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Copyright Sauder Summit 2015
Thank you to Molson Coors Brewing Company for exhibiting one of Vancouvers most prominent businesses to our esteemed international competitors and delegates.
Interviewees and Contributors from Molson Coors Brewing Company
Dennis Leard, BC Sales Coordinator
Case Writers
Christy Tang
Natalie Korenic
Professor Kin Lo, Faculty Advisor
Suki Chan, VP Cases
The Undergraduate Office of the Sauder School of Business
The UBC Commerce Undergraduate Society
The Sauder Summit Global Case Competition Organizing Committee
This case has been prepared solely and specifically for the Sauder Summit Global Case Competition,
and is not to be distributed, shown or discussed without the permission of the organizing committee.
All data in this case, quantitative or otherwise, has been obtained from publicly available sources and
from Molson Coors Brewing Company. This case is not intended to serve as an endorsement, a source of
primary data, or an illustration of effective or ineffective management. Molson Coors Brewing Company
does not warrant the accuracy of the information in this case study. The Molson Coors Brewing Company logo and any of its affiliate graphics are trademarks of Molson Coors Brewing Company.

RE: Molson Coors Market Strategy Presentation

From: Christy Tang; Natalie Korenic
To: Molson Coors BC Sales and Marketing Team
CC: Dennis Leard
Sent: March 9, 2015
Hello everyone,
Todays client, Molson Coors Brewing Company (Molson), is a North American brewing company formed
in 2005 by the merger of Molson of Canada and Coors of the United States. As the worlds seventh
largest brewer, Molson operates as an industry leader in the global beer market, with 33 breweries
spanning over 50 countries and a diverse portfolio comprised of over 100 beer products.
Built on a rich history of brewing and and a passion for its product, Molson takes pride in its
commitment to innovation and the production of quality beers that cater to both local and international
tastes. Molsons vision is to become a top-tier global brewer, and to reach that top spot, the company
looks to its core values of challenging themselves with new-thinking everyday, personal accountability,
and putting its drinkers first.
With operations and products distributed around the world, Molson is firmly rooted as a major player
in the global beer market. In Canada, Molson evenly shares a vast majority percent of the beer market
with its main competitor, but the make-up of the competitive landscape differs greatly on a more local
scale. In British Columbia, Molson shares a much smaller majority of the market, with dozens of small
craft brewers competing over a significant portion of the remaining market.
The dramatic rise of craft beer labels over the past few years, especially in large urban centres, is proving
to be a concern for Molson in the BC beer market. As the popularity of craft beer among consumer
grows and as the expected total number of craft brewers in BC continues to rise, Molson is faced with
the challenge of repositioning itself in a market with changing consumer preferences, while remaining
true to its product and mission.
Molson has come to us today to receive guidance on how to best establish a plan of action in managing
the rise of craft beer in the BC beer market. This plan should be developed with the ultimate goal of
improving consumer sentiment and building brand loyalty.
The members of the Molson BC sales and marketing team are looking forward to your presentation on
the potential issues facing the company and your proposed solutions.
You will have twenty minutes to present to the judging panel, followed by ten minutes where you will
have the opportunity to field questions and clarify your proposal. Our research team has compiled a
collection of relevant information for your reference, which is attached to this email. Best of luck.
Christy Tang and Natalie Korenic

