Marketing Strategies of Shaoxing Rice Wine in China

Topics: Wine, Marketing, Alcoholic beverage Pages: 8 (2926 words) Published: May 21, 2011
In this report, it first analyzed the development of rice wine industry in China, then it discussed the rice wine industry in the capital market, next it carried out the SWOT analysis of Shaoxing rice wine, finally it explored the 4P’s marketing strategies of Shaoxing rice wine. Through the analysis, it has been found that the Shaoxing rice wine has a huge market potential. In the aspect of marketing strategies, it should focus on the high price market, and the northern market and rural market, as well as make efforts on brand.

Table of Contents
1 Introduction4
2 Differential advantages / Competitive edges4
2.1 Comparison of volatility4
2.2 Comparison of valuation4
2.3 Analysis of profitability and growth capability5
3 SWOT analysis5
3.1 Strengths5
3.2 Weaknesses6
3.3 Opportunities6
3.4 Threats7
4 4P’s marketing strategies7
4.1 Product7
4.2 Price8
4.3 Place9
4.4 Promotion10
5 Conclusion11

1 Introduction
The rapid development of rice wine industry has become an important category of alcoholic beverages. Along with the industrial policy guidance of "positive development of rice wine", nutrition, health care consumer attitudes are deeply rooted, and ancient rice wine industry has renewed vitality. In 2002, rice wine production exceeded 1.4 million tons, in 2005, rice wine production exceeded 2 million tons, and in 2006, is a breakthrough in the history of 2.2 million tons (, 2010). Rice wine has been able to start actively direct competition with health wine and foreign wine. In the minds of consumers, it becomes the fourth-largest category besides white wine, beer and red wine. Shaoxing Rice Wine Group Ltd. of China is one of the 520 key enterprises, is the chairman unit of Chinese rice wine Industry Association branch, the total assets is 2.4 billion yuan, and has more than 3,000 employees (, 2010). The company is based on rice wine, and actively develops the rice wine-related industries, develops rice wine extension products, involved in high-tech, focusing on cultivating bio-chemical, electronic information industry.

2 Differential advantages / Competitive edges
2.1 Comparison of volatility
In the sub-sectors, the beverages sub-sector volatility was 0.84, which was slightly higher than the average volatility of 0.82 of the food and beverage categories, the grape wine industry has the lowest volatility 0.64; and rice wine has the highest volatility 0.9 (, 2010). On the asset allocation category, the food and beverage is a typical defensive specy, while the rice wine is the most of the sub-sector volatility in the defensive varieties, if the industry valuation levels are increased, it may get more benefits.

2.2 Comparison of valuation
Rice wine sub-sector is the lowest valuation of the various sub-sectors, either PE or PB, as well as PS is the lowest. Why the rice wine industry does not enjoy a higher premium, it is not the performance problem, but the problem for the concern on the market for rice wine industry, if rice wine industry is the prelude to the revival, it is believed that in the near in the future, the valuation of rice wine there will be leap improvement.

2.3 Analysis of profitability and growth capability
Because there are only three listed companies in rice wine industry, excluding Textile City, it should focus to consider the First Food and Gu Yue Long Shan, if the two listed companies selected according to the average or weighted index as the industry index, both are wrong, it will be shown separately as both the subject of rice wine industry (Agri-Food Trade Service, 2008). It can be seen from the gross margin targets, the leading listed company of rice wine is First Food, rice wine gross margin level is not less favorable than the liquor and grape wine, the First Food of the asset swap will be more apparent after the rice wine business advantage, the higher gross margin is the...
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