Bar and Tavern

Topics: Marketing, Beer, Alcoholic beverage Pages: 10 (3215 words) Published: October 6, 2013
“The Marketing Concept is the philosophy that the pub, bar and tavern industry uses to analyse the needs of their customers and then create decisions to satisfy those needs”. Building brand loyalty is the key to the success of the marketing concept. The components of the marketing mix- product, promotion, place and price will provide a starting point to create requirements in developing appropriate marketing strategies for the industry (Jaray 2006, p.1) Market segmentation has specific expectations and bar, pub and tavern operators develop products and services that will cater the needs and wants of the target market. This report provides an overview of the industry and analysis of the micro and macro environmental factors that directly influence the industry’s overall marketing performance. This report provides a clear description on how the marketing mix elements are used by major companies in their marketing strategies and make recommendations to improve the industry’s current marketing performance. A summary of findings is presented at the end of this report.

Industry Overview:
Pubs, taverns and bars are establishments that primarily sell alcoholic and non-alcoholic beverages for either for immediate consumption in the premises or off the premises for later consumption (O’Brien et al 2011, p.210-213). They also offer meals, gaming facilities, wagering activities, retail liquor outlets and may also have table service like a restaurant style at work in their premises. . “About 84.6% of total revenue garnered by industry operators is derived from the sale of liquor for on-premises consumption (32.4%); the sale of liquor for off-premises consumption from associated retail liquor or bottle shops (27.9%); and gaming and wagering activities, from gaming machines or TAB facilities (24.3%). The remainder is derived from meal services (10.3%), accommodation (1.5%) and other areas (3.6%)” (Connell 2012, p.4). The industry’s restrained growth is primarily caused by declining alcohol consumption, strong competition from other liquor retailers, rough economic recession, rising unemployment and government restrictions. Customers have high purchasing power and a great deal of influence in this industry. They become more discerning on how they spend their disposable income in the intention to cut back their expenditure on non-basic goods. This in turn, compelled customers to swap their alcohol drinking in the pub, tavern or bar to the comfort of their own homes, causing huge economic downfall for some highly leveraged industry operators. Furthermore, the changing community attitudes towards the industry's three major products: alcohol, gambling and gaming facilities influence the industry revenue. There are significant government regulations ‘to curb binge drinking, alcohol-related violence, problem gambling and gaming machines’ proliferation. It is forecasted that the industry has “another year of moderate growth in 2012-13, with ongoing consumer uncertainty and another wetter than average summer expected to weigh on on-premise sales”. Suppliers have major agreements with the industry operators and oftentimes, like Beer Breweries owned their bar, tavern and pub themselves to integrate their “businesses downstream”. Microbreweries in Australia usually produce around 15,000 barrels or 18,000 hectoliters/ 475,000 US gallons per year. The rising of microbreweries and the wide range of microbrews produce a great opportunity for many pub, tavern and bar operators to provide good product variety to customers that attract revenues. .

Market Segmented
Industry targets customers in different age groups. Around most functions, the Pubs, Taverns and Bars industry inclines to attract the older age group as its leading customers. A slice of this relates to the attraction of wagering and gaming machines to this target market. The industry targets the late nighters and weekend partiers. These are...
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