Molson Coors Brewing Company (Molson) is a publically traded company (NYSE: TAP, TSX: TPX.B)
formed through the merger of Molson Brewery Canada and Coors Brewing Company of Colorado (Coors)
in 2005. Molsons operating segments include Canada, the United States, Europe and Molson Coors
International (MCI). An industry leader in the global beer market, the companys portfolio contains over
100 beer brands internationally. As the worlds seventh largest brewer, Molson has 33 breweries across
50 countries, and operates offices in Canada, United States, United Kingdom, Central Europe, and Asia.
In 1786, John Molson, Molsons founding father, established his first brewery in Montreal - one of the
oldest North American breweries still standing today. By 1800, Molson became the first brewery in
Canada to bottle its own beers by hand. The idea of bottling in glass packaging introduced the concept
of bottle deposits and re-uses to the industry, a practice still seen in Canada. Subsequent to John
Molsons passing in 1836, the company and brand continued to prosper. From the implementation of
a refrigeration system in 1890 that allowed Molson to brew its beers year round, to delivering its first
beer via truck in 1910 Molsons success continued, leading to a number of great expansions. Through
purchasing Sicks Capilano Brewery in 1958, merging with Carling OKeefe brewery in 1989, to merging
with Coors in 2005 Molson had then solidified itself as one of the largest breweries in the world.
By 2004, Molson and Coors had already been in venture together as two independent entities. Molson
facilitated the brewing, sales and distribution of Coors beverages in Canada, and Coors facilitated the
sales and distribution of Molsons beers in the United States. Faced with rising competition in the
beer industry, the two companies ultimately merged to form Molson Coors (Molson), with the goal
of developing a strong business able to sustain long-term growth against even larger players in the
market. Preserving the visions of the two family-established breweries, Molson continues to bring
diverse and innovative beers of the highest quality to dedicated drinkers around the world.

Molsons ambition is to become one of the top brewers globally, delivering extraordinary brands that
captivate beer drinkers around the world. Molson is passionate about driving results and doing so the
right way by taking smart risks and working as a team. In order to continue progress, advancement,
and the development of Molsons presence in the beer industry, the company is constantly building on
its competitive advantage. By diversifying its brands to meet a wide range of consumers needs, Molson
seeks to create value for its customers, which ultimately drives financial success.
Molson has five core values that embody its brew and represent the company:

Excellence: Molson commits to efforts that are keys to winning, and works hard

to outperform its competitors in all manners. Focusing on the details that truly make
a difference in beer, Molson strives to deliver unique and flavourful beverages. To
surprisedrinkers with new achievements, Molson always pushes its limits to bring better
beers, even after 225 years of brewing.

Passion: Molson is a champion of great beer and seeks to share its passion. Sharing

the thirst for beer with its drinkers, Molson looks to offer the best beverages, at the best
moments, to the best people.

Integrity and Respect: Molson holds to heart the Golden Rule: treat everyone as

we expect to be treated. Having strong moral principles, Molson believes that being honest,
ethical, and open is the foundation for building lasting relationships with business partners
and colleagues within the company. Furthermore, respecting its customers builds loyalty.

Creativity: Molson holds a portfolio of over 100 beer brands internationally covering
a multitude of diverse taste palettes. Molson supports and values the importance
of discovering, innovating, and cultivating new ideas to keep the company sharp and
competitive. Being bold and distinctive, Molson consistently aims to challenge the norm in
the industry to bring to drinkers a renowned Molson beer experience.

Quality: Molson is devoted to delighting drinkers with high quality beers. Using sensible

procedures and effective technologies for quality control, Molson ensures all its beers are
superior. The company believes that high quality product stems from high quality people. As
such, Molson attracts talent who strive to deliver excellence in all areas.


In the British Columbian market, Molson is ambitious in further differentiating its beers
from local competitors through emphasizing two main themes in their products: quality
and locality.


Quality is a key differentiator against Molsons competitors. Molson boasts high

levels of quality control within each of its breweries all beers are tested for merit
prior to being delivered to customers. Due to economies of scale and capacity for
extensive quality controls, Molson (like other large brewers) has a competitive
advantage over craft brewers with regards to quality.
Molson distinguishes taste and quality as two individual and separate components.
Molson is comprised of many beer brands that cover a wide palette of taste
preferences. While one person may like a certain beer within the Molson portfolio
(e.g., Molson Canadian), another person may prefer a different one (e.g., Coors Light).
One person may enjoy a darker, bolder brew, and another may enjoy a lighter taste.
These differences in flavour preference motivate Molson to ensure that each of the
beers produced by Molson breweries is of the highest quality, in hopes of satisfying
each niche of beer drinkers.


