2. Internal Analysis2.

1 Place
2.1.1 The Market Expansion Matrix
Looking at the market expansion matrix (Hollensen, 2008, p 179) you could conclude that the
Heineken Company is a number 4, with high country diversification and high market/customer
diversification. We already looked at the many countries they expand to; we will look into costumer
groups and segments later in this chapter.

Heineken mentions on its website (www.heinekeninternational.com) that their beer is available in

almost every country around on the Globe the world but the list on the websites contains mostly
developed countries1. That the beer is widely available is not surprising, since Heineken has a wide
presence of international brewers, and are the largest brewer and distributer in Europe. Heineken
has a global network of distributions with 115 breweries in more than 64 countries, with breweries
on every continent. You can concluded from this that they are a expert in what they Theydo, they
achieved a global coverage through a combination of wholly-owned companies, license agreements,
affiliates, strategic partnerships, and alliances. The wholesalers that sell Heineken, sell other drinks,
alcoholic and non-alcoholic, as well, such as wine, spirits and soft drinks. 2

2.1.2 Religion
When talking about different places, the focus also has to be on the cultural values and beliefs of
consumers in the different areas Heineken sells its beer. When you enter the home page of the
Heineken Company (www.heineken.com), you can select the country you are in. This list of different
countries is ernormousgigantic, Heineken has a lot of export, with all countries having their own
website in their own language. However, when scanning the list, you can hardly find any countries in
the Middle East that sell Heineken beer. This is probably because the majority of the population in
this area, and parts of Africa, is part of the Islamic religion 3, and in the Islam, the drinking of alcoholic
beverages is forbidden. In Europe and the Americas, the majority of people follow the Christian
belief, which allows the consumption of alcohol (see Appendix figure 1). Besides religion, there are
more factors that can influence a consumer behavior think about cultural, social, personal,
psychological factors.4

2.2 Product
2.2.1 Marketing Offer and Target Market Theory
As already mentioned before in a paragraph, Heineken is a company that is globally active; therefore,
they have to adapt to many different consumer buyer behaviors. For that reason, Heineken has a
large and qualitative marketing offer that satisfies the needs and wants of many customers with

1
http://www.heinekeninternational.com
2
http://www.heinekeninternational.com
3
http://www.mapsorama.com
4
Kotler, 2010, 36
different cultural backgrounds. To be able to create this good marketing offer 5, Heineken first divides
its market into smaller groups of buyers, and then they decide on their target market. This is so that
the consumers can be attracted more efficiently and effectively with products and services that
match their unique needs. However, there is more than one approach to segmenting a market. A
market can be segmented regarding the following aspects: geographic, demographic, psychographic,
and behavioral segmentation.6

2.2.2 Consumer and Market

Beer is an alcoholic drink made from malt, barley, and flavored with hops, and there are various
types of it.7 Beer is a drink that is known in every country, and is consumed by the majority of the
world’s population. Western Europe is Heineken’s largest and leading beer brewer market and has a
strong market position in the UK, in the domestic country the Netherlands, Spain, Belgium, Finland,
France, Ireland, Italy, Portugal, and Switzerland. Africa and the Middle East are fast growing markets
for Heineken, due to a joint venture with a local brewer. In the Americas, Heineken has already built
up a strong position, owning several breweries in this area. In the Asia Pacific region, Heineken
cooperates with many breweries, has a couple of 50/50 joint ventures and its own breweries. 8

Beer, as it is an alcoholic drink, can only be sold to a market of a certain age, which would be an
example of demographic segmentation. Drinking alcohol is only allowed above an age set by the
government, and differs from country to country. For instance in the United States, the regulations
define the age as 21, in United Kingdom it is 18, and in The Netherlands 16 for soft alcoholic drinks.
Heineken tries to respect the age restriction by asking for the date of birth, before it is possible to
enter the website. While this technique obviously won’t keep minors away from the website, it is a
device for Heineken to build up a family-friendly image. Another demographic factor is income.
Western Europe is a wealthy area, where a beer is a fairly affordable product that people drink
regularly, whereas in less wealthy regions, like some African markets, Heineken beer is more of a
luxury product.

Next to demographic segmentation, it is also important to segment beer geographically. Loyalty for
one’s country might for example play a big role in geographic segmentation. While Heineken is very
popular in the Netherlands, it is not as successful in Ireland as Guinness, for example. So far, a couple
examples are mentioned that we think influence the market segmentation of Heineken the most.
There are however many more factors9.

2.2.3 Strategy to Create the Right Marketing Offer10

5
Kotler, 2010, 6
6
Kotler. 2010, 67
7
Wehmeier, S. (2005), Oxford Advanced Learner's Dictionary
8
Datamonitor (2009),”Global Beer Industry Profile”,(September), 1-32
9
Geographic factors such region, density, and climate; Demographic factors such as gender, family size, family,
income, region, race, and nationality; psychographic factors such as social class, lifestyle, and personality;
behavioral factors such as occasions, benefits, user status, and loyalty status (Kotler page 68)
10
http://www.heinekeninternational.com
Heineken aims a sustainable and consistent growth, while constantly improving profitability.
Additionally, they aim to be market leaders in each of their markets. They establish the broad
leadership mostly by acquiring other strong, often local brandsbrands with high status and the right
licenses. Since Heineken wants to offer high quality products, they often train their employees to
improve the production process and introduce new technologies, which results in economies of
scale. If the market is already in the hands of other brewers, Heineken puts all its energy in
developing a leading position through selling premium products.

