beijing red star. by nils boesel and sebastian hornschild 21st of november 2011
TRANSCRIPT
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Beijing Red Star.by Nils Boesel and
Sebastian Hornschild 21st of November 2011
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Situation Analysis: Company
• Beijing Red Star Company founded in 1979• On of thelargest Liquor Producer in China ( 537
tons of liquor in 2010)• Most commonly Baijiu among Blue-Collar
workers across norther and north-eastern China
• Broad range of different products• On the German Market for almost five years
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Situation Analysis: Market Research
• Overall Revenue: > 2 Billion US-$ (ranked 11th in Europe and 45th in the world)
• Average German drinks approx. 8 bottles/year• German Liquor Market dominated by
„Jägermeister“ and „Smirnoff“ Vodka• Herb Liquor with 22% market share first,
followed by clear liquor, rum and vodka HongXing Erguotou categorized as clear liquor
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Situation Analysis: Market Research
Liquor
Rum
Vodk
a
Clear liquor
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Situation Analysis: Market Characteristic
• Predominantely small family owned liquor producersBerentzen, Turnover: 170 Million US-$Rum 80 (Jagertee), Turnover: 48 Million US-$CONTRARY: Diageo, Turnover: 10 Billion US-$
• Comparatively high liquor tax: 0,7l Rum with 40% alcohol percentage = 3,65 Euro tax (excl. VAT)
• Law restrictions: advertisements addressed to minors are not allowed
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Situation Analysis: Customer Insight Search
Most revenue generating customers
Male
person: age
between 40-65
Male and
Female : age
between 20-35
Sources: McKinsey Study on the Liquor Market 2010
China Germany
Conservative Liberal
Traditional Values Liquor for Socializing and Fun
Liquor drinking as a habit of the older aged
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Situation Analysis: Customer Insight Search
• In 2007 more than 712 Million Bottles á 0.7 liters have been sold Market penetration of 68%
• Between 2004-2008 choose liquor by price („The cheaper the better“)
• Starting from 2008 a new consumer trend can be identifiedQuality and Brand name is becoming more
important
Sources: McKinsey Study on the Liquor Market 2010
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Situation Analysis: Customer Insight Search
• Conduction of an online survey via E-Mail and Social Networks in Germany
• Participants: 213; Valid surveys: 198• Persons that consume liquor on a regular
basis(minimum once a week): 112• Share of people between 18-35 years who
consume liquor on a regular basis: 73%• Most important attributes during purchasing
decision: quality(58%), brand name (19%), price(15%), taste(8%)
• Information sources: TV(45%), magazines(29%), radio(20%), online(6%)
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Situation Analysis: Customer Insight Search
Gender
Male Female
Age
18-2526-3526-4545+
Education
Middle-SchoolHigh-SchoolUniversityProfessoral
Age of persons who consume liquor on a regularly basis
18-2526-3536-4545+
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Situation Analysis: Customer Insight Search
Important Attributes buying liquor
QualityBrand namePriceTasteNever buy liquor
Information sources
TVNewspapers,MagazinesRadioOnline
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Situation Analysis: Customer Insight Search
Important Attributes buying liquor
QualityBrand namePriceTasteNever buy liquor
Information sources
TVNewspapers,MagazinesRadioOnline
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Situation Analysis: Key Advertisement Problem
• HongXing Erguotou barely known in the Western Hemisphere, no exception Germany (only 2 respondents out of 198 knew the brand)
• Beijing Redstar tried to enter the European market
Missing Communication and
Advertisement Strategy for German
Market
No consistency and motivation
NO brand awareness and recognition
Code of Conducts for Advertisement of the Liquor Industry!
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Situation Analysis: Opportunities
• Most valuable liquor customers: young and middle-aged adults (drink alcohol for socializing and fun) More attracted to brands than the older aged
• In the industry for clear liquor no distinct or dominant producer can be found (in contrast to herbal liquor and Vodka) entrance barriers are comparatively low in this
market
HongXing should communicate its distinct values and cultural background (contrast to competition)
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Situation Analysis: SWOT
S
• German Liquor Market value of 2 bn US-$•Quality 1# in the purchasing decision of German liquor consumers • Liberal market
• Consolidation of the Market Large producers(e.g. Diageo) with high market power• Advertising restrictions are becoming stronger
• Unique and exotic product• Successful in China• Good advertising strategy
• Low advertising budget• Very unknown in Germany
W
O T
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Advertising Message Objectives
Communication Goal:• HongXing Erguotou to be the new popular
drink among the young target group on • Focus on building brand awareness • Goal: 10-20% brand awareness after the first
year large media campaigns• Long-term Advertising penetration to achieve
60% brand awareness after the third year
Response Goal:• 20-30% market share in the segment of „clear
liquor“
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Advertising Appropriation
• Hongxing major player on the Chinese market• Still government-owned
First real involvement on an international stage Tendency for Low-risk involvement
Period: • Liquor consumer market not cyclical
campaign can be started at any given time of a year
• Higher spendings at the beginning to get awareness
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Advertising Appropriation: Media Channels and Media Strategy
• Self-prescripted code of conduct of the German liquor industry• Assumption: Comparatively small advertisement budget (1.3 mn €)• TV campaigns too expensive• Focus on print ads and billboard-ads
1st year 2nd year 3rd year 4th year0
100
200
300
400
500
600
700
800
Budget Spendings
On-Spot MarketingOnlineBillboards and Print Ads
in $
100
Brand Awareness
Recognition
1st Year 20% 10%2nd Year 35% 20%3rd Year 50% 30%4th Year 60% 40%
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Creative Strategy
High Quality, Unique Taste, Exotic Origin
China
Double Distilled
Sorghum
Fit with the young and middle aged target consumers!!!
• Focus on the distinct, unique and outstanding attributes
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Creative Strategy: Message
• HongXing liquor wants to exceed the consumer expectation
• Stronger, Greater, Taller, Better are often terms to describe the Chinese emerging market (link to the liquor‘s origin)
Both elements as part of the messages
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Creative Strategy: Message
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Creative Strategy: Message
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Evaluation StrategyVI.Conclusion
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Evaluation Strategy
• Pretest: Qualitative and Quantitative interviews of people that belong to our target group
• Research on the German Test Market Hassloh• Surveillance Tests: Different households in
different regions will be tested on their brand awareness
• Post-test: evaluating the effectiveness of the campaign results for the product launch in other European countries
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Agenda
I. Situation AnalysisII. Advertising Message ObjectivesIII. Advertising AppropriationIV. Creative StrategyV. Media StrategyVI.Conclusion
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Conclusion
High QualityUnique TasteExotic Origin
= Beijing Redstar.
Exceeds your expectations!
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Thank you!