Guido Berlucchi & Co. SpA is one of Italy’s leading sparkling wine producers. After years of outstanding success, the company finds itself facing a stable market, with competition becoming even more intense, distribution more complex and consumers more sophisticated.
The executive Committee is convinced that the strategy that drove the company’s development in its first 40 years needs to open up a new growth path, thus this marketing plan for the strategy for the upcoming three years. External Analysis Customer analysis Approximately 35% of the 313,000 million inhabitants of the U. S. drink wine at a per capita rate of 11. 5 liters. In terms of demographics 69% are white, 14% Hipic, and 11% African American, with the remainder 9% from other races.
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The average age of the American wine consumer is 49, with Millennials making up 26% of wine consumers, generation X-ers aged 35-44 at 19%, ages 45 to 54 at 21%, and those over 55 at 34%. 24% of wine consumers in the U. S. have a college degree Segmentation by frequency Wine consumers are divided into two categories, core wine drinkers and marginal wine drinkers. The core group drinks wine once a week at least and represents 57% of wine consumers whereas the marginal group has a glass of wine in a time p ranging from once every 2 or 3 months to 2 or 3 times a month. 8% of all wine consumers have a glass of wine more than once a week and are considered to be the high frequency wine drinkers. Segmentation by age Thirty two percent of baby boomers (47 to 65) have a glass of wine compared to 17 percent in 2005. 62 percent of Generation X-ers (aged 35 to 46) are core wine drinkers, compared to only 43 percent in 2007. 6 percent of Millennials (aged 17 to 34) drink wine on a daily basis, 26 percent of them drink wine several times a week and 19 percent drinks once a week on average. This comprises the core wine drinking segment of Millennials, accounting for 63 percent of them compared to 37 percent in 2007.
There is a significant difference between younger Millennials (17 - 25) and older Millennials (26 – 34). Older Millennials consume wine with greater frequency, consumed more glasses of wine per drinking occasion (2. 92 glasses on average) and were found to be highly experimental as 89% of older Millennials frequently purchase wine of an unfamiliar brand. Also interesting is that 60 percent of older Millennials found “fun and contemporary” looking labels of great importance when choosing wine to drink at home compared to just 31% of Baby Boomers.
All Millennials and high end wine drinkers throughout the Generation X and baby boomers often visit wine related web sites and Facebook pages or follow wine twitter accounts. The generational differences are also noticeable in the preference of domestically produced wines and imported wines. * 63% of Millennials, (70 million consumers), are reported to either “primarily drink imports” or “equally drink imports and domestics” * 43% of Generation X members (44 million consumers) report the same preferences * 32% of Baby Boomers (77 million consumers) report these preferences Segmentation by geography
Wine consumption per person is lowest in the Midwest where 13% buys 4 or more bottles per month compared to 24% in the South, 25% of those in the North East and 29% in the West where 10% of the adult population even purchases 11 or more bottles per month. The top three states for Wine consumption are California, New York and Florida. The top three emerging markets, where the capita per wine consumption has grown the most over the past three years are Texas, Illinois and New Jersey Western states, especially those that produce wine locally such as California, Washington and Oregon, have proven more ikely to favor domestic wines while eastern states are more receptive to imports. Amongst others, New York, Florida, New Jersey and Washington DC all import more than 30% of the total wine consumption from outside the U. S. Competitive analysis Direct Competitors Listed below are the top 3 sparkling wines in the US at the current moment. They all fall in the range of our target customers in terms of their taste and their prices making them a direct threat and therefore a direct competitor.
