In our previous blog, we did an in-depth SWOT analysis of one of the most famous mango drinks, Frooti. Here we will be doing a complete SWOT Analysis of Carlsberg.
It is the 2nd largest beer company in the world and also the world’s most water-efficient brewery company. It has gained a lot of success by marketing its product with the latest marketing techniques which is the use of digital marketing.
As most people are online nowadays it is one of the best marketing strategies that a company can use. If you want to know what is digital marketing and how to use it to your advantage – check out our Free MasterClass on Digital Marketing 101 by the CEO and Founder of IIDE, Karan Shah.
Thus this makes us keen to know how Carlsberg became one of the largest contenders in the industry. So to understand it we will be doing an in-depth SWOT Analysis of Carlsberg. Before heading straight to its SWOT analysis, let us know about Carlsberg as a company, its products, competitors, financials, and more.
About Carlsberg Group
Carlsberg Group was founded in 1847 by J.C Jacobsen on a hill in Copenhagen, Denmark, Europe. Today it is one of the oldest brewery brands in the world. Today the Carlsberg group has around 140 beer brands, Carlsberg, Tuborg, Kronenbourg 1664 being a few popular ones.
Their beers are served in more than 150 markets globally and have created a strong brand image over the years. The vision of Carlsberg is to follow the legacy of J.C. Jacobsen and make sure that his ideas are reflected even today.
They aim to focus on innovative and high-quality products with a blend of natural sciences. Carlsberg has a strong research laboratory where they focus on developing and improving the quality of their products and are highly focused on achieving perfection in results every day.
Some of Carlsberg’s top competitors include CCU, Asahi Breweries, City Brewing, Mahou-San Miguel Group, Heineken, etc. Even though Carlsberg has faced tough competition it continues to provide the best Danish beer in the world. Carlsberg entered Indian markets in 2006 and soon became the 3rd best beer brand in the country. The main target group of Carlsberg is the young who enjoy drinking beer occasionally.
Carlsberg Group is currently headed by the CEO Cees ‘t Hart with a revenue of $9.48 billion, who recently announced the company’s mission to cut down carbon emissions, and water waste and avoid the use of plastic to meet sustainability targets by 2022. It had a market capitalization of about $24.2 Billion and a total of about 40,010 employees working under it. Its sales for the year 2020 touched about $9 Billion.
Quick Stats About Carlsberg
|Founder||J. C. Jacobsen|
|No. of Employees||40,010 (2020)|
|Market Cap||$22.24 Billion (2020)|
|Annual Revenue||$9.1 Billion (2020)|
|Net Profit||$466 Million (2020)|
Current News About the Brand
- Jacob Aarup-Andersen recently received the position of the CEO of Carlsberg. As soon as he took the role, his first strategic move was to buy shares of Carlsberg itself. He brought 1.6 million dollars worth of the company’s shares as a form of showing his trust and support in the beer company.
- Carlsberg has ended its partnership with its well-known counterpart Asahi brand, constricting the sales of Asahi Super Dry beer from December 2023. They believe that the ending of this contract will not harm them in any way, but in contrast, is actually beneficial in strategic terms.
- Carlsberg has achieved progress on its CSR vision by introducing 0 Carbon Footprint electric trucks. Beverages will now be transported from Western to Southern Sweden through electric vehicles produced by their partner brand Einride.
CEO of a financial firm
- Quality product with a strong taste
- The brand has an established identity and image
- Packaging makes it easy to use in huge parties and social gatherings
- Beer is priced towards an affordable side
- Widely Available across countries
- Aligns with the individual’s beliefs and values
Interest & Hobbies
- Watching Sports
- Trying new foods
- Going to music festivals and concerts
- Hosting parties and barbecue
- Faces stiff competition from Heineken
- Consumer tastes are moving towards a healthier drink
- A decline in sales due to Covid-19
- Geopolitical risks including suspension of operations in Russia
- Rising Inflation
- Issues in being sustainable
Social Media Presence
SWOT Analysis of Carlsberg
SWOT analysis is one of the techniques used by every company to recognize their strengths, weaknesses, opportunities, and threats they might face. Companies draw a detailed plan and create business strategies based on their SWOT Analysis report.
