This is because it is claimed that the distillery has been in operation since the year 1779. That gives it a history spanning at least two hundred years. But this history is not very clear, since it is not clearly stated from any form of documentation when the first product was distilled in these facilities. But since the marketers claim that it is one of the oldest, the public has no option but to go with this reasoning.
This distillery is famed for its single malt scotch whiskey. Rather than marketing a blended scotch whiskey, Bowmore prides itself in marketing the best aged and single brandy whiskies. Their brand Bowmore Islay Single Malt Scotch is wildly famous not only in the united kingdom but also in other parts of the world like Japan and china.
The success of this brand can be attributed to the marketing strategies that had been adopted by the marketers of this distillery. One of them is creating a brand that is unique in quality. This means that the scotch is priced highly and this sets it apart from other run-of-the-mill scotches. The marketers have long realised that sophisticated consumers are looking for the expensive scotch and not necessarily the best scotch. As such, when a brand is able to combine expensive and good, it is bound to succeed. This is what Bowmore Distillery has done; they have produced a very expensive and a very good scotch whiskey.
Objectives of This Report
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This report is a culmination of a market research that was carried on Bowmore Islay Single Malt Scotch. It was commissioned by Bowmore Distilleries and conducted by this research outsourcing company. The major aim was to analyse the domestic and international markets of this brand. The aim of this research was to determine how these trends in the domestic and international markets may affect sales of the product. The research also focused on how Bowmore can utilise different types of market research to enter into a new market.
This report will have the following components:
- definition of the problem of the study
- methodology for the research
- presentation of the findings of the research
- an analysis of the domestic market
- an analysis of the international market
- competitor analysis at both international and domestic markets
- impacts of the domestic and international market dynamics on sales of the product
- Bowmore use of different market research methods to enter the African market
Problem of the Study
It has come to the realisation of the marketing department in Bowmore that the domestic sales have dropped below those of the international market. In fact, when the sales accrued from the international market increase at a high rate, those of the domestic market seem to decrease at a very low rate or stagnate at times. The executives of the distillery needed to know where this discrepancy was stemming from. Another impetus for this research was the fact that the marketing department wanted to launch the product into the African market. Kenya, a country in the eastern part of the continent, has been chosen as the entry point into the region. The executives needed to know the different types of marketing research that they can use to make inroads into this market.
Methodology of the Research
There are various methods that the researcher used to collect information for this study. Liang (2003) opines that the success of any market research lies on the methods that were used to execute it. If the research design was poor, this will be reflected in the findings of the research and vise versa. The accuracy of the research is of paramount importance given that the policy makers rely on the findings and recommendations to make their decisions. As such, if they are presented with a misleading research, which has been poorly conducted, the quality of their policies will also be poor (Diagero 2009).
The target population was the current consumer group of Bowmore Islay single malt scotch. The reason why the researchers focused on this group was the fact that they wanted to gauge their opinions, since the current consumers are also the ones that becomes former consumers. The aim was to gauge reasons why they would abandon consumption of this scotch for another brand.
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Due to logistical and other hindrances, it is not possible to conduct research on the whole of the target population (McNeil 2009). This necessitates the researcher to come up with a sample population that is representative of the target population. This sample population is manageable and easily controlled by the researcher given the fact that they are small in size. The sample population for this research were the customers that had been loyal to the brand for at least a period of more than one year. This sample was divided into two; the local and the international consumers.
The study involved an analysis of a sample size of 200 respondents. This sample size was arbitrarily determined by the researcher given the fact that there was need to do a deep research and the time was restricted to one month only. As such, the researcher found this population size to be quiet manageable. It was composed of 100 domestic consumers and 100 international consumers.
4)Characteristics of the Sample Population
The researcher strived to make the sample population to be as representative of the target population as possible. It was with this in mind that the researcher included within the sample, a hundred respondents from domestic market and another a hundred from international market. The sample population was made up of respondents from varying backgrounds who were aged eighteen years and above.
This is the technique that was used by the researcher to come up with the sample size that was identified above (Angell 2008).
