What
 Who
 How


Premium

 Global

beer
and
price
 Young
adults
 presence:
170

countries


Diversified

portfolio

Emphasis
on

Status

Brand
image
 reputation


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 1864
 • Heineken
family
entered
the
beer
business



1921‐1931
 • Moving
into
US
and
Asian
markets


1949
 • Beer
can
travel
–
focus
on
brand
&
marketing


1961
 • Expansion
to
South
America
and
Africa


1968
 • Heineken
merged
with
biggest
competitor
Amstel

• Cooperation
with
Coca‐Cola
in
Brazil

1983
 • Entering
the
Japanese
market
under
a
license


2008
 • Acquisition
of
Scottish
&
Newcastle



2010
 • Merger
with
FEMSA


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

2005
 2008

+19%
 +27%

Volume
 125,000
 Revenue
 






4,318

thousand

mil.
€

hectolitres


Worldwide Volume (millions of hectoliters) Worldwide Revenue (€ million)

300 17000

200 16000
Heineken Heineken
15000
100 Inbev Inbev
14000 SabMiller
SabMiller
0 13000

Heineken Inbev SabMiller Heineken Inbev SabMiller

2008
 2008


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Firm
Infrastructure

Human
Resource
Management

Technological
Development

Procurement

Margin


Marketing
&

Operations


Outbound

Inbound


Service

logistic


logistic


Sales


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Brand

Expansion

recognition

Economies

of
scale


Advertisement
 Portfolio

Synergies

mix
/

diversification


Innovation


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Threat
Of

Entry


Power
Of
 Competitive
 Power
Of


Suppliers
 Rivalry
 Buyers


Threat
Of

Substitutes


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 TE
 • Powerful
and
experienced
incumbents

• Market
saturation
and
low
differentiation

• Investment
needs
and
high
entry
barriers

PS
 CR
 PB
 • Threat
from
other
beverage
companies


TS
 Threat
Of
Entry


BEER
INDUSTRY

PORTER
FIVE
FORCES


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 TE
 • Alcoholic
and
non‐alcoholic
beverage

• Ambiguous
price/performance
–
taste
dependent

• High
loyalty
to
beer:
most
drank
alcoholic
beverage

PS
 CR
 PB
 • Health
consciousness
growth
trend


TS
 Threat
Of
Substitutes


BEER
INDUSTRY

PORTER
FIVE
FORCES


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 TE
 • Local
scarcity
and
shortage
signs

• Easy
access
to
supplies
(e.g.
malting
barley)

• Small
and
fragmented
supplier
breakthrough

PS
 CR
 PB
 • Orders
from
major
brewers
crucial
for
suppliers


TS
 Power
Of
Suppliers


BEER
INDUSTRY

PORTER
FIVE
FORCES


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 TE
 • Retailers:

• Fragmented
and
diversified

• Several
switching
options
and
little
differentiation

PS
 CR
 PB
 • Consumers:

• Price
sensitive
and
culture
dependent

• No
switching
costs

TS
 • Fragmented
but
loyal
buyers


BEER
INDUSTRY
 Power
Of
Buyers

PORTER
FIVE
FORCES


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 TE
 • Mature
and
saturated
industry
with
static
growth

• Strong
brands,
loyalty
effects
and
low
differentiation

• Intense
rivalry
at
the
top

PS
 CR
 PB
 • High
exit
barriers


TS
 Competitive
Rivalry


BEER
INDUSTRY

PORTER
FIVE
FORCES


Company
 Strategic
 International
 Comparative
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Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Beer
Industry
‐
Porter
Five
Forces
Analysis

Competitive
Rivalry

5


4


3


2

Threat
Of
Entry
 Threat
Of
Substitutes

1


0


Power
Of
Suppliers
 Power
Of
Buyers


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

KEY
ISSUES


Health
Consciousness
Trend


Increasing
Regulations
(IEC)


Expansion
To
Eastern
Cultures


Increasing
Concentration


Segment
Saturation
And
Cannibalization


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Strengths


•  
Large
portfolio
including
major
beverage
brands

•  
Unique
innovation
‐
product
and
consumption

•  
Worldwide
famous
brand
image



Weaknesses


•  Inconsistent
positioning
(premium
vs.
mainstream)

•  Damaged
reputation
due
to
minor
scandals

•  Higher
exposure
to
risk
–
acquisitions
and
cultural
differences


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Opportunities

•  Backwards
integration
to
supply
gathering

•  Emerging
economies
with
growing
populations
and
income

•  Highly
demanding
consumers
looking
for
specific
taste


Threats

•  Increasing
health
consciousness
concerns
towards
alcohol

•  Rising
popularity
of
other
beverages

•  Highly
regulated
industry


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Foreign
Product
Diversity


Worldwide

Product

Division
 Global

Matrix

Foreign
Sales

Over
Total
Sales


Multi‐
Area

Domestic

Division

Division


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Need
For
Global

Integration


Global
 Transnational


Multi

Domestic


Need
For
Local

Adaptation


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Need
For
Global

Integration


Global
 Transnational


Multi

Domestic


Need
For
Local

Adaptation


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Firm
Strategy,
Structure

and
Rivalry

Demand
Conditions


Porter’s

Diamond


Related
and
Supporting

Factor
Conditions

Industries


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

 Country
 Power
Distance
 Individualism
 Masculinity
 Uncertainty
Avoidance

Netherlands
 38
 80
 14
 52

Portugal
 63
 27
 31
 104


Company
 Strategic
 International
 Comparative
 Future


Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

Company
 Strategic
 International
 Comparative
 Future

Overview
 Analysis
 Strategy
 Analysis
 Challenges

Filipe
Carvalhão
|
Joana
Vaz
|
Maria
Teresa
Costa
|
Michael
Beerhorst
|
Nuno
Loureiro