After more than a century of success it seems foolhardy that a company would try to reinvent the wheel or try to fix something that is not broken. It seems that the brightest minds at Foster’s Group – a beer and liquor company based in Australia – knew something that the average beer drinker is not aware about. But a casual survey of the beer drinking industry will reveal that there is a trend towards low-calorie beers (Lee, 2009). After an unbroken string of success that stretched as far back as the late 19th century, Victoria Bitter – a very popular brand among blue collar workers and the “average bloke” – will have to be upgraded because the marketing people wanted to offer an alternative for the under 30’s segment of the male population. This is the major reason why Foster’s Group is more than willing to take a gamble with a product spin-off that will be known as VB Raw. While Forester’s Group is optimistic about VB Raw, there are those who are voicing their concern that the new low-calorie beer may hurt the company in the long term.
There is a need to find out why consumers will choose a particular product over another. There is a need to understand the factors that influence consumer behaviour especially when it comes to switching brands or discontinuing the use of one product while patronising another. These are very important ideas and concepts that if understood correctly will help businessmen and their respective marketing executives to develop a strategy that will help them increase their revenue. In this particular study there is a need to know why after decades of successfully branding and marketing Victoria Bitter, the company is willing to take a risk and develop a similar sounding product VB Raw and yet designed to cater to a new market. In the same vein, the proponent of this study would like to know if the VB Raw campaign will succeed or not.
The first step is to look for an article that discusses a consumer behaviour problem. This was achieved by acquiring a business article from The Sydney Morning Herald regarding Forester’s Group’s bid to develop a new product in order to address a perceived need (Lee, 2009). After focusing on this article the next thing to do is to gather information from different sources in order to understand why changes has to be made and how principles gleaned from consumer behaviour is fuelling growth and how it is contributing to heightened competition between two or more firms.
This study is limited only to the beer market in Australia. It is specific also to the launch of a new beer product called VB Raw. The data that will be used are those that can be easily gathered through a review of related literature as well as those that can be accessed by the Internet. Furthermore, the discussion will also focus on an article written about VB Raw and the bulk of the discussion will also centre on the limited information released by Foster’s Group. This is not a report regarding the beer industry in Australia.
Before a customer will be able to purchase a new product or switch to a new brand, he or she must go through a process. It can be argued that different consumer behaviour processes can be observed in different continents and under different socio-economic conditions but at the same time most will agree that the following phases comes standard in modern day consumer behaviour and these are:
- Problem/Need Recognition;
- Information Search;
- Evaluation of different purchase options;
- Purchase decision; and
- Post Purchase Behaviour (Learn Marketing.net, 2009).
This sophisticated study of products and consumerism was made possible by the emergence of psychology as a branch of science. It is now possible to study people and make scientific inquiries into their behaviour. Aside from that there are many noted psychologists, like Maslow and Freud who were able to develop experiments proving once and for all that human nature is predictable to a certain extent (Doole & Lowe: 2008, p. 80). This has prompted marketing gurus to develop their own set of principles and throughout the most part of the 20th century they were able to show that to a certain degree, they too can make customers buy their products. This study is merely scratching the surface but it will also show how some principle of consumer behaviour can be applied in the case of VB RAW.
Problem or Need Recognition
In the case of Australian men their problem is easy to see, they love to drink beer and they need to have a constant supply of it. In recent years this is made more complicated by the need to look good and the need to stay healthy in spite of consuming large quantities of the said beverage. Based on this idea the marketing wizards at Foster’s Group were convinced that there is a growing need for a low-calorie beer. This understanding of consumer behaviour is an integral part of success (Peter & Donnelly: 2003, p. 42). But this is just the beginning. The company will have to develop a product that has to address that specific need.
They decided to create a product spin-off. It is common knowledge in Australia that Victoria Bitter (“VB”) is an instantly recognizable brand. If they can create a product that will create a strong link to a successful brand and at the same time satisfy a deep-felt need then the company have a winner in their hand. On the other hand there are those who said that lovers of VB may not like the idea of tampering with a product that has been a part of their lives since practically the day they were born because the brewer of VB has been in the business as far back as the 1890s (Victoria Bitter, 2009). Foster’s Group will succeed if they will focus on the following aspects of consumer behaviour.
In the 21st century there are various ways of delivering information. In the past companies rely on word-of-mouth and when technology became a part of marketing TV and radio ads became the norm. Today, the Internet and the use of wireless technology are complicating the delivery of advertising content to consumers. Aside from that consumers are also influenced by what their friends, family, co-workers, and acquaintances will have to say about a particular product. Advertising is critical to their success.
