Kirin Case Study_5

Conjoint and Segmentation analysis The KIRIN Case study

Sejong YOO (B00702551) BLANLUET Ambroise (B00603115) GABELLA Victor (B00698126) HATIM Leila (B00604795)

Contents • Background • Key issues • Conjoint Analysis KIRIN BEER Conjoint and Segmentation Analysis for ICHIBAN SHIBORI

• Segment Analysis • Recommendation

2

Background #1 Beer firm in Japan KIRIN

KIRIN Brewery Limited was the largest beer firm in Japan, and fourth largest in the world.

Dominant market leader in Japan’s beer market

Although Kirin diversified into food, liquor, and even biotechnology, its performance relied largely on its market position in beer. In 1990 its market

Asahi launched the new beer and achieved favorable market acceptance

share was almost 50% in Japan, nearly twice its nearest competitor, Asahi. Sapporo was the third largest brewer in Japan, followed by Suntory.

Kirin answered with a new product, Ichiban Shibori, which was a huge success

3

Background US import Market

On the US market, Kirin started with a niche strategy and is trying to get new consumers

US import beer market is mostly made of young upper-middle classes

Kirin first entered the US market in 1983 with a niche stragtegy, targetting Japanese people. Later, they signed contracts with beer distributors to get sold in other places than Japanese restaurants. Their major market is located in New York and Los

It is dominated by European and Mexican beer producers Among Japanese producers, Kirin is only second to Sapporo

Angeles.

4

Key Issues

New product launch in the US

Market Share in US

Product attributes

Segmentation and Targeting

They think about bringing Ichiban Shibori to the US market

1

Kirin would need to sell an additionnal 300-400.000 cases to beat Sapporo

3

Would that be the right product to launch into that market, and wich consumers should be primarily targeted ?

2

5

Product Attributes Are our new product attributes suitable to the consumers in the US

Conjoint Analysis

6

Discrepancy between actual vs predicted M/S Based on managerial judgments on competitors European Heinken

Beck’s

Bass Guinness

Standard Awareness

100 100 27.0%

50 80 13.5%

30 70 8.1%

25 100 6.8%

65 85 17.6%

60 100 16.2%

20 50 5.4%

20 50 5.4%

Standard Distribution

15.7%

12.6%

11.0%

15.7%

13.4%

15.7%

7.9%

7.9%

Weighted Average

22.5%

13.1%

9.3%

10.4%

15.9%

16.0%

6.4%

6.4%

First Choice

13.0%

12.0%

14.0%

14.0%

3.0%

39.0%

5.0%

N/A

Choic of preference Logit

16.0% 16.0%

15.0% 14.0%

14.0% 14.0%

14.0% 14.0%

11.0% 10.0%

17.0% 22.0%

13.0% 11.0%

Awareness Distribution

Amstel Light

Molson

Corona

Sapporo

Old Kirin

Note

0.6 SA * 0.4 SD

• Choice role is dependent on the context. - High Stake choice -> First Choice - High Variety of Seeking -> Choice of Preference - In between -> Logit

7

Discrepancy between actual vs predicted M/S Weighted Average

Why discrepancy? European

First Choice

Choic of preference

Logit

39%

40%

• All the other tangible and intangible attributes that

30%

are not reflected in the 23%

product profile.

22%

20%

16%16%

- Brand Power

13%

- Distribution Networks - Advertising Budget

15% 14% 13% 12%

14%14%14% 9%

10%

16%

16% 14%14%14%

10%

17% 13% 11%

11% 10% 6% 3%

0%

Heinken

Beck’s

Bass Guinness

Amstel Light

Molson

Corona

5%

Sapporo

6%

Kirin

8

Conjoint Analysis : New product profile Origin •European •Canadien •Japanese

Aftertaste •Strong •Mild •Very Mild

Calories Price •6.19 •5.49 •4.79

Body •Rich Full Body •Regular •Crisp and Clear

•Full •Regular •Low

Packaging •Six 120z Large •Six 120z Small •Four 160z

Glass •Green Label •Brown Label •Brown Painted 9

Methodology 1 Each attribute Level - First Choice

The relationship between each product attribute and the market share

10

Conjoint Analysis: Attribute Test 1 Kirin New (Baseline) Attributes

1

2

Tests

3

4

Origin

5

6

Price

7

8

Body

9

10

Aftertaste

11

12

Calories

13

14

Packaging

Glass

Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren Curren New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S New M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S t M/S Origin