JCB by Jean-Charles Boisset No. 69 Burgundy, France
Jean-Charles Boisset's JCB wines are made entirely from Pinot Noir grapes grown in the Burgundy region of France, this refreshing rose is light and crisp, offering raspberry and red currant aromas. Many wine lovers associate this brand with romantic outings. It is currently listed as number one on the top sparkling wines in the US available at only 7 stores, and at a very affordably price it is sure to be serious competitor. Price: $20
Mendoza, Argentina Toso has been producing sparkling wines in the Mendoza wine region of Argentina for 85 years. Their non-vintage brut is made entirely from Chardonnay grapes. Light and refreshing, it offers aromas of lemon and apple with buttery and toasty notes. It is very popular in the US with people looking for something inexpensive, well made, clean and bubbly especially for large events like weddings, receptions and birthday parties.Price: $11
Taltarni Brut Tache Australia
Made from Chardonnay, it is an established household name, known for producing extraordinarily high quality sparkling wines in Australia. They are known to be very environmental friendly because they recycle the vines and they refrain from using Diuron and Simazine on their property, thereby reducing the impact on ground water. One disadvantage however is that its prices compared to other wines has been progressively rising lately. Price: $25 Indirect competitor
Listed below is one of the top wines in the US at the current moment, although it does not fall under the category sparkling wines it is nonetheless a competitor in the total wine market especially now that it is making is mark on the US market making it worth the mention.
Moscato’s Asti, Italy
Moscato is currently one of the fastest-growing wine varietals in the U. S. Moscato wines tend to be sweeter and less alcoholic. Gallo, which holds 44 per cent of Moscato’s market share, saw sales of its own Gallo Family Vineyard Moscato increase by 124%in 2010, according to marketing research firm IRI.
More than half of all Moscato consumers are under the age of 45, while nearly one-third are between the ages of 25 and 34 Moscato’s popularity with the younger generation could, perhaps, be due to hip hop influences. Kanye West claimed on MTV that he liked Moscato, while Lil’ Kim sang “Still over in Brazil/Sipping Moscato. ” A more likely reason, however, is the low price tag that many Moscatos enjoy.
Price: $5,99 – $16,79 Market analysis Overall size The U. S. wine industry has steadily increased in size and revenue over the past ten years and has grown into the fourth largest wine producing country in the world. In 2010 the U. S. became the leading wine consuming country, consuming as much as 330 million cases a year. This means Americans drink 3. 96 billion bottles of wine, surpassing France’s 3. 85 billion bottles and have spent more than $40 billion on wine in 2010. California is the largest wine producing and consuming state in the nation, currently it accounts for 61% volume share of the U. S. market.
Wine market is currently witnessing steady growth in both developed and emerging economies. Increasing disposable incomes, rising awareness about the medical benefits of wine, and the resultant consumer shift towards consumption of premium alcoholic beverages are driving the growth in the wine industry. US wine market is one of the fastest growing markets of the world, both in terms of production and consumption As per our findings, the US wine market is expected to hit a value of around US$ 33. Billion with 871 Million Gallons of wine sales by 2013. The market (in volume terms) will grow at an annual growth rate of over 3% during 2010-2013. The economic recession had impacted the US wine industry by consumers starting to enjoy low-priced bottles and wines by glasses. The millennial segment is the future of the US wine industry, and their numbers are increasing as younger members are attaining the drinking age. Moreover, rise in the number of female wine drinkers in marginal segment is also fueling the growth of the US wine industry.
This trend, coupled with government’s initiatives, is playing a greater role in promoting reforms and competitiveness in the wine industry of the US. The market for sparkling wine in the USA has been growing rapidly in recent years according to some top findings from the Wine Market Council Report: Profitability Sparkling wine sales in the U. S. are estimated to have outperformed table wine brands for the third straight year in 2011, when American drinkers will have consumed the equivalent of 900 million glasses.
