Drinkworks Strategic Analysis

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Drinkworks is a privately held company that incorporated Keurig’s technology and the alcohol expertise of Anheuser-Busch InBev (AB InBev) to design Home Bar, an innovative product for making single-serve adult beverages at home. In this regard, market research and strategic planning are essential to ensure efficient decision-making and align the company’s processes. This paper aims to provide a strategic analysis of Drinkworks in the alcohol market in terms of segmentation, consumer change, competitive responses, and prioritization of limited resources, as well as recommend a marketing strategy for the company’s successful development.

Strategic Analysis of Drinkworks in the Alcohol Market


To position Drinkworks in the United States alcohol market, customer segmentation is required. The company’s research highlights six primary consumer groups to consider. Out of them, non-social infrequent drinkers and young beverage enthusiasts that host and drink weekly constitute about a quarter each, followed by social infrequent spirit drinkers. Based on the alcohol consumption by segment, beer and red or white wine are the preferred beverages among most groups. The purchase intent for Drinkworks’ devices and pods is highest among young frequent drinkers and hosts, followed by an older category of people who drink and host often. Therefore, to appeal to a large market, Drinkworks’ customer profile would include US-based male and female individuals aged above 25 and belonging to the middle class or above. The primary consumer would be a high-frequency drinker that hosts on a regular basis and values convenience and quality.

Consumer Change

Drinkworks is currently facing a consumer change in the alcohol market as customers view brand and price as the main purchase factors. Price indicates the quality of the product, and a number of clients report that they are willing to pay for the opportunity to make top-quality drinks. Home Bar is perceived as luxurious and sophisticated, which places it in the high-end sector of the market, positively impacts brand loyalty, and appeals to status-oriented customers. Drinkworks’ product is viewed as innovative, modern, and trendy, which adds to its value. Furthermore, customers report that Home Bar allows them to prepare cocktails in an easy and fast way and improves their efficiency. Hence, Drinkworks product is considered premium, and the willingness to pay is higher among young people that live in an urban area, socialize at home weekly, and are marked by higher household income.

Competitive Responses

Drinkworks used the principle of Keurig coffee-makers to create a home appliance for producing alcoholic beverages with a single touch of a button. The company aimed at creating an excellent beverage experience through innovation and adjusting its strategy in accordance with the consumer research findings. The user is placed at the center of Drinkworks’ operations and treated as the hero whose needs must be met. The company has made some changes to respond to the market status, such as infusing the drinks with all-natural ingredients and extending the drink options to allow every consumer to find some to their taste. Moreover, Drinkworks implements non-traditional approaches and values innovation in its operations. For instance, each appliance can connect to the user’s Wi-Fi to ensure easy software updates and connectivity. Bluetooth connectivity is another feature added for monitoring the device’s performance and ensuring a positive user experience.

Prioritization of Limited Resources

Drinkworks prioritizes innovation and a thoughtful approach to operating limited resources. The company invests in projects that allow for increasing the value of its products and creates mutually successful partnerships. In doing so, it aligns investments and business priorities which contributes to higher growth potential. Drinkworks considers its teams the greatest asset and encourages initiative and a learning mindset to help the whole company grow and improve. Overall, the company conducts consumer research to consider the changing needs of clients and focus on projects with high profitability.

Strategy Recommendation for Drinkworks

The 4Ps model is based on four elements, including product, price, place, and promotion used to define the company’s marketing mix. The product is the Home Bar appliance that enables a simple process of producing single-service alcohol beverages at home with the use of pods. Drinkworks’ customers perceive its device as premium and are willing to pay reasonable prices for quality and convenience. The most efficient model of product distribution is selling Home Bars directly to consumers or through e-commerce platforms, such as Amazon. Finally, promotion should be done primarily through advertising and social media marketing, whose influence in the market continues to grow. Based on the strategic analysis of Drinkworks and the use of the 4Ps model, the company should implement a sustaining innovation strategy, which allows for adding value and enhancing the company’s products.

Overall, Drinkworks’ goal is to make the drinking experience remarkable through the use of innovation. The company’s approach is to test, learn, and improve immediately while focusing on the consumer’s requirements as the key priority. Hence, the use of technology and big data will allow for anticipating new trends and meeting clients’ changing needs in a timely manner, gaining a competitive advantage. A sustaining innovation strategy can provide the existing market with better value while driving the company’s profits.

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