Final Project - Part 2: Camu camu craft beer

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GLOBAL MARKETING MANAGEMENT

Final Project - Part 2: Camu camu craft beer

Presented by:

Caballero Torero, Haru Ximena Andrea

Espinosa Diaz, Paloma

Sánchez Morán, Manuel Antonio

Gana, Wassim

Shida, Yu

Professor:

Bernard Meunier

Lima, June 2023

1. Executive summary

The product developed for the present project is JungleFizz, a camu camu craft beer. The market opportunities for Camu camu beer are significant. As the craft beer market continues to expand, consumers are increasingly interested in innovative flavors and distinct beer offerings. Camu camu beer has the potential to stand out in this competitive landscape due to its unique flavor profile and health benefits. Additionally, the popularity of fruity beers, particularly among the younger generation, presents an untapped market segment that camu camu beer can cater to.

The product strategy for JungleFizz is to offer a unique and unforgettable drinking experience by combining the refined art of craft brewing with the exotic flavors of the camu camu fruit. The beer targets the Spanish market, particularly “beer geeks” (enthusiasts) who appreciate quality, authenticity, and are open to exploring new and unique flavors. The strategy involves standardization with some local variations to cater to the foreign market, while maintaining the product's originality. Packaging and labeling focus on protection, brand identification, and compliance with EU regulations. Sensory branding aims to create a captivating visual, aromatic, and flavor experience that reflects the vibrant nature of camu camu and craft beer. The price strategy follows a skimming approach, taking into account market circumstances, customer sensitivity, and competitive conditions. Distribution strategies include retail stores, specialized liquor stores, and craft breweries. Promotion strategies aim to create brand awareness and encourage product trial through messaging that emphasizes uniqueness, taste exploration, and the exotic essence of camu camu. Finally, a simple but exhaustive enough marketing budget is detailed in order to support the whole strategy and its respective actions and initiatives.

1. Product strategies

The product developed for the Spanish market is a camu camu craft beer, branded as JungleFizz, an alcoholic beverage that mixes the refined art of craft brewing with the exotic detail of a delicious fruit from the jungle of Peru. This beer would tempt taste buds with its extraordinary fusion of flavors, creating a truly unforgettable drinking experience. It would be given a delightful tartness and tanginess by the main ingredient, camu camu. Also, the camu camu's naturally high concentration of vitamin C would add another layer of appeal to the beer's distinctive flavor profile, as beer connoisseurs (“beer geeks”) would be enthralled to savor this inventive brew's unique flavor repeatedly because of the way it enchantingly combined jungle fruit and beer traditions. Overall, what we believe will truly differentiate JungleFizz is its extraordinary originality and capacity to provide an incredibly novel drinking experience. As craft beer is becoming more and more popular in Spain (and worldwide), the

release of a camu camu craft beer would offer consumers an intriguing and unorthodox flavor profile, capturing the attention of Spanish beer enthusiasts and offering them a unique and refreshing choice that stands apart from the crowd.

To enter the Spanish market we will follow a standardization (product-driven) strategy. This, because we want to leverage on economies of scale, international standards (if subsequently we seek to expand in the EU), the exotic appeal of the product and, very importantly, maintaining the characteristics that make our beverage unique (camu camu scent and taste). However, it is undeniable that we must make some adjustments in order to adequately approach the foreign market we seek. In this sense, we will follow a core-product approach, which means making some local variations to the product while keeping its uniformity.

Regarding packaging and labeling, its main objectives are to protect the product from harm during handling, storage, and transportation; as a means of brand-identification and differentiation; and to convey information, as it displays essential details and complies with regulations. For JungleFizz we will only consider primary packaging, which will consist of a glass bottle of 33cl (330ml). Regarding the labeling, its color will be soft-dark, making contrast with a pinkish reddish hue that represents the color of the essential component of our beer: camu camu. In addition, we must comply with the following EU regulation regarding labeling for an imported alcoholic beverage: name of the product, net content, alcohol by volume (ABV), ingredients list, allergen information, manufacturer name and address, best before date and responsible consumption warning (European Union, 2022). We will also include a stylized illustration of the camu camu fruit, information related to conservation conditions and a seal and description of Peru as the country of origin of the product (mainly to highlight the exotic and unique appeal of the beverage). The product description and composition (ingredients list) can be found in the Appendix section. Finally, as both Peru and Spain have the same official language —which is a great advantage—, no further modifications have to be made in this regard.

