagittarius ( Pale Lager, Indian Pale Ale, Traditional Lager)

Earth – Green Bottle used for the beers type under the signs of Taurus, Virgo and

Capricorn (Stout, Pilsner, Porters)

Air - Transparent Bottle used for the beers under the signs of Gemini, Libra and

Aquarius (Shandy, Pale Ale, Wheat Beer)

Water - Blue Bottle used for the beers under the signs of Cancer, Scorpio and

Pisces ( Belgian Wheat, Doppelbock, Brown Ale)

 Our Labels:

The label will have incorporated Brand Logo, zodiac sign, beer type, and the beer

story as per example: “Aries’ sense of humor is second to none and just like a Pale Lager

an Aries will have you giggling all night long. That’s why it’s the perfect beer for you!”

Market Research:

Before launching the products we will conduct 2 studies via Focus Groups

(Quantitative and Qualitative):

1. Packaging (bottles, body and neck labels). How do we perform vs our main

competitors?

2. Liquids – Defining the most appropriate test for Romanian beer drinkers, per

each type of liquid we want develop

Price Strategy:

Our value proposition is offering to our consumers refreshness and enjoyment, at

reasonable prices and top quality liquid. From this perspective we need to price our

products combining the following two elements:

1. Cost of Good/Production Cost

2. Competition Price Strategy

 Our quality credentials allow us to charge more the beer consumers (unique recipes and

top quality liquid that require top quality ingredients, pure and untreated water and

craftsmanship), but we need to consider also that we are still unknown in the market. We need to

be accepted and listed by our trade partners, by selling our products there margins should be at

least the same or even higher vs our main competitors portfolio. Taking into consideration that

our main competitors are positioned in the range of 9 to 11 ron, our products will be charged for

9,99 RON, delivering reasonable margin for us, but also being positioned as anchor price.

Positioning Grid:

In Craft Beer segment our positioning is Top Quality product with a very good Value for Money

proposition.

9,99 RON
 Distribution Strategy:

To become the most loved and consumed Craft Beer in Romania, our company vision,

delivering 6.000hl/year, we need to have a much better Route to Market strategy vs. our

competitors. We need to build a national distribution, urban mainly, in the most important cities

with the highest level of incomes per capita.

Channel Approach/Distribution Targets:

1. On Trade – 30 Premium locations ( 10 in Bucharest, 5 in Cluj-Napoca, 5 in Timisoara,

2 in Constanta, 2 in Brasov, 2 in Iasi, 2 in Sibiu, 2 in Craiova) , with permanent activity

and 150hl volume potential/year.

2. Off Trade/Modern Trade – Mega Image retail chain (the biggest retail chain,

supermarket format, widest range of import/craft beers listed, the highest penetration in

Bucharest).

3. On Line – http://www.berero.ro/, http://craftbeer.ro/ ,

http://www.emag.ro/supermarket/bere/

As future plans, if the demand will grow outside of Bucharest Area, we will use local

distributors, especially the ones which are specialized in HoReCa (premium portfolio of spirits,

and wine). There is potential to grow distribution in other Modern Retail chains, like Kaufland

and Carrefour, but this action requires extra investments in our production capacity. We will

consider this after year 3.

 6. Marketing Program

Communication Target

Younger population up to 35 years old, living in urban area, is the most appropriate

communication target (Craft Beer in Romania, 2015, IPSOS Study)

The Reason Why?

 They are more opened to novelties and experimenting

 They enjoy trying new tastes and finding the best beer for them

 They tend to show off and impress others

 They like to differentiate

 They need to differentiate and feel unique

 They want to stand out from a crowd

 Level of monthly/annual incomes is above average

 They need to experience authenticity

Integrated Marketing Communications

Being a small company, with less than 1,5 million euro net sales in year 1 and 25.000 euro

marketing budget, we need to spend our resources very smart. Digital media is expected to

remain the most dynamic advertising revenue driver, as internet usage will continue to grow,

driven by the more affordable gadgets and mobile services provided by telecom companies.
 For having full year coverage, Digital will be our main communication channel, using the

most used/visited social media platforms, like Facebook - 8.100.000 user accounts, LinkedIn -

1.810.000 user accounts, YouTube - 824.000 user accounts, Tweeter - 380.000 user accounts and

Instagram - 360.000 user accounts.

Based on the study performed by Gemius Global in November 2015 – “Age groups of
social media user”, we should consider Facebook, Instagram and Tweeter the more appropriate
social media platforms for our brand , all of them having at least 50% of the user accounts in the
range of 18-35 years old, our main communication target.

We will use also bloggers/endorsers (http://blogdebere.ro/), In Store communication as

part of our Marketing Communication Strategy.

All media campaigns will be developed under the slogan “Unique taste but different, like

every one of us!”

Reason To Believe build up plan via three major consumer benefits: Unique Recipes, Top

Quality Liquid made it from Top Quality ingredients and Craftsmanship

 Promotion Strategy

On Trade Channel

Customer - Full portfolio listing offer 22 boxes + 2 free of charge

Consumer - Trial campaign 2 beers for the price of 1 and Happy Hours sessions -20% Price

Off

Modern Trade Channel

Customer - Bulk Offers 11 pallets + 1 free of charge

Consumer - Trial campaign 2 beers for the price of 1, Promo Pack’s 5+1 free of charge,

Thematic Displays

On Line Channel – Monthly Price Off celebrating natives

Due to profitability reasons, promo discount should not exceed 20% from Gross Sales in the year

1 and not more than 15% after.

 7. Financial Data and Projections
We have built our 5 years plan with focus on Top Line Growth (Net Sales Revenue, Cash

Flow end EBIT), due to very limited financial resources. For reaching our goals, we need to have

a reasonable 10% YoY volume growth (no risk considering that we can extend our distribution if

needed), while maintaining variable industrial cost and variable logistic cost per hectoliter at the

same level with year 1. Front investment in production facilities (600.000 euro) will be recovered

in year 5.
 8. Marketing Plan Audit
 Check Financial KPI’s – Net Sales Revenue absolute, Net Sales Revenue / hectoliter,

Cash Flow and EBIT

 Check Volume Performance

 Check Customer Satisfaction – we will conduct a Customer Satisfaction Survey once a

year, by checking all relevant touch points that influence positive or negative perception

(the product himself, interaction with our sales representative, order placing, delivery,

pricing and promotions, category expertise). There is no budget needed for this action,

we have a limited number of customers.

 Check Consumers feedback on Social Media platforms

Bibliography

Kirin Holdings Company, Limited. (2015, 12 24). Global Beer Consumption by Country in 2014.
(K. Group, Producer) Retrieved from Kirin Group:
http://www.kirinholdings.co.jp/english/news/2015/1224_01.html#table3
Watercoolers Europe. (2011). 60% of Europe’s mineral water reserves are in Romania.
Retrieved from Watercoolers Europe: http://www.watercoolerseurope.eu/news/60-of-
europe-s-mineral-water-reserves-are-in-romania
Gemius Global study : https://www.gemius.com/agencies-news/age-groups-of-social-media-
users.html