highlights 2 Flashcards
Factors influencing the demand for wine – social factors
S H a R P
- changes in spending patterns
- consumption habits
- changes in reputation
- consumer preferences
Factors influencing the demand for wine- economic factors
F a C E
- fluctuation in the currency exchange
- changes to the market
- economy strength
Factors influencing the demand for wine- legislative and political factors
W I L T in G
- wine laws
- international trade
- laws prohibiting or limiting the sale of alcohol
- taxation
- government policies to reduce alcohol consumption
What are the contributing factors that are factored into the price of a bottle of wine? (supply side)
PLOWing MTS
- Production -Growing costs
- Legislation -Marketing costs
- Over/ Under -Transportation costs
- Winemaking costs -Sales Costs
- Importation costs
Factors influencing Supply of wine
-production – what are the influencing factors of supply?
C A V E H A N
reasons for loss other
- Conversion to other uses -Human factors
- Abandon rural area -Area under vine
- Vine pull schemes -Natural Factors
- EU restriction on planting new vineyards
Reasons for consumption of wine to be falling?
C H e R r Y
-changes in lifestyle- shorter mealtime, traditional of drinking at lunch is increasingly forbidden by employers
- health concerns- increasing awareness of negative health effects
- reduced availability of cheap wine
- younger people drinking less- old fashioned & turn to other drinks – Spending less time in bars, contact friends through social media
Factors influencing Supply of wine -grape growing costs
-Beyond purchasing the land, what are other initial costs of establishing the vineyard?
S C A B S W I M P
- Survey -Stakes/ trellising
- Clear -Weather hazzards
- Access roads -Irrigaion / drainiage
- Buying plants -Machinery / equipment
- pest protection
Factors influencing Supply of wine -grape growing costs
-ongoing costs of managing the vineyard and producing grapes that may start as soon as the vines are planted & before productivity?
T I M E M e L d
-Treatments: Conventional: herbicide, fungicide, insecticides
Organic/ biodynamic; may use Sulphur powder or Bordeaux mix
- Irrigation if needed
- Materials: replacement vines & trellising
- Electricity- for irrigation systems, bird scares, frost protection equip
- Machinery / equipment running à fuel & maintenance
- Labor costs - seasonal, annual skilled
Factors influencing Supply of wine -winemaking costs
I P M P
-Initial costs of establishing the winery
-producing wine
-maturing wine
-packaging wine
Factors influencing Supply of wine- wine making costs:
-producing the wine costs include?
F L E W M e M
*Fruit-buying fruit vary with quality & vintage. Blend in cheaper varieties
*Labor- some full time staff & harvest labor to Unloading crates, moving equip
*Electricity- for refrigeration, ventilation, presses, pumps, lighting
*Water- uses large volumes of water for cleaning, invest in water treatment plants
*Machinery & equipment- fuel, electricity, maintenance
*Materials- sugar for enrichment, de-acidification agents, yeasts, carbon dioxide, inert gasses, fining and filtering agents
Factors influencing Supply of wine
-sales costs
P L E a S e D M
Property costs for on/ off prem
Labor
Equipment & material
Storage
Delivery
Margin
The Impact of Legislation on the Cost of Wine
Cost is affect by types of legislations:
S M a L D o T T
Subsidies Duties
Minimum Pricing Taxes
Labeling law Trade barriers
List type of producer engaged in the production of wine?
M E G G a V a C C C
Merchant Virtual Winemakers/ Wineries
Estate Co-Operatives
Growers Custom Crush Facilities
Grower-Producer Conglomerates
The Impact of Fluctuations in Currency on the Cost of Wine
-mitigation methods to a fluctuation exchange rate include?
F E B T O O L
- Fixing price in the currency of the importer on date of ordering
- Entering a contract to fix the exchange rate
- Buying currency to cover specific order
- Trading in USD/EUR -Options
- open an account in an overseas bank
- open a foreign currency account in a local bank
Disadvantages of a free market for the producer selling directly to retailers?
F A C T D E E L
Freight forward Delivery
Administrative Burden Extra staff
Collection Exported duties/ taxes
Transportation Label/ package compliace
Advantages for using a distributor?
C A L L K C-
Contacts -timesaving for proucers
Admin burden relief
Logistics - collection, trans/ delivery / risk of damage
Language barriers -retailers like one point of sales
Knowledge of the market -key players, preferences, trends
Compliance Experience & staff to deal with legal
List the options for direct sales?
C O E W
Cellar door sales
Online
Events
Wine clubs
List the retail wine buying options?
D o G S S C H O W
Deep Discounters Convenince Retailers
Global Travel Retail Hybrids
Supper markets Online Retailing
Specialist wine retailers Wine Investment company
Reaching the end consumer - Deep discounters
-how does the busines model work?
B R O i L S
Buy direct from producers
Rarely stock major brands
Often basic
Limited product range
Specialty items around holidays in affluent areas
Reaching the end consumer - Supper markets
-private labels- producer’s risks
D O N E P Q
Delisted if volume & profit not achieved
Over supply
Negotiating power of spmk
Ensure variation for Spmk
Pay for product placement
Quality control- pkg, label, delivery
Overview of the marketing process?
P A T O D I M
1 identifying the Product/ brand to be marketed
2 Analyzing the current market
3 identifying the Target market
4 setting the Objective of the marketing strategy
5 Devising the marketing strategy (the marketing mix)
6 Implementing and Monitoring the marketing strategy
A successful brand with a positive image in the consumer’s mind can be achieved through?
Successful ___ can be achieved: L e S s S T E P S
Longevity Story
Substance Trust
Engagement
Price premium
Strong brand name
Types of branding include?
P P L L ea S e
Position
Private Label
Ladder brand
Luxury brand
Soft Brand
Segmentation is often based on variable which include:
B a D G a P
Behavior
Demographic
Geographic
Psychographic
Wine Intelligence segregation model known as Portraits
Name the US Portraits?
E M P ty B a S K e t
Experienced explores Bargen hunters
Millennial treaters Senior Sippers
Premium bran suburban’s Kitchen Casuals
Key marketing objectives include?
T A S P
1 what TYPE of marketing strategy does the company want to pursue
- what are the AIMS of the marketing strategy
3 how will the SUCCESS of the strategy be measures
- within what time PERIOD should the objectives be achieved?
Marketing mix factors- 5Ps
The elements of the strategy are often referred to as ______
Product Price
People Place
Promotion
Marketing strategy – Place
Model of wine market maturity by Wine Intelligence
-Markets can move up and down categorization
M E G E N
Mature Market
Established Markets
Growth Markets
Emerging Markets
New Emerging Markets
Marketing strategy – Promotion
AT THE POINT OF SALE
-list ?
F P o L i C C I e S
Free Merchandise
Price promotions
Limited edition packaging/ presentation
Competitions Consumer tasting
Incentives Staff Training
Marketing strategy – Promotion
AWAY FROM THE POINT OF SALE
W A S P S S W E a R
Websites Smartpones Apps
Advertising Wine Tourism
Sponsorship Events and Festivals
Public relations Reviews and Awards
Social Media