More than 40 percent of those 15 million cases are sold during the holiday season. The overall wine market is projected to increase 1. 7 percent by year-end, to 313 million cases, its 18th consecutive annual gain. Sparkling wines account for a modest 5 percent, but growing, share of that volume. Entry Barriers The wine industry in the U. S. has high barriers of entry because of high investments needed to buy land and machinery together with high costs of advertising and distribution. Because of the strict laws and high taxation of alcohol in the U. S. large economies of scale have the best chance of becoming and remaining profitable. Distribution System Throughout the U. S. the three tier system is enforced for the distribution of all alcoholic beverages. The system works as follows: * Non-U. S. Producer * 1st Tier – U. S. Producer / Importer * 2nd Tier – Distributor * 3rd Tier – On/Off Premise Trade (restaurants/ bars/ retailer) Non-U. S. producers are only allowed to sell directly to an importer, Importers and U. S. Producers are only allowed to sell to retailers, and only retailers are allowed to sell to consumers.
Some states have partially or completely prohibited the distribution and/or the retailing tier and have these operated by the state government itself or contractors operating under its authority rather than by independent privateers. In any case taxes must be collected at all three tiers, even though in some states the importer and the distributor can be the same company, it must still pay taxes for both tiers. Trends A broadening of the consumer base, a greater range on offer, and an increasing desire among some consumers to make sparkling wine a regular rather than occasional treat are the main factors driving the trend.
Americans still do not drink as much sparkling wine as consumers in other countries like Germany and the UK, but there is a strong long-term growth trend establishing for domestic and particularly mid-priced imported sparkling wines in the years ahead. At the moment Moscato has experienced a sharp increase in sales, up 73%, driven largely by younger drinkers. Cheaper and in wide range of flavored wines have become more popular as well due to restaurants adding less popular varietals to their glass pour list because the higher profit margin.
This has resulted in wine consumers becoming more open-minded to seeking out unique varietals. Italy’s Macro Environment analysis: Demographic The Italian Population is currently approximately 61,261,254 but the growth rate of the population is gradually slowing, with most of the increase coming from immigration. Birth rates and death rates are virtually identical. However, the national figures conceal contrasting regional trends. In general, the birth rate and average family size are higher in the south of Italy than in the north, although populations in Molise, Basilicata, and Calabria are declining through continued emigration.
For the country as a whole, life expectancy rose during the second half of the 20th century, reflecting higher nutritional, sanitary, and medical standards. At the beginning of the 21st century, the majority of the population was between 20 and 49 years old, with the largest group between ages 30 and 44. The age structure is built up as follows: 0-14 years:13. 8% male 4,315,292female 4,124,624. 15-64 years:65. 9% male 19,888,901female 20,330,495 65 years and over: 20. 3% male 5,248,418female 7,109,074 GDP Contribution by Economic Sector and Top Industries: Agriculture: 3. 9%
Industry: 28. 3% Services: 67. 8% (2011) Economic Italy is currently the world's largest wine producer. However it has not been immune to the global economic downturn but it has been able to weather the financial storm. Wine is a key player in Italian trade with exports in 2011 valued at 3. 6 billion euros, compared to imports of 326 million euros. Sparkling wines account for 11% of exports. A sector report presented at the Vinitaly wine trade fair showed that the economic downturn was responsible for a 5. 1% decline in Italian wine exports in 2008 over the previous year.
In this moment of economic crisis and uncertainty, people try to satisfy their desires. Italian cuisine is the most popular all over the world. In Italy the Docg sparkling wines do better than others, indicating that high quality standards and strong local identity, as much as the price, are central factors for the customers’ choices. Italian exports rose 17 per cent in the first nine months of 2010, according to Coldiretti, the Italian farmers association. The growth had been even higher at 22% for the first six months of the year, primarily due to explosive demand from the US. Ecological (Natural)
The future of wine grape supply depends on the availability of groundwater and high temperatures will decrease the availability of wine grapes. High water use by the industry, and in particular the treatment of wastewater, is likely to come under increasing public scrutiny. Over the five years through 2015-16, the level of capital intensity is likely to increase marginally due to investment in water treatment. Political The wine and grape industry in Italy is regulated by laws and decrees issued by the Ministry of Agriculture (Ministro Delle Risorse Agricole, Alimentari e Forestali).