The researcher used stratified sampling technique. The target population was identified from the records of the various outlets of this scotch. The researcher stratified the customers into those from abroad and those from the local market. Each stratum produced a hundred respondents.
The potential respondents were further stratified based on various categories, ranging from age, marital status and duration of consumption of Bowmore Islay single malt scotch.
6)Tools for Data Collection
To collect data from the respondents, a structured questionnaire was used which the respondents were required to fill out. The researcher came up with two different sets of questionnaires. The first set was to be administered to the domestic customers while the other one was to be administered to the international customer. The customers were traced down to their homes, or were accosted at their shopping place. They were required to fill up the questionnaire in the presence of the researcher, since the latter was not allowed to leave any questionnaire with any respondent.
The data was organised into tables, percentages and charts. It was analysed using simple statistics and later using statistic systems such as SPSS.
FINDINGS AND DISCUSSION
The findings and analysis of the respondents will be determined on whether the respondent was a domestic or international consumer.
There were various factors that were found to contribute to the deck lining popularity of the scotch in the local market.
The first is the poor taste of the scotch that was released around 1995 (Espeto 2009). The scotch had a nasty perfume taste that the consumers referred to as the “French Whore Perfume” (Lehman 2006). The aroma of the scotch was just like that of a cheap French perfume.
It seems that the customers never quiet recovered from this disappointment. This is especially so given the poor way that the distillery handled the queries from the concerned customers. The company denied any problems with the taste of the scotch and threatened to take legal action against any person that was found “slandering” the taste of the scotch. The consumers were disillusioned and they felt like they had been cheated and their intelligence muddled with.
Bowmore also seems to have abandoned the local market as far as advertising is concerned. The company seems to assume that given that they have such a long history, the consumers out there must know them already. As much as this true, there is need to appeal to the loyalty of the current consumer while at the same time trying to appeal to the potential ones. Their competitors like Blackwood and Diageo, seems to have perfected this art. They invest heavily in publicity materials, unlike Bowmore.
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A competitor analysis of this market found that the local brands of scotch that is either distilled locally in United Kingdom or imported have invested very much in publicity. They have a strong presence, despite the fact that their products are of low quality than that of Bowmore (Howard 2009). But it seems that they are doing a very good job of attracting the potential clients by appealing visually and orally to them.
The products of the competitors are also fairly priced. They are affordable to the masses, unlike Bowmore which is only consumed by those who can afford the steep costs.
In order for a domestic brand to succeed, there is a need to keep reconnecting on a regular basis with the customers so that they feel appreciated. This improves their loyalty. But when they are abandoned, they are equally to be lured by another brand that, realising their quality weakness, will invest in publicity campaigns to counteract this.
An analysis of the consumers' behaviour in the United Kingdom market revealed a very curious trend. Consumers here seem to prefer taking their scotch home and enjoying it from there. As such, they can be described as home based consumers. This is as opposed to other parts of the globe where consumption of alcohol is a social affair, the customers preferring to take their drinks in the local pubs with their friends. A home based consumer is more discerning than a social consumer and that may explain the reason why these clients are easily offended by the obstinacy of Bowmore.
The effects of the above scenario on the sale of the product cannot be ignored. If the consumers are not satisfied, they will to react by placing their loyalties where they are satisfied. The sales will more likely than not decline, since the number of consumers will have been reduced.
The scenario in the international market is quiet different from what can be seen in the domestic market. The customers here seem to be more enthusiastic about the brand and in fact, they exhibit a curious sense of loyalty. The managers of the franchises here report that they have recorded growths of between 20 and 25% in sales in the past two years.
The researcher concentrated their efforts in two countries; Japan and China. In Japan, the consumers seem to have taken over the consumption of single malt and replaced it with consumption of blended ones. The company also seems to be conducting a substantial amount of publicity stunts. There are adverts that are placed on the local media and on the internet seeking to promote the brand.
Japanese and Chinese consumers seem to be seeking expensive and quality scotch. This is especially so for the emerging rich in the economy. They want to create a name for themselves as distinguished consumers who have had a taste for the best (Brownski 2008). Given the fact they are aware of the long history of Bowmore Islay distillers, they seem to hold the opinion that the company has one of the best brands around and as such, they are ready to spend money on what they regard as a quality product.
