Selling Australian Wine to Overseas Market

Integrated Marketing and Communication Plan

Australian Wine is on the rise in relation to quality and production because of free market status in the country. This has seen the transfer of labor and expertise from across Europe help boost the wine industry in Australia. The Australian Wine is intensely competitive in the world’s market making it among the largest wine exporters globally. The Oz Wine Exporters performs the role of promoting the Australian wine in the global market. Australian wine comes fourth in the global ranking as one of the main exporters or players in the wine industry. Australian Wine market at the internal level is approximately over 3.0 billion Australian dollars. The growth rate of this export market is above 10% annually making it a market of formal return (Wine Industry Profile: Global’ 2012, pg.1-31). It is favorable for potential investors since the Australian Wine is a leading player in the global wine industry. This makes the return on investment to be under short duration hence worth the bargain. Main international markets for the Australian Wine products are United Kingdom and the North America region. Currently Australian Wine is the main exporter of wine in the United Kingdom thus the region contributes significantly towards the development of the annual turnover. In order to compete effectively with France and Italy as the main wine exporters, Australian wine industry plans to revise its marketing and communication plans in the international market. In order to improve on the current market coverage and volume of turnover, Australian Wine plan is to adopt Television, Celebrity, and Internet as the main strategy for competing effectively in the market.

Demographic Opportunities

Australian Wine currently majors in Northern parts of America and the Great Britain. The entire global markets offer extensive opportunity for improvement in terms of turnover and export volumes. Australian Wine wishes to other parts of the global market such as Africa, Asia, other parts of Europe, and the southern region of America. This will increase the entire volume of turnover per annum, as revenues would also shoot to the maximum. In order to venture greatly in to the new markets, Australian Wine plan is to maintain the existing market coverage and improve on the weaknesses in those markets. For instance the United States of America still possess more than enough opportunity for improvement since Australian Wine controls merely 17% of the wine distribution. In the African market, the Australian wine plans to star in the Southern region that has witnessed proportional level of growth. This market would offer new demographic opportunities since the area boasts of various wine distribution channels and processing firms. Apart from the Great Britain, other countries such as Germany, Spain, and even France or Italy would provide the much-needed demographic opportunities. This would boost the current global turnover to approximately 4.5 billion Australian dollars to help reduce the disparity between Australian Wine and the best three wine exporters. (Lattey, Bramley, & Francis, 2010, pg. 189-202)

Product Analysis

Australia houses close to 2000 wine manufacturers, producers, and distributors. Among this group, the majority are small-scale business entities. Australian wine products are designed for party like activities, vocation, holidays, honeymoons, birthday events, sporting activities, and interaction functions. Australian Wine product is manufactured from grapes (red and white) as the main inputs. The products are of high quality to the extent that some of the wine products act as benchmarks for processing and manufacturing activities. The wine products sell in well-designed bottles that appeal to numerous wine consumers globally. The products are in white and red wine forms in order to serve the varying consumer tastes and needs in the wine market. This expresses the variety in the wine industry in Australia. Since different consumers possess different tastes, purchasing power, and needs, Australian Wine comes in different types and quantities (Jeffery, Parker, & Smith, 2008, pg 153-161). This enhances the market coverage since the rich, the poor satisfy their needs effectively, and efficiently relative to the quantities, they can afford. This reduces economic burden on the consumers to purchase what they can easily pay for to ensure that they live within their resources. The product is environmental friendly in the sense that its packaging ensures minimal pollution to the surrounding. The bottles undergo the process of recycling to minimize the total cost of production while limiting environmental pollution. The product also forms an alliance with Australian Environmental entity to enhance the fight against environmental degradation. This alliance also helps in promotion of the products. The designing of the product considers conventional standards to ensure that the product is the best in the market (Siebert et al., 2005, pg.937-947).

