SAB MILLER vs. Other BrandsSABMiller is 2nd market leader in Wellington state. The problems encountered by the brand are, 1. The most selling brand Knock Out is losing market shares because of the new entrants like Dilburg, and other mainstream brands because of high trade margins they give to Distributors and local dealers. But SABMiller’s brands have a great brand equity which has sustained the brand.

According to Porter’s generic strategies SABMiller may go for cost reduction or Differentiation or Focus. SABMiller can never go for a Focused strategy as the company is already a diversified one and a lot of brands of different target segment are operating under it. And also it cannot reduce cost without hampering its own profit. Now there is one strategy left, which is Differentiation. Differentiating its products from rest of will hopefully prove positive for SABMiller.

As the disposable income of Wellington is increasing the trend will shift more towards premium beers. The state is also shifting towards urbanisation the social needs of people are changing. The people now more and more choose to go to Bars, Restaurants, and Pubs than Off-Shop counters. But SABMiller has limited presence in Bar and Restaurants. Now is the time for expanding the distribution channels. Making SABMiller products available in all urban centres should be primary focus of the company.

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Beer Sales in India in Kilo Liters

Again the beer market is growing rapidly in India. The number of beer consumers is increasing because the disposable income of people is growing, Urbanisation, Innovations in beer products and Shift in consumer taste. This means it is now or never. The beer market will grow till the saturation comes, just like what happened in 1997-98. It is the time for Disruptive Innovations.

Keeping mind the next 18 months, SAB Miller should follow the following strategies in order to increase profits considerably.

1. SAB Miller should increase the prices of all its products by around 5 rupees and dedicate a great part of price rise income to the distributor as incentive/margins. This strategy is followed by TUBORG which gained popularity in a very short time. The distributors play a major role in promoting a brand in beer industry. For generating more sales they do sometimes ask the buyers to try a brand and this happens in day to day life.

2. The other part gained by price rise should be used in promotion and advertisement of its not so successful brands like Fosters. This will result in consumer awareness and the consumers are getting more and more experimental these days. This will definitely increase its sales.

3. The company should select a more permanent sales team because the high turnover will result in very temporary relationship between the company and distributors. The turnover in sales force may also hamper reputation of the company. To make a stable sales team the company should give them reasonable sales target and compensate them with better incentives than what the competitors are offering. And also the company should increase sales team size in order to expand its sales. The most desirable solution for this case is to hire sales executives from competitor’s company at a better pay package which in turn will result in acquisition of new customers and more sales.

4. The company can come with promotional offers at its new markets to attract new customers. The offers can be online recharge coupons, freebies like cigarate lighter or may be one beer free with two beers etc. This will definitely attract new customers to try the product.

5. Last but not the least, the company should do market research on its customers and distributors. Its should be based on why they like their competitors beer and why they don’t like SABMiller’s products. This will help SABMiller to come upto customer’s expectations.

The BEER market is growing and inviting new competitions. If SABMiller wants to lead the market, the time is now. But for that the company has to play a big gamble without which it is not possible.

Prepared by: Priya Ranjan Mohanty(UM15036), Debasish Dash, Swagat, Sri, Jaydeep.