AN OVERVIEW

Cobra Beer is one of the fastest growing beer brands in the UK, with a current turnover of 56.9 million at retail value. It has been exported to over 30 countries worldwide, and is available nationwide in more than 5,000 Indian restaurants and in major supermarkets and off-licenses Cobra Beer has been awarded Gold for three successive years at the 2003,2002 and 2001 for Quality, presented with the Monde Selection International High Quality Trophy in 2003 for its achievements, and listed on the 1999 Virgin Fast Track 100 list of the fastest growing, privately owned companies in the UK. Founder and Chief Executive, Karan F. Bilimoria, was honored as 2003London Entrepreneur of the Year (Consumer Products) 2003,Entrepreneur of the Year 2003 by the Asian Achievers Awards, Asian of the Year 2002, and is co-Chairman of the Indo-British partnership. Cobra was recently recognized as Business of the Year by the Asian Business Awards. Headquartered in London, UK, Cobra Beer has office sthroughout the world, including India, South Africa, and the USA.

KARAN BILIMORIA

THE STARTING
The inspiration came with analysis of the eating habits of the people in U.K. where the people used to drinking beer along with the food. The Indian curry-houses were popular among the people for the Indian cuisine & they used to serve locally available beer to accompany Indian dishes. But Karan found that the local beer would left the person gassy &bloated & with not enough room for food. From here he developed an idea to produce a premium, high quality lager which would complement rather than fight against the food.

Portraying idea into reality

The result was COBRA a premium beer, using best quality natural ingredients, a unique blend of barely malt &yeast with maize, hops & rice. Cobra beer is extra smooth &less glassy, retaining a premium strength of 5%

VISION
To brew the finest Indian beer & to make it a global beer brand

USP
The Cobra USP is that the beer is the ideal accompaniment to spicy Indian food

Problems faced
Bilimoria could hardly raised funds by getting a bank loan of just30,000 euro to begin its operation. Bilimoria was operating in a highly competitive market with the presence of all global brands & locally brewed beer. Moreover, 1990, the year Cobra launched its operations in the UK ,saw the beginning of a recession. The brand & the quality were both unknown to the people. The cobra beer was large in bottle size where the customers were accustomed to small bottle size, suited for individual consumption. Logistics was the major threat to profitability & eating time up to50% of management in managing & organising

Strategies Adopted
Created a strong USP for a niche market segment. Targeted growing no. of restaurants serving Indian cuisine. Developed personal relationships, by making cold calls, with the South Asian curry houses. Convinced the customers with the benefits of sharing one bottle & two glasses, which worked. Started to brew its beer with Charles Wells UK largest independent brewery under license. Creative advertising & premium quality helped achieve Cobra a very successful penetration of the Indian restaurants sale of beer. Availability in super markets & can be ordered through net. Going & diversifying into new markets by offering a full range of packaging formats, including cans & multipacks

Going global
Commenced brewing with Brower Belgia in Poland to serve European as well as other markets. Introduced wine & goes for expansion from south of France. Added various South African & Spanish range. Major initiative to make cobra a global brand was taken in 2004 by launching the Krait, the export brand of Cobra in the US.

Entering Indian market

Launched its beer in one city at a time. Tie-up with Mount Shivalik Group, Indias largest independent brewery in 2004 to brew it in Rajasthan, Punjab & Maharashtra. Marketed its beer in metros like Delhi, Mumbai, Goa, Pune, Kolkata, Hyderabad & Bangalore. Launched at competitive prices but it were higher then the competitors due to taxes.

Feeling the heat

Consumption of beer in India is one of the lowest in the world. The price of the beer was somewhat higher then the competitors. Drinking of beer is quite often an independent entertainment activity. Unlike the UK people, Indians dont have the habit to take beer with their food. Licenses are required to serve beer along with food in the Indian restaurants, resulting in expensive affair & restriction up to smaller no. of restaurants. Advertisement of beverage in India is prohibited & illegal, there fore restricted to make people aware of the Cobra brand. Sponsoring various events will lead to further expense which it cant weigh because of low initial sale & limited resource base

CONTD
State level regulations on sale of alcoholic beverages. Transport & infrastructure issues. The Indian market is highly regulated. Effective duopoly exists in the form of SAB Miller & the United Breweries. Customer base is also very small. Some market experts say that the market growth at a double digit level is highly exaggerated as the real growth is only 2-3% during last2-3 years.

QUESTIONS?
1.Analyze Cobra beers decision to enter the Indian market& evaluate the possibility of its success. 2.What should be Cobra beers marketing strategy in the face of Kingfishers well established product positioning &marketing strategy?