Molson has a large brewery located on Burrard Street in Vancouver, British Columbia,
and many of the renowned beers consumed on the West coast are brewed in that
very location to satisfy the thirst and demand for Molson products.
Manufacturing beers locally provides an advantage as it is a great selling point for
marketing the Molson brand. In the past, Molson had pursued a specific point-ofsale marketing technique, labeling their beer bottles with an XX km away label
indicating the distance (in kilometers) that specific beer is from the Burrard brewery
where it was initially created. The further the beer bottle is from the brewery, the
greater the value of XX.
However, most of Molsons marketing efforts are focused on national branding (see
Appendix for examples). While this improves international exposure and strengthens
the Canadian flagship brands, Molson is hoping to improve local-based marketing.


Molson has a sizeable assortment of beers that are offered
around the world to satisfy a diverse set of consumers; ranging
from Belgian-styled Blue Moon, to Hollands imported Heineken,
to Canadas very own Molson Canadian. Molson has two primary
flagship brands within its portfolio for which it aims to emphasize
and strengthen branding: Molson Canadian and Coors Light.
Rickards is another key brand within the Molson portfolio and is
particularly relevant in BC where it was created. Rickards volume,
however, accounts for less than half of Molson Canadian and Coors
Lights volume.

Molson Canadian:

Made from Canadian water

and barley from the fields of the Canadian Prairies (Alberta,
Saskatchewan, and Manitoba three provinces to the east of
British Columbia), Molson Canadian is a premium domestic lager
that perfectly embodies the beauty and nature of Canada. Sold in
both bottles and cans, this iconic Canadian beverage can be found
in homes all across Canada. Brewed with no preservatives, Molson
Canadian has a crisp, fresh taste, and contains an alcohol by volume
(ABV) measurement of 5.0%. With breweries in Vancouver, Toronto,
Montreal, Moncton, and St. Johns locally producing Molson Canadian,
drinkers in all parts of the country can easily pick up freshly brewed
beers to bring home.

Coors Light:

Originating from the Rocky Mountains

region in Colorado but brewed in Canada, Coors Light is a light, pale,
and refreshing lager that holds subtle hints of apple and banana.
The lager does not taste sweet, but the fruity notes of Coors Light
counterbalance the bitterness that is characteristic of barley-based
beers, making it easy to drink. Coors Light contains an ABV of 4.2%. It
is commonly known for and identified by its temperature-activated
packaging; when a Coors Light beer is refrigerated to the ideal
temperature, the mountains printed on the bottles and cans change
color from a snowy white to an icy blue a clear indicator that the
beers are ready to drink.


Rickards primary beer, Rickards Red, embodies

a complex yet balanced flavour. Rickards Red is an Irish-styled
amber ale with an ABV of 5.2%. Brewed using three different types
of malted barley, Pacific Northwest hops, and premium brewers
caramel, it has a full-bodied and smooth taste. With subtle hints
of burnt caramel, Rickards Red is perfect for pairing with proteins
such as pork and chicken. Also within the Rickards product line
are Rickards White, Rickards Blonde, RickardsDark, and Rickards
Oakhouse, their limited season brew. Varying from 4.8% to 5.5% ABV,

To suit drinkers of all types, Molson offers dozens of brands of beers worldwide. While Molson
recognizes that taste is crucial to existing beer drinkers, taste may also be a possible deterring factor to
potential beer drinkers. To increase enjoyment for existing drinkers and remove barriers for potential
drinkers, Molson has developed a Beer Taste Discovery System. This system categorizes the vast
majority of beers on the market, assisting customers in learning more about the style and tastes of
Molson beers, and to discover what they like.

Taste Category


Taste Experience

Flavoured and

Flavoured light

Lighter bodied,
tangy, or mild

Straw to gold

Lighter and

Light lagers
Light ales
Some lagers

Lighter bodied,
low malt,
bitterness, or

Straw to gold

Bright and

Gold to copper
Light to
bodied, crisp
Imported lagers
finish with a
Some Pilsners
hop, bitterness,
and malt

Fruity and smooth Wheat

Robust and malty

Dark lagers


Medium body
Blonde to
and sweetness,
amber, often
Amber to dark

Molson Brands &

Competitor Brands
Canadian 67
Bud Light Lime
Canadian 67
Keystone Light
Coors Light
Bud Light
Corona Light
Keystone Lager
Miller Genuine
Molson Dry
Premium Lager
Keiths IPA
Stella Artois
Rickards White
Rickards Red