Evaluation of Different Options
Based on their needs and the information that they are getting from the media and from the people around them, they have to make a decision whether to stick to what they have been using in recent years or switch to a competing brand or try a new product. The correct set of information must be delivered so that the people can make informed choices. But in a highly competitive market such as the beer industry the Foster’s Group cannot simply rely on the idea that they are probably Australia’s best beer. They have to aggressively campaign based on that premise.
Their major challenge is in convincing the under 30s men to go for a low-calorie alternative while still enjoying the emotional and psychological benefits of having a VB even if at this time they will consumed it using another type of packaging and the word RAW attached to the famous VB sign. It is not hard to miss the implication of the word RAW it seems that the company is also targeting a market segment that are well-aware of the benefits of natural products. This term also signifies that it is a beer for serious drinkers but at the same time they are the type that is conscious when it comes to their overall appearance, hence the low-calorie beer.
It will require the expert understanding of social, marketing, and situational influences on consumer decision-making in order for Foster’s Group to convince them to try and switch loyalties to VB RAW (Peter & Donnelly: 2003, p. 42). But they have an advantage. There is evidence to show that decision-making is influenced by childhood experiences (Wright: 2006, p. 24). Knowing that many Australian young men grew up with VB in their household is an advantage that the Foster’s Group will have to capitalize on.
This means that their customers will purchase VB Raw over other competing products because drinking this particular brand allows them to reconnect with the past and the happy memories of an earlier time. Aside from influences and emotional connections to their childhood years, decision-making is also influenced by friends, neighbours, and acquaintances. This is where an intense media campaign should come in.
Post Purchase Behaviour
The best TV ad and the cleverest Internet campaign are only good for the first few months after product launch. The life expectancy of the product will now depend on the effect of drinking VB RAW can create in the mind, emotion and wallet of the consumer. One aspect is called the social risk of purchasing a new product (Doole & Lowe: 2008, p. 82). If the comments of friends and family will create a backlash then the customers may feel that it is not worth buying VB RAW. It can be argued that in some families the drinking of VB is part of family culture and deviating from it can be a problem in some community. But if the outcome is positive then the under 30’s young men may be encouraged to continue; this is positive reinforcement (East: 2008, p. 10). Consumers must still be perceived as part of the group and not alienated during social and family gatherings if they are caught drinking VB RAW (Moore: 2008, p. 360). Thus, the marketing campaign and consumer reaction to VB RAW is crucial in the first few months of product launch.
There are many psychological factors at work during this last stage (Mooij: 2004, p. 13). It must be pointed out that the same company, Foster’s Group already have Pure Blonde a type of low-calorie beer (Foster’s Group, 2009). This means that the company is not creating VB RAW for the sake of satisfying a need or solving a problem. They are in the fight for an increased share of the market. This is the reason why there are critics who are saying that in the long run this may hurt the company. The VB logo has long been associated with hard working blue collar type workers. In this recent marketing campaign some of them may feel that the company does not care anymore.
The marketing people at Foster’s Group were convinced that the market is ready for a product spin-off. This is easy to understand considering that Australia is one of those countries where men and women love to drink beer (Swierczynski, 2004: p. 76). But it seems that the only reason why Foster’s Group is pushing for the creation of VB RAW is not to serve its customers but to increase their market share. There is nothing wrong with that but there are those who believe that they are tampering with something that is already part of the culture of many beer-drinking Australian men and that this can backfire anytime soon.
- Doole, I. & R. Lowe. (2008) International Marketing Strategy: Analysis, Development and Implementation. UK: Cengage Learning.
- East, R. (2008) Consumer Behaviour: Applications in Marketing. London: Sage Publications Ltd.
- Foster’s Group. (2009) About Us. [online]
- Foster’s Group. (2009) Pure Blonde. [online]
- Learn Marketing.net (2009) Consumer Buying Behaviour. Web.
- Lee, J. (2009) VB puts on a shirt and goes clubbing. Fairfax Digital [online]
- Mooij, M. (2004) Consumer Behaviour and Culture: Consequences for Global Marketing and Advertising. London: Sage Publications Ltd.
- Moore, C. (2008) Managing Small Business: An Entrepreneurial Emphasis. UK: Cengage Learning.
- Peter, P. & J. Donnelly, Jr. (2003) A Preface to Marketing Management. 9th ed. New York: McGraw-Hill Higher Education.
- Swierczynski, D. (2004) The Big Book O’ Beer: everything you ever wanted to know about the greatest beverage on earth. PA: Quirk Books.
- Victoria Bitter. (2009) Victoria Bitter. [online]
- Wright, R. (2006) Consumer Behaviour. UK: Thomson Learning.