Adnams Company: Marketing Approach Redesigning

Introduction

Operating in the environment of the global economy is a challenging task that requires addressing a variety of factors affecting entrepreneurship on several levels. More importantly, integration within a particular market requires that a well-put-together strategy should be adopted to address a target customer. Although the framework designed by the Adnams Company to address marketing issues is truly stellar, due to the incorporation of unique artwork, an unwillingness to focus on sustainability as the foundation for its operations in the target environment may pose a significant threat to the firm’s success.

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SWOT Analysis

Strengths

The entrepreneurship has designed a unique marketing tool that is bound to be associated with the company and, therefore, make the firm and its brand product outstandingly memorable. Furthermore, the fact that the entrepreneurship complies with the principles of environmental sustainability and offers products that can be defined as exceptionally green increases the possibility for the firm to become popular in the designated market.

Weaknesses

The lack of emphasis on sustainability development may trigger major consequences. For instance, the organization may suffer from an inadequate allocation of costs and, therefore, fail to use its strengths to its advantage.

Opportunities

The company has ample chances for exploring the global environment and promoting innovation as its primary strategy in the global economy.

Threats

The lack of sustainability in the distribution of financial resources may lead to the company’s untimely demise (Verity & Turnbull 2013).

Target Market

The brewery industry has something of a proud history of being both an extension of unique, country-specific traditions and incorporating the latest technological advances (Gammelgaard & Dörrenbächer 2013).

The beer market, in its turn, can be described as one with a rather steady development rate. For instance, on a global scale, total production rates have been rising consistently over the past 15 years, with a minor hiccup in 2009 (Beer production worldwide from 1998 to 2014 (in billion hectoliters) 2014).

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As far as the beer market in the UK is concerned, the target environment can be identified as rather competitive, with brands such as Heineken and SABMiller leading. Total sales rates have increased by 1% over the past few years, according to a recent report (Beer in the United Kingdom 2015).

One should mention, though, that the 1% rise in the on-trade area occurred simultaneously with a 1% decline in the off-trade segment , which means that the company may face certain obstacles in entering the target environment and promoting its product. Particularly, while developing the marketing strategies targeting independent retail and restaurants, bars, etc., the entrepreneurship will have to focus on meeting the standards of the on-trade environment (bars, pubs, and restaurants, in particular).

The UK beer market, as well as the global one, can also be characterized by increased rates of product diversification. The measure above is sensible, given increasing quality demands and the numerous needs of customers. At present, the market is largely represented by products including standard and premium beer, ales/stout and bitters, non-alcoholic beer and specialty beer, each type also including a variety of subclasses with unique features and original taste (The beer market and its characteristics 2016).

As far as competitors are concerned, Heineken and SABMiller are currently at the helm of the UK market. On a global scale, companies such as Anheuser-Busch InBev tend to play the lead role. Although competing with corporate monsters such as the ones mentioned above does not seem reasonable, Adnams may take the niche of producing exclusively green beverages, therefore putting a strong emphasis on the sustainability component.

Strategic Options for the Organization

At present, several options for the company’s further development can be identified. Although the option described as the most efficient has evidently warranted the credit given to it, it would be wrong to dismiss other approaches as entirely inefficient. Quite on the contrary, they should be viewed as secondary steps in the evolution of the entrepreneurship in the global economy environment.

Specifically, during the promotion of the sustainable approach as the primary strategy of the firm, and the subsequent design of the brand product, it will make sense to concentrate on investing into brand product development, at the same time cutting costs for the procurement process. Seeking better options for enhancement of the latter stage of upply chain management can be attained by improving current information management strategy. To be more accurate, the enhancement of information security of the entrepreneurship, combined with the inclusion of advanced data management tools into the framework of the organization, must be viewed as one of the primary goals to be accomplished.

Option 1. Focus on a new brand (product scope)

Entering the global economy is going to be a very bumpy road unless the entrepreneurship designs a strong brand image that will be associated with the entrepreneurship, and that people will instantly recognise. Although the products currently created by the firm enjoy quite a success among local members of the population, once entered into the global market, it will have to be targeted at a different set of customers.

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Therefore, a new brand image, a brand product, or at the very least, the tools for revamping the current one, will have to be identified and applied successfully. In other words, a substantial amount of money will have to be spent on R&D and the design of the corresponding marketing approach.

Option 2. Improving the logistics strategy (geographic scope)

Apart from reinforcing its product development process, Adnams could also consider the cross-functional decision-making model as the tool for improving the current state of affairs at the organization. The approach mentioned above implies that diversity and improved quality standards should be introduced to the members of the entrepreneurship. Particularly, the Total Quality Management (TQM) approach, along with the Just-in-Time framework, should be suggested as the primary means of managing the value chain in a more sensible manner.

The choice of better geographical options for delivery of raw materials and the end product to target customers and retailers must be carried out in the most efficient manner. In other words, the time taken to transport goods, the quality of the process (e.g., the possible damage to goods in the course of transportation), etc., will be improved significantly. Consequently, a rapid rise in customer satisfaction rates can be expected. The identified outcome, in its turn, is likely to trigger an increase in the firm’s popularity in the target market, therefore, causing Adnams to become globally recognized.