Italy is also a member of the European Union and shares the Common External Tariff regime. EU duties are charged by the Italian Customs Agency on the CIF (cost, insurance and freight) value of the product imported into Italy. Below are the 4 wine designations: * DOCG: the highest classification for Italian wines, introduced in 1963. It denotes controlled production methods and guaranteed wine quality. There are strict rules governing the production of DOCG wines, most obviously the permitted grape varieties, yield limits, grape ripeness, winemaking procedures and ageing specifications.
Every DOCG wine is subject to official tasting procedures. To prevent counterfeiting, the bottles have a numbered government seal across the neck. * DOC: a step below DOCG, the DOC classification accounts for the majority of wines produced in Italy. The quality control regulations are less stringent than those applied to DOCG wines. * IGT: The IGT classification was introduced in 1992, to allow a certain level of freedom to Italy's winemakers. Prior to 1992, many wines did not qualify for DOC or DOCG status not because they were of low quality, but because they were made from grape varieties (or blends) not sanctioned under DOC/G laws.
The IGT classification focuses on the region of origin, rather than grape varieties or wine styles. * VDT: VDT wines are typically of lesser quality than those labeled with IGT, DOC or DOCG, but not always; the 'Super Tuscans' (see below) are often labeled as Vino da Tavola. U. S. Macro Environment analysis The following macro environmental factors have an indirect effect on Berlucchi’s success in the US market. The major forces of the macro environment should be highly regarded as the company is looking to enter unfamiliar territory while at the same time striving to acquire a competitive advantage.
Demographics According to the Wine Intelligence USA Sparkling Report 2012, over 30 million Americans say they drink sparkling wine at least once a year. For the majority of this population their sparkling wine experience is confined to perhaps one or two glasses a year, on special occasions. However, what appears to be driving the growth in sparkling wine is the segment of consumer; estimated at around 9 million, and female-dominated, who say they like to drink the bubbly stuff at least once a week. Many of these people say that sparkling wine is their favorite drink, ahead of still wine.
California| California accommodates 37,691,912 people, houses more people than any of the other states of America and has eight of the 50 most populous cities in the U. S.. Remarkable is that only 39. 7% of the people living in California are white non Hipics and 38. 1% are Hipic whites, only 6. 6% is black and 13. 6% of Asian ethnicity. The ethnic makeup is very different from the countries average. Of the persons aged 25 years or older 80. 7% has graduated high school and 30. % has a bachelor’s degree or higher. The Median house hold income is $60. 883. Texas| Texas is the second most populous U. S. state, housing 25,674,681 people who are mostly located in the major cities of Houston, San Antonia and Dallas. Similar to California, Texas also houses a relatively large number of Hipics. 38. 1% of the population is white of Hipic decent and 44. 8% is non-Hipic white. The division of other ethnic groups is quite similar to the nations average. 80% of adults 25 years or older have a high school degree and 25. 8% of them have a bachelor’s degree or higher. The median household income is $49,646 a year. |
New York| New York is the third largest state after California and Texas with a population of 19,465,197 of which roughly 64% lives in the New York City metropolitan area. The percentage of the population that is of African American decent is slightly higher than the nations average, 17. 5% as well as those with an asian heritage, 7. 8%. The median household income is $55,603, 84. 4% of the persons age 25+ are high school graduates and 32. 1% has a bachelor’s degree or higher. | Florida| Florida is the fourth most inhabited state in America, accommodating 19,057,542 people.
Notable are that it contains the highest percentage of people over 65, 17. 6% and the 8th fewest people under 18, 21%, also its population is expected to double between 2000 and 2030. Florida’s ethnic makeup shows few differences from the countries average with the exception of persons of Hipic or Latino origin which is 23% and growing faster than in any other state. 85. 3% of the adults 25 years of age or| Social-Cultural In the U. S. wineries have become more than just wine producers and sellers. They're often venues for gatherings as diverse as weddings and business meetings.