Beer is a $5.7 billion dollar industry in Canada, and experienced an aggregate growth rate of
1.8% from 2010-2015. The industry is dominated by several top players, but the market share
of such players has been in decline in recent years, primarily due to the increasing popularity
of craft breweries.
The two big players in the Canadian market are Molson and Anheuser-Busch InBev (AB
InBev) with 33.3% and 41.5% market share respectively. Each of these corporations essentially
act as umbrella companies, holding many different beer brands in their portfolios. The main
brands under Molson are Molson Canadian, Coors Light and Rickards. The AB InBev portfolio
most notably includes Budweiser, Corona and Kokanee (which has a brewery in Creston, BC).
Molson Brands

AB InBev Brands

Increasingly, consumers are moving towards purchasing beer products they perceive to be
of higher quality, and have shown a higher willingness to pay for the improved quality. This
is leading to an increasing value of the beer market as a whole. Sales volume is anticipated
to remain fairly static in the beer industry, although there are subcategories of growth. For
example, demand for craft beer has skyrocketed in the urban areas of British Columbia.


Craft beers are beer products in small production from small, local breweries and they typically target
local and regional markets. It is an imprecise definition; there is no specific size or brewing capacity
that defines a brewery as a craft brewery. This can be a source of confusion in the market for both
brewers and consumers. Some brewers use this ambiguity and lack of information to their advantage
by promoting their brand using Craft Style marketing; some large brewers, for instance, may label their
beer as craft.
In the first two quarters of 2014, craft beer brands saw a 43.4% increase in sales, while bigger domestic
brands faced a more static trend line. The rising popularity of craft beer products can be attributed to
increasing appreciation for local craftsmanship and the perception of higher quality beer.
This perception of superior quality is largely due to a wider variety of unique flavours, made possible by
the smaller batch sizes for craft brewers. However, this also creates increased entry costs, increased
costs of production, and difficulty in capitalizing on economies of scale. Despite these barriers, craft
brewers are largely able to maintain success through provincial government subsidization. Craft
brewers cannot survive on uniqueness of flavour alone and would likely be priced out of the market by
the larger breweries without such subsidies.
This increase in craft beer popularity is particularly apparent in British Columbia (BC), relative to the
rest of Canada. Table 1 shows the market share for different beer segments within the province as
compared to the national statistics. For a frame of reference, craft beers held only 6.4% of the market in
2007. Since the majority of craft brews are in the medium to darker ales category (see Beer Taste chart),
the rise of craft breweries has also brought declining demand for lighter beers.
Market Segment
Above Premium Domestic
Above Premium Imports

BC Market Share

Canadian Market Share


Market Segment
Molson Canadian, Coors Light, Budweiser, Kokanee, Pilsner
Keystone, Extra Old Stock, Old Milwaukee, Lucky Lager, Colt 45, Black Label
Above Premium Domestic
Craft beer, Rickards, Sleemans
Above Premium Imports
Heineken, Coors, MGD, Corona, Stella Artois, Becks
Despite the rise of craft beers, no single craft brewery is large enough to be an individual
concern to any major player. However, their collective power poses a threat. Since 2013,
30 new craft breweries have been established in BC alone. The expected total number of
craft brewers in BC will rise to nearly 100 by the end of 2015. For comparison, there are
approximately 60 craft brewers in the province of Quebec and 50 in the province of Ontario
(who have double and triple the population of BC respectively).


Many restaurants and bars in urban areas of BC pride themselves on their selection of local craft brews
on tap. Several restaurants, such as Craft Beer Market in Vancouver, focus their entire operation on the
promotion of craft brews. Another key component of the craft beer industry is the publics ability to go
to the brewery for a tour and tasting. The Molson brewery in Vancouver offers tours of the facility as
part of its effort to promote its beer products as local (see advertisements in Appendix B).
In order to better compete amongst the many craft beers in the market, some large beer companies
have chosen not to create their own craft breweries but rather acquire existing ones. Molson acquired
Creemore Springs Brewery in Ontario, Canada, and Granville Island Brewing in Vancouver. The company
has been successful with both these brands. However, Molson must ensure the continued health of
its flagship brands. The driving force of its success thus far has been economies of scale, which craft
breweries inherently cannot achieve.