Let us now learn more about its SWOT Analysis by starting with the Strengths of Carlsberg.
1. Strength of Carlsberg
In this segment, you will see the positive factors that contribute towards making Carlsberg one of the best beer brands in the world.
- Loyal customer base – Carlsberg being an old brand has been serving customers for years, each year it has been successful in gaining people’s trust by improving its quality. Therefore its customers have remained loyal and are less likely to switch.
- Strong net worth – Carlsberg has a net revenue of around 58.54 billion Danish kroner, with almost no losses due to which it can expand its business and grow in new markets.
- Diverse Portfolio – Carlsberg has around 14 beer brands that offer a variety of 500 different types of beer. Some of the most famous ones are Tuborg Kronenbourg, Somersby cider, Neptun, Baltika, Belgian Grimbergen, etc. In this way, they try to serve beers according to each one’s preference.
- Widespread global presence – Carlsberg began in Eastern Europe and slowly expanded towards nations like China, Russia, India, Greece, etc. Today they are successfully working in 140-plus countries.
- Working towards Sustainable Goals – Carlsberg has been striving to work towards its sustainable goals such as reducing wastage of water, cutting down on carbon emissions, avoiding plastic products to control global warming, and sustaining our planet.
2. Weaknesses of Carlsberg
Weaknesses are the drawbacks that the company needs to focus on. The company needs to take steps to improve its weaknesses so that competitors may not take advantage of them. Let us look at the weaknesses of Carlsberg listed below.
- Increased expenses – Expenditures have always been a problem for companies. The number of expenses by the company is increasing which results in a decrease in profits every year. Even though they have a high net revenue their profits are falling every year. A reduction in profits may create possibilities of losses in the future.
- Lack of Research and Marketing – Research and Marketing play an important role in any business. Every company conducts thorough research about its target audience, and mediums to market its products. Due to its high expenses, Carlsberg is lacking in conducting good product research and marketing activities. Even after launching 500-plus beers, the majority of revenue is generated from two brands Carlsberg and Tuborg, which shows a lack of research on its product.
- Lack of Innovative Marketing Strategies – Carlsberg is one of the top beer brands globally and has failed to deliver innovative marketing strategies. The advertisements by Carlsberg have caught many eyes, however, repeating similar advertisements for years has created a negative impact.
3. Opportunities for Carlsberg
In this segment, we will look at the possible opportunities that Carlsberg can use to its benefit.
- Enter New Markets – Carlsberg can enter new markets because of its brand name and recognition. They should benefit from the increase in purchasing power of customers.
- Launch new products – Carlsberg already having a loyal customer base should think of launching new products like snacks, fruit beverages, desserts, etc. Carlsberg can also consider launching beers that may be low-carb to serve health-conscious customers.
- Improve its Digital Presence – Being one of the top beer brands in the world, Carlsberg should take the opportunity of the booming digital era and build a stronger relationship with its customers online. Having a strong digital presence creates a lasting impression and attracts new customers.
- Change in Lifestyle – With the change in lifestyle, many people believe in enjoying life by eating and drinking to the fullest. This can be a great opportunity for the company to reach potential customers and increase sales.
4. Threats for Carlsberg
Even though Carlsberg is a market leader, there are several threats it has to look out for. We have listed some of Carlsberg’s threats below.
- High Competition – A major threat to Carlsberg can be its competitors, people may prefer to buy local beers that are available at a lesser cost. Many competitors may also launch substitutes that may look and taste like Carlsberg beer.
- Government Restrictions – With an increase in deaths due to alcohol the government may impose a high amount of tax on alcoholic beverages making them more expensive for customers. The government can also impose limitations on the supply of alcohol.
- Change in preference – Many customers may prefer switching to other alcoholic beverages like wine and whisky which will lead to a decrease in demand for beers.
Example of a Failed Campaign Or Backlash from Viewers
What was the issue?