Costed Budget

In the process of executing integrated marketing and communication plan, Australian Wine plans to inject 1.5 million Australian dollars. This will enable the promotion of the product through television, internet, and celebrity. In order to increase the market coverage for Australian wine designing and maintenance of a website is crucial. Through the official website, consumers globally would have access to what products are available in the market and how they can obtain them with ease. This would cost approximately 300,000 dollars for a start. For further maintenance, continuous injection would follow according to the demands for the service. The internet would offer acute and effective platform through which the company can interact with its consumers (Cox, 2009, pg.209-229). The opinion on the products would help improve the standards of the wine since the producers would know how effectively to serve the needs of their clients. Through social networking platforms such as facebook and twitter, the company would be in a better position to interact cheaply with their clients hence enlarging the market coverage, as well as enhancing communication levels. Australian also plans to improve on the level of advertise on television to supplement on the existing promotion program. This would cost about 500,000 Australian dollars to acquire advertisement services of international televisions such as CNN. Television advertisement program would enhance on the existing market coverage and attraction of new market. Consumers would easily identify the brands of our products in the market because adverts would be straightforward. The third bit of the integrated marketing and communication plan, Australian wine plans to approach celebrities to help market our products in the international market. The celebrity in mind is Tim Cahill, the football superstar. This would enhance the product chances in European countries and other global parts. The program would demand 700,000 Australian dollars in return to help dig into the new market as well as maintaining the current coverage (Cox, 2009, pg.209-229).

Competitor Analysis

Australian wine faces competition from the emerging wine powerhouses such as China and Chile. This supplements competition from Italy and France (Wine Industry Profile: Global’ 2012, pg.1-31). This limits involvement of Australians wine processing and distribution in the competitors’ marketing zones. In order to compete effectively in the growing wine industry, Australia must adopt measures that would minimize the cost of production while maximizing the annual profit levels. Transfer of labor and expertise from wine exporting countries is ideal to counter efforts by competitors in the wine industry. Since Australia offers ideal climatic condition for growth and development of grapes, it holds competitive advantage over other exporting countries. This improves its chances for survival in the international wine market.

Target Market

Based on the current economy state, it is crucial to determine efficient target market to help boost the total revenue annually. The Australian Wine targets small business wine entities, stay-at-home wine consumers, large wine outlets, and partygoers. This will present effective, affordable, and efficient model for enhancing the total turnover in the global wine industry. In order to accumulate large volumes of annual turnover, the company plans to star in the large wine outlets or distribution entities. This would provide the much-needed competition to the other wine exporting countries like China, Chile, Italy, and France. The distribution channels would enlarge the market coverage since Australian wine would attract new consumers who enjoy a close relationship with the firm (Thach & Olsen, 2006, pg 307-322).

Strengths

Australian Wine enjoys one of the largest market coverage in the global level, in the wine industry. This enables the firms to enjoy economies of scale hence reducing the cost of production as well as improving on the profit levels. Economies of scales provide effective ground for competition in the industry. Australian Wine also enjoys strongly built a reputation and image to enhance efficient association with consumers. Since the products are trustworthy in relation to the quality of their manufacturing and distribution processes. This offers favorable platform for the Australian wine to counter competition from other wine exporting countries. Large production levels also reduce the cost of manufacturing and distributing the products. High rates of profits emerge due to minimal cost of production (Tesfaye et al., 2009, pg.142-156).

Weaknesses

Extensive competition in the global market from China, Chile, Italy, and France limit the achievement of annual financial targets. The other weakness of Australian Wine is the ever-fluctuating global market. Because of this, it becomes difficult to project the financial gains of the company. This also reduces the capability of the company to work on appropriate measures to improve the condition.

Price

The price for the wine is highly dependent on the area with the market. Therefore, some markets will tend to have a higher price attached to the wine than other markets because of the relative cost of export in the country. In addition, the government policies and rules governing the export of wines has a massive influence on the price of the commodity. The demand for the wine also has an influence on the price with areas that do not have a vast demand having a lower price to act as an incentive while markets having a whopping demand will have a higher price than the other areas.

Price for wine in the U.S. will go for $162/dozen. There will be a few variations, which are dependent on the policies of the different states, although this is the average price of the wine in the country. Some states like California will have a higher price with the projected price being $170/dozen. This is because of the high demand for wine in the market. In addition, the company will maintain the competitive advantage of the wine in that highly volatile market. In Africa, the price will be $155/dozen although specific countries like South Africa have a high price, $161/dozen. Other markets like Asia will have an average price peaking at $160/dozen. However, these prices are expected to change with time depending on the performance of the wine in the different markets.

