Foundations of Marketing 6th Edition by William Pride,Ferrell

Exercise 33

New Belgium Brews Up Strong Brand Equity
The idea for New Belgium Brewing Company began with a bicycling trip through Belgium, where some of the world's finest ales have been brewed for centuries. As Jeff Lebesch, a U.S. electrical engineer, cruised around on a mountain bike, he wondered if he could produce such high-quality ales in his home state of Colorado. After returning home, Lebesch began to experiment in his Fort Collins basement. When his home-brewed experiments earned rave reviews from friends, Lebesch and his wife Kim Jordan opened New Belgium Brewing (NBB) in 1991. They named their first brew Fat Tire Amber Ale in honor of Lebesch's biking adventure.
Today, NBB is a successful company with products in 30 states. The entrepreneurial company has steadily expanded its distribution throughout the western United States, partnering with regional breweries to produce and sell its freshbrewed beers in local communities farther and farther from its Colorado headquarters. The standard product line includes Rampant Imperial IPA, Sunshine Wheat, Shift, Blue Paddle Pilsner, Abbey Ale, Trippel, Ranger IPA, 1554 Black Ale, and the firm's best-seller, the original Fat Tire Amber Ale. NBB also markets seasonal beers, such as Springboard, released around springtime. The firm occasionally off that are sold only until the batch runs out.
To reinforce the firm's commitment to old-fashioned brewing quality, NBB's packaging and labels evoke a touch of nostalgia. The Fat Tire label, for example, features an old-style cruiser bike with wide tires, a padded seat, and a basket hanging from the handlebars. The label and packaging designs were created by the same watercolor artist, Jeff Lebesch's next-door neighbor.
NBB prices its beers to reflect high quality and set the products apart from those of more widely available brands such as Coors and Budweiser. This pricing strategy conveys the message that the products are special but also keeps them competitive with other microbrews, such as Pete's Wicked Ale and Sierra Nevada. To demonstrate its appreciation for its retailers and business partners, NBB does not sell beer to consumers onsite at the brewhouse for less than the retailers charge.
Since its founding, NBB's most effective promotion has been via word-of-mouth communication by customers devoted to the brand. The company initially avoided mass advertising, relying instead on small-scale, local promotions, such as print advertisements in alternative magazines, participation in local festivals, and sponsorship of alternative sports events. Through event sponsorships, such as the Tour de Fat, NBB has raised thousands of dollars for various environmental, social, and cycling nonprofit organizations. The company is also a member of 1 Percent for the Planet, donating 1 percent of its annual sales revenue to environmental-protection groups around the world.With expanding distribution, however, the brewery recognized a need to connect more effectively with a far-flung customer base. NBB's top management consulted with Dr. David Holt, an Oxford professor and branding expert. After studying the fast-growing company, Holt, together with NBB's marketing director, drafted a 70 -page "manifesto" describing the brand's attributes, character, cultural relevancy, and promise. In particular, Holt identified an ethos of pursuing creative activities simply for the joy of doing them well and in harmony with the natural environment. With the brand thus defined, New Belgium went in search of ways to market its new brand identity. For instance, NBB teamed up with Amalgamated, a New York City advertising agency, to help communicate the brand identity. The agency created a $ 10 million ad campaign targeting high-end beer drinkers among men ages 25 to 44. The grainy ads focused on a man rebuilding a cruiser bike out of used parts and then riding it along pastoral country roads. The product appeared in just five seconds of each ad between the tag lines "Follow Your Folly … Ours Is Beer." The company later modified its ad to coincide with the U.S. Pro Challenge.
One of New Belgium's whimsical advertising campaigns was its promotion of its new brand, Ranger IPA ale. During the campaign, the NBB sales force was sent out in tan-and-olive "ranger" uniforms riding bicycles instead of horses. NBB took out traditional advertisements in Wired and Rolling Stone. It also launched a microsite for promotional purposes. The microsite featured a video of a hip-hop number performed by the NBB rangers to promote the new beer. The ad helped position the growing brand as hip and whimsical. In addition to advertising, the company promotes its brand by sponsoring bicycle tours and engaging customers and employees in online conversations via social media such as Facebook and blogs.
NBB's mission is: "To operate a profitable brewery which makes our love and talent manifest." From top-quality brewing to a strong belief in giving back to the community, the company reinforces the positive qualities that make its brand so successful every day. 54
How is New Belgium Brewing using packaging to support its brand image?