Some wineries have onboard restaurants and gift shops and are also lively tourist attractions. That says something for the ingenuity of savvy wine producers, but it says even more about the changing American attitude toward wine. Recent consumption gains for sparkling wine have been driven by many factors over the last few years including the adoption of wine in early adulthood by the large Millennial generation, the availability of quality wine at all price levels, and the acceptance of moderate wine consumption as compatible with a healthy lifestyle. Economic
The turbulent economy has had a moderately negative affect on the nation’s collective wine consumptions growth. Within the 2008–2011 period, stock market volatility had little effect on how much wine consumers were drinking. In 2008, 61% of respondents stated they hadn’t changed the amount of wine they consumed despite the poor economic conditions. The economy has had a direct effect on prices over the last 10 years, prices went down significantly during the recession, but as the economy has improved, they have bounced back very quickly and even surpassed previous highs.
Fine wine prices dropped 19 percent from August 2008 to August 2009 and they increased 33 percent from August 2009 to August 2010, surpassing their previous pre-recession prices. Political Wine is regulated by the Alcohol, Tobacco, Firearms and Explosives division of the internal revenue service which makes it subjected to high levels of control and tax. Us wines are shaped by politics including which grapes grow where, what can be written on the label, which wines are exported or imported, which wines are available in local stores, and how much a wine costs.
In the United States, the wine laws are more flexible than European standards in regards to regulations on what viticultural and winemaking practices are allowed in each wine region. A sizable portion of American wine laws relate to wine labelling practices. The United States imported 932 million liters of wine in 2010. The majority of imports came from Italy ($1. 3 billion). Depending on the type of wine, U. S. tariffs on imported wine from nations with which the United States maintains normal trade relations range from 5. 3 cents per liter to 22. 4 cents per liter.
Tax rate for natural wine imported to New York for example is $0. 30 per gallon Internal Analysis Current products Berlucchi’s current products: * Cuvee Imperiale Brut * Cuvee Imperiale Max Rose * Cuvee imperial Demi Sec * Cuvee imperial vintage * Cuvee Storica Franciacorta DOCG * Bianco imperiale * Cellarius Brut * Cellarius Rose * Cellarius Pas Dose * Berlucchi ’61 brut * Berlucchi ’61 Rose * Berlucchi ’61 Saten * Palazzo Lana Franciacorta Brut Millesimato * Palazzo Lana Franciacorta Saten millesimato * Palazzo Lana Franciacorta Extreme millesimato Prices
The sparkling wines of Berlucchi are between €15 and €28. The average price per line: * Berlucchi bianco imperiale: €10 * Berlucchi ’61: €15 * Cuvee imperiale: €20 * Cellarius: between €15 and €20 * Palazzo Lana: €28 Target Market Geographically speaking, Berlucchi is targeting Italy. Berlucchi won market leadership in its first few years because of its mission to ‘democratize the bubbles’. With their below average price for sparkling wine, and their distribution through grocery stores, Berlucchi sparkling wine was accessible for everyone. Distribution channels Grocery retailers
In 2006 70% of all Berlucchi sales went through the grocery retail distribution channel. Because of the company’s solid penetration of this channel, they established an undisputed leadership position. HoReCa and specialty stores Berlucchi produced a product especially made for this channel, which won considerable success and allowed the company to re-establish its reputation among connoisseurs and win over specialized dealers. Positioning By distributing through grocery retailers, Berlucchi positions itself in a totally different range than most other Italian sparkling wine, which are available in specialty stores.
