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WSET Diploma D2 - Wine Business > 12. Devising the marketing strategy > Flashcards

12. Devising the marketing strategy Flashcards

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1
Q

In the context of ‘wine’, the product is what?

A

The liquid, packaging and branding.

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2
Q

Marketing should what?

A

Communicate the characteristics of the product that will appeal to consumers’ needs and wants.

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3
Q

What are some examples of how a producer might communicate how their product differs (5) from the competition in a saturated market?

A

Higher quality.
Better value.
Organic.
Vegan.
Fairtrade.

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4
Q

What is the ‘penetration strategy’.

A

Where a producer deliberately prices their product relatively low to enter the market or on promotion with the expectation customers will switch brands because of the lower price.

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5
Q

What risk is associated with the penetration strategy?

A

It may be difficult to raise the price if consumer feels product offers less VFM at higher price.

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6
Q

How might a retailer price a product so as to psychologically influence a customer’s purchasing decision?

A

$9.99 instead of $10 because of instantaneous association with the first number (9).

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7
Q

What two ways might ‘people’ be interpreted in the context of the 5Ps?

A

1) The attitude & behaviours of the TA where other aspects of strategy will be tailored accordingly.
2) The company, staff, partners and customers including employee attitudes and skills.

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8
Q

What is a mature market?

A

An established market that shows most signs of saturation and least growth.

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9
Q

What are the advantages of a mature market?

A

Most reliable trade structures and routes to market with an established wine culture.

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10
Q

What are the advantages and disadvantages of emerging markets?

A

May hold most potential but have the most risk associated with lack of structures in place for easy route to market.

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11
Q

If a product is aimed at high involvement customers, in what sort of venues is it best suited?

A

Specialist retailers and wine bars, fine dining.

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12
Q

If a product is aimed at low involvement customers, in what sort of venues is it best suited?

A

Supers, casual dining, general bars.

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13
Q

What is the most effective distribution channel for products targeting high involvement customers?

A

Specialist intermediaries.

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14
Q

What is the most effective distribution channel for products targeting low involvement customers?

A

Larger intermediaries.

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15
Q

What are the five types of market?

A

1) Mature - where wine has reached potential with stable or declining volumes.
2) Established - strong historical growth that’s tailing off.
3) Growth - mainstream product experiencing growth.
4) Emerging - experiencing growth with potential from a low base.
5) New emerging - relatively new product showing potential

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16
Q

Give four examples of a mature market

A

1) UK
2) France
3) Germany
4) Switzerland

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17
Q

Give four examples of an established market

A

1) Ireland
2) South Africa
3) Hong Kong
4) Italy

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18
Q

Give four examples of a growth market

A

1) USA
2) Canada
3) Brazil
4) Poland

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19
Q

Give four examples of an emerging market

A

1) China
2) Russia
3) Turkey
4) Taiwan

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20
Q

Give four examples of a new emerging market

A

1) India
2) Malaysia
3) Thailand
4) Phillipines

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21
Q

Provide four types of price promotion.

A

1) Specified or percentage discount.
2) Seasonal sales.
3) Certain day discounts.
4) Discounts for certain groups of people.

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22
Q

Provide five multi-buy or volume discount examples

A

1) BOGOF
2) BOGOHP.
3) Three for two.
4) Specified percentage saving when spend meets a certain amount.
5) Hospo: buy two glasses, get rest of bottle free.

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23
Q

What are two reasons for offering discounts at the point of sale?

A

1) Increase sales of existing products, gain volume sales for new products or attract new customers.
2) Can help shift old stock or discontinued lines (bin ends).

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24
Q

What are two disadvantages of offering discounts or promotional offers?

A

1) Consumers will see no value at higher price and shop for other promo alternatives.
2) Damage product image who may view reduced price as ‘correct’ price.

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25
Q

What is an example of a brand concerned with the damage promotional offers may have on their product?

A

Champagne’s concern over British super promos.

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26
Q

What is an example of a promotion that is less likely to affect customer perception?

A

Multi-buy and volume discounts.

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27
Q

What risk is associated with multi-buy and volume discounts?

A

Could be perceived to encourage excessive consumption.

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28
Q

What are two other types of price promotion

A

1) Link saves = buy one product for a discount on another product from another category.
2) Discount on delivery over a certain amount instead of the product itself.

29
Q

Name an example of a competition designed to encourage a purchase and also to collect customer details for future marketing purposes.

A

Buy a wine and go in the draw to win a trip.

30
Q

What advantage does running a competition have to a retailer/supplier/producer?

A

Opportunity for company to collect consumer details for further promotion.

31
Q

What two advantages are there to offering consumer tastings?

A

1) In-store tastings can increase sales - try before you buy.
2) May encourage peripheral sales of other items at the store.

32
Q

For what reason might staff incentives be considered unfair?

A

In some markets (China) this is considered bribery, unfair competition and is illegal.

33
Q

Where is staff training most beneficial?

A

Works especially where there is a staff to consumer connection such as in specialist retailers, fine-dining restaurants.

34
Q

Why is staff training not best suited to supers, deep-discounters, general bars?

A

There is little engagement between staff and customer in these environments.

35
Q

What forms of advertising away from the point of sale can be the most powerful?

A

TV and cinema because the can reach the greatest number of people.

36
Q

What disadvantage is there to TV and cinema advertising?

A

It can be very expensive meaning only companies with large marketing budgets can afford them.

37
Q

What is an alternative to advertising on TV and in cinema?

