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Anheuser-Busch Case Study

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Introduction Of Anheuser-Busch Case Study

American brewing company Anheuser-Busch Companies is based in St. Louis, Missouri (Anheuser-Busch 2023). Anheuser-Busch InBev SA/NV (AB InBev), currently the leading brewing organization in the world and owner of myriad well-known international brands, including Michelob, Budweiser, Stella Artois, and Beck's, has owned it its entire length since 2008. The firm has more than 19,000 employees and runs 12 breweries in the US. Until December 2009, its family entertainment division, Busch Entertainment Corporation, was one of the country's biggest drivers of theme parks, with ten parks. One of the most well-known beer brands in the world, Budweiser, is produced by the company. One main feature of the brewery is that more than 98 percent of the beer consumed in the US is produced there, granting it distinctly American characteristic features. The company generates 13.8 billion USD in revenue each year.

Introduction Of Anheuser-Busch Case Study

2.Vision and Mission Statement

Vision: Anheuser-Busch has lofty aspirations. Bringing people together for a better world is the dream of the company. For thousands of years, beer, the first social network, has been bringing people together. Their heritage and culture are symbolized by it. But it is also a matter of their future. They constantly look forward to this future and devise innovative approaches whenever a new problem emerges. The company is always focusing on change and growth. They aspire to reach a time when their dreams will never stop growing. They aim to provide individuals with opportunities and support their neighbors. The company's ambition is to influence the world and create a future that everybody can be happy about and is free to share. More cheers in the future are their ultimate ambition (Anheuser-Busch 2023). Anheuser Busch entails encouraging the partners to take similar action as well as doing their part to safeguard the environment from seed to sip. 

2.Vision and Mission Statement

Anheuser-Busch Situation Analysis

One of the top companies in its sector is Anheuser-Busch InBev SA/NV. By thoroughly analyzing and evaluating the SWOT analysis, Anheuser-Busch InBev SA/NV keeps its leading position in the market. SWOT analysis is a highly active process that calls for efficient communication between many corporate divisions, including finance, marketing, management information systems, operations, as well as strategic planning.

Industry Structure and economic feature

Anheuser-Busch InBev has a great hold on the beer market all around the world. For several years, people have criticized the organization for having a massive impact on the US and beer markets around the world which has given the company a near-monopoly status. In the year 2020, small firms worldwide suffered due to the COVID-19 pandemic (Underwood 2021). But Anheuser-Busch InBev was able to weather the challenges of the pandemic. The company saved around $1 billion, and it was able to cut its dividend. It was one of the two beer firms in the US to regulate most of the beer market in the country in 2020. The company acquired SABMiller in the year 2016. Anheuser-Busch InBev's huge market share is way ahead of the competition. In 2020, the company had 38.7% of the country's market share. In 2019, it accounted for around 30% of the worldwide beer market sales (Underwood 2021).

The company and its brands have been serving for over 160 years. It operates 21 craft partners and 12 flagship breweries across the US. There are more than 120 facilities across 27 states in the US. There are over 400 independent wholesalers and over 25 wholesaler facilities. The company works with over 1000 American growers. It has played a crucial role in the manufacturing and distributing of hand sanitizers in response to the COVID-19 pandemic. It has also hosted blood drives in stadiums across the US. It is the leading beer manufacturer in the US and the nation's largest brewer, and it has been assisting with over 2.1 million jobs associated with the beer sector with a strategic investment of over $1 billion over the following two years in their work and places of work to drive economic prosperity across the US communities (Anheuser 2023). This strategic investment across 26 states will expand the company's US operations, allow sustainable innovations, boost economies, and strengthen the company's association with the country's communities. Around $100 million of the investment will go to sustainability projects such as water treatment, installation of solar panels, and other such approaches over the following two years.

It focuses on supporting the restaurant and bar community and is committed to sourcing its ingredients from over 900 farms in the US. It assists in safeguarding the livelihoods of those individuals across their whole supply chain, encompassing factory workers, farmers, truck drivers, bartenders, and so on (Anheuser 2023).

Part 1: Business Level Strategies

The business level strategies emphasize mainly premiumization, development through adjacencies, and differentiating the core. Three interlocking frameworks define the company's commercial strategy. It includes growth champions, the market maturity model, and a category expansion framework. The company uses the frameworks for leading and shaping the beer category across various price points and occasions and establishes the appropriate portfolio for each and every market. 

The company employs growth champions to make sure that they expand their portfolios and their business practices in an efficient and effective manner. The company is benchmarking the best practices for top-line development worldwide to implement them across the same kind of markets. The market maturity model has been used in order to classify the company's markets against a share of beer and a maturity level so that the company is able to recognize best practices that could be shared among markets with the same type of characteristics. The category expansion framework assists the company in identifying which beer types will best fit an evolving market's adapting requirements for the company to shape its brand portfolio and provide the beer types that the customers desire (AB InBev 2021).

The company's portfolio of core brands is emphasized in developing meaningful functional and emotional differentiation. It partners with local farmers in addition to working with local authorities. The company tries to integrate the farmers' crops into their recipes so that they are able to provide affordable brands, and by doing so, they will be able to gain a share in the value segment. Premiumization needs a portfolio strategy to meet the requirements of the consumers. The company anticipates that most beer growth would come from Premium offerings. The adjacencies approach of the company is developed around looking out for disruptive ways to offer customers new propositions. Scaling non-alcohol beverages and emphasizing premium alcoholic drinks in advanced markets are the two long-term directions for development.