The company’s solid penetration in this modern distribution channel anchored the positioning of the Berlucchi brand. But having a lower price does not mean they work with a bad quality, although some may look at Berlucchi as a cheap supermarket wine. The Berlucchi brand guarantees a high-quality, prestigious, accessible product. Competitive Advantage Berlucchi stands out because of their innovative spirit and desire to experiment with new products and market segments, but off course, still in an accessible and qualitatively good manner. The solid penetration in the modern distribution channel of grocery retailers is something no other ompany has accomplished. Marketing Mix The marketing strategy that has secured Berlucchi’s success over the last thirty years can be summed up in three key words: Italy, mass market, and corporate brand. In the 1960s, the company’s founders saw an opportunity to create a sparkling wine market in Italy using the champenoise method. This method meant educating both trade and final consumers through constant communication, the aim of which was to eliminate the image of Italian spumante as a sub-category of wine, or a lower-quality version of the more familiar French champagne.
In just a few years’ time the company won a leadership position in the Italian market. They had a clear mission: “To make bubbly accessible to everyone”. The firm achieved this mission with an extensive distribution strategy. Berlucchi spumante wanted to create a festive atmosphere on any occasion. The best way to achieve this was to reach the consumer through the simplest distribution channel, for instance grocery retailers. Berlucchi has always implemented a push rather than a pull strategy, focusing communication and commercial investments on trade.
Another marketing strategy of Berlucchi was based on avoiding product proliferation in the portfolio, in keeping with the need to educate Italian consumers on the traditional method. Berlucchi came up with a series of simple, distinctive brand visuals, which over time have come to be identified with the company. Financial Performance SWOT analysis Confrontation matrix * S1 x O4, because despite the challenging economic environment we are currently in, sparkling wines are set to gain share in the US alcohol market.
Berlucchi has a below average price and that could be an opportunity for them to gain share in the US alcohol market. * S3 x O3, because Berlucchi has an innovative spirit and desire to experiment with new products and market segments. They could have an opportunity in the US alcohol market, because most Americans show an interest in broadening their horizons in terms of what kinds of wine they buy. * S3 x T3, because consumers in the wine market are constantly evolving. That could be an opportunity for Berlucchi, because they have an innovative spirit and desire to experiment with new products and market segments.
Corporate strategy Berlucchi grew in a few years after founding to be leader in its market thanks to a clear mission: ‘democratize the bubbles’. The founders were convinced they could produce an Italian sparkling wine of comparable quality to the current products on the market. The aim was to produce a high-quality, prestigious, accessible product for a below average price. The basic reason for their attitude was that they could not justify the substantial price difference between Berlucchi products marketed through large retailers and the same wines sold in specialized stores and wine bars.
Eventually Berlucchi grew to be a market leader in the large grocery retailers and an important player in the HoReCa and wine shops, without ever letting go of the initial corporate mission. Segmentation The wine consumers in the U. S. can be segmented in to the following groups based on consumption and spending patterns: Daily Musts | Variety Seekers| Personal Image| Savvy Buyers | Occasional Consumers | Represent 16. 4% of wine drinkers| Represents 14. 4% of wine drinkers| Represents 14. 1% of wine drinkers| Represents 2. 6% of wine drinkers| Represents 34. % of wine drinkers| Spending share of 49. 3 % | Spending share of 34%| Spending share of 3. 1%| Spending share of 9. 7%| Spending share of 4%| Median age is 61| Median age is 50| Median age is 34| Median age is 48| Median age is 55| Annual income averages $62,000| Annual income averages $100,000| Annual income averages $62,000| Annual income averages $80,000| Annual income averages $63,000| | Target Market The segments most viable for targeting are the Daily Musts, the Variety Seekers and Personal Image consumers and through using a differentiated strategy all three can be targeted.
Daily musts Although this segment is brand loyal, by applying low cost strategy and attractive packaging this segment can be entered, after which the focus should be customer retention and maintaining everyday low price offers in combination with a loyalty program to create loyalty to the berlucchi brand and maximize customer equity. Variety seekers Premium brand images and first-class packaging will strongly appeal to the Variety Seekers and expert ratings, premium pricing and event or celebrity sponsorships will truly entice this segment to try berlucchi brand wine.
