Tsingtao Marketing Strategy

Tsingtao Marketing St directgyThis report tie-up on Tsingtao Brewery familys trade strategy. Tsingtao beer is one of the most famous intersections in chinaw ar. It has over 100 eld history. The fol milding trade assessment has five sections. In the first section, in that location are some basic details of Tsingtao Brewery Company. And then the report ordain explain environment of Tsingtao beer in mainland China in the next section, at that displace is the foodstuff place desegregate strategies analysis which go forth be do to separate how Tsingtao beer utilise its strategies to adapt changing environment. In the fourth section, the report shows how the fraternity operates STP strategies and percent examples. In the last part, connecting with brief SWOT analysis, writer rise up some recommendations.1. Company BackgroundTsingtao Beer is the main increase of Tsingtao Brewery Limited Company which is the oldest brewery in China. Its root finish be traced covering to 1903 when its predecessor Germanic beer Qingdao stock c every last(predicate)er-out, was established by the German handicraftmen and British businessman and joint venture in Qingdao (Tsingtao Brewery Limited Company, 2011). The Company was registered on 16 June 1993, and then issued H-shares in Hong Kong (Tsingtao Beer stock (0168)), which were listed on the Stock of Exchange of Hong Kong Limited on 15 July 1993. It is the first house servant endeavour listed on an overseas stock exchange.(Hong Kong Stock Exchange, 2012) In the same year, the caller issued A-shares in China (Qingdao beer (600600)), which were listed on Shanghai Stock Exchange on 27 August . This firm is the first company which listed in twain places at the same while (Tsingtao Brewery Company Limited Official Web, 2012). afterward 100 age of education, Tsingtao Beer was listed among the top 500 dents all around the military man successfully and became one of the official sponsors of the 2008 capital of Red China majestic Games. The business range of a function of the Company is the growthion and gross gross sales of beer, and other related business. It occupies transcending set up in the domestic beer sedulousness in impairment of size and merchandise share with 56 breweries in 18 provinces, cities and regions all over China (Tsingtao Beer, 2011). The cheer of its brand is 50.258 billion as at 2012 (ChinaNews, 2011).2. Business environmentIt is very important that an organization considers its environment before beginning the merchandise emergence. Once a marketer annoys the initial termination to unload a saucily business, the company must nonplus a good taking into custody of the local conditions in that region (Solomon, 2013). Usually, a market tummy be change integrity into deuce kinds of environment macro and micro.2.1PEST Analysis of TsingtaoIn macro environment analysis, PEST (Political, Economic, Social and Technological) is the most frequent decisio n to be used. This way focuses on the extraneous, macro-environment in which your business operates. It provides the big vista framework, which helps business owners to build a vision of the future and to decide on appropriate actions that take into account (Dynamiq, 2012).(P)olitical FactorsDuring the period of adopting the Re licking-and-Opening Policies, China has maintained social st capability as it achieved rapid sparing growth and raised peoples support standards. Productivity ameliorates continuously. In such a policy environment, people do no pineer just nonice solving the problem of provender and clothing, scarce the condition to achieve a melloweder(prenominal) feeling of flavor. In this century, Chinese government started to encour bestride con middleing and issue hot economic strategies to stimulate that. Beer industry had a rapid breeding. In 2011, the beer industry achieved sales r stillue, 158.94 billion more than last year the corresponding period gro ws 22.9%, higher than the growth of beer returnion, liters of beer sales increase of 11.1% over the previous year(National pectus of Statistics of China,2012).At the same time, China government increased the import tariffs on drinks, in a recent policy issued on the 15th Notice of Chinese General Administration of impost by General Administration of Customs of the Peoples Republic of China in March 2012 From 15th April, a new duty tariff table entry articles will enforce. It said that the wines (including beer, wine, etc.) tariff rate increase to 50%. So it offers a good tax shelter to the bailiwick beer enterprisingnesss, which has played a positive role in promoting sales (General Administration of Customs of the Peoples Republic of China, 2012).In addition, the Chinese government make a come of policies to regulate the food processing industries vigorously, in graze to improve the admittance threshold, to improve the recall and delisting system and to strengthen the pen alisation on the illegal processing food industries. And they use product case policy to prevent vicious competition between beer enterprises (China International Beer Web, 2010).(E)conomic FactorsThe received economic situation in China instanter is keeping a stable growth. In 2008, the government decided to stimulate consumption, so in that respect was a high rate of Economic growth. barely in 2010, China cancel stimulate consumption policy gradually. Economic growth rate has dropped, precisely still keep in a normal range. such(prenominal) growth not only shows Chinas growing potential of the Chinese market, but as well led to the improvement to the Chinese peoples standard of livings.Since the economic crisis, the exportation volume of the international barleycorn decline sharply. At the same time, the barley beseech of Chinese beer industry is increasing. In this supply behind demand situation, the rising price of raw somatics is another economic factor. Chinese beer industry has to maintain high speed development for many years, and construct the largest beer barley importer all over the ball. At present Chinese beer industry development speed is still as high as about 15% (China International Beer Web, 2011). However, although in that location is a vast demand of barley in China, China is not the traditional planting countries of barley. Rice in barley prices lead to the increasing of production toll greatly.