A

Product placement, which comes at a lower cost as the advertising is more subtle.

38
Q

Compared with TV and cinema, radio adverts are generally what (3)?

A

1) Less expensive
2) Slightly less effective
3) Less memorable due to the lack of images

39
Q

Why is press advertising considered particularly beneficial for wine?

A

Wine has a story to tell so an effective text advert can convey a more detailed story often at a lower cost than TV, cinema, radio.

40
Q

What is an advertorial?

A

Where a producer pays a well respected wine writer to write an article in a magazine specifically about them.

41
Q

What must a billboard achieve?

A

Be memorable with a short and simple message.

42
Q

Where might a billboard be positioned?

A

1) By the side of the road.
2) At railway stations and bus stops where they can include more information.

43
Q

What are two areas to be conscious of when using social media?

A

1) Can provide free promotion but can lead to negative publicity.
2) Careful and frequent management is essential to ensure positive, appropriate content.

44
Q

What are four potential uses to a winery of social media?

A

1) Can be used to share adverts, positive reviews, promo activity.
2) Non-promo activity is considered as important and less alienating.
3) Share news, articles, photos, videos to interest TA even if not related directly to wine.
4) Post updates of the vineyard and winery.

45
Q

What other advantage to social media is there that’s considered valuable by younger audiences?

A

Allows non-specialist users to share their experience and opinions.
Peer reviews have increased in popularity especially among millennials.

46
Q

Studies show that websites must what? (4)

A

1) Be consistent with the overall marketing strategy
2) Attractive
3) Unique and reliable
4) Include varying levels of information for different customer subsets

47
Q

What sort of information might a website present? (4)

A

1) Tell the story of the wine.
2) Give details of the wine(s) produced
3) Food pairing suggestion
4) A link to more technical specifications to satisfy high involvement customers

48
Q

What are three potential purposes of smartphone apps to consumers?

A

1) Read reviews from other enthusiasts or professionals
2) Manage their cellar
3) Direct customers to retail outlets/websites

49
Q

How might a retailer engage with smartphone apps?

A

By allowing their stock information to be shared with the app directing consumers to the retailer’s website to purchase for a commission fee.

50
Q

Name two types of rewards and reviews beneficial to producers

A

1) Favourable review or high critic score
2) Being awarded a medal at a prestigious wine competition.

51
Q

Why are high scores and medals beneficial to producers?

A

These can influence purchase decisions particularly among lower-involvement and less knowledgeable consumers.

52
Q

What must a producer consider when running a competition?

A

The cost associated with entering and the cost of any free samples required against the potential benefits.

53
Q

Where and to whom might wine tourism be particularly beneficial?

A

New producers
Up and coming regions

54
Q

What benefits (3) does wine tourism provide to producers?

A

1) Opportunity to engage with the public
2) Gives consumers the chance to try before they buy, which can increase the likelihood of sales.
3) People who visit producers are more likely to become regular customers and recommend their wines to others

55
Q

What options (7) does a producer have in their cellar door?

A

Tasting rooms
Vineyard and winery tours
Visitor centres
Shops
Restaurants
Cafes
Accommodation

56
Q

Other than wine tasting, what other (2) options might a winery or vineyard be suitable for from a wine tourism perspective?

A

1) Experience packages - participate in harvest
2) Hire out space for weddings or events

57
Q

What are three considerations a winery should make before establishing a cellar door?

A

1) The cost of developing the infrastructure.
2) Cost of additional resources to service the customers.
3) Location of the cellar door and whether customers are likely to visit

58
Q

What are two examples of wine regions that have developed wine tourism stategies?

A

1) Alsace - cycle routes
2) Napa Valley - gourmet dining experience aboard vintage rolling stock

59
Q

What is public relations?

A

Seeks to give the business the most favourable image possible in the mind of consumers.

60
Q

List four potential PR activities

A

1) Press releases
2) Newsletters
3) Social media
4) Reps attended PR events or appearing on TV, radio to comment on issues relevant

61
Q

What is a brand ambassador?

A

Often an employee, social media influencer or ‘opinion leader’ or can be a celebrity such as Roger Federer for Moet & Chandon.

62
Q

Provide three examples of wine companies sponsoring events

A

1) Cono Sur (Chile) - Tour de France
2) Mouton Cadet - Ryder Cup
3) Carbon (Champagne house) - F1

63
Q

What are three potential sponsorship deals

A

1) The display of a business’ logo on billboards or participants’ clothing
2) Exclusive rights to be served in bars and hospitality venues
3) Television programmes, which is cheaper than producing a TV advert

64
Q

How much is it estimated to cost to sponsor an event?

A

To the factor of 6. For every $1 spent on the sponsorship, another $5 must be spent on all other activation costs including transport, tickets, hospitality etc.

65
Q

What are two disadvantages of participating in an event or festival where wine may or may not be the primary focus?

A

1) Lots of stands competing for customer attention.
2) Problem of excessive drinking.

66
Q

What are two advantages of participating in a wine event or festival where wine is not the primary focus.

A

1) Likely to attract both high and low involvement customers due to other entertainment.
2) Cost to exhibit can be offset by attracting new customers (may charge for samples at certain events).

67
Q

Why might free merchandise be a good form of advertising?

A

It is a way to generate sales without the meed to reduce the price of a product.

68
Q

Give an example of how free merchandise may help boost sales

A

Offered in a presentation pack with branded glasses.

WSET Diploma D2 - Wine Business (13 decks)

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