...FACULTY OF ECONOMICS MATEJA PIRNAT, 19554965 UNIVERSITY OF LJUBLJANA INTERNATIONAL MARKETING SCHOOL YEAR 2014/2015 INDIVIDUAL ASSIGNMENT- Chateau Margaux Study Case 1. Describe the current distribution system of the company and explain why it is so important for its brand positioning? Please explain also how the brand is positioned on international markets. Chateau Margaux’s current distribution system is completely traditional, which means that it is handled by the specialized and independent merchants. The merchants are a major part of the distribution system for the Chateau Margaux’s wines. Besides the responsibility for the distribution of wine, the merchants also have other significant roles, for instance negotiating prices, maintaining the relationship with retailers, promoting and positioning the brand. The distribution is dependent on the merchants who are responsible for customer relationships and finding out who the wine consumers are. For this reason they are selected on the basis of their previous relation with the château and their past success in promoting and positioning the brand. One of the major benefits of current distribution system is that it creates a scarcity on the market and helps to gain the better prices and at the same time not give an impression of wide availability to the customers - customers begin to appreciate the wine more and more. The merchants are able to create an enthusiasm around the wine which can affect the whole...
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...Background Information & Problem Statement ___________________________________________________________________________ Châteaux Margaux is a historic wine estate in the Bordeaux region of France, which has been producing fine wine since the 15th century. The estate was one of four châteaux to achieve Premier cru, or “first growth,” status in the Bordeaux Classification of 1855, securing its status as one of the finest and most expensive wines in the world. The primary wine produced by the Châteaux, Grand Vin du Châteaux Margaux, is regarded as one of the top wines in the world, while its secondary wine, Pavillon Rouge du Chateau Margaux, was also considered in the top echelon of wines. Although the Pavillon was originally intended to occupy a slightly lower perceived quality point and lower price point, strong reviews of each wines have led to both the first and second wines garnering premier status and commanding exorbitant prices. Due to the increasingly prestigious reputations of the wines fueled by strong reviews by the world’s preeminent critics, Châteaux Margaux has become increasingly selective in selecting grapes for their first and second wines. This increase in selectivity has led to an increase in leftover grapes, deemed to not be of high enough standard for the first and second wines. In the past, Châteaux Margaux had sold the remaining wine in bulk at a low price. In 2009, the Châteaux experienced a particularly strong vintage. This led to extremely...
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...Chateaux Margaux experience a golden age because of strong demand for Bordeaux wines by the British; In 1977, Andre Mentzelopouls re-introduced the chateau’s second wine and redefined the Pavillon Blanc white wine. His vision of paying attention to quality and innovation made CM outstanding. After Corinne took over CM, she hired Pontallier to help her. Their combination was very successful. They came up with useful ideas leading to finer wines. They focused on increasing first-growth wine quality. Distinguishes: CM put less of production in the first and second wines and reduced yields overall in the vineyard in order to concentrated the flavors in the remaining grapes. Therefore CM got fewer bottles but with higher quality. While chateau relied on the channel to serve as the distribution and marketing arms for its wine, CM took note of demand shifts. It conducted the “ambassador” program in China to get close to customers in the big increasing market. The brand equity of CM is it offered high quality first-growth wines and good reputation for spectacular wines. 2. Assuming CM will go ahead with a third wine, whom should they target in their marketing efforts? Core customers in traditional markets, like the US, UK, Japan and France. Because CM wines have become inaccessible to the consumers in traditional markets. The third wine could bring them back. 3. What should the third wine’s brand image be relative to CM’s first and second wines, including the name and...
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...Château Margaux Case 1- Château Margaux’s distribution system Château Margaux is one of the well-known wines from the Bordeaux region in France. It is famous by the fact that this wine has got a luxury and high quality notoriety, and also stand out from the competitors thanks to the quality of is first growth produce with carefully selected grapes. With only two mains wines (first wine: Chateau Margaux; Second wine: Pavillon Rouge; See in Exhibit 2) Chateau Margaux is a famous wine all over the world. This situation is, in a part, due to its distribution system. Indeed, Chateau Margaux has not got is own distribution system because it entrust the distribution through specialist merchants which have good knowledge about the potential consumer and consequently allocated the product in the right places all over the world. This system allows Chateau Margaux to be concentrate on the producing activity in order to have always the best first growth whereas merchants take care about the promotion and the sale. There are many merchants in the Bordeaux region, where Chateau Margaux’s terroir is located, which assures them to have many choices to select the best specialist to sell the wine. After, selected the right merchant, this one allocate the wine in small amount in markets that they think interesting to create a scarcity climate that search Chateau Margaux to keep is luxury image. More precisely, the distribution is mostly performed by the en primeur system. It means...