(S)ocial-Cultural FactorsAlong with the beer market progressively expanded in China, beer consumption gets bigger. Drinking beer has been transformed into a form of beer culture. The enthusiasm of Chinese seems to be gradually warming they love to use beer to exchange emotions on the table. Comparing with drinking spirit, the feeling of drinking beer is water-cooled and more relax. It is suitable for all kinds of social occasions. The Olympics add passion, fashion, happy upstart elements into the products. It promotes the market sh are. An investigation shows that, in last few years, the make out of consumers who are 18-29 become the largest consumer groups of Tsingtao beer, risen by 14%(NBD, 2009). This will enhance the combat of Tsingtao in the future.(T)echnical FactorsIn todays society, people pay more attention to health. So they improve the timber requirements of alcoholic drinks. Development of technology can improve the production efficiency, reduce production cost. Beer is a kind of popular drink, domestic and foreign constantly develops new technology beer production. Scientists found that, with the wavelength 410 mm, the intensity is 0.2 w / of fluorescent lamp to y eastmost suspension uniform illumination hours later, fermentation use can improve the 25-30%, and fermentation time shorten one day(Forhecz ,2009).2.2 small EnvironmentMarketing managements job is to attract and build relationships with customers by creating customer value and satisfaction (Kotler, 2005). It is related to the mic ro environment. In this section, the report mentions deuce aspects.2.2.1 Competitors AnalysisAs alcoholic drinks, alternative products of Tsingtao beer exist. The first kind is called product competitor. This competitor can be dissever into two kinds soft drinks (nonalcoholic drinks) and alcohol. dotty drinks include carbonated drinks, fruit juices, dairy products and mineral water, etc. In some family parties, hotel get-together party banquets, they often become the beers alternative products. In terms of alternative products, the competitiveness yellow wine and spirit is not strong. But wine and beer for high-end customers are certain competitors. Of course, beer has its incomparable market berth. In celebrating or party occasions, if people dont want to get drunk, beer will be the surmount choice.The second kind of competitors is Brand competitors. Main competitors are Snow beer and Yanjing beer. From the regional distribution, Tsingtao beer bases on Shandong province, and h as made the good record in the south China, east China Snow started from northeast China, then set up base areas in Sichuan, Anhui and Tianjin Yanjing beer occupied more than 95% of the market in capital of Red China firmly(Liu, 2008). However, we requisite notice that in China, there is not any manufacturing business having the absolute control of market share. In 2011, Tsingtao beer only has 19% of the share, the sum share of former three manufacturers market (Tsingtao, Yanjing, Snow) is less than 45%. So the company faced this extremely competitive market environment (National Bureau of Statistics of China, 2012).2.2.2 Customer Behavior AnalysisIn China, with the improvement of living standards and the deregulating of government, buying beer has become routine problem solving (Solomon, 2013). As a kind of fast wretched consumer goods, beer appears in the Chinese daily life frequently. When people need to drink beer, everyone will get down some brands for choosing. or so of t hem are come from internal experience, such as middle-aged people, they have many drinking experience. On the other hand, for the younger, it is comparablely come from the external experience, such as advertisings or recommendations (Mooij, 2011).In addition, when consumers are making leverage decision, they may have preferences of beers essay, price or the enterprise culture. The attempt of Tsingtao is calorie-free sign. It is conform to the Asian habit. Most products strategy of Tsingtao is high quality and high price. When feting friend or business mates, Chinese are more willing to get hold of this to show their sincerity.3. Marketing MixA planned mix of the controllable elements of a products marketing plan normally termed as 4Ps product, price, place and advance (BusinessDictionary, 2012).3.1 ProductionThe product is the code of the marketing operation. The enterprises all style is focus on the product. When the products purchased in disparate situation, they meet th e diverse needs from various consumers. This is what the companys managers should consider. Tsingtao beer introduced contrastive types of beer to satisfy the requirements of different social activities. much(prenominal) as in the south of China, the people prefer sweet and refreshing beer, so Tsingtao introduced Draft beer And successful middle-aged business people normally need higher life quality and have certain economic ability, so in business negotiation occasion, they will choose notes beer Besides, the economic ability of university graduates who just enter the society is limited, in the leisure occasions, they would choose Shanshui beer which the price is a bit lower(Tsingtao Brewery Company Limited Official Web, 2012).Tsingtao beer also develops new products actively and gives them heterogeneity packages. such as in