Hansa Pilsner

1. Situation Analysis

Hansa Pilsner was first launched in 1975, at a time when the beer wars in South Africa (SA) had elevated the status of the drink. The aim of the launch was to allow South African Breweries (SAB) to enter the light beer market - a market whose growth was rapidly increasing in the USA. Positioned as different from other beers - a lighter beer of Germanic origin - it was targeted primarily at English speaking white males between the ages of 18 to 24.

Although initially brisk, sales soon declined, resulting in Hansa garnering a market share of less than 3 percent. The reason for this poor showing was that pilsners were not understood by the SA beer-drinking public, with Hansa being perceived as weak, watery and too light bodied - attributes not favoured by a public which had not traditionally been afforded much choice. For the better part of a decade the Hansa team, with the aid of several advertising agencies, launched various advertising campaigns in an attempt to increase the brand's market share, convinced by a ‘gut feel' that there was a place in the market for the brand. Although these efforts ultimately failed to reach the original target market, there came a turning point toward the latter part of the 1980s, when Apartheid laws, which had prohibited the black population from purchasing or partaking of alcohol, began to be relaxed, and a new target market was identified.

With the brand initially gaining favour in Pretoria and the surrounding region, brand awareness rapidly spread, firstly to northern areas such as Polokwane and eventually to the coast. The demographic of the Hansa drinker had changed, identified as typically being a sophisticated, discerning, educated, upwardly mobile black individual between the ages of 18 and 34. The Hansa team, however, knew that it was necessary to make concerted efforts to get the message across that Hansa was a beer for all, and not just special occasions.

Following the introduction of the returnable 750ml bottle in 1988, along with a negatively perceived re-branding of SAB's flagship brand - Castle Lager - Hansa had, by the end of 1990, managed to grow its market share to 6.1%. By 2000 the Hansa consumer profile had been adjusted to include both black males and females between the ages of 25 and 34, with females accounting for 30% of the brand's consumers by 2001.

In 2001 Hansa had become the second largest brand in SA, accounting for 20% share of the South African beer market. Owing to this, it was no longer feasible for the Hansa team to position the brand as a niche brand. The team was now faced with how it was going to go about repositioning the brand, whilst at the same time differentiating it from the rest of the mainstream brands.

2. Question 1 : Critically assess SAB's marketing strategy in launching Hansa beer

SAB had been the market leader in the South African beer industry for over 100 years since 1895. Its main local competitors were Ohlsson's and Chandler's Breweries, which SAB later bought out in the 1950s. Other small competitors were Louis Luyt Breweries established in 1971 which was later merged into Intercontinental Breweries (ICB).

To stay a market leader SAB had to take action by, finding ways to expand market demand, protect its current market share through good defensive and offensive actions and increasing market share even if the market size remained constant. Continuous innovation is the most constructive way to protect market share, which is often achieved by launching new products (Kotler and Keller 2009). SAB's launch of Hansa was a way of expanding market share by tapping into the light beer market.

The launching of the new brand by SAB at this time was primarily to counter the fierce offence from ICB who constantly attempted to match SAB brands. In situations of attacks like these, the market leader responds with a counter attack, and that is exactly what SAB did. SAB invaded the competitor, ICB's, main territory so that it became necessary for ICB to pull back to defend it. SAB also adopted a mobile defence strategy by stretching its domain over new territories that could serve as future centres for defence and offence through market broadening.

In the 1970's there was no light beer in SA but in the USA it was already popular with Miller Lite being the first successful brand in that country. To protect its market share in SA, SAB adopted the pre-emptive defence approach by attacking future competitors before they have even entered the country.

2.1 Marketing strategies: Introduction Stage and Pioneer Advantage

A company has to decide whether to be the first to enter the market or to do it later. It can be rewarding to be the first but this reward comes with higher risks