Transcript New Belgium`s Marketing Strategy JULIA

Case Study # 8
New Belgium Brewing
Developing a Brand Personality
Group 5
Group Members
Mauricio Gonzalez
Bui Thi Thuy
Chantharas Kanchanakool
Nina Krapf
Vincent Tenchavez
Julia Vassiljeva
Outline
I. Introduction of Group and Outline
II. Introduction of New Belgium Brewing
III.New Belgium’s Marketing Strategy
IV.Developing a Brand Manifesto
V. Selecting Media
VI.Message Development
A. The Mindset Personification - Urban Professional
B. Development of Commercial - The Tinkerer
C. The Advertising Campaign
VII.Questions for Discussion
Introduction of New Belgium Brewing
JULIA
Introduction of New Belgium Brewing
Background
• Established in 1991 in Fort Collins by
Jeff Lebesch
• Inspired by a bike ride through
Belgium on a fat-tired mountain bike
-> flagship product - Fat Tire Ale
• Evolved from a tiny basement in
1991 into a $5 million brewery in
1995
JULIA
Introduction of New Belgium Brewing
Achievements
• Sales: $32.0M (2008)
Total US craft brewing industry annual
volume is $6.3 billion
• 210 employees
• 350,000 barrels of beer a year
The craft brewing industry produced
nearly 8.6 million barrels of craft beer
in the US in 2008.
JULIA
Introduction of New Belgium Brewing
NBB Ranking
JULIA
The US's third largest craft brewer
1,525 breweries in the US , July 31, 2009
New Belgium’s Marketing Strategy
JULIA
New Belgium’s Marketing Strategy
JULIA
• Marketing department evolved from Kim
and Jeff traveling to festivals, sampling out
beers and talking to folks to having Beer
Rangers who continue doing the same job
• Philantropic bike festival “What’s Your
Folly”
• Web-based contest “The Worthy Endeavor”
• Media support
• Selling products emblazoned with its logo
including hats, t-shirts, beer glasses,
frisbees
New Belgium’s Marketing Strategy
“We're not looking at aggressive
marketing strategies right now because
quality of life-for ourselves and our
employees-is important, too.
If sales become the only focus of a
business, and you're constantly hiring
new staff, you may lose track of the
original goals: to have some fun,
maintain a great working environment
and produce an excellent product that
doesn't have [negative] impacts on the
environment."
Kim Jordan, 2003
JULIA
Developing a Brand Manifesto
THUY
Developing a Brand Manifesto
• With expanding distribution the
brewery recognized a need to reach its
far-flung customers -> looked for a more
formalized and systematic approach to
analyzing its audience
• Rejected a mind-share approach to
branding and hired Douglas Holt –>
proponent of “cultural branding” that
tries to speak tensions within society
• Developed
a
brand
manifesto
describing the brand’s attributes,
character, cultural relevancy, and
potential.
THUY
Selecting Media
THUY
Selecting Media
THUY
• Having selected Amalgamated, an
equally young, independent New York
company, as an advertising agency, NBB
starting advertising through a mix of
radio shorts, television and theatrical
screenings.
• However, television quickly rose as a
preferred option
• Amalgamated created a $10 million
advertising campaign for New Belgium
that targets high-end beer drinkers,
men ages 25 to 44 and highlights the
brewery’s image as being down to
earth
Selecting Media
• The advertising helped position
the growing brand as whimsical,
thoughtful, and reflective.
• In addition to the ad campaign,
the company maintained its
strategy of promotion through
event sponsorships.
THUY
Message Development:
The Mindset Personification
Urban Professional
MOD
Message Development
The Mindset Personification
New Belgium Brewery true character
conveys through the advertising and
TV commercials in the way that
matches style and life preferences of
its core consumers.
MOD
Message Development
New Belgium Brewery’s Core
Consumers:
Professionals who follow the
traditional route of existing within
a capitalist economy but still has
artistic learning and desires.
MOD
Message Development
New Belgium Brewery beers could
be positioned as a manifestation of
the lifestyle that compromises
between living the life one wants
with balancing the economic needs
of existing within a technopoly.
MOD
Message Development:
Development of Commercial
The Tinkerer
NINA
Message Development
Development of Commercial
• Choosing of a character called the
“Tinkerer” , who discovered an old
cruiser bike, for their commercials
• Amalgamated allowed the whole
NBB crew to take part in the process
and weigh the different storyboards
NINA
Message Development
Development of Commercial
• Suggested tag line: “Follow your
folly….. Ours is beer.” led to a lot of
discussion within the crew:
Debate about the content of the tag
line  some had the feeling that the
expression “folly” does not suit with
high-quality beers
Finally the creative team decided that
“folly” is suitable and ready for a fresh
new definition!