Creative

In the current market, the challenges of achieving success in the mainstream market are exceedingly difficult for the company. Therefore, the company has come up with various creative methods that will reach the markets. These include the social media, which is currently hugely influential in the market. The company has a Twitter account that will serve as a channel for customers to air their views. Any communication to the customers will also be made through the channel. The company also has a Face book account for the various brands for the company that will serve as communication for the communication of events to the public. In addition, these strategies will enhance interaction between customers and the company (Comm & Comm, 2010, p194)

Distribution

The company will use various methods in the distribution of the wine. This is highly dependent on the accessibility of the market and the demand for the wine. In countries where the demand is extremely high, the wine will be transported by air. However, this is expensive, and the demand for wine in such a market has to prove to be worth it through the returns that it will give. The expectation is that the U.S. is one of the markets that will require air transport. Other slow markets will necessitate the use of ships as the method of distributing to the respective countries. These include the Asian markets, which do not have an enormous demand, but the accessibility to the sea will have a large influence on this method of distribution (Coad, 2009, p598). Once in the country, the distribution of the wine will be through various channels. However, the main channel is through the wholesalers. These will then distribute the product to the bars that have an immense demand for the product in the respective countries. The clients who place their orders to the company directly through the internet will also have their demands attended to promptly (Hayden & Krueger, 2012, p194). However, the company is open to other methods of distribution on the near future.

Situation Analysis

The situation analysis of the company is through the 5C method. First analysis is that of the company. The mission of the company is to be the leading producer of wine and to serve a large market base both in Australia and worldwide. Currently, the company is stable and possesses a large market base in the country already. The only part remaining is outside the country where various strategies are in place to attain an enormous market. The expectation is that with the demand for wine increasing in the recent past, and then the product will be a success. Many competitors in this industry pose a massive challenge in the operations of the company. The strategies of the main competitor are to hold wine tasting shows frequently. This method is effective since it provides the chance for customers to sample the product free before they decide on buying the product. Therefore, this company will also use the same method but will also add promotions to the strategy to try to better the efforts of the competitors (Upson et al., 2012, p101).

The most suitable methods to get to customers is through the electronic media. Advertising in the television will have a large impact on the amount of customers that are reachable. In addition, there will be use of the internet, and especially the social media as a method of creating awareness in the new markets. There is also need to use a celebrity in the country as a tool of advertisement. Tim Cahill is one of the most iconic football prospects of the country. Considering that the largest market for the wine is men, then the football celebrity will have an immense influence on the appeal of wine to this market segment. The potential growth for the product in some markets is expected to be high. An example is the Asian market and the U.S. market where the demand for the product is exceptionally high. Most of the distribution of the product will be on a wholesale level. However, this is dependent on the success of the product, with retailing also being a choice later on. Online distribution is also available although this is only for exceptional large orders. Therefore, the main target for the wine is the middle and high-income members of the society.

Collaborators are also part of the situation analysis. There will be partnerships with some agencies in the different markets. These will help in the recruitment of the workers necessary and other activities that are necessary for the survival of the company. Thus, there is also need to collaborate with some partners that will help reduce the risks for entrance to some of the volatile markets. It is also imperative to take into account the environments that will affect the company. These include the political and economic, which will govern the laws and trends of the economies respectively. Since the company is relying on technology as the method of getting to the potential markets, then the technological environment is extremely crucial for the company.

Branding

The company has various brands that will be distributed to the various markets. These include Chardonnay, which is one of the most famous brands for the company in Australia. This brand is lightly oaked and has an exciting straw color. The source if the wine is the citrus fruit, which is well visible from the citrus finish in the wine. The wine is fantastic for drinking immediately. Shiraz is also another brand that the company expects to have a large impact in the markets. This brand is made of the plum fruit, and there are traits of pepper in it. The wine is excellent for drinking immediately although it can also be placed in the cellar for a maximum of 3 years. Cabernet Sauvignon is arguably one of the hottest prospects in the country now. This wine has a large influence of fruits, which is evident from the rich flavor especially of oak. These brands have a large following in the Australian market currently and, therefore, the expectation is that the rest of the countries will exhibit the same characteristics (Keys, 2012, p14).

Packaging

The company understands that packaging of the wine is imperative to its performance in the market. This is the reason why some of the markets will have wine packaged in boxes (Hildebrandt, 2012, p46). An example of this is Africa. This is in an effort to reduce the cost of wine to the consumer to attract customers. However, some markets like in the U.S. will require bottles as the packages. In particular, the Burgundy bottle is the best for these brands since it provides an outlook of luxury to the consumers. This bottle is also the most suitable for the red and the white wine that the company will export from Australia. The color of the bottle will be green. This is to act as protection of the wine in the bottle and the appeal that the bottle has to the consumers. According to feasibility test, green is the favorite color for the consumers of wine (Connolly, 2008, p32).

