Wine Marketing 2

1) Some figures,
1. 1/3 wines are imported from France
2. HK do import & re-export to Macau and China
3. Wine import to be HK$ 5 billion in 2009
4. Demand are expected to increase by 72%
5. Alcoholics consumptions - 25% red wine (New Zealand and Chile are fast growing countries), 5% white wine, 2% sparkling.

2) China Wine Market
1. HKTDC firgures, import wines accounted for 11.8%, French wines being the most popular.
2. Import tariffs to China:
Import Tax 14%
VAT 17%
Consumption Tax 10%

3) Marketing Communication Mix
Advertising
Sales Promotion
Events/Experiences
Public Relations
Personal Selling
Direct Marketing

[First 2 suitable for single brand & companies, last 2 are lowest in cost]

My Notes on the Mix:
Now more and more online marketing solutions provides more and more targeted promotion channels.
Product placement in TV program and movies.
SEO: Search Engine Optimization
Responsible marketing campaign: "If you drink, you can't drive." Social responsibility

4) SWOT Analysis
External factors: Opportunities and Threats
Internal factors: Strengths and Weaknesses

Exercise:
Study on Wine High Club (http://www.winehighclub.com/)
Background: Direct importer from France (mainly from Bordeaux) and UK, online sales. Small amount of business for trade, wholesale.

SWOT Analysis for Wine High Club
Strengths:
Lower cost (direct from one main region, Bordeaux, transportation cost relatively low)
Efficient distribution channel
High return customer (repeat customer)
No outlets, lower overhead

Weaknesses:
Higher import cost due to small volume (compared to chain stores)
No interaction (tasting)
Low turnover
Customer are price sensitive
WOM is important

Opportunities:
General public increasing interest in wine
Expand wine offering portfolio
Advantage in exporting to China
Lowered tariffs
Local customers are familiar with online purchase

Threats:
Floating foreign exchange for GBP and Euro
Economy. Wine is not a necessity
Product life span (My note: this would be further discussed in the Japan case study)
Fake wine on rare vintage


Articles under this topic:
Wine marketing 1
Wine marketing 3
Wine marketing - Case study of Japanese market