However because of their low brand loyalty a truly aggressive loyalty program is necessary to retain their business. Advertisement be should focused on wine magazines and internet media. Personal Image This segment shows the most potential profitability on the long term and should be engaged to ensure a significant market share in the next decade as this is the fastest growing segment. The focus has to be on moving them towards Variety Seeker of Daily Must habits. Innovation through products and packaging and leveraging social media would speak most to the Personal Image wine drinkers. Positioning
Daily Musts and the Personal Image consumers can be catered to with one product in the area , the product’s should have a below average to average price level and focus on offering an accessible product of decent or higher quality. The product targeting the variety seekers should be higher priced to project a somewhat prestigious image and high quality. Below you can see the product value proposition for Berlucchi’s target customers. Objectives Market share Brand familiarity Revenue Timeframe: 3 years Marketing Mix Product As described in positioning, there are three target groups for which there are different product needs.
To accustom all potential customers it is neccessary to introduce two different lines of products. Lines Cuvee Imperiale - Brut - Max Rose - Demi Sec - Vintage ‘For over half a century, Cuvee Imperiale has been synonymous with festiveness, joy, and raising a toast, and its consistently fine taste has made it the Italians’ favourite classic-method sparkler. Its four styles make it the perfect choice for both casual moments and the most special of occasions. ’ This line will serve the needs of the Daily Musts and Personal Image consumers, it has a below average price, it is accessible and has a high quality.
Palazzo Lana - Brut - Saten - Extreme ‘The timeless elegance of the Palazzo Lana Berlucchi, the handsome mansion that inspired the first Franciacorta, is present once again in these vintage-dated Franciacortas. Produced from free-run must, and rare both in quantity and quality, the three are bound together by a common thread of gracefulness, complexity, and avoidance of excess, each wine dedicated to those who enjoy them thoughtfully. ’ This line will serve the needs of the Variety Seekers consumers, it is above average prices, has a prestigious image and has a high quality. Packaging Daily musts
The Daily Musts consumers are flexible in their response to different packaging designs. Personal Image They consider wine consumption an extension of their personal images, however are more focused on store brands. Variety seekers This consumer group appreciates premium packaging. When lining together these consumer characteristics and the packaging of the chosen products, we can come to a conclusion of no necessity to change the packaging of the products, due to the already existing compatibility of consumer needs and the product packaging. Price Cuvee Imperiale The price for the Cuvee Imperiale line will be $15.
Berlucchi will have to lower their price a little bit than they have in Italy, but this way they can compete with the competitors in the US, for instance the Toso Brut from Argentina. The Cuvee Imperiale will be a good competitor due to their below average price and good quality sparkling wine. Palazzo Lana The price for the Palazzo Lana line will be around the $30 in the US. One big competitor is the Taltarni Brut Tache, their price is around the $25. Berlucchi Palazzo Lana is more expensive, but Berlucchi will still be a good competitor since the prices of Taltarni have been progressively rising lately.
It will also be a good competitor, because of its prestigious image and high quality. Place Locations Below is a table with 6 states located in the U. S. whom are known to have an extremely large wine drinking population, and therefor will be the best states in the US to introduce the Berlucchi’s wines.
Within each one of these 6 states the wines will be available in two types of store retailers: * Specialty stores: A small retail outlet that focuses on selling a particular product range and associated items. Most specialty store business operators will maintain considerable debt in the type of product that they specialize in selling, usually at premium prices, in addition to providing higher service quality and expert guidance to shoppers. Superstores: A very large retail store that stocks highly diversified merchandise, such as groceries, toys, and camera equipment, or a wide variety of merchandise in a specific product line, such as computers or sporting goods. Specialty stores: Berlucchi’s wines will be available in the best of the best wine shops in each state. They will be placed in these shops according to the stores location and popularity.
