Situation Analysis 1003MKT
Victoria Bitters
Author: Lucas Mariner-Horrigan Course Convenor: Dr Mitchell Ross Tutor: Sarah Sloan

List of Content:

Introduction (Pg. Number: 3)
Internal Environment (Pg. Number: 4)
Micro Environment (Pg. Number: 4-5)
Macro Environment (Pg. Number: 6-7)
‘SWOT’ Analysis (Pg. Number: 8)
Bibliography/Reference List (Pg. Number: 9-10)
Appendix List (Pg. Number: 11)

Introduction

Victoria Bitter since its inception in 1854 to the beer market has been vastly popular amongst Australians, Drawing acclaim from consumers that it is in fact Australia’s best beer. This being due to its distinctiveness from other beers on the alcohol market as it tailors to the harsh conditions of Australia (Brewers, 2014). However Victoria Bitters as of late has had a negative connotation toward the brand with a recent poll showing that the Australian populace is not as loyal toward the brand as before, With Victoria Bitters ranked as number four on the list of top ten beers to consume on Australia Day. With reporter Emma Brown prefacing her comments on the larger by using the slang like ‘Bogan’. (Brown, 2015) Therefore proving that Victoria Bitters is in need of repositioning its target market and advertising campaigns in order to stay afloat in the ever-growing alcohol market.

Internal Environment:

The Victoria Bitters brand was first introduced into the Australian market in 1854 in the Victoria Brewery. The Beer was first produced by founder and head brewer Thomas Aitken who believed that “ there ought to be a beer specially brewed for our harsh Aussie climate.” (Victoria Bitters, 2015). Carlton united Breweries (CUB) are the parent company of this brand producing a plethora of alcoholic products. Victoria Bitters only produces a small range of products, which include the original VB in different sizes and packaging, however they also offer an alternative called VB Gold, which comes in the unique stubbies and cans. VB uses Intensive Distribution of its product meaning that it is sold in as many outlets as possible where consumers are exposed to it frequently i.e. Supermarkets, Liquor stores etc. (Business Dictionary, 2014). The size of the CUB worldwide is around 70 000 employees. VB is brewed using a ‘wortsream’ process in which cane sugar to thin out the body of the beer. VB at one time had 305 market share however as of late is has dropped to 12.3% due the rise in other beer products and the increasing popularity of other drinks (Refer to Appendix 1). (Sydney Morning Herald, 2013).

Micro-Environment
The Beer industry can currently be seen as an oligopoly, which means that it is dominated by a small number of sellers. The market has dramatically recovered after the GFC with statistics indication that by 2018 the beer industry will be worth $607.8 billion dollars, hence the market is trending up, which is beneficial to breweries. The customer cliental for the consumption of beer is changing from the ‘macho man’ and sports oriented people to a more diverse range of customers therefore making the beer market more vastly popular.

Victoria Bitters is in need of rebranding as brands such as Heineken and Corona not only appeal to the same market VB does but also appealing to a plethora of other markets. However VB does have the advantage of better pricing so if here is deficit of some kind people may switch to the alternative cheaper brand that is VB.

Competitive Market Summary
Competitor
Target Market
Price per bottle
Slogan
Heineken
Product caters to all beer drinkers

Price $4.09

The Worlds most international brewer
Corona
Young urban upper middle class individuals

Price
$4.39
Corona, Miles away from the ordinary
Hop Hog
Young