Consumers accessibility to large international brands further increases competition in the craft beer
market. In 2012, legislation lifting restrictions on interprovincial transportation and distribution of
alcoholic beverages took effect, allowing craft brewers to transport its beers outside provincial regions.
The elimination of geographic limitations gives way to both craft beer imports and the expansion of BC
craft beers into other provinces.
The rise of small producers can be partially attributed to the growing perception in BC that craft beers
are fresher and of higher quality due to their local production. Further appeal of craft beer lies in the
more unique range of available flavours, some a significant departure from the traditional beer taste.
Craft breweries are able to create many experimental flavours, offering consumers new and exciting
options. For this reason, flavoured lagers have been seeing a rise in sales.


There are high barriers to market entry due to strict liquor regulations
in British Columbia. These regulations include prohibitions on the
public sale of alcohol other than in licensed liquor stores, and on the
consumption of alcohol outside of a private residence or licensed
premises. In addition, licensing regulations often require craft breweries
to meet certain sales volume and production scale levels. Provincial
governments across Canada, however, tend to support craft breweries
and allocate shelf space for craft breweries in licensed liquor stores. In
fact, the BC government made a pledge in 2014 to promote craft beer
As added support, the BC provincial government provides subsidization
to craft brewers in the form of tax breaks. It is unlikely that craft
brewers could survive on uniqueness of flavour alone and would likely
be priced out of the market by the larger breweries without these tax
In 2012, the BC provincial government implemented a graded tax
structure, meaning that smaller breweries are subject to increasing tax
rates on an incremental scale as their volume increases. The tax rates
increases for every 5,000 hectolitres (500,000 litres) sold above 160,000
hectolitres up to 300,000 hectolitres (at which point the brewer would
be in the highest tax bracket). As a frame of reference, Molson produced
over 30 million hectolitres in 2014.
Note that it is not uncommon for larger brewers such as Molson, AB
inBev and Sleemans, to jointly lobby the government for their mutual


Men consume 59.5% of total beer volume and consumers between 19 and 30 years old
account for 19.9% of the total market (note that the legal drinking age in BC in 19 years
old). Below is a chart showing the population breakdown for Vancouver, Victoria, BC and
Canada as a whole in the target demographic segment, as well as a segment above and
below. Consider the fact that those in the 10-19 year old segment are just beginning to
come of legal age and will become part of the key target market quite soon.
As metropolitan areas, Vancouver and Victoria are respectively the 3rd and 15th most
populated in the country. The recent dramatic rise in craft beer labels in the industry has
been most prevalent in these larger urban centres. In British Columbia, this phenomenon
has been particularly visible; Vancouver and Victoria have come to be perceived as Craft
Beer hubs.
British Columbia

Total Population

% Age 10-19

% Age 20-29

% Age 30-39

Beer producers have consistently attempted

to draw female drinkers and non-beer
drinkers. While female consumption is clearly
a minority, it has steadily increased over the
past 5 years. Accordingly, many breweries
have started producing beers geared towards
females, offering new options with a lower
calorie count or a sweeter taste. Molson has
also tried to capitalize on this growing market
with the creation of lighter and more
refreshing brews.


With goals of growing market share and brand recognition, what are the key strategies that Molson
should utilize in managing the rise of craft beer in the BC beer market?
Please provide recommendations on the following:
What is the best way to convey quality and locality of Molson to consumers?
How can Molson distinguish quality from flavour?
How will your recommendations ensure the continued success of Molsons existing flagship brands?
Who are your recommendations targeting, and how will you target them?
What communication channels should be used?
Recommendations should be focused at a local level for the Vancouver and Victoria regions, and not at a
national level.
Please note that Molson is very profitable and thus has a considerable budget to allocate to marketing
and advertising. As such, budgetary constraints are not an issue regarding the viability of your




