Moonshot Caffeinated Beer-Final

No Capital, No Advertising
New Century
Brewing:Moonshot
Caffeinated Beer
Sinem Gler , zgr Gemici , Egemen Yldrm , Orkun
Eti
ITU EXECUTIVE MBA 2009-2010 1

Agenda
Summary
Brief History of Rhonda Kallman &U.S Beer
Industry & New Century Brewing
Distribution & Demographics
Energy Drinks
Moonshot Caffeinated Beer
Swot Analysis
Corporate-level strategy
Recommendations
New Century Brewing:Moonshot Caffeinated Beer 2

Summary
Rhonda Kallman, CEO of New Century Brewing,

comes up with the idea for Moonshot which
is a caffeinated light-beer and after the other
brewers enter the market with their own
caffeinated beers and a disappointing first
year she decided to relaunch Moonshot with
a new label and more caffeine by investing
almost all the companys resources for
supporting Moonshot.
New Century Brewing: Moonshot Caffeinated Beer 3

History of Rhonda
Kallman
At the age of 19 Rhonda became administrative

assistant to Jim Koch, at Boston Consulting
Group (BCG).
She was also working part time as a bartender

and waitress.
In 1984 Jim Koch left BCG to start Boston Beer

Company, one of the first craft brewers in USA.
He asked Kallman to join him as she had the
knowledge of local pubs and restaurants and
this would help the company to access
potentialNew
customers.
Century Brewing: Moonshot Caffeinated Beer 4
History of Rhonda
Kallman
N e w C e n tu ry B re w in g : M o o n sh o t C a ffe in a te d B e e r 5
History of Rhonda
Kallman
Kallman; as a vice-president of sales, focused on

direct sales to bars and restaurants because of
the difficulties of having the distributors
convinced to carry a small label with limited
advertising support.
In 1985 Samuel Adams was voted the best beer

in America so the distributors are convinced
and Boston beer grew between 30 % to 60%
each year.

History of Rhonda
Kallman
In 1995 Kallman became executive vice-
president of Boston Beer .
By this time, with the entrance of more than 600
craft brewers to the market, Boston beer
began producing alternative beverages to
maintain growth and to stay in the maturity
period.
And after being a public company in 1995,
Kallman felt that she had begun to lose touch
with customers. She had stopped working
directly with distributors, bars and restaurants
and instead spent most of her time in meeting
rooms. As the company started growing up
she ended up losing
New Century her sense
Brewing: Moonshot Caffeinated of
Beer family. 7
History of Rhonda
Kallman
New Century Brewing
New Century Brewing
Moonshot Caffeinated
Beer
Beer
Beer
US Beer Industry
US Beer Industry
Craft Beer Industry
Small local brewers offering unique European
style beer.
Opportunity to enter the market without making

costly investments in plant and equipment by
leasing excess capacity to craft brewers.
Increase in the number of breweries and total

production accounted for more than 3 per cent
of total beer consumption.
In 1980s craft segment was new, few

competitors. Now there is an increase with the
help of advertising support, creative
Distribution&Demograph
ics
Three-tiered distribution system (Brewers,
distributors and retailers)
Transportation Process:
Brewers > distributor warehouses (temporarily
storing) > individual retailers.
Law prohibits brewers from taking a direct
interest in distributors or retailers and from
selling directly to customers.
In US, Alcohol drinking prohibited to people less
than 21 years.
People under the age of 35 consume 54 per cent
in bars and restaurants
Males account for more than 80 per cent of
consumption.
Energy drinks
SWOT Analysis
P o sitiv e N e g a tiv
e
Strengths Weaknesses
-First-to-market advantage (First caffeinated beer -Lack of budget (100.000$ with no advertising in it)
in the market.) -No marketing plan&research (Is therea need in the
n te rn a-Rhondas
l
market.
marketing expertise and reputation in the market for a caffeinated beer)
-Distribution to several states only
-The price of the product -Wrong advertising strategies.
-Outsourced production to 3rd party breweries (No
planting and equipment cost)
-No additives (sugars and/or artificial
ingredients) in Moonshotin contrast with energy
drinks.
Opportunities Threats
x te rn a-New distributors in Wisconsin and Colorado. -MADD campaign against caffeinated beer.
l -The rise of energy drinks -Bad publicity cause by B-to the-E.
-Development in craft beer industry . -The other competitors in the market who
-Consumption percentage of light beer (one launched their own products.
out of two drinkers) -9/11 terrorist attack made things difficult in terms of
-Adventurous drinkers open to new products getting the capital.
-Technological breakthroughs (Advertising
support, creative packaging and product
innovation.)
Comparison of selected
Beverages
April 2005 (Cdn $1 = US
$0.80)
Brand Calories Caffeine ( mg ) Alcohol (%) Price ( 6 pack )
Edison 109 0 4.0 $6.49
Budweiser 140 0 5.0 $4.99
Bud Light 110 0 4.2 $4.99
Michelob Ultra 96 0 4.1 $5.50
Corona Extra 148 0 4.6 $7.99
Sam Adams (Lager) 160 0 4.8 $7.50
Moonshot 128 45 4.8 $6.49