Option 3: Emphasis on sustainability (value chain scope)

Last but definitely not least, the issue concerning the further promotion of sustainability needs to be brought up as one of the most reasonable choices driving the evolution of the organization. As stressed above, the concept above used to be part and parcel of Adnams’ operations and key processes, yet was quickly forgotten once the entrepreneurship had to face other concerns while entering the global environment.

Nevertheless, its further enhancement is bound to have a huge effect on the development of the entrepreneurship, given the fact that it will serve as the foundation for a new resources allocation approach. In other words, a cost-efficient strategy can be designed so that the company could reduce its expenses by significantly bringing down waste rates. The identified option seems the most sensible step to take at present, since Adnams is in desperate need of a cohesive strategy for allocating resources to create a new, strong brand.

Recommendations

In light of the fact that Option 3 seems to be the most legitimate approach to adopt in the identified scenario, it will be necessary to make sure that the concept of sustainability should be incorporated into the entrepreneurship’s system of values, and accepted as an integral part of the corporate philosophy by the employees. Apart from promotion of a better data management approach mentioned above, the organizational behaviour patterns of the staff will have to be altered. To be more accurate, it will be necessary to ensure that every employee should make company-related decisions based on the corporate ethics and the new principles of customer satisfaction enhancement. For these purposes, the idea of Corporate Social Responsibility (CSR) should be promoted in the corporate environment.

In fact, Option 3 will allow for enhancement of innovation as the primary asset of the entrepreneurship. As the SWOT analysis carried out above shows, innovativeness and openness to original solutions can be defined as essential strategies that Adnams can adopt in the target environment to gain the competitiveness that it needs. Given current competition rates in the target environment, the application of innovative solutions is evidently a pathway to a successful representation of the firm’s services to the target audience. The application of sustainable principles will prompt the idea of using every single positive characteristic of the company to its advantage. Therefore, the promotion of innovative solutions can be enhanced with the reconsideration of current value chain elements and the philosophy thereof.

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PESTEL Analysis

A closer look at the target market will show that Adnams is going to face serious obstacles in obtaining market share. First, the fact that the market is filled with numerous competitors needs to be considered. Furthermore, one should point to the fact that the rivals in question have been operating in the target environment long enough to have developed a competitive advantage that propels them to the top. The PESTEL analysis below points quite clearly to the fact that the target environment cannot be defined as suffocating in terms of legal constraints, economic regulations, etc.

However, the fact that the marketing strategies of the rival companies are efficient, and distribution channels are wide and numerous, proves that design of the marketing strategy needs to be sophisticated, inviting as many customers as possible. The latter is required, not for the entrepreneurship to be the best in the target area (although such an outcome is also desirable), but merely to remain in business in the designated area and not to be swallowed by large corporations.

PESTEL Analysis.
PESTEL Analysis.

The PESTEL analysis carried out above shows graphically that the entrepreneurship is going to enjoy a variety of freedoms in terms of legal regulations in the UK environment. However, Adnams’ leaders should bear in mind that, entering the environment of the global economy, the firm may encounter legal constraints, such as the use of particular imagery in advertisements, and the requirement to target only people aged 21 and older (18 and older in some countries). Particularly, the impact of the factors above on the areas listed below needs to be brought up.

Competitors Analysis

Adnams SABMiller Anheuser-Busch InBev Heineken
Overview and profile
  • PLC
  • Brewery industry (Equities2016)
  • 65.7 m GBp
  • Holding company
  • Brewery industry
  • 4,217 m GBp
  • 32.53 m GBp
  • Brewery industry
  • PLC (Ownership structure, 2016)
  • 6.4 m GBp
  • Holding company
  • Brewery industry
Competitive advantage
  • Sustainability
  • Green product
  • Employees
  • Talent management (Erasmus & Schenk 2008)
  • Sustainability
  • Customer loyalty (Beyond the beer at Anheuser-Busch Inbev2013)
  • Sustainability
  • Numerous investors
  • Expansion strategy
Target market
  • Global
  • UK (home)
  • Global
  • UK (home)
  • Global
  • Belgium (home)
  • Global
  • Germany (home)
Market share (global) (Statista, 2016) To be determined 9.7% 20.8% 9.1%
Marketing strategies
  • Innovation
  • Sustainability
  • Emerging markets (e.g., Africa) (Wales 2016)
  • Creation of champion brands (Brand strategy2016)
  • Adaptive approach
  • Use of social media (Heineken’s adaptive marketing strategies2016)
Products and services
  • Beer
  • Wine
  • Spirits
  • Beer
  • Beer
  • Soft drinks
  • Beer
  • Cider
Pricing and costs Flexible High High High
Distribution channels Three-tiered (History of beer distribution 2016) Three-tiered Three-tiered Three-tiered
Strengths Original marketing tool Large collection of products Unique and vast experience in the industry Huge array of products and brands
Weaknesses Lack of sustainability Failure in emerging markets
  • High leverage rates
  • Lack of distribution channels
  • Large number of imitators
  • Inconsistencies in the corporate values
Opportunities
  • Exploring new markets (including the global one)
  • Creating a unique global brand
  • Possible increase in market share
  • New brands development
  • Expansion into emergent markets
  • Increasing growth due to expansion
Successful acquisition policy
Threats
  • Failure to allocate the resources properly
  • Tough drinking regulations
  • Tough drinking regulations
  • High competition rates
  • Drinking regulations
  • Policies regarding consumer health
  • Tax regulations
  • Drinking regulations

