This document provides an analysis of Château Margaux's strategic marketing plan over 5 years. The objectives are to develop the Japanese market and enter the Russian and Chinese markets to increase sales. Tactics include trainings, tastings, repositioning the brand image, and a new customer program. Financial forecasts project increasing annual sales, margins, and net income through targeting new markets and consumers.
Closing Case The Growing Trade in Growing Grapes Wine i
Château margaux
1. 1
Strategic Marketing 1
MiM1 Anglo C01
ÉLÉONORE MICHEL
CHLOÉ MORVANT
PAULINE VALLANZASCA
PIERRE-EMMANUEL MORINEAU
PIERRE URIER-CATTOIRE
3/2/2013
2. Table of contents
2
Introduction
I. External diagnosis
II. Internal diagnosis
III. Objectives and strategy
IV. Marketing Mix
V. Budget
Conclusion
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5. POLITICAL
5
Strong points Weak points
Orientation of Europe toward Under-age drinking is
alcohol consumption prohibited (18 years Fr)
Taxes are lowered inside Europe Political campaign against
drinking and driving in France
Promotion of French culture
worldwide (candidate for
the UNESCO World Heritage)
Tax on alcohol except on
French wine productions
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6. ECONOMICAL
6
Strong points Weak points
Agricultural incentives in Competition from New World
Europe to go against “rising” wines (California, Australia,
emerging countries Argentina, Japan, Chile)
Grants for one-time loss Black markets in some
southern countries
Easy fluctuations of
investments, money and goods Financials buy vineyards
within the European Union and do not pay attention to
wine quality
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7. Legal - Ecology
7
Strong points Weak points
Glass recycling Legal age: between 18 and 21
years old according to the
country
Advertising regulation : loi
Evin (1991)
Export travel causes
pollution
Organic wines
Competition but not direct
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8. Social - Technological
8
Strong points Weak points
Different drinking patterns Young people drink less and
according to countries less wine
They are not trained to know
Europe : tradition drinking wines
wine is in culture (heritage, and
culinary habits, especially in
France) French people are the most
important consumer of French
wines
Faster and more precise
machinery in France makes New technologies can
production easier and faster deteriorate a wine’s taste
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10. Product
10
Strengths Weaknesses
Secured and authentic wine Expensive product depends on
vintage year
Product full of history
Renowned Specific localization and
distribution difficult to change
1855: official classification as a
Pavillon Blanc does not take
“first vintage wine”
benefit from Margaux’s
Luxury wine seen as an
appellation
exclusive product
Accessible in limited quantity
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11. Consumers
11
Strengths Weaknesses
Loyalty to the brand Principal customers:
connoisseurs
Established in Europe (United
Kingdom, Germany, etc…)
People with high income
French attractive product
Ambitions about new markets:
Japan, China and Russia
Evolving taste of consumer
3/2/2013
13. Current ranking of wine producers
13
Production Exportation Country % of the world’s
production
1 1 Italy 18%
0 3 France 16%
3 2 Spain 13%
4 6 USA 8.6%
5 7 Argentina 5.2%
6 4 Australia 5.1%
7 10 China 5%
8 9 Germany 3.6%
9 8 South Africa 3.5%
10 5 Chili 3%
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14. New world producer
14
FROM 1995 up to 2000:
South Africa: +220%
Australia: +125%
Argentina: +73%
Chili: +160%
USA: +96%
SINCE 2000:
Production keep increasing (5 to 20% per year depending on the
country) until the crisis
3/2/2013
15. The French market is changing
15
Problem :
How can Château Margaux develop it export activity while
maintaining its high-end positioning ?
Current product New product
Current market Develop awareness in France Create a new product
Aim curious people with high (entrée de gamme) in
income or connoisseur of other France and Europe
wines (i.e. Burgundy wine)
New market Use the same product to Create a new product to
increase our market place and attract young people and
develop the company in Japon, (non connoiseurs) all
China and Russia around the world
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17. Objectives
17
Hypothesis (p.a.) Inflation: 0,1% Production: +0,01% Same quality as 05
This budget only reflects activity related (directly and indirectly) linked to production and selling of Château Margaux
N+1 - N+5: Japan (closer to our market, aim gastronomy traditions and add "French Touch" - product quality): +0,05% p.a.
N+3 - N+5: Russia and China (aim new "Bling-Bling" market and work on brand image): +0,05% p.a.
N+1; N+3: Formation for negociants with whom we work worldwide
Invite international critics
N+1 - N+5: Tastings in well-known and high-end places worldwide
N+3 - N+5: Annual Programm for our best customers (5/year): domain visit and 3 days in 5 star hotel/at the domain
N+2: Reorganise website
Development objectives:
Japan
Russia and China
Access new clients: developp openess, product
quality as well as brand image
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18. Segmentation
18
Socio-demographic :
Men and women above 35 years old
Social & Economic :
People with a high level of revenues that allow them to spend
money in quality product
Connoisseurs of wine products
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19. Targeting
19
The people we target are nowadays located in Japan,
China and Russia.
In Japan, there is a strong gastronomy culture
In Russia and China it is more « Bling-Bling »
People are interested in expensive products at the expense of
quality.
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20. Positionning
20
We want to keep the same positionning that Château
Margaux has in France.
Quality product => High-end product (haut de
gamme)
It is a product that customers buy for their pleasure.
To show-off
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23. Price
23
Vary according to the vintage of the bottles, but always have a high
price. Production have been reduced so there are less bottles (scarcity
of bottles) but higher prices.
A bottle cost approximately 15 euros to produce, but Château Margaux
benefits thanks to the perceived value approach.
Usually sold between 200 and 1000 euros/bottle (these last years).
Besides, it is also sold en-primeur (prices vary a lot between 70 and
300) but it is only between 5 to 15 % of the production.
-> is high and climb a lot but it is justified by its high rank and
prestige
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24. Place
24
Training for foreign negociants in order to allow them to sell our
products properly.
Tastings organised by negociants, with selected people, and products
from the terroir
Distribution remains the same: the estate, Château Margaux sell the
production to brokers who take 2% margin and then deal with
negociants on the Bordeaux place who take 15 to 20% margin. Then
importers export the products all over the world.
3/2/2013