Positioning

Southcorp Wines Company is the largest competition that the company will have to face. The company is the largest exporter by volume in the country. Other leading competition includes BRL Hardy, which also has a massive market, and I well positioned in the market (Aylward, 2002, p357). Therefore, this company will have to start as an underdog in the industry although the ranking is expected to rise in the near future. This company will position itself in the market as the fastest exporter of wine. In addition, the products of the company are relatively cheaper in comparison to the competition. Therefore, the company will offer a cheaper alternative of high quality wine in the market for consumers who enjoy their drinks in the current markets.

References

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Coad, A 2009, ‘On the Distribution of Product Price and Quality’, Journal Of Evolutionary Economics, 19, 4, pp. 589-604, EconLit with Full Text, EBSCOhost, viewed 26 May 2012.

Comm, J., & Comm, J. (2010). Twitter power 2.0 how to dominate your market one tweet at a time. Hoboken, N.J., Wiley. http://www.myilibrary.com?id=255149.

Connolly, K 2008, ‘NEW WINE PACKAGES: TAKE THE GRAPE’, Brand Packaging, 12, 7, pp. 30-35, Business Source Complete, EBSCOhost, viewed 26 May 2012.

Cox, D 2009, ‘Predicting Consumption, Wine Involvement and Perceived Quality of Australian Red Wine’, Journal of Wine Research, 20, 3, pp. 209-229, Academic Search Complete, EBSCOhost, viewed 26 May 2012.

Haydon, J., Dunay, P., & Krueger, R. (2012). Facebook marketing for dummies. Hoboken, N.J., John Wiley. (Haydon & Krueger, 2012, p167)

Hildebrandt, S 2012, ‘The art of primary packaging’, Beverage Industry, 103, 5, p. 46, Masterfile Premier, EBSCOhost, viewed 26 May 2012.

Jeffery, D, Parker, M, & Smith, P 2008, ‘Flavonol composition of Australian red and white wines determined by high-performance liquid chromatography’, Australian Journal of Grape & Wine Research, 14, 3, pp. 153-161, Academic Search Complete, EBSCOhost, viewed 26 May 2012.

Keys, T 2012, ‘The dance of brand myth-creation’, Wine & Viticulture Journal, 27, 2, pp. 12-17, Hospitality & Tourism Complete, EBSCOhost, viewed 26 May 2012.

Lattey, K, Bramley, B, & Francis, I 2010, ‘Consumer acceptability, sensory properties and expert quality judgments of Australian Cabernet Sauvignon and Shiraz wines’, Australian Journal of Grape & Wine Research, 16, 1, pp. 189-202, Academic Search Complete, EBSCOhost, viewed 26 May 2012.

Lynch, J, & Ariely, D 2000, ‘Wine Online: Search Costs Affect Competition on Price, Quality, and Distribution’, Marketing Science, 19, 1, pp. 83-103, JSTOR Arts & Sciences IV, EBSCOhost, viewed 26 May 2012.

Siebert, T, Smyth, H, Capone, D, Neuwohner, C, Pardon, K, Skouroumounis, G, Herderich, M, Sefton, M, & Pollnitz, A 2005, ‘Stable isotope dilution analysis of wine fermentation products by HS-SPME-GC-MS’, Analytical & Bioanalytical Chemistry, 381, 4, pp. 937- 947, Academic Search Complete, EBSCOhost, viewed 26 May 2012.

Spirits and Wine Are Gaining Share from Beer in the United States’ 2004, Black Book – Anheuser-Busch: Times Are Getting Tougher for the King of Beers, pp. 31-42, Business Source Complete, EBSCOhost, viewed 26 May 2012.

‘SWOT Analysis’ 2005, Southern Wine & Spirits of America, Inc. SWOT Analysis, p. 5, EDS Foundation Index, EBSCOhost, viewed 26 May 2012.

Tesfaye, W, Morales, M, Garcia-Parrilla, M, & Troncoso, A 2009, ‘Improvement of Wine Vinegar Elaboration and Quality Analysis: Instrumental and Human Sensory Evaluation’, Food Reviews International, 25, 2, pp. 142-156, Academic Search Complete, EBSCOhost, viewed 26 May 2012.

Thach, E, & Olsen, J 2006, ‘Market segment analysis to target young adult wine drinkers’, Agribusiness, 22, 3, pp. 307-322, Business Source Complete, EBSCOhost, viewed 26 May 2012.

Upson, J, Ketchen JR., D, Connelly, B, & Ranft, A 2012, ‘Competitor Analysis andfoothold moves’, Academy Of Management Journal, 55, 1, pp. 93-110, Business Source Complete, EBSCOhost, viewed 26 May 2012.

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