Molson Coors set to close its Vancouver beer bottling line Company points to B.C. consumers preference for cans, government
subsidies to small breweries
NICK ENGLAND, THE PROVINCE - December 18, 2014 - Molson Coors will close the bottling line and lay
off staff at its brewery on Burrard Street in Vancouver, citing changing consumer tastes and government
subsidies that favour smaller breweries.
In an announcement last week, the company said its decision was based on careful consideration
and evaluation of the brewery operations, combined with the need to address the changing trends in
consumer demand and the overall industry.
Jennifer Kerr, director of corporate affairs in Ontario and the West for Molson Coors Canada, said she
couldnt disclose how many employees will be affected.
Theres no immediate impact on staff, Kerr said.
Theyve been given notice that its happening, but it wont take effect until the end of the first quarter,
which is end of March.
The company is working to ensure those employees are well taken care of, Kerr said.
Molson Coors will continue to bottle beer at its Toronto and Montreal breweries, and will ship bottled
products to B.C. based on demand, she said. The Vancouver plant will continue to produce beer in cans
and kegs.
A representative for the Brewery, Winery & Distillery Workers Union, Local 300, which represents
Molsons Vancouver employees, was not made available for comment before deadline.
Molson Coors partly attributed lower demand for bottled products in Canada to government subsidies
encouraging small brewer growth through tax incentives. Large breweries have been struggling to
compete with growing craft beer sales in B.C., which rose 42 per cent between 2013 and 2014, according
to data from the B.C. Liquor Distribution Branchs most recent quarterly market review.
Theyre hurting us, Kerr said of the governments subsidies for small breweries. And particularly in
B.C., theres definitely diminished demand for bottled products.
Beer Canada, a trade organization which advocates on behalf of beer makers including Molson Coors,
reported that more British Columbians have been choosing canned beer over bottles in recent years.
Bottled beer made up just 16 per cent of Canadian beer sales in B.C. in 2013, down from 22 per cent in
2008, according to Beer Canadas 2014 annual report. Canned beer made up 68 per cent of Canadian beer
sales in B.C. in 2013. In contrast, Newfoundlanders bought 85 per cent of their Canadian beer in bottles
last year, the report found. Canada-wide, bottled beer made up 43 per cent of Canadian beer sales in
2013, down from 59 per cent in 2008.


Recognition Reinforces Companys Commitment to Environment,

Communities, Employees, and Alcohol Responsibility
DENVER and MONTREAL, September 11, 2014 Molson Coors Brewing Company (NYSE: TAP) has
maintained its listing on the World Index for the third consecutive year and North America Index for
the fourth consecutive year. The Dow Jones Sustainability World Index recognizes the top 10 percent of
global companies, making Molson Coors one of just eight food and beverage companies listed.
Every day at Molson Coors, we work to delight the worlds beer drinkers, not just with the products
we make but in how we run our business, says Peter Swinburn, Molson Coors president and chief
executive officer. Our continued recognition by the Dow Jones Sustainability Index is a testament to our
commitment to continue improving Our Beer Print.
The DJSI follow a best-in-class approach, including companies across all industries that outperform their
peers in numerous sustainability metrics. RobecoSAM invites over 3,000 publicly traded companies,
including 800 companies in emerging markets, to report annually on their sustainability practices. The
Corporate Sustainability Assessment provides an in-depth analysis of financially material economic,
environmental and social practices, such as innovation or supply chain management, climate strategy
and stakeholder engagement.
DJSI North America tracks the performance of the top 20 percent of the 600 largest Canadian and United
States companies in the Dow Jones Global Total Stock Market Index that lead the field in terms of
sustainability, while the World Index tracks the performance of the top 10 percent of the 2,500 largest
This year Molson Coors launched its 2020 Sustainability Strategy which integrates how the company
manages energy, greenhouse gas emissions and water and solid waste to achieve its 2020 targets of
zero waste to landfill, 25 percent energy reduction, and 15 percent reduction in both carbon and water
Molson Coors exceeded its 2013 energy efficiency goals, reducing energy intensity by 2.6 percent
compared to a 2.3 percent target.
The company achieved a 2.4 percent water intensity reduction over 2012 and global alignment
around a 2020 zero waste to landfill target.
Molson Coors has committed to reducing the weight of its primary packaging by 4 percent by 2015,
and achieved a 6 percent reduction in 2013.



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