In respect of sensory branding, it will focus on creating a captivating visual, aromatic, and flavor experience. Using the previously described colors and patterns that evoke the exuberance of the fruit, the label and bottle design will reflect the camu camu's vibrant tropical nature, mixed with the art a craft beer represents. The beer's scent will have roasted malt aromas, as well as a citrusy and fruity finish with distinct camu camu notes that arouse the senses and impart a feeling of freshness and vitality. When it comes to taste, our beverage will provide a distinctive fusion of flavors: the reviving acidity and slightly sweet

undertone of the fruit would combine with light toasted and hops flavor, balancing the taste experience and creating an indelible flavor profile. Overall, for beer enthusiasts, our camu camu craft beer will offer a comprehensive and distinctive sensory experience thanks to the mix of the three sensory components previously detailed.

Considering potential future line extensions, it could involve new craft beers made from other Peruvian exotic fruits, like passionfruit, blueberries, goldberries, acai, among others. Each of these new beers should have its own unique personality and body, but maintaining the whole JungleFizz brand cohesion and coherence.

1. Price strategies

3.1.   Market circumstances

Inflation in Spain, after being at its highest peak of 10.8% in July 2022, fell to 5.7% in December. In April 2023, it fell to 3.1%, being the European Union country with the lowest inflation. The general drop in inflation responds to the drop in energy prices, which skyrocketed in 2022 as a result of the Russian invasion of Ukraine. In recent months, the prices of energy products have gradually fallen (Castro and Ordaz, 2023).

Regarding regulations, as mentioned above, Spanish tariffs are 21% on the sale of alcoholic beverages and 25% on corporate tax revenues.

3.2.        Customer sensitivity

Regarding the current situation of price sensitivity of the Spanish consumer, although the inflation of 2022 caused almost a third of Spaniards to sacrifice the quality of the items in favor of lower prices (González, 2022). However, we must understand that inflation did not affect the alcoholic beverages sector to a very high extent, the most affected sectors were: food and non-alcoholic beverages with a rise of 15.7%. Daily basic products such as milk, mineral water, vegetables or meat are some of the products that have been affected by this rise (Centre Gestor, 2023). It can then be concluded that inflation has not greatly affected the price sensitivity of the Spanish consumer.

On the other hand, it is necessary to highlight the specific characteristics of the chosen target market: Beer geek. This consumer resides in urban areas and drinks craft beer at least once every two weeks. It is also aligned with our product profile and characteristics, and has the financial establishment to enjoy this kind of product. They seek good quality, uniqueness and authenticity.

Thus, the camu camu craft beer will be aimed at people who appreciate the quality and flavor of gastronomic products and who are willing and actively seek to explore new and

unique flavors, as well as "adventurous" people who are curious and interested in trying new experiences. In addition, to be interested in and value the ingredients, the history and origin of the product, as well as its manufacturing process. The aforementioned allows that the elasticity of the consumer with respect to price is not so sensitive because the quality is valued more than the price of the product.

3.3.        Competitive conditions

In the course of the 20th century, the large companies in the brewing sector consolidated through the acquisition of various competing breweries. During the 2000s, there were numerous M&A moves in this sector, leading to the formation of five main groups accounting for 50% of global beer production: AB InBev in Belgium, SAB Miller in the UK. Kingdom, Heineken in the Netherlands, Carlsberg in Denmark. In Spain, there is oligopolistic competition as the four large beer companies command 96% of the national market: The Mahou San Miguel brewery, the capital of the country, has a 37% share of the Spanish beer market; Heineken Spain 30%; Estrella Damm 25% and Estrella Galicia 4% (Riva et al., 2015).

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