Murphy Brewery Ireland, Ltd

Group 2:Orson Chi - Hughes Guan - Peter Leung - Danny Nguyen - Ken Nguyen - Shawn Sahihi - Matthew Tran

October 14, 2014

History Throughout the Ages● 1856 - James J. Murphy and Company Limited founded in Cork City, Ireland

(James, William, Jerome, and Francis)● 1867 - 4 Cork distilleries combined to create Cork Distilleries Company

Limited● 1960 - Murphy’s started facing financial problems● 1966 - Combined with 2 other distilleries to create Irish Distillers Limited● 1975 - Murphy’s licensed with Heineken to create Heineken Ireland Limited● 1982 - Heineken invested 1.6 million pounds after Murphy’s faced recession

problems● 1983 - Heineken purchased Murphy’s and created Murphy Brewery Ireland

Limited● 1985 - Murphy’s Irish Stout launched in the U.K.● 1992 - Murphy’s became the 1st brewery to achieve the ISO 9002 mark for

operations in Europe; draughtflow cans launched● 1995 - Draughtflow bottles and Murphy’s Irish Amber launched in Germany

and France● 1996 - Murphy’s Irish Amber and advertising campaigns launched in

Hungary, Czech Republic, Finland, and in the U.S.

Problem

How can Murphy’s employ a strategy to expand globally but continue to maintain its authentic Irish brand?● Target market ● Brand awareness● Advertising, promotion, product line, and

pricing approach

Strengths● Irish stout (Murphy’s superior brand)

o Rated 36-38 European units of bitterness while Guinness stout is rated 45-48 and Beamish stout is rated 40 according to a study conducted by the European Brewery Convention

● Murphy name (most common surname in Ireland)● Supported by Heineken (2nd highest in market

shares)o Adds credibilityo Helps financiallyo Increases industry knowledgeo Lager complements stout

● Demand in foreign markets are increasingo Irish Red Ale

Weaknesses● Sales in the domestic market are stagnant

○ Limited to only Murphy’s Irish Stout ○ Unrealized potential of lower alcohol (Murphy’s Red Ale)

● Current facility is at near capacity (Murphy’s Brewery at Lady’s Well in Cork)● Small tactical advertising and promotion schemes rather than large-scale campaigns● Murphy’s has a “niche” image

Opportunities● Irish Red Ale expansion● New facilities in foreign markets● Foreign market has potential for high

growtho US Market

● Popular in Irish pubso Focus on promotions in pubs

Threats● Brand loyalty towards Guinness● Damaging effects if the Guinness-Grand Met merger prove to be a success● Beamish competes for second largest stout in Ireland● Consumers in other markets have different preferences

o https://www.youtube.com/watch?v=jzwP_KqgduE

Alternative Courses

● Expand productions to other countries including the US● Create global advertising campaign● Ad campaign for specific region● Promote in the domestic market by endorsing and

sponsoring local sports teams in Ireland

Analysis - Alternative 1Expand productions to other countries including the USPros● Lower the cost of distribution (manufacturer to pubs)● Builds brand awareness● Increase focus in international markets● More presence in international pubs● Allocates capacity and resolves constraints

Cons ● Different taste ● Quality control● Costly to implement

Analysis - Alternative 2Create a Global Advertising Campaign

● Previous ad campaign launched in the UK increased the volume of sales by 191,682 barrels

● Remake a similar campaign and push into other international markets (US)

● Substantial amount of market research should be conducted● High risk, high rewards● https://www.youtube.com/watch?v=jb5IPE3tzXQ● https://www.youtube.com/watch?v=PbDjXh61wmQ

Pros● Increase brand image and awareness● Future customers ● Profit growth● Global opportunities ● Creativity and innovation

Cons● Advertising and market research can be costly● Uncertainty of success (potential to damage the brand)

Analysis - Alternative 3Ad campaign for specific region

● https://www.youtube.com/watch?v=f5I_UGnnr1Y● Target Canada

Pros● Attract new customers ● Brand Awareness ● Better fit for the region● Stout suited for colder climates● Lifestyle● Government incentives

Cons● Cost of releasing an ad campaign● Risk of failure

Promote in the domestic market by endorsing and sponsoring local sports teams in Ireland

● Only 5% market share in the Irish market, Beamish is beating Murphy’s in spot for second place

● Sponsorships target amateur and youth sports teams to build brand loyalty with the younger generation

Pros● Successful sponsorship

o Murphy’s Irish Open and English Open Golf Championship

● Increase brand awareness in the domestic market● Build brand loyalty by increasing brand exposure

Cons● High risk due to Guinness’ high brand loyalty● Guinness has established sponsorships● Direct competition with Guinness in this campaign strategy

Analysis - Alternative 4

Recommendations● Alternative one

o Expand productions to other countries including the US

● Alternative two o Create global advertising campaign

References● Cravens, David W., and Nigel Piercy. "Murphy Brewery Ireland, Limited." Strategic Marketing.

9th ed. Boston (Mass.): McGraw-Hill, 2006. 618-19. Print.● http://en.wikipedia.org/wiki/Murphy%27s_Brewery● https://www.youtube.com/watch?v=PbDjXh61wmQ● https://www.youtube.com/watch?v=jb5IPE3tzXQ● http://books.google.com/books?id=3rUlRd3MqD8C&pg=PA178&lpg=PA178&dq=Like+the+Murp

hys,+I'm+not+Bitter+ads&source=bl&ots=k5D5cgGTCO&sig=JOENtD2ULo2o5R1x9JLJPqw2A7M&hl=en&sa=X&ei=UMc6VK26IaaI8gGgvYGoCQ&ved=0CDQQ6AEwBA#v=onepage&q&f=false