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...and harvest. Then they provide with the information the largest buyers. So merchants get the primeur cheaper, but then chateau Margaux can ask for higher process on the bottled markets, which the merchants accept, to get the primeur price for the next year. The merchants allocated wine to their buyers. This makes wine available to their customers. This system profits everybody. For wine industry it’s good because they get the payment earlier and they do not have to worry about distribution. As for merchants they are as well paid early. Customers benefit because they get a high quantity. 2. How is price set? Trace the process from the sale of the first tranche to the sale of a bottle in a wine store for $1,200. Why is the process so complicated? The distribution is mostly performed by the en primeur system. It means that Chateau Margaux sell its wine in barrel and no after bottling when the wine is in advance about the major vintage. This way of distribution is used by most of the chateaux and wine producers because they sell only between 5 and 10% of their wine in after bottling. The en primeur system is characterized by different step that Chateaux and merchants respect in order to fix the final price. This system is complicated because of the number of middle men who are involve in the transaction and how each take a commission , Because Chateau Margaux wants to concentrate on producing the wine they are have many negotiators who are there to sell the wine to the...
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...ANNUAL REPORT 2009 CORPORATE PROFILE Le Château is a leading Canadian specialty retailer offering contemporary fashion apparel, accessories and JANUARY 30, 2010 JANUARY 31, 2009 STORES SQUARE FOOTAGE 352,214 319,762 117,321 128,768 35,575 28,083 16,200 19,332 9,203 3,480 1,029,938 17,591 STORES AND SQUARE FOOTAGE STORES SQUARE FOOTAGE 371,240 360,017 139,605 133,025 38,148 28,083 20,157 19,332 15,314 3,480 1,128,401 17,591 ONTARIO QUEBEC ALBERTA BRITISH COLUMBIA MANITOBA NOVA SCOTIA SASKATCHEWAN NEW BRUNSWICK NEWFOUNDLAND P.E.I. TOTAL CANADA TOTAL UNITED STATES 75 68 27 27 8 7 5 5 3 1 226 4 73 65 26 27 7 7 4 5 2 1 217 4 footwear to style-conscious women and men. Our brand's success is built on quick identification of and response to fashion trends through our design, product development and vertically integrated operations. Le Château brand name merchandise is sold exclusively through our 230 TOTAL LE CHÂTEAU STORES 230 1,145,992 221 1,047,529 stores. All stores are in Canada, except for four locations in the New York City area. In addition, the Company has 9 stores under license in the Middle East. SALES (in ‘000) 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 150,000 100,000 200,000 SHAREHOLDERS’ EQUITY (in ‘000) 07 08 09 50,000 0 07 08 09 Le Château, committed to research, design and product development, manufactures approximately 40% of the Company's apparel in its own Canadian production facilities. NET EARNINGS...
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...Using the aforementioned data, it is easy to conclude that the Chateau de Margaux brand is performing very well, yet there is always a question if a company can be doing even better than they already are. In 1997, the Mentzelopoulos family and Margaux brand had to ask themselves this question- should they extend into the mass market or maintain their exclusivity? In order to draw a conclusion one must investigate alternative ways of expanding, marketing and distributing their brand- which is exactly what we will consider when examining the Château de Margaux business model. New Idea for an Old Brand: As a way to freshen up the traditional brand and to gain more exposure, the granddaughter of the Margaux family wanted to begin mass marketing a new wine brand. The idea would be to use different grapes in order to be more accessible to the younger generation. The target price range would be €20-€25 per bottle (Dessain, 2011). There are a large number of young wine drinkers who cannot afford the high prices of the current Gran Vin brand and are therefore not being attracted to the Château de Margaux vineyards. If these consumers were introduced to an affordable brand of wine from the Margaux estate, then they may be more likely to recognize and trust the brand. That way, when they are looking for a more expensive wine, they will first go to their label of Grand Vin from the Château de Margaux collection. Some of the issues with this suggestion are: maintaining the exclusivity...
