Case Study
UNDERSTANDING & COMBATING NEW COMPETITIVE THREATS
overview
Imagine that new competition enters your industry. It quickly grows in popularity with your primary customers, and your sales are impacted. You don’t have time to “wait it out” or make guesses about how and why this shift in consumer behavior is happening in light of more product options filling the marketplace.
One major brewing company experienced this situation as the craft beer craze started. The craft beer explosion showed staying power and, early on, was already impacting sales of the brewer’s brands.
The brewer knew they needed a better understanding of craft beer consumers to learn how they could meet changing consumer tastes and attitudes. C+R Research’s analytic team developed a two-step strategy employing both qualitative and quantitative techniques in order to provide both depth and breadth to the understanding of this changing marketplace. The insights gathered would help the brewer plan the correct course of action to stay relevant.
THE PROBLEM
Craft beers had been gaining popularity and were impacting sales of most all client brands across several key demographic segments. In addition, consumer trends for beer consumption had shifted as emerging craft beers (and ciders) expanded reach in both on-premise and off-premise destinations. A change was taking place in the marketplace that had not been seen in contemporary history.
There was a pressing need to evaluate the attitudes and perceptions of the primary craft beer consumers to arrive at an understanding of this new beer consumer and specifically uncover the attributes that are important within the craft beer category.
OUR APPROACH
C+R’s two-step approach included both qualitative and quantitative strategies to capture deep insights into craft beer consumers, their attitudes, motivations, and occasion usage of craft beer and how it differs in various regions of the nation.
C+R began with the qualitative phase to gather a comprehensive, consumer-driven understanding of the craft beer (and cider) marketplace and culture. Several onsite observations and focus groups were conducted in four major US markets. The focus groups consisted of individuals representing diverse demographics including legal drinking age males, Millennial females, and Hispanic drinkers. The purpose of this phase was to uncover what draws consumers to craft beer over other alcoholic beverage choices, and in what occasions it dominates and fulfills a need. During this phase, we also analyzed craft beer shopping behavior and the role of food in craft beer consumption and purchases.
The quantitative phase entailed a large online survey developed by the C+R analyst team who also observed the qualitative phase. The survey was conducted with over 1,000 participants and was designed to:
- Quantify the specific attitudes and behaviors around craft beer and ciders that were uncovered qualitatively
- Identify how consumers define craft beer
- Discover the various occasions where craft beer is consumed
- Uncover insights around purchase triggers and decision catalysts for craft beer drinkers
The results from this research have helped our client understand the changing competitive landscape of the beer industry and how these changes are and will continue to impact them.
The result
The C+R analytic team uncovered important details driving the craft beer trend in addition to consumer attitudes and behaviors around craft beer and cider and how they fit into the current evolution of the American palette. In our work, we revealed that the craft beer boom showed no signs of slowing and would continue to grow with even more choices flooding the market as the trend gained traction.
One major area uncovered was the retention trends of the consumers. Craft beer drinkers are likely to retain their interest in craft beers over time. And they are often most loyal to the brand(s) that introduced them to the category. Consumption patterns of this segment generally reflected the consumption patterns of other alcoholic beverages and beers.
We also provided insights as to where craft beer and cider is purchased and consumed most often in both off-premise (e.g., grocery stores, liquor stores, mass merchandisers.) and on-premise (e.g., fine dining, casual bars, fast casual) locations. Our team provided critical information on highly effective placement opportunities benefiting the craft beer segment within these premises.
In addition, the team shed light on what is most important to consumers when choosing a craft beer, and that recommendations likely to be considered come from family and friends.
Our client was able to use the insights garnered as they developed future strategic brand plans and refresh their thinking of craft beer drinkers. The research was effective in impacting changes to the point that a portion of the research was re-conducted several months later to evaluate how the market changed since the initial effort.
proven experience
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