2.2.4 Differentiation
Heineken brand offers their beer in different packages to satisfy their consumer’s needs. While most
of their products show their icon, green color and a red star, Heineken offers a variety of products
items: bottled beer, canned beer, small beer tenders, and barrels for the tap. 11 They also offer a
premium version of their beer, the Heineken Premium Light. 12

The Heineken Company brews, besides the Heineken brand, more than 170 international, regional,
local and specialty beers. The most famous brands are Amstel, Europe’s third-largest beer brand,
Cruzcampo, Tiger, Zywiec, Birra Moretti, Ochota, Murphy’s and Star. Heineken still continually seeks
new brands, and new product presentation through innovations in production, marketing and
packaging.13 This leads to differentiation segmented marketing, a market-coverage strategy in which
a firm decides to target several market segments and designs separate offers for each. 14 This
adaption to local markets through different brands is a strength of Heineken, and shows a geocentric
approach to marketing – think global, act local.

2.4 Promotion
A huge company as widely spread as Heineken needs a very differentiated and complex marketing
plan. Due to the many brands they acquired and their partnerships with local breweries, Heineken’s
approach is geocentric: ‘Think global, act local’.

2.4.1 Website
When entering the Heineken website, you can decide on a country, and language, showing local
adaption.15 The design of the websites, however, regardless of the country selected, barely changes. 16
On the website, the basic information about their different kinds of Heineken brand packages can be
found. Additionally, it is possible to read about the company, and stay up-to-date with stock
information, upcoming events, newspaper articles, releases and to sign up for a newsletter. 17 There is
nevertheless not a lot of contact information or a platform for critical comments, feedback, or
suggestions. It will be appropriate when they create one since they are such large company, and this
11
http://www.heineken.com
12
http://www.heinekeninternational.com
13
http://www.heinekeninternational.com
14
Kotler, 2010, 82
15
www.heineken.com
16
http://www.heineken.com
17
http://www.heinekeninternational.com
way they can interact more with their consumers. This lack of a customer-orientated marketing
approach might be a weakness of the website, as well as a weakness of the company in general.

2.4.2 Sports
One point that comes to mind when entering the international website is the sport involvement of
Heineken. There is a special link to UEFA Champion’s League, a major soccer event. 18 When you enter
this sport part of the website you can read about sport events, follow Heineken to sport matches,
and participate in lottery games. It is possible to watch a small video suggesting that Heineken is best
enjoyed with friends, watching soccer. 19 Besides soccer, a sport that is not popular in every country,
Heineken is also involved in the Olympics. The house in which the Dutch athletes get honored, for
instance, is named after the company: ‘Holland Heineken Huis’ (Holland Heineken House). 20 They
adapt to international sport events on the website, and have special editions for each new event,
coupled to marketing campaigns. For the 2010 Olympics, for example, you can design and order your
own Heineken house beer. 21 Through the sponsoring of events and involvement in sports, they reach
a wide group of both, current and potential customers.

2.4.3 Advertising Campaigns

Heineken’s strength in its advertising campaigns is mainly humor. This tool is used in campaigns on
television, the website, and also in advertisements (see appendix figure 2). On television there are
frequently new commercials that respond to current events. For example the commercial on
television in the Netherlands at the moment is responding on the soccer World Cup 2010 what is
coming up soon that advertises Amstel one of the local brands from Heineken. 22 Another strong
commercial is the one about the walk-in-fridge, where they generalize the women and men most
favorable place in the house. 23 When having those funny commercials on television, people will talk
about it and this creates strongly promote the products face-to-face marketing. In the commercials,
they also mention the minimum age requirements and that you should not drink too much of this
product. Through this, they show social responsibility, which gives them a positive edge.

2.4.4 Other Activities

Heineken is a brand sponsoring not only sport events, but also several other activities. A famous
example is the Dr. A.H. Heineken Price, a price going to 5 renowned scientists and one visual artist
every year, which is provided by the Heineken Fondsen foundation. 24 Their involvement in several
areas of academia next to sports shows that Heineken really has customers from all kinds of different
segments. Another example for this is the ‘Heineken Music Hall’, a concert hall named after the
company in Amsterdam. Exceptional is the hall’s good catering service, several free basic services,
such as coat storing, and bathrooms, and tips go to charity. 25 All these activities gives them positive
attention from the Media.
18
www.heineken.com
19
http://ucl.heineken.com
20
http://www.hollandheinekenhouse.nl
21
http://www.jouwheineken.nl/
22
http://www.youtube.com/watch?v=WGU-7-woryE
23
http://www.youtube.com/watch?v=HBKaaiEXHqI
24
http://www.heinekenprizes.com
25
http://www.heineken-music-hall.nl