Japanese

European

Canadian

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Japanese

Price

5.49

5.49

5.49

6.19

4.79

5.49

5.49

5.49

5.49

5.49

5.49

5.49

5.49

5.49

5.49

Body

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Regular

Crisp and clear

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Rich full bodied

Aftertaste

Very mild

Very mild

Very mild

Very mild

Very mild

Very mild

Very mild

Strong

Mild

Very mild

Very mild

Very mild

Very mild

Very mild

Very mild

Calories

Regular

Regular

Regular

Regular

Regular

Regular

Regular

Regular

Regular

Full

Low

Regular

Regular

Regular

Regular

Packaging

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Small

Six 12Oz Large

Four 16Oz

Six 12Oz Small

Six 12Oz Small

Glass

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Brown Label

Green Label Brown Painted

Heinekin+

13%

12%

13%

11%

13%

12%

13%

13%

13%

12%

13%

13%

13%

13%

13%

13%

13%

12%

13%

9%

13%

11%

13%

11%

13%

12%

13%

12%

13%

12%

Becks

12%

11%

12%

11%

12%

11%

12%

10%

12%

10%

12%

12%

12%

12%

12%

10%

12%

11%

12%

12%

12%

10%

12%

9%

12%

9%

12%

11%

12%

10%

Bass/ Guiness

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

14%

9%

14%

13%

14%

14%

14%

14%

14%

14%

14%

14%

Amstel Light

14%

13%

14%

13%

14%

14%

14%

13%

14%

13%

14%

13%

14%

13%

14%

14%

14%

13%

14%

12%

14%

12%

14%

13%

14%

13%

14%

14%

14%

14%

Molson

3%

3%

3%

3%

3%

1%

3%

3%

3%

3%

3%

3%

3%

3%

3%

2%

3%

3%

3%

3%

3%

3%

3%

3%

3%

3%

3%

3%

3%

3%

Corona+

39%

39%

39%

37%

39%

36%

39%

39%

39%

38%

39%

39%

39%

39%

39%

38%

39%

39%

39%

37%

39%

38%

39%

35%

39%

37%

39%

39%

39%

36%

Sapporo

5%

3%

5%

4%

5%

4%

5%

4%

5%

3%

5%

2%

5%

4%

5%

3%

5%

3%

5%

4%

5%

4%

5%

2%

5%

2%

5%

3%

5%

2%

Kirin

n/a

4%

n/a

7%

n/a

9%

n/a

4%

n/a

5%

n/a

3%

n/a

2%

n/a

6%

n/a

5%

n/a

13%

n/a

8%

n/a

13%

n/a

10%

n/a

4%

n/a

9%

11

Conjoint Analysis: Attribute Test 1 Graph 6.62%

European

Origin

8.52%

Canadian 3.79%

6.19

Price

5.21%

4.79 Regular

Body

3.15%

Baseline: 3.94

Crisp and Clear 1.89%

Strong

Aftertaste

6.31%

Mild

5.05%

Full

Calories

13.25%

Low

8.36%

Six 120z Large

Packaging

12.62%

Four 160z

9.94%

Green Label

Glass

4.26%

Brown Painted

0.00%

8.52%

3.50%

7.00%

10.50%

14.00%

12

Methodology 2 Global attribute Level - Choice of Preference

Optimization of the attribute

13

Conjoint Analysis: M/S Optimization European

5 optimal products that maximize M/S Attributes / Optimal Product Profiles

Optimal Product 1 Optimal Product 2 Optimal Product 3 Optimal Product 4 Optimal Product 5

