Chateau Margaux
Advanced business cases in strategic management – Group 10 - Chateau Margaux : Launching the Third Wine
1. Identification of the problem
How should Chateau Margaux best market and launch their new offering – their third wine?
Previously considered a left-over, the quality of the third wine in 2009 was so good and unexpected that the management team of the vineyard decided to sell as a Chateau Margaux wine.
This raises the following subquestions:
a. To which target consumer and market should it be addressed to?
b. How can this vintage wine be positioned in relation with the Chateaux’s first and second wines?
c. What should the price be?
d. What are the best channel and communication approaches? What places should they sell the wine to if they bypass the negociants?
2. Analysis of the situation
2.1. Swot Analysis
Strengths
Weaknesses
Prestige (1855, the “Premier cru” rank, “our picture made the Wine Spectator cover in 1984”)
Well established presence in the wine industry (“enthusiasts from all over the world were coming to visit, taste and compare”)
The quality and quantity of the 2009 third wine
Their first and second wines are very well appreciated in markets like China,
Pioneers in their harvesting practices and techniques
Robert Parker’s highly favorable reviews
Increased engagement with media
“Ambassador” strategies for better communicating the value of their brand
Loss in the popularity of the image of the Bordeaux wines among “Sommeliers” (“Bored of Bordeaux”)
No control on end-consumer prices and types
Limited production – they cannot satisfy an eventual increase of the demand in one of their wines
Lack of experience of the management team in the marketing area
Selling en primeur reduces their benefits of the real market price evaluation
Opportunities
Threats
Increasing wine consumption in several New World countries (USA, Brasil, Australia, Canada) as well as in Russia, China, Japan => potential target markets (importers)
1. Identification of the problem
How should Chateau Margaux best market and launch their new offering – their third wine?
Previously considered a left-over, the quality of the third wine in 2009 was so good and unexpected that the management team of the vineyard decided to sell as a Chateau Margaux wine.
This raises the following subquestions:
a. To which target consumer and market should it be addressed to?
b. How can this vintage wine be positioned in relation with the Chateaux’s first and second wines?
c. What should the price be?
d. What are the best channel and communication approaches? What places should they sell the wine to if they bypass the negociants?
2. Analysis of the situation
2.1. Swot Analysis
Strengths
Weaknesses
Prestige (1855, the “Premier cru” rank, “our picture made the Wine Spectator cover in 1984”)
Well established presence in the wine industry (“enthusiasts from all over the world were coming to visit, taste and compare”)
The quality and quantity of the 2009 third wine
Their first and second wines are very well appreciated in markets like China,
Pioneers in their harvesting practices and techniques
Robert Parker’s highly favorable reviews
Increased engagement with media
“Ambassador” strategies for better communicating the value of their brand
Loss in the popularity of the image of the Bordeaux wines among “Sommeliers” (“Bored of Bordeaux”)
No control on end-consumer prices and types
Limited production – they cannot satisfy an eventual increase of the demand in one of their wines
Lack of experience of the management team in the marketing area
Selling en primeur reduces their benefits of the real market price evaluation
Opportunities
Threats
Increasing wine consumption in several New World countries (USA, Brasil, Australia, Canada) as well as in Russia, China, Japan => potential target markets (importers)