Part 2: Corporate-Level Strategies

The business's strategy depends on its ability to differentiate its brands more from those of its rivals and to offer prices that are more reasonable. The business not only sells non-alcoholic drinks but also engages in the packaging and entertainment industries. It makes substantial investments in promotional strategies and depends on open reporting. In order to expand its operations, the company's main strategy is to make use of its sizable financial resources, low cost of capital, and stellar credit rating.

Competitive Analysis and Advantage in the Industry

The foundation of competitive advantage for the brewing sector is growing the distribution chains with collaborations and acquisitions in exotic locations, logically regulating the distribution cost, identifying the proper market for beer segments, and creating items readily accessible and available to the customers. Introducing innovative brands and maintaining the established brands' image fresh are significant for advantage. The company aimed for strong brand equity and top-line growth. It aimed at capturing the market of the United States and saving costs in a significant manner and reaching greater geographic stability. 

SWOT Analysis 

Strengths:

1. It has a highly skilled workforce. It has strong free cash flow.
2. The company has invested in developing a strong brand portfolio.
3. It has a high customer satisfaction level.
4.It has performed extremely well in new markets.

Weaknesses

1. The weaknesses are loopholes in the item range being sold by the firm.
2. The attrition rate is higher compared to other companies.
3. There has been little investment in Research and Development.

Opportunities

1. Opportunities include new customers from the online channel.
2. The latest technology offers a chance for the company to practice differentiated pricing techniques in the new market.

Threats:

1. The threats are that the company's profitability could be affected by increasing raw materials.
2. The competitors are developing new technologies and posing a danger to Anheuser-Busch.
3. The changing behaviour of customers from online channels may pose a great threat to the current physical infrastructure-driven supply chain model. 

PESTLE Analysis

Political: The likelihood of a military invasion, political stability, the importance of beverages, preferred trading partners, mandatory employee benefits, and other political factors are among those that have an impact on the business.

Economic: The quality of the industry's infrastructure, the economy's growth rate, the unemployment rate, and other economic factors are among those that have an impact on the company's performance.

Sociological: Culture, demographics, people's attitudes, education levels, and other sociological factors all have an impact on Anheuser-Busch.

Technological: The rate of technological diffusion, the impact of technology on product offerings, the impact of the cost structure in the beverages-brewers industry, and other factors all have an impact on the company.

Legal: The legal factors influencing the company are health and safety law, data protection, discrimination law, employment law, and so on.

Environmental: Weather, laws governing environmental pollution, climate change, and other environmental factors all have an impact on the company.

Target Market Analysis of Anheuser-Busch

1. Demographic Characteristics of Market

Anheuser Busch Inbev is required to divide its customer base based on two main demographic factors: the prospective customer's income and life cycle stage. These factors are important because Anheuser Busch Inbev's products offer a superior value proposition (Pro 2022).

2. Psychological Characteristics of the Market

Anheuser Busch Inbev can use psychographic segmentation to separate the potential customers into various segments based on factors such as personality traits, purchase behaviors, consumption opinions, viewpoints on social issues, recreational activities, hobbies, and many other aspects.

3. Behaviors of the Target Market 

Depending on their attitudes, product knowledge, item uses, and other responses to a product, buyers are divided into groups by behavioral segmentation. A lot of marketing professionals think that behavior factors are a good place to start when creating consumer segments (Pro 2022).

4. Strategies Appealing to Market

To create a customer value-driven marketing strategy in the consumer/non-cyclical industry, Anheuser Busch Inbev can employ the four major steps: market segmentation, targeting, differentiating, and positioning.

Marketing Mix of Anheuser-Busch

1. Product strategy:

It entails how much of a personal significance the product is to the buyer.

2. Pricing Strategy:

The success of Anheuser-business Busch's strategy depends on its ability to provide customers with competitive pricing and greater brand differentiation than its competitors (Taylor et al. 2020).

3. Promotional/ Advertising Plan:

It includes powerful marketing campaigns and launching ads with powerful messages.

Anheuser-Busch Competitive Analysis

Product, price, place, and promotion make up the four Ps of the marketing mix. Anheuser Busch InBev should put the customers at the heart of its decision-making process and core decisions on the necessities and desires of the client as well as the firm's technical and financial resources to create goods at a particular price. Finally, it must decide on both distribution and marketing channels to reach those clients in an effective and efficient manner.

Anheuser-Busch's Strong brands and size give InBev undisputable competitive advantages, but the company's share price indicates there may be issues. Deleveraging should be the top priority, but most investors underestimate how difficult it will be to achieve the ideal capital structure. That job will be made more difficult by intensifying competition in important markets, challenges related to beer consumption, and the necessity to develop in related categories (Dimitrov 2021).

Key Success Factors And Financial Analysis

Anheuser Busch's focus on comprehensive quality control and complete customer satisfaction is one of its key success factors.

Problems and Issues in Anheuser-Busch Organization

Shortage of water is a serious issue. Climate change affects the beer industry.

Anheuser-net Busch's income for the fiscal year that ended on September 30, 2022, was $5.088B, up 2.33% from the previous year. Anheuser-2021 Busch's net income was $4.67 billion, a 232.38% increase over 2020 (Macrotrends 2022).

Conclusion

Anheuser Busch company is establishing a long-term business. In order to ensure that they can keep on going to package, brew, transport, and distribute their more than 100 brands most sustainably and effectively as possible, they push the limits, start embracing emerging technologies, and see opportunities in challenges. They are an owner-run business with a steadfast enthusiasm to steer the future development of their sector. The company encourages its co-workers to set lofty ambitions and scale greater heights by empowering individuals to lead genuine change. They celebrate aspirations, resiliency, dedication, and accomplishment in addition to striving for more.

 

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