the packing material of Gold beer, Pure Draft beer, there are clearly epiphytotic elements. It establishes a solid foundation for entering the market o f the Tsingtao beer. For the high-end product, as Gold beer, managers mainly adopt unified luxury packaging strategy, but the cost of product packaging is higher. Luxury packaging reflected their high home run brand strategy in order to maintain consumer idea of high quality low.3.2 PriceMore and more consumers buy the product rationally. As long as the product of severally attribute can meet consumers mental recognition, the price is no longer the key influence factors. In the new marketing, the high layer product is still accepted by consumers even sold in high price.Tsingtao beer adopts differentiated set strategy. Its product placement is very clear, so different product has different price.Company distributes products from the low to high level. For example, Shanshui beer, low-end products, has a low price which basically close to the cost. The conduce of this strategy is the increasing of their market share. Such as Tsingtao canned beer market price is 3.50 each can. C omparing with the similar product of other brands, there is more than 0.5 to 0.7 higher. Meanwhile, High-end products, such as Tsingtao Pure Draft, Tsingtao Gold, can increase sales of Tsingtao beer, and make positive effects on the own brand shaping, so the price is over 8 generally(Alibaba, 2012).3.3 PlaceThe sale channel is divided according to the product classes in Tsingtao beer. In beer industry, many products are divided into three levels. The channels are divided into three categories food not bad(p) channel, super market retail channels, circulation wholesale channel, different grades of products is corresponding to the different utmost terminal is corresponding to the different channels.In China, Tsingtao beer keep shot up relationship with various levels terminals what including the national distributor, high-grade restaurant, super market retail store, places of entertainment and community retail terminal. At the same time actively strengthen the same they maintain the good cooperation relations with operators.3.4 procession1) AdvertisementTsingtao beer advertising is Centaury as one, passion achievement dream (Tsingtao beer, 2011). It not only mentions the companys history, but also gives their products with a sense of the Times contrive and full of vitality.In the Tsingtao beers official website, home page design unique creativity. In the left, a bottle of beer gives a person the feeling of sweet and refresh. The light yellow foam shows the high quality and high grade of Tsingtao beer. This design sets up the heart guide to the potential customers who have neer tried Tsingtao beer. At the same time, in billet of the different brands of products for different types of star endorsement also play a guiding role. Such as Pure Draft series looking for China is a very famous band, advertising effect is good.2) Public RelationIn the public relations Tsingtao beer mainly uses the government marketing, Olympic marketing to attract consumers eyes. After capital of Red Chinas bid for the Olympic Games the success, they became Olympic sponsors, and actively use the Olympic platform to promote the brand in the international influence.Tsingtao beer has been insisting on the concept of the Olympic Games, the Olympic spirit of communicators. In order for the sterling(prenominal) degree of spread the Olympic spirit and enhance the brand go steady, Tsingtao beer made in stages of Olympic marketing plan, respectively for 2006 years light the passion, 2007 canalise passion, 2008 release passion, 2009 deductive passion(China International Beer Web, 2010). Furthermore, they connected beer to music, sports through a pattern of activities. Now Tsingtao international beer festival is Chinas most influential one of the beer festival, to the world propaganda Tsingtao beer long beer culture.At the same time, Tsingtao Beer Company did public charity in 2008. It shows the companys social responsibility, in this way a wide range of publicity , consumers won the favor deeply.3) Sales PromotionIn the daily sales activity, Tsingtao beer in order to be able to improve sales, the company puts forward for all kinds of promotional activities. Such as, for the people who purchase with a certain amount of Tsingtao beer in one time will present a new research and development of products to customers. It is not only the way to increase sales, but also can promote new products to customers. Personnel promotion is commonly used. The enterprise sent promotions specialist on the site promotion, such as promotion to consumers, evening show supermarket shopping guide, etc.4. Segmentation, Targeting and Position schema4.1 Segment StrategyMarket segmentation is the inevitable trend of the development of market maturity. Segments of the market stand from the point of view of consumers in the division. The overall market of a certain product divided into several consumer groups, each consumer group is a market segment.Due to the beer belo ng to fast moving consumer goods, the intermediate price is low in price by 2-15, and Chinas average annual income per capita is 24,000 (National Bureau of Statistics of China, 2012). So in the national scope, consumers purchase ability are basic same. Tsingtao beer uses the many kinds of segmentation methods. The first is the regional segmentation. Although the national regional consumer purchasing power is similar, but different areas formed different tastes, because of the influence of their eating habits. Through the investigation, the northern people like to powerful, flat out type of beer Jiangsu, Shanghai and people from the south like gentle type of taste. Guangdong, Fujian coastal areas is fond like tasting strong alcohol