An analysis of consumer behaviour in this region also proved to be significantly different from that of United Kingdom consumers. The consumers in Tokyo and shanghai prefer to take their scotch in a social setting. It is hard to find a person taking alcohol alone at home. They invite friends over, or they congregate to the local pub. This being the case, there is need to show off to the rest of the consumers on the sophisticated and refined tastes of one's palate by consuming an expensive, high quality scotch. This is how Bowmore has made its mark in this region.
The international client seems to be satisfied. As such, they are likely to improve the sales of the product both in the short and long term. The only thing that Bowmore has to do here is concentrate their efforts in maintaining the loyalty of their current consumers, while continuing to cultivate the brand as the ultimate choice for the discerning consumer in the society.
Entering the African Market
As earlier stated, the company seeks to make an entrance into a new international market. They want to make their presence in Africa felt. The executives have identified East Africa as their entrance point into the region. They have specifically identified Kenya as their entry port.
The researcher conducted a regional analysis to determine the suitability of Kenya as an entry point to the region. The following were the findings of the researcher:
The Kenyan market seems to be dominated by one distiller, East Africa Breweries Limited. This is the largest brewery and distiller in the local market and in the east African region. Their scotch products like Smirnoff, VAT69 and Moonwalker among others seem to have reverberated well with the local consumers.
The marketing strategy of this distiller can only be described as aggressive. They seem to have a continuous presence in the local and regional media. They sponsor events such as rugby, reality shows and such others both as brands and as products. The distiller is also known for their underhanded deals that they hand to their competitors. They will use their economy of scale, their connections in the political circles and such other tactics to drive away their competitors. Their favourite tactic in Kenya is the appeal to the patriotic spirit of Kenyan, by claiming that they are 100% local. This is how they drove out their competitor Castle Distillers, a South African company that had established itself here in the late 1990's.
There other products in the local market, like the United Distillers and London Distillers among others. This is an indication that the Kenyan market and in extension the east African market, is ripe for another entrant.
The Kenyan tax laws seem to favour international investors. They are lower than the rest of the east African region. The country is also proud to have one of the best infrastructures in the east African region. Their roads are fairly good and they have been connected to the international optic fibre cable meaning that communication will be very easy and fast.
Kenya has one of the best airports in the region and is connected to the rest of the east African region, and to the world in extension, by the railway and the port facilities. This means that it will be very easy to establish a branch in Kenya and then form distribution networks within the rest of the region.
Bowmore Islay Single Malt Scotch is the famous product of Bowmore distillers in Islay Island in Scotland. This distiller claims to be one of the oldest, with the finest distilling history in the region and in the world. But of late, there have been concerns around the place as to the decreasing number of sales in the local market. This factor was perplexing given that while the local consumption was going down, the international one seemed to be peaking. This led to the realisation that the problem cannot be the brand but is likely the relationship between the distiller and the consumers.
This report found that the problem was in fact the relationship that had broken down between the distiller and their clients. The distiller also seeks to make inroads in a new market in Africa. Specifically, they want to make their presence felt in Kenya. With this in mind, this report makes the following recommendations:
- Change of marketing strategies in the local market. The company should seek to reconnect with their consumers by increasing their presence through advertisements and other marketing strategies.
- Hiring of a public relations consultant for the local market who will counteract the effects that the “French Whore Effect” had on the local consumers.
- In the international arena, the company should concentrate on strategies that aim at maintaining the loyalties of the existing consumer base.
- The company should maintain the brand of their product as an expensive and sophisticated drink. This strategy seems to be working for the international discerning consumer; especially, in the emerging markets of china and Japan.
- The decision to make an entrance in Africa has occurred at the right time. The Kenyan market is ready for a new entrant, especially given the negative feelings that the Kenyans have on the way their sole distributor, East African Breweries, seems to be engaging in unethical competition practices.
- The infrastructure of this country, coupled by the strategic geographic location and political stability, makes it a logical entry point
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