Origin

European

European

European

European

European

Price

4.79

5.49

4.79

5.49

4.79

Body

Rich full bodied

Rich full bodied

Crisp and clear

Crisp and clear

Rich full bodied

Aftertaste

Mild

Mild

Mild

Mild

Mild

Calories

Low

Low

Low

Low

Low

Packaging

Six 12Oz Large

Six 12Oz Large

Six 12Oz Large

Six 12Oz Large

Six 12Oz Large

Glass

Brown Painted

Brown Painted

Brown Painted

Brown Painted

Brown Painted

M/S

17%

17%

17%

17%

17% 14

Conjoint Analysis: Optimization for new product European

Attributes / New Product Profiles

Kirin New 1

Kirin New 2

Kirin New 3

Origin

Japanese

Japanese

Japanese

Price

4.79

5.49

6.19

Body

Rich full bodied

Rich full bodied

Rich full bodied

Aftertaste

Mild

Mild

Mild

Calories

Low

Low

Low

Packaging

Six 12Oz Large

Six 12Oz Large

Six 12Oz Large

Glass

Brown Painted

Brown Painted

Brown Painted

M/S

16%

16%

16% 15

Recommendation on product profile

Price & Packaging • Sell at 6.19 per case • Premium and large packaging

Market Share • Initial product profile : 12 % • New product profile: 16%

Body, After taste, and Calories • Rich Full Body • Mild After taste • Low calories

Glass • Brown Painted

16

Target consumers Who is our target consumers and going to buy our product ?

Segmentation Analysis

17

Segmentation Analysis

Cluster Size

Size / Cluster

Cluster 1

Cluster 2

Cluster 3

Number Of Observations

115

103

99

Proportion

36.3%

32.5%

31.2%

31.20%

36.30%

32.50%

18

Segmentation Analysis on the taste Segmentation Variables 1.98

Rich full-bodied

5.26 7.48 3.16

Light beer

4.06 4.03 3.17

No aftertaste

5.05 5.68 3.2

Refreshing

5.14 7.02 3.47

Goes down easily

5.65 6.64 2.97

Gives a "buzz"

3.47 3.81 0.426

0.748

Good taste

8.33 0

2.25

4.5

6.75

9

19

Segmentation Analysis on price and image Segmentation Variables 3.1

4.13

Low price 3.71

4.63

4.55

Good value 3.24

5.84

4.05 4.24

ountry with brewing tradition 2.83

3.01 3.18

Attractive bottle 2.54

3.31

Prestigious brand

3.85

1.42

5.04

High quality

7.44

2.2

2.32

For young people

2.19

Masculine 0

2

3

2.56

3.33 4

6

8

20

Segmentation Analysis on consumption Segmentation Variables 2.29

Drink with friends

6.3 5.83 2.1

5.22

Drink at home

6.02 2.54

6.03

To serve dinner guests

6.53 2.83

6.27 6.3

For dining out

2.82

5.14 5.3

Drink at bar

3.56

5.13 5.15

Drink at picnics 0

1.75

3.5

5.25

7

21

Segmentation Analysis Discriminant Variables Cluster 1

Cluster 2

Cluster 3

8.6

Weekly consumption

9.73 9.9

4.783 4.8 4.8

Age (1-7)

5.383 5.6 5.4

Income (1-7) 4.322 4.5 4.6

Education (1-6) 1.139 1.1 1.1

Sex (M=1)

3.513 3.5 3.5

Adapt to new situations

3.33 3.4 3.2

Make friends easily

3.583 3.6 3.5

t like to be tied to timetable 3.165 3.2 3.0

Like to take chances

3.278 3.4 3.2

Like to travel abroad

3.487 3.6 3.4

Like ethnic food 2.948 2.9 3.0

Knowledgeable about beer 0

2.5

5

7.5

10

22

Recommendation on segmentation and targeting Advertising Scope

Focused regional advertising

Demographic information

Male, Aged 40-50, Mid and high income and education,Weekly consumption

1 2 2 3

•

Due to budget constrains, launching the product in one specific region with strategic promotions. If initial outcomes in the test markets are positive, we expand the campaign into major U.S. cities.

•

Our main target consumer is male, aged 40-50, mid and high income and education and consumes beer usually on weekend.

23

Recommendation on segmentation and targeting Narrowly Targeted advertising

3

Expanding target customers

4

Medium of the advertising

5

Our product’s compatibility with Cluster 3

Cluster 2 and 3 are quite similar preference in beer.

POP advertising focusing on distributors

•

Based on the demand of cluster 3, our product should aim for a premium market because our target consumer has knowledge and values good taste, rich full-bodied taste, and refreshing, high quality beer.

•

Since cluster 2 and 3 have similar preference, we might consider targeting two clusters. Our customer values a high quality beer more than the price, and has the highest knowledge of beers and values a prestigious brand.

•

Since we don’t have enough advertising budget, we need to invest on point of advertising focusing on distributors such as bars, retail chains, and restaurants. 24

Thank you

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