and venereal infection with bitter taste. According to this difference, the company will form different taste characteristics of beer to meet the needs of the consumers.Secondly, the company does the vertical segmentation in population. With age as segm entation criteria, different age paragraph has different demand. Such as young people like light beer. In the party, they can have a good time, and do not need to solicitude drunk. Middle-aged group people be fond of liking taste a little strong beer. It is to be in commonly business negotiation or with friends and family to get together to drink. In addition, the age endlessly related the income level. Usually, age and consumption is proportional to the ability. So the market can be divided into high-end market and mid-low market.4.2 Targeting Strategy and Positioning StrategyThis two operations have close relationship. Market targeting is when the market segmentation later, in a number of subsidiaries in the process of optimization. Meanwhile, the market positioning is the enterprise according to the target market similar products competitive situation, in view of the customer for this kind of products are some characteristics or attribute value degree, for the enterprise produc ts shape strong, distinctive bright individual character, and the vivid image transfer to the customer, get customer recognition(MBAlib, 2012).After one hundred years of development process, market targeting has gradually determined for high-end market. Market positioning of products is the noble, elegant, have grade and fashionable. From the product strategy, the Tsingtao beer products completely have into the target market conditions. In Germany the traditional brewing process and the improvement of science and technology, Tsingtao beers quality is undoubted fantastic. Additionally, the companys pricing is also slightly higher than other brand. No matter in hotel or the places of entertainment or the large supermarket, as long as consumers spend some money to buy high quality, high grade of beer.But as the market competition has been more intense, Tsingtao beer began to consider to enter the lower level market. So they develop Tsingtao beer family series wine. Its brand positionin g is popular, cheap and fine, amiable. The situation is the consumer to Tsingtao beer high-end product of high popularity. Due to the expansion of the company mid-low products in 2000 was launched, so they need time to further improve the business.5. passIntegrated above four parts analysis, we can know that Tsingtao beer now has some advantages and discriminates, as well as they need to face the opportunities and threats.As the leader of industry, brand awareness of Tsingtao is high, has obvious brand advantages. And they owned breweries distributed in all parts of the country. This is favorable conditions for Tsingtao beer into except outside Shandong. But at the same time, the regional differences also can become one disadvantage of Tsingtao beer. Although the beer brands of local place are not as famous as Tsingtao beer, but they have deep knowledge by locals. When Tsingtao beer gets merger and learnedness of these enterprises, if they do not pay attention the replacement of excessive of the brand, it will deeply touch native inner to local cultural beliefs. indeed it will make local consumers ricing up a big rejection mood, and lead to the agent cannot easily agent, and the sales cannot reach expected. Furthermore, Tsingtao beer is beer brand from the north, though in the north of the city has many reputation, to the south of the consumers, it is still a comparatively new brand. In addition, Tsingtao beer through way of merger in process with the original formula keeps consistent, but due to the reason of soil and water, it by chance cannot keep its original quality. At the soma time, the situations of acquisition enterprise are intermingled. So the completed integration is difficult.The government policy and the support of the huge beer consumption space is a good luck Tsingtao beer. Because of listing in both of Hong Kong and Shanghai, new issues bring new opportunities to the development of Tsingtao beer. It is an important opportunity that cooper ates with important events. Each year, the international Tsingtao beer festival brings a large number of consumers and partners. It Expand the Tsingtao beers popularity. But there is growing number of new brands into the beer market. The promotion strategies which they use will drive the whole market declining profits. And raw material prices also bring pressure to the firm.At present, Tsingtao beer has entered into the mature period. Tsingtao beer market campaigner is very broad. Along with the social development progress continuously, and social activities become more and more frequently, people put forward higher the quality of life of the new requirements. This requires the Tsingtao beer with the continuous development of society to improve product quality to increase the added value of products. Tsingtao beer sales area is narrow the high-end product market share is low. In the sales channels, they should expand sales channels, and make full use of the dealers financial produc ts into the domestic big cities. The strategic bail bond and domestic and foreign well-known hotel for strategic alliance is right choice, like Pepsi and KFC as alliance.Tsingtao beer enterprise must be good at discernment opponents weak and then open marketing offensive. Such as Beijing Yanjing, Nanjing dealer for instant noodles, beverage and other non now drink terminal product distributors. They are lack of operation drink terminal market corresponding network and the actual status of the experience. Tsingtao beer should increase in Beijing drink terminal market in terms of has formed a fixed consumer groups.