Analyzing Cobra beers decision to enter Indian market & possibility of its success
DECISION PARAMETERS: As the Indian market is one of the largest beer market so the decision is viable & sound. The consumption level is lower at present but in future it will increase like other nations (China, South Africa, UK & Czech Republic ) i.e. from 0.5 litre per year per person to somewhat 5-15 litre per year per person or even more. The Indian market is growing @ 7-8% & is valued at Rs. 4500-5000 crores, therefore, turning into an altogether profitable scenario. The attitude of the consumers are also changing with respect to drinking mild intoxicants including beer. Large no. of department. stores are also retailing beer.

Contd
Many classy up-markets & stylish bars & lounges are opening up in the metros. The beer more-or-less is becoming a life-style product as the experience of purchasing & its consumption is changing. POSSIBILITY OF SUCCESS: As the Indian market consumes 85 million cases per year & Cobra see it growing 30-35 times in the next 25 years, so more scope is there to establish& position itself & snare a huge market share. If the market continues to open up then there are more chances to succeed. If the customers are provided with greater choices then they do respond, hence possibility is there to penetrate into the market.

Contd..
As the economy grow also grow the consumption pattern of the consumers which may lead to higher demand. A slight relaxation in the govt. norms & tax would lead to access to more markets & lowering of price of beer, thus leading to more growth prospect &sales. By looking at the potential of Indian markets Cobra like to make India a production hub for the entire South Asia which would result in more access better management. By joining the hands with Greenfield's brewery in Andhra Pradesh the company is looking for gaining market share as A.P. is the biggest consuming state with 16 million cases out of the national total of over 80 million cases. Moreover by producing in A.P. the company will be publicized easily & be better known by the citizens of the state

Cobra Beer marketing strategy in the face of Kingfishers product positioning & marketing strategy
PRODUCT POSITIONING STRATEGY: Cobra Beer should position himself as a brand that enhances brand imagery and creates awareness about the brand in India as a brand that was born in India, went to UK, became successful there and has come back to India now. It should carry on with the same USP the beer is the ideal accompaniment to spicy Indian food. The company should go for product adaptation at regional, country ,city & retailer level. The company should build brand form bottom-up both strategically(building awareness before brand-image) & tactically (creating sources of brand equity in the market)

Contd..
The non-gassy feature of the beer should be highlighted as it wont create any bottleneck problem & its smooth also. The beer can also be associated with the changing attitude of the consumers in India w.r.t. drinking beer as it can be highlighted as 100% natural beer with no added flavors & helps in digestion & dont do any harm. The company should position himself as first company to produce 100%alcohol free beverage. The company can also present its product more of a general/normal need product instead of a luxury need product. As it had already tied up with so many Indian breweries, so it can present himself as original Indian brand serving its people with finest of quality

Contd..
MARKETING STRATEGY The company can focus on the 30% remaining portion in Andhra Pradesh where 64% is with SAB Miller & 6% is with UB. The company should do surrogate advertisement like Kingfisher & others top remote their brand & product. The company should target it more as a youth product by sponsoring various events like sports (ICL tournament), fashion shows, concerts etc. Apart from using only few forms of advertisement means (TV ad, hoardings, sponsoring ) the company should spread positive WOM & can go for developing relationship with the local retailers as they did in UK to serve their beer to the consumers & potential consumers.

Contd..
Kingfisher is having strength in national & regional products. So the company can also look for developing strength in city & some retailer products apart from having strength in national & regional product. Kingfisher has projected its product as a life-style product whereas Cobra can project it as a life-style as well as a general product which everyone can have. Cobra can highlight its 0.0% alcohol free beer & can develop a niche market for those who earlier were not taking beer because they think that it contain alcohol. Cobra can also project its low calorie lower carb beer for those who are health conscious & want to take a low calorie fat free drink.

Contd
The Cobra beer can also promote its brand by teeing up the various airlines companies where the passengers being provided with the cobra beer. The company also can back-up its brand by highlighting the various awards won by it in different-2 categories. Thus creating a brand image & a type of impression in the minds of consumers & potential consumers to shift from the existing brand & to start taking Cobra beer.

Updates
The founder of Cobra beer, Lord Karan Bilimoria, has put the brand up for sale at around GBP200 million. Lord Bilimoria said he was looking either for a strategic partnership for the brand or a sale in order to fully achieve sales potential. In October 2008, Cobra announced year-on-year volume growth of 37% and retail sales of GBP178 million, both in line with analyst expectations. That said, the company has still never recorded an annual profit during almost 20 years of existence

Updates
Lord Bilimoria aims to hold 10% of the Indian beer market by 2012,but does not feel the company can realistically expect to achieve this in its current incarnation. Likely suitors for Cobra could include Diageo, which was previously linked with acquiring a stake in Cobra in July 2008. Diageo is understood to be in advanced talks with Cobra Beer for purchasing a 30% stake in the company Cobra Beer, which is seeking a valuation of about $400 million, the stake in Cobra Beer is being valued at $100 million