Heineken Case Report

Heineken has a company history of tradition and prides itself on their superior quality of beer. Heineken has a differentiation and international business strategy. Heineken differentiates itself by creating a prestigious brand image, which has held a leading position in the premium beer market. Heineken since its inception has always implemented an international strategy to promote growth in distribution of the brand within the industry. With the increasing growth and globalization of the beer industry, Heineken has made several recent mergers and acquisitions to expand their brands into various markets around the globe. To establish and develop a global brand, Heineken, has used a mix of strategies to push their brand into developing markets, and maintain a leadership position in established markets. They gained a leadership position with their historical and traditional prestige, a distinctive taste, bottle, and quality. The company expands on the differentiation strategy, by pushing other brands of beers into various types of markets and offering new forms of packaging to redesign and remarket currently established brands.

The global beer industry is a growing competitive industry. There are high entry barriers, as a result of customer loyalty and the ability for new firms to provide a product that is unique to consumer tastes. There is a high degree of substitutability of products within the industry, which increases buyer’s bargaining power. However, for premium brands such as Heineken, buyers lack comparable alternatives therefore reducing buyer’s bargaining power and price sensitivity. In the industry, buyers bargaining power is relatively moderate to high; supplier’s bargaining power is relatively moderate to low. This is due to the high amount of substitutes and prestige within the industry, less prestigious beers can be easily substitutable providing for low supplier bargaining power, and prestigious brands such as Heineken with more moderate...