Product-Marketing Study:
Export Intentions of Spezial Bräu Bamberg

by: Katja Zimmerling

1. Conceptual Formulation  3

1.1. About Spezial Bräu Bamberg  3
1.2. Reasons for the Export of Spezial Smoke Lager Beer to the U.S.  4

2. Tariff and Non-Tariff Barriers 5

2.1. Tariff barriers for the Export to the United States  5
2.2. U.S. American non-tariff Barriers  6

2.2.1. U.S. Customs  5
2.2.2. New Safety Arrangements since 9/11 6
2.2.3. Labeling.  6
2.2.4. Other Authorities to be contacted  7
2.2.5. Distribution of Alcoholic Beverages  8
2.2.6. Competitors 8
2.2.7. Liability Risk  9

3. Cultural Obstacles with Regard to German-American Business Relations 9

3.1. Social Behavior 10
3.2. Business Behavior 11

4. Marketing Strategy 11

4.1. Product Policy 11

4.1.1. Branding 11
4.1.2. Packaging 11

4.2. Distribution Concept 12
4.3. Pricing Policy 13
4.4. Promotion 13

5. Future Prospects  14

Bibliography

1. Conceptual Formulation

1.1. About Spezial Bräu Bamberg

Spezial Bräu Bamberg is one of about 530 German medium-sized breweries. The first documentary evidence of this brewery goes back to 1536. Since 1898 it has been privately owned by the Merz family. It is assumed that the name “Spezial” has its roots in the German word “Spezeln”, which means “pals” or “buddies”. A specialty of this small brewery is the so called smoke beer for which Bamberg is famous and which has been produced here for over 465 years according to the same procedure. The required smoke malt is produced with a centuries-old manufacturing process by the brewery. Hereby, the malt is dried over a beechwood fire where it gets its special aroma; a mild, fine, smoky taste.

The company offers the following types of beer:

Lagerbier (a mild smoke beer with 4.7% vol.)
Märzenbier (a mild smoke beer, only available in March with 5.9% vol.)
Spezialbräu-Weißbier (a crisp wheat beer with 5.3% vol.)
Ungespundetes (a dry hopped beer, naturally cloudy)
Bockbier (a strong smoke beer, only available from November until Christmas with about 8% vol.)

The annual production output spans 6,000 hl and includes all the different types of beer mentioned above, whereas the lager is the one with the highest sales volume.

1.2. Reasons for the Export of Spezial Smoke Lager Beer to the U.S

So far, Spezial Bräu Bamberg has only distributed its beers in a 10 mile radius, as there is high competition between local medium-sized breweries in Germany. Therefore, an enormous expansion within Germany would be unprofitable. Through a survey conducted by a local market research company, Spezial Bräu found out that there is a market for smoke beer in the United States, and that to the present day no comparable product is existent in this country.

Besides, the infrastructure is similar to Germany, there are a large number, and variety, of public warehouses, advertising agencies specializing in the beverage industry, and beer, especially German beer, is a well known, appreciated beverage. Spezial Bräu, therefore, can make use of the country of origin effect and the positive image of German beer in the U.S. After having thoughtfully balanced all issues, Spezial Bräu decided to take the next step. For the initial stage, the decision has been made to introduce only their most famous and most common type of beer to the U.S. American market, the lager beer, which is only a mild smoke beer and the company’s best-seller in Germany. Besides, lager is the most common beer in the United States, with a market share over 95%. The U.S. market, with a per capita consumption of 89.5 liters of beer in 2001, poses an interesting opportunity for foreign breweries. This number includes 1.4 billion liters that were exported from Germany into the U.S. The expected sales volume for 2005 is even said to increase by 6.8% compared to the previous year to a total of 19.5 billion liters. A lot of preliminary consideration now has to be done before the product can finally be launched in the U.S.

2. Tariff and Non-Tariff Barriers

First, it has to be clarified if there are any legal or economic obstacles that are invincible, especially for a medium-sized company like Spezial Bräu.

2.1. Tariff barriers for the export to the United States

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