Tsingtao Beer Case Study

Consumer buying behavior Consumer behavior of purchasing beer is definitely stirred and of woeful involvement. The pleasure and gratification getting from drinking beer can be sensual but fleeting. When making purchase decisions, consumers hardly sp closure all time to recognize problems or to search information because when they feel comparable drinking, they will bonnie buy some. Generally speaking, customers keep loyal to their best-loved beer home run. In fact, many of my friends have told me that Yanjing Beer judgements the worst among all they have move and even though its comparatively cheap, they are not belike to buy it after first try.As you can see, among all the brand attributes of beer, the footing is not a significant concern while taste, which can pass along to brand value, matters much more than. Once customers have recognized the nice taste of a certain beer brand, probably they are never going to sack brand and all the beer decisions they make later wi ll be symmetrical purchases. Beer trade segmentation The bases I choose for segmenting the Chinese beer market let in age, gender, income take, life style, user rate and geographic area. All these factors matter in that they determine the different consumer behavior of drinking beer, as concluded in Table 1.AgeFrom 18 to 60 Young customers at 20-35 have conceptive potential GenderMen and women Women might drink beer less often than men or choose light flavor, out of concern of weight control Income levelFrom low to high-middle Income does not matter a lot due to beers relatively low cost compared with other alcohol LifestyleWith leisure time and by chance some pressure User rateLight drinker, medium drinker, heavy drinker geographical areaNortheast, southeast, northwest, southwest and middle Some areas have notable drinking habits much(prenominal) as northeast China. Besides, there is a tendency for people to choose their local beer brand.Table 1. Competitive landscape and Tsingtaos status China is the largest beer manufacturer throughout the world. Many local Chinese brands as well as foreign competitors are engaged in the competition. There are triplet main characteristics about the militant landscape of Chinese beer market. First of all, price war is the main competitive tactic used by near local brewery brands. Not only small regional brands, but also large brands like Yanjing are entangled in price war. In general, price war does not lead to a favorable market position for any company because their profit margins will definitely be influenced.And most of the essence(predicate)ly, as I have mentioned before, price is not a significant factor that people will consider when buying beer. If companies effect too much emphasis on lowering price through lowering cost rather than improving taste and grapheme, it will not work to their advantage in the long run. Secondly, there is a social movement of foreign companies buying local brewers stock, meaning that foreign competitors are implosion therapy into Chinese market in a more strategic way. Tsingtaos collaboration with Anheuser-Busch is a case in point. It facilitates mutual learning and internationalization.The tierce characteristic might be a future trend that the integrating and centralization level of Chinese beer market will become higher. With want to Tsingtao Beer, it is one of the gigantic tiers of China beer brewers. Its competitive advantage is the superior quality due to unparalleled brewery techniques. According to the consumer survey results posted on its website, customers cover Tsingtao beer as high quality and high price. In general, the fierce competitive marketplace has influenced Tsingtao a little but I retrieve its schematic brand image is still far from being hurt.Positioning alternatives for Tsingtao Tsingtaos arrangement alternatives are whether to get more low-price market or to adhere to the watercourse high quality, high price dodging, especially when it penetrates into Beijing market and get by with the local giant Yanjing. In my opinion, Tsingtao can adopt a multibrand strategy to fulfill needs of different target markets. For people who have not bad(p) concern about price, Tsingtao can lower the price as a response to the local price war. For other people, however, Tsingtao should never pursue more sales at the expense of quality.To implement this strategy, Tsingtao has to do a fatten up consumer survey and then better segment the market. In the segmentation process, income level and geographic area might be the two most important bases. Besides, Tsingtao has to improve its advertising and packaging because beer is low- involvement and emotional product. As is mentioned in the case, nowadays the main reason for consumers to buy a certain brand of beer is brand image and the culture attached to the brand. I think Reeb beer, establish in kidnap, has done a bulky job in this part, although Reeb is just a sma ll regional brand compared with Tsingtao.I remember when I was a primary school student, Reebs TV commercial was an interesting song. The lyrics were in the main saying that Reeb has witnessed the quick development of Shanghai and peoples great change after the opening policy of Pudong District (See the appendix). And at the end of the commercial, it said Reeb beer is the reason why you love Shanghai. Almost everyone from Shanghai of my age or older than me can sing this song and the concomitant with this city definitely has enhanced Reebs brand image. I think Tsingtao might learn from Reeb to improve its advertising.