Carlsberg had an issue in 2020 where they had to willingly compromise on their taste and quality due to a decline in their product sales. Their “Probably the best beer in the world” Campaign proved the opposite. This had cost them their customer base since they started looking for other beer companies and options. The brand was in big trouble since they traded off their USP- the quality.
What backlash did the brand face?
The compromised quality of the beers greatly disappointed the consumers. Not only was the brand heavily criticized in media channels, but people especially voiced their opinions on Twitter. While some tweets were directly expressing their discontentment, other tweets were quite amusing.
What did the brand do in this situation?
In order to do damage control, the brand decided to introduce the Mean Tweets Campaign. Taking consumers as their point of focus, the brand tried to embrace the negative tweets about their old beer while swiftly introducing the new and better version. The campaign was able to start a conversation between the people and create a sense of curiosity as Carlberg’s tweets spiraled into memes and posts.
Did they take down the campaign or change it as a whole?
Instead of taking down their campaign, they added a few words to change the campaign. Thus, the campaign went from ‘Probably the best beer in the world’ to ‘Probably not the best beer in the world’. This bold step from the brand shows its ability to apologize for its mistakes while taking ownership on a public platform. They introduced two ads for the campaign- the first was a slight twist on their famous ad, and the second promoted how their new product was different. The images below are their digital ads that became a token of their honesty.
Top 5 Competitors of this brand
- Anheuser-Busch InBev– It is the world’s largest brewing company. It is headquartered in Belgium and was formed in 2008 through the merger of two Belgian brewing companies, Interbrew and AmBev. AB InBev has a wide portfolio of beers, including Budweiser, Corona, and Stella Artois. AB InBev is known for its innovative marketing campaigns and its commitment to sustainability.
- Heineken– It is the second-largest brewing company in the world. Founded in 1873, it is headquartered in the Netherlands. The company has a wide portfolio of brands, including Heineken, Amstel, and Tiger. Yet, the company’s flagship product is Heineken Lager. Heineken’s USP is its smooth, refreshing taste. They are also known for its iconic green bottle and its marketing campaigns, which often feature celebrities and music.
- Diageo– Also inclined towards sustainability and reducing its environmental impact, Diageo is a multinational alcoholic beverage company. Headquartered in the United Kingdom, it owns some of the world’s most famous brands, such as Guinness, Johnnie Walker, and Smirnoff. Founded in 1997, their product portfolio includes beers, wines, spirits, and liqueurs.
- Molson Coors– It is a multinational brewing company that was formed in 2005 through the merger of Molson of Canada and Coors of the United States. It is now headquartered in the United States and offers various products to consumers like Coors Light, Miller Lite, and Molson Canadian. Molson Coors offers beers for every taste and occasion, from light and refreshing to full-flavored and bold. It also owns a number of other beverage brands, such as Blue Moon Belgian White and Leinenkugel’s Summer Shandy.
- Asahi Group Holdings– It is a Japanese brewing company founded in 1889. It is headquartered in Tokyo and has a wide portfolio of brands, including Asahi Super Dry, Pilsner Urquell, and Peroni. Asahi’s USP is its “Karakuchi” taste, which means “dry” in Japanese. The beer has a crisp, dry taste and a clear, golden color.
On the detailed study of the SWOT Analysis of Carlsberg, we know that it is one of the largest beer companies in the world. It has a loyal customer base and a large global presence. It has opportunities like entering new markets and improving its digital marketing tactics. Even with such positive factors, there are some flaws that stop Carlsberg’s growth.
It lacks proper research on its audience and low marketing strategies. It also faces problems like high competition, government restrictions, and changes in preferences. It can improve its marketing techniques by implementing advanced digital marketing techniques which is very essential for a business during this digital era. If you want to learn and upskill, check out IIDE’s 3-Month Advanced Online Digital Marketing Course to learn more.
If you would like to read such detailed analyses of companies, find more such insightful case studies on our IIDE Knowledge portal. Thank you for taking the time to read this, and do share your thoughts on this case study in the comments section below.