Devising the Marketing Strategy Flashcards
What are the 5 P’s of marketing?
- Product
- Price
- People
- Place
- Promotion
Explain the ‘Product’ portion of the 5 P’s
The product is the service, object or system being marketed.
In terms of wine as an object, it includes the liquid itself and, all packaging and branding.
What all goes into the marketing of a product?
Marketing should communicate the characteristics of the product that will appeal to target consumers and how it will satisfy their needs.
The presentation of the product (the bottle and label) should be designed to appeal to the target consumer.
The marketing should also describe the experience that the product will deliver to the consumer. (This is seen as increasingly important to the consumer.)
What things are included in the price?
This is the amount which a consumer pays for a product. It is not just the price of a product on the shelf; it includes any additional cost such as delivery as well as discounts.
How does the Penetration Strategy work?
When trying to introduce a new product into the market, companies may offer the wine at a low or promotional rate. This is done to undercut the competition and rapidly reach a wider section of the market.
The expectation is that consumers will permanently switch to the new brand because of the lower price
What is one of the potential drawbacks to using the Penetration Strategy?
The problem that certain products that are brought in using the penetration strategy is that any subsequent efforts to raise the price may not be successful if the consumer doesn’t feel that it still offers the same value as the product did at the lower price.
What are the two ways that ‘People’ may be interpreted depending on the model?
Sometimes marketers will view ‘people’ to mean the attitudes and behaviors of the target consumer.
In other models, ‘people’ will refer to the relationship between the company, its staff, its partners, and its customers. It also includes aspects such as employee attitudes, skills, and customer service.
What is an important component of ‘people’ that may get overlooked?
Wine producers should make sure that they have sufficiently knowledgeable and trained staff to help sell their products. Whether it is out the cellar door, at consumer events, or to distributors/retailers.
What are some options for producers to make sure that their staff, or a distributors staff, are adequately trained on their product?
The producer can hold a master class where they go into the history of the estate, where and how the wine is made, and any unique talking points.
What does ‘Place’ refer too
It refers to where the product is sold.
Why is place important for a marketing strategy?
Companies need to identify where their target consumer(s) shops. Where it be online, at supermarkets/deep discounters, or at specialist wine shops, and focus on those outlets.
What are some of the different places that low-involvement consumers and high-involvement consumers shop or drink at?
High-involvement drinks tend to shop at specialist retailers, or premium supermarket chains. They also go out to high end wine bars, and eat out at casual or high fine dining establishments. (More suited lesser known regions/grape varieties, or limited supply options)
Low-involvement drinkers tend to look for wines at lower price points, with simple flavors/aromas that meet a certain quality standard. They tend to buy wines at the supermarket and eat out at non-destination establishments.
What things should be considered if a wine is going to be sold in multiple countries? (think flavor profiles, not laws)
Flavors can change from country to country, so it may be beneficial to produce different wines for each country. The differences could include flavors, aromas, and varying levels of sweetness and alcohol.
What other issues can arise when selling wines to other countries? (Think laws and distribution)
Legislation, taxation and duties, and restrictions on distribution (i.e. monopolies or the Three-Tier System) can make some markets more attractive than others.
Producers may choose to not sell their wines in price sensitive markets if they don’t think they can make a profit.
Define what a Mature market is? Give some examples of countries that fit this definition
Markets where wine appears to have reached it’s potential with stable or declining volumes.
Countries that fit this definition would be Germany, France, Switzerland, UK
Define what an Established market is? Give some examples of countries that fit this definition
Markets with strong historical growth which is tailing off.
Countries that fit this definition would be Ireland, South Africa, Italy and Hong Kong.
Define what a Growth market is? Give some examples of countries that fit this definition
Markets where wine is a mainstream product and/or experiencing growth.
Countries that fit this definition would be USA, Canada, Brazil and Poland.
Define what an Emerging market is? Give some examples of countries that fit this definition
Markets where wine is experiencing growth and shows potential from a relatively low base.
Countries that fit this definition would be China, Russia, Taiwan, and Turkey.
Define what a New Emerging market is? Give some examples of countries that fit this definition
Markets where wine is still a relatively new and unknown beverage, but showing some potential.
Countries that fit this definition would be India, Malaysia, Philippines and Thailand.
What are the two categories for promotional activities?
- At the point of sale
- Away from the point of sale
What are the different ways to promote something at the point of sale?
- Price Promotions
- Free Merchandise
- Limited Edition Packaging/Presentation
- Competitions
- Consumer Tastings
- Staff Training and Incentives
What are some of the risk of running a price promotion?
The goal of the price promotion is to build brand loyalty, and seeing a small uptick in sales once the brand has return to its normal pricing.
However the risk is that people may start only buying it when it is on sale, this is not building brand loyalty.
Price promotions also carry the risk of devaluing a brand because the consumer looks at the sale price as the “correct” price.
What are some of the different ways to promote something away from the point of sale?
- Advertising
- Billboards
- Sponsorship
- Websites
- Social Media
- Smart Phone apps
- Wine Tourism
- Events and festivals
- Reviews and Awards
- Public Relations
What is the most powerful form of advertising?
Television or Cinema advertising, just due to the amount of people that it can reach. And if the company has a large enough budget, they could get it in during the Superbowl/World series/NBA finals etc…
What are the main forms of advertising?
- Television and Cinema
- Radio
- Press
- Online
Is radio considered as effective as Television or Cinema?
Close, but not quite. They are much less expensive overall, which is good for companies with modest advertising budgets. However the lack of visuals makes radio advertising much less memorable.
What are some of the benefits to doing press advertising?
- It is generally less expensive
- Since wine generally has a story to tell, press/print can do that more effectively than a 30 sec ad
Where is most press advertising carried out?
It is generally done in more specialized publications that have to do with food and wine.
Larger wineries with larger budgets can usually put advertising out in any publication.
What are some of the ways that online advertising is carried out?
- Youtube Ads
- Ads on instagram and facebook
How do sponsorships work?
Most cultural and sporting events are supported financially with sponsorships of some sort.
These can range from anything from just using the logo on billboards or clothing that competitors are wearing, to having exclusive rights to be served in the bars.
Some TV shows/Podcast are also sponsored by a company and the show will mention their sponsors at some point during the show.
What is one of the largest advantage companies have seen with the creation of social media?
With the creation of social media, companies can finally talk with consumers, and not just at them
Why have multi-buys been banned in countries like Sweden and Scotland?
Because multi-buy promotions are controversial, particularly because they seem to encourage excessive alcohol consumption
Describe what a ‘link-save promotion is, and provide some examples
A link save promotion is a promotion where retailers will have people purchase the product at full mark up, but receive a discount elsewhere.
One example would be if there is a minimum bottle/cost amount, shipping may be free.
Give some examples of a ‘free merchandise’ promotion
G.H. Mumm selling a bottle and throwing in 2 champagne glasses
Buy a bottle of Round Pond single vineyard cabernet and receive a free cork screw
Buy a 6 pack of beer and get a free beer koozie