More than a third of all wines sold in America are purchased at Superstores. Wall-Mart 2011 USA Retail Sales ($000): $307,736,000 Extending its lead, it is making solid progress on improving its merchanides through different new projects. The company’s grocery business accounted for more than half of its 2011 sales. Wall-Mart constantly hires wine scouts to research new wines in order to further broaden their inventory. Wines located in a Wall-Mart store Kroger 2011 USA Retail Sales ($000): $78,326,000 America’s largest traditional grocer is food focused and price led.
It includes a wide variety of all sorts of wines. In 2012 Kroger hired wine stewards for a few of its Texas stores. The political push to sell wine in grocery stores is now in different Kroger stores. Wines located in a Kroger store Target 2011 USA Retail Sales ($000): $65,815,000 Target will try to become more beverage focused and currently has strong store innovations and loyalty programs. They combine grocery store bargains with wine shop-level service and expertise. Wines located in a Target store Restaurants:
In addition to these retail stores, the wines will also be available in a variety of restaurants in each state. These restaurants will include non-fast food restaurants that have an ideal location for different types of customers to reach. Below is an example of one of the restaurants that look real promising in terms of boosting Berlucchi’s brand image. Since 1979 Antonello Ristorante located in California has captured the essence of Old World authenticity with a new Italian. Antonello's award-winning wine list boasts more than 700 foreign and domestic labels.
For special occasions or business meetings, there are eight Promotion The goal is to become the first thing that comes to mind for a person from one of our targeted segments when in the market for wine. According to professor Jacob’s Creek of the University of South Australia’s Wine Marketing Research Group, it is not the brand but the wine regions that influences consumers choice the most. The promotional strategy used to differentiate the Berlucchi wines from others is to sell the idea of living the southern European care free, want for nothing life style using the campaign slogan: ‘A taste of the Italian life’.
This should invoke an emotional response to advertisement as consumers in the Daily must segment, who are older and often retired or near retirement age can relate to the care free living. The variety seekers can relate to the ‘want for nothing’ aspect and high end allure of Milan or Rome and the younger personal image consumers can indulge in the American romanticized cultural image of Europe. Promoting the Brand As Americans are not yet aware of how many wines are actually Italian and no wine markets itself distinctively as such, the Berlucchi products can be analyzed as a new product.
To start the introduction phase a launch event will be held in Los Angeles, California to which columnists/writers for different lifestyle and food magazines, influential tasters and VIPs’ will attend to experience the different wines by Berlucchi that will be launched in the U. S. which will result in features in magazines such as ‘food and wine’, Decanter, WineEnthusiast and Fine. During the introduction phase a print ad and a broadcast media advertisement featuring Robert Deniro will run.
Because of his Italian heritage and wine expertise as he owns his own vineyard, on the other hand because of his long and outstanding acting career he is recognizable and idolized by people across generations. The broadcast ad, which will run for thirteen weeks, will be shown during lifestyle television shows and cooking shows such as ‘Master chef’ and ‘come dine with me’ and can even be featured on the shows. The print ad will run for a total of 30 weeks, appearing once to 10 times throughout that period in different magazines and as banners on different online magazines.
To promote the brand directly to the target group, Berlucchi nights will be organized during which selected restaurants will serve free glasses of Berlucchi wine that go well with the dish ordered. The before mentioned strategies will be very effective for the Daily must and Variety seeker segments, but to ensure the involvement of the personal image segment a social media campaign needs to be launched. Each bottle of Berlucchi wine will have a code and instructions printed on the back side of the label.
After purchasing a bottle a consumer can befriend Berlucchi on Facebook or follow them on twitter, after which the phrase “Having a taste of the Italian life #Berlucchi #;code;” should be posted online. In response a code will be send back to the consumer which entitles him or her to a 61% discount on their next purchase of a bottle of Berlucchi Cuvee Imperiale and they enter a lottery for a set of 3 Berlucchi Franciacorta ’61 bottles. The low price and exciting price will attract the segment and by posting they immediately communicate the existence of Berlucchi to their friends.
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