B E 203 54 6.6 $7.99
Molson Kick 167 55 5.0 $10.95 Cdn
Labatts Shok 157 60 6.9 $7.95 Cdn
Red Bull (250 ml) 110 80 0 $11.95
*Moonshots caffeine content was increased to 69 milligrams in June 2005.

Marketing Mix - 4Ps
Product: Good
* Brand name: Good brand name choice. reminds an energetic beer.
* Functionality: Beer with caffeine. it may be preferred by people who
doesnt like sweet taste of energy drinks.

* Packaging: Current package can be considered as attractive by
young people. The brand name and the new design fits well.
* Appearance: Just like normal beer
Place (Distribution): Not enough

* Distribution channels: New distributors in Colorado and Wisconsin.
Promotion: Not enough
*Promotional strategy: Samples to consumers in night clubs
*Advertising: No capital for advertising.
Price: Good
Higher than premium domestics, lower than imports.
Priced in the middle.

Corporate-level strategy

Mission : Making new American style beers

Goals:
Reinventing light beer
Producing innovative products
Providing smooth tasting, low-caloried, natural
beverages

Mistakes
The major problem was the lack of advertising and wrong
strategy to rely on other companies ads such as they
did with B to the E.
Conflict between target market and the place where

promotion activities took place.(23 years of old, just got
of the college and working people and high-energy
clubs)
Lack of a market plan, strategy and most importantly a

market research.
Choosing product concept which refers to the ideology

that a product would be the most successful in the
market if the main focus is put on the product quality
and specifications itself.
Recommendations
Attracting Angel Investors:Providing the capital to

accelerate the business.
Internet Marketing: Company can reach a wide audience
for free or a small fraction advertising budget.
Publishing articles on the internet; company can build
a brand awareness by telling about the product through
blogs, social networks or websites about brewing or
dining (all natural, good taste, hand crafted etc.). As a
result this would cause word-of-mouth marketing.
In-store displays: Placement of a product in visible
locations in a store, such as at eye level, at the ends of
aisles and near checkout counters, eye-catching displays
promoting a specific product.
Importance of Distribution Channels:
More attention should be paid on gaining more
distributors in more states so the product could be nation
wide.
To do this; motivating distributors by offering better
margins. This would allow us know about the key functions.
Which are;N e wgathering
C e n tu ry B re w imarket
n g : M o o n sh research,
o t C a ffe in a te d developing
B eer 24
communications, finding prospective buyers, transporting
Recommendations

Moonshot Caffeinated Beer-Final

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No Capital, No Advertising

ITU EXECUTIVE MBA 2009-2010 1

New Century Brewing:Moonshot Caffeinated Beer 2

Rhonda Kallman, CEO of New Century Brewing,

New Century Brewing: Moonshot Caffeinated Beer 3

At the age of 19 Rhonda became administrative

She was also working part time as a bartender

In 1984 Jim Koch left BCG to start Boston Beer

Kallman; as a vice-president of sales, focused on

In 1985 Samuel Adams was voted the best beer

New Century Brewing: Moonshot Caffeinated Beer 6

Opportunity to enter the market without making

Increase in the number of breweries and total

In 1980s craft segment was new, few

Moonshot 128 45 4.8 $6.49

Red Bull (250 ml) 110 80 0 $11.95

*Moonshots caffeine content was increased to 69 milligrams in June 2005.

New Century Brewing: Moonshot Caffeinated Beer 20

doesnt like sweet taste of energy drinks.

Place (Distribution): Not enough

New Century Brewing: Moonshot Caffeinated Beer 21

New Century Brewing: Moonshot Caffeinated Beer 22

Conflict between target market and the place where

Lack of a market plan, strategy and most importantly a

Choosing product concept which refers to the ideology

Attracting Angel Investors:Providing the capital to

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