Segmentation, Targeting and Positioning

Based on the information provided in the PESTEL analysis above and the evaluation of competitors, it will be sensible for Adnams to focus on middle-class customers aged 21-45. Identified customers will be split up into groups based on their income, gender, annual income, etc. Thus, the entrepreneurship will be able to address each customer category directly, therefore, appealing to them successfully.

Brand Identity and Image

In light of the fact that the company cannot target people under 21 (18 in some countries), the segmentation process must be carried out with respect to the legal restrictions in question. It is desirable that the brand image should reflect the firm’s philosophy, i.e., emphasis on green production.

Marketing Mix

People

The legal, sociocultural, and sometimes political factors mentioned above affect the identification of the target customer to a considerable degree. Adnams will have to be very careful when considering the legal age in each market, so that its license should not be revoked.

Product

As a rule, the history of beer production and connection to traditions is crucial for promoting beer. Therefore, in some way, the product defines the routes that the entrepreneurship could take with the design of its promotion campaign. However, to attract the attention of the public, Adnams could consider breaking some of the advertising tropes and, therefore, shock the audience into paying attention.

Place

Seeing that Adnams is targeted at both on- and off-trade areas yet will have to focus more closely on the latter, the use of online tools should be viewed as the primary location of the product. Specifically, announcements on social networks and offers on advertisement sites will have to be posted. Furthermore, the organization will have to adopt a range of sophisticated SEO tools, such as creating a set of blogs, vlogs, etc., that will provide essential and interesting information about the products created by the company (e.g., the origins and creation of light beer, the unique properties of alcohol-free beer, etc.).

In addition, a well-thought-out site design must be considered. To be more accurate, the company may need to create a site that will include a list of products with corresponding descriptions and prices, as well as an electronic form to be filled in for delivery of the beer.

Price

Seeing that the company is not going to compete with corporate monsters such as Heineken at present, it will be reasonable to adopt a compromising pricing strategy, with options for choosing average (£2.99 per can) and luxurious (£4.99 per can) products. In addition, the firm could consider the idea of using a discount policy, with customer loyalty programs that include discounts and discount cards.

Promotion

Similarly, certain sociocultural specifics of the global economy environment, such as the propensity of Germans to be attracted to commercials involving puns, affect the promotion strategy. One might assume that the information above must be followed closely to avoid any culture clashes. However, the given supposition would be erroneous. Instead, the firm should not be afraid of seeming obnoxious to a specific tier of society in its focus on becoming memorable and recognizable. Thus, it will attract the attention of every member of the target population and become instantly identifiable and relatable.

Physical environment

Another essential component of the UK market and the global one, the specified factor does not affect the marketing approach of Adnams’ ad, therefore, does not need special attention.

Process

As stated above, the focus should be on environmental sustainability.

Buyer behaviour

As the PESTEL analysis carried out above shows, the company is likely to arouse the interest of the UK audience in the beverage produced. Moreover, with a flexible pricing strategy and the focus on diversifying its product, along with emphasis on innovative properties and greenness thereof, the firm is likely to attract the attention of the British people soon enough.

Unique selling proposition and sustainable competitive advantage

Creating a unique selling proposition and maintaining sustainability in the environment of the British and especially global markets, however, is bound to be rather challenging. However, seeing that the company is particularly targeted at promoting a sustainable use of resources and focuses on the green production process, it could be suggested that the environmentally friendly approach may propel it to the top of the current list of leading companies.

Reference List

Beer in the United Kingdom. 2015. Web.

Beer production worldwide from 1998 to 2014 (in billion hectoliters). 2014. Web.

Beyond the beer at Anheuser-Busch Inbev. 2013. Web.

Brand strategy. 2016. Web.

Equities. 2016. Web.

Erasmus, B, & Schenk, E 2008, South African human resource management: theory & practice, Juta and Company Ltd., Cape Town.

Gammelgaard, J, & Dörrenbächer, C 2013, Challenges of the global brewery industry. Web.

Heineken’s adaptive marketing strategies. 2016. Web.

History of beer distribution 2016. Web.

Ownership structure 2016. Web.

Statista. (2016). Global market share of the leading beer companies in 2014, based on volume sales. Web.

The beer market and its characteristics. 2016. Web.

Verity, A, & Turnbull, J K 2013, ‘Case study. Adnams – a living company’, in Johnson G, Whittington R, Scholes K, Angwin D, Regner P (ed.), Exploring strategy: Text and cases, 10th edn, Pearson, Harlow, pp. 606-611.

Wales, A 2016, SABMiller’s unique strategy for emerging markets. Web.

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