NINA
Message Development
Development of Commercial
• Jake Scott was chosen as director for
the commercials:
Shooting the spots on 16mm film stock
Influenced by work of 1960s
documentarian William Eggelston
Scouted locations in Colorado
Chose Charles Srbecky, a Czech Boulder
craftsman to be the “Tinkerer” due to
his atypical style and maturity
NINA
Message Development
Development of Commercial
• Chosen
musician
for
the
commercials: Devendra Banhart
Music derived from “Freak Folk”
Integrated sense of cheerful nostalgia
• The product itself was just shown in
the last five seconds of the spot 
created a totally new way of beer
commercials
NINA
Message Development:
The Advertising Campaign
MAU
Message Development
Even as NBB decides to speak to a
WIDER AUDIENCE through a NEW
MEDIUM the ROOTS-STYLE COULD
BE NOT ABONDONED
MAU
It became even more important to
speak to the insiders who helped
build the brand in the same
AUTHENTIC and PERSONAL TONE
they had come to know and
embrace.
Message Development
Events became an even greater
opportunity to maintain the vital
dialogue
(event
sponsorship).
NBB turned to insiders in bike
community and friends of the
brewery with some personal history
and knowledge of the brand.
MAU
Message Development
THE THEORY:
The medium of TELEVISION would
reach those FARAWAY OUTPOST
where Ranger sales staff
penetration was difficult and not
cost effective.
MAU
In MATURE MARKETS, the
PERSONAL TOUCH would be
REDOUBLED.
Message Development
“…the basic proposition of beer has
to be fun. The small brewers have
always done this well… often with
great irreverence, quirkiness or just
plain silliness… but always with a
strong, instinctive understanding of
the unique personality of their
brands…”
Bob Mikulay
(Miller SAB vice president of marketing)
MAU
Message Development
…so NBB´s fist television-based advertising
campaign mirrored well the craft BREWER'S
PERSONALITY, aimed seemingly at a youth
demographic, positioning itself as a
WHIMSICAL THOUGHTFUL AND
REFLECTIVE.
Even the texture of the film and the musical
tone capture the ideals of WHIMSY and JOY
inherent to NBB´s philosophy of BREWING
and QUALITY OF LIFE.
MAU
Questions for Discussion
VINCE
Questions for Discussion
Insiders vs. Focus Groups
Rather than testing its television spots
using focus groups, New Belgium Brewing
Company instead tested these spots
using insiders in the bike community and
brewery friends who had a personal
history and knowledge of the brand.
Evaluate NBB’s decision not to use focus
groups.
VINCE
Questions for Discussion
• In order to create NBB’s brand
personality, NBB needed to find out
what their products mean to their
customers
• Since NBB started as a backyard
company, the core customers, know
best what NBB’s products are about.
VINCE
Questions for Discussion
• Information that are genuine and
reliable about a product would come
from people who know the product,
especially when it comes to dealing
with brand personality.
• It all boils down to Insiders vs.
Focus groups.
VINCE
Questions for Discussion
• Focus groups, while useful, also
have a lot of disadvantages:
o time can be lost on issues irrelevant to
the topic
o tough to analyze because the talking is in
reaction to the comments of others
o Uncertainty Principle. What is observed
is not nature itself, but nature exposed to
the method of questioning.
o focus groups often aim to please rather
than offering own opinions or evaluations
VINCE
Questions for Discussion
New Markets vs. Mature Markets
What are some benefits of NBB’s decision
to redouble its roots-based, personal
touch marketing efforts aimed at its
mature markets?
VINCE
Questions for Discussion
• Retaining customers of the mature
market have the following key
benefits:
o Acquiring new customers can cost five
times more than satisfying and retaining
current customers
o A 2% increase in customer retention has
the same effect on profits as cutting costs
by 10%.
VINCE
Questions for Discussion
• Retaining customers of the mature
market have the following key
benefits:
oThe average company loses 10% of its
customers each year
o A 5% reduction in customer defection
rate can increase profits by 25-125%
depending on industry
o The customer profitability rate tends to
increase over the life of a retained
customer
VINCE
Questions for Discussion
• Those key benefits were taken from
a study made by Vadim Kotelnikov,
regarding customer retention.
• They primarily study the effect of
sales, profits and statistics.
VINCE
Questions for Discussion
• But simply put, and relating mature
markets to developing a brand
personality, the following are obvious
reasons:
o Dealing with your core and mature
markets is definitely way easier than
expanding to new markets.
o Core and mature markets know your
product best.
VINCE
Thank you!