Nøgne Ø

Abstract

Nøgne Ø is Norway’s largest craft beer brewery and exports to 37 different countries, where the United States is the biggest export market. However, they have a small market share relative to their competitors. In collaboration with our client we came up with a thesis purpose: “The purpose of this thesis is to build a marketing plan with core initiatives for Nøgne Ø to grow in the US market, more specifically: in New York City.“ Our secondary research gave us an insight into the consumer behavior and the craft beer industry. The industry reports showed us that the craft beer market has had a steady growth in the last 6 years. We used this as a basis for our qualitative research. After analyzing the market, we came up with three key competitors for Nøgne Ø. They are Mikkeller, Boston Beer Company, and Brooklyn Brewery. We identified Nøgne Ø’s target market as craft beer drinkers between the age of 25-44, finished college or more, and have an annual household income above $90,000. We have chosen to call this target segment “Connoisseurs”. In our qualitative research, we conducted three in-depth interviews, ethnographic research at three locations and taste testing at a craft beer bar. We wanted to further understand the supply chain dynamics, get an insight into the industry, and increase our understanding of the craft beer market in New York. Some of the key findings in the qualitative research are that there could be several improvements in the supply chain, which can be resolved by hiring a sales person specifically for the US market. The beer is considered to be of high quality and have good taste by the craft beer drinkers. We also found that even though seasonality beer is very popular among the consumers, the newest trend in the craft beer market is sour beer. Our quantitative research consisted of an online survey through Qualtrics. We wanted to use a bigger sample size to confirm our observations in the qualitative research, as well as uncover new information about the consumer and where Nøgne Ø more effectively can reach their target market. In our quantitative research, we found that the average price that respondents are willing to pay is $11. The beer style that is most popular among the respondents is semi-light beer, with 89% of our respondents said they liked this style. The top three social media platforms are Facebook, Instagram, and Twitter. The Connoisseurs mainly get information about craft beer through friends and family (84%). The most popular places to drink craft beer are in Manhattan and Brooklyn. The promotions are split into two different segments, B2B promotions and B2C promotions. B2B promotions focuses mainly on supply chain communication and relationships to stimulate push action into the marketplace, while B2C focuses on Nøgne Ø’s consumer target segments to create pull-action. All our promotions are heavily weighted on digital media and communication with the main purpose of increasing brand awareness, brand knowledge and ultimately improve distribution coverage and sales. Financial calculations revealed the break even point estimate to be 44,136 units sold (liter). We expect the net profit to be negative in 2017 and 2018, while the marketing initiatives will take effect in 2019, where we see a positive net profit. These are our final reccomendations. Nøgne Ø should recruit a US marketing manager, as this will improve the communication within the supply chain. Our client should use country of origin as a selling point, as this will differentiate them from the competitors. They should also focus on getting into retail stores, such as Whole Foods and Trader Joe’s, and activate social media to reach their target segment.