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...OPPORTUNITIES 1) Demand for its wine: Although traditional markets like United Kingdom, Belgium, Netherlands, and Germany have historically driven the market for premium wines but in the last year’s new countries around the world have joined the club of countries with a high demand of high-end wines. Countries like United States, Japan, China, and Russia are demanding now almost half of its total demand, becoming very important markets. We see this as an opportunity for the company’s growing. 2) Increasing new consumers in America, Asia where the wine is associated with Status Symbol: China, Taiwan, Singapore, Russia and other countries in North America with big and growing economies, see the Château Margaux brand as a status symbol. We see a big opportunity for the company in those markets with more rich people anxious about luxury wines. 3) Marketing of the Product can help meet the increasing demand: We believe that if the company creates marketing strategies focused on luxury markets and its current customer. It can result an increasing demand of their products. 4) Online Sales: As part of the marketing effort, Online sales can help company knowing its end users and that will help company monitor the changing trends and consumer behavior about their product. THREATS 1) Competition from worldwide manufacturers like California, Australia, South Africa: We believe that one of the main threats for the company are the new competitors, not only new competitors from countries...
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...situation analysis 4 4.3.1. Competitive forces (Porter analysis) 4 4.3.2. Key competitor’s analysis 4 4.4. External analysis conclusion 5 5. Internal Analysis 5 5.1. Company’s resources, capabilities, competencies, and competitive advantages 5 5.2. Value chain analysis 5 5.3. Marketing Strategy and competitive position 6 5.4. Is the company competitively stronger or weaker than key rivals? 6 6. Problem Statements 6 7. Formulation and Discussion of Strategic Alternatives 6 8. Strategy Recommendation 7 1. Introduction Le Chateau, a specialty retailer, who has been in business since 1959, has managed to vertically integrate its value chain to achieve financial stability while targeting the middle market. With tough competition in the industry, Le Chateau has struggled with marketing its brand and international expansion. 2. Company’s Current Strategy 3.1. Vision Le Chateau plans to market to the post-baby boom market while still attracting its current Baby Boomer clients and the rest of its current market. 3.2. Mission What: Retailing the latest runway fashion and global trends for men’s and women’s apparel, shoes and accessories. Who: Targets the middle market; large number of soccer moms and career oriented women. * In 2004, it became more upscale and offered better quality products, 50% of...
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...Consumer Conditions Chateau Margaux Wines Background: Chateau Margaux produces one of the highest quality wines in the world. It is not unusual for a bottle to sell for over $100.00. There has been a tremendous increase in wine usage over the last ten years. This is due to the introduction of lower priced New World Wines in Canada and the United States. These wines come from California, Australia, Chile, Argentina, South Africa and New Zealand. The quality of these wines is very good, and the grape varieties are the same as in France: Merlot, Shiraz, Cabernet, Malbec, Pinot Noir, Shiraz, and Zinfandel. Chateaux Margaux does not participate in the quickly growing segment. They are considering launching a lower priced wine which does not carry the Chateaux Margaux name. They would use the grapes that are very good but are not up to the standards of a Margaux. These lesser quality but great tasting grapes would be able to compete on a price level with Market Measures Size of the Market The wine industry was worth $213.8 billion as of 2005 or 18.9 billion litres. The industry is forecasted to grow 2.7% by 2010 making it worth $243.7 billion. Five percent of global wine production comes from France, worth $10.69 billion in 2005. Category Sales New World wines have created a higher consumer demand for simpler wines. The sales in this category have experienced the most growth of all of the wines. Consumers find the product easier to relate to and...
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...A prisoner in the Southern French city of Marseille attempted to escape a penitentiary by switching places with a corpse in a burial bag and later died, as the bag was thrown into the ocean, prison management says. The incident occurred at the Chateau d’If, a high-security prison about one mile of the coast of Marseille. Prison officials claim that the prisoner, Edmond Dantés, who was, at the time, confined for conspiracy charges, entered the cell of Abbé Faria (Father Faria), an imprisoned Italian Priest who was dead of unknown causes, Sunday evening or early Monday morning via a tunnel dug under and between their two cells. Dantés proceeded to slit a hole in the burial bag in which Faria was contained, remove the corpse, take it back to...
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...Reporte Caso Chateau Dupont Situación Actual Identificación de Actores Administración de Polaridades La familia Dupont enfrentó varias disyuntivas en el periodo estudiado (BFF) como ¿qué es más importante: la familia o el negocio?, esto lo vimos en la primera serie cuando se tomó el espacio familiar para discutir de negocios. Cuando se pretendía dar una respuesta rápida al banco para financiar la compra de un segundo hotel pero sin considerar la opinión de accionistas e interesados la disyuntiva consistió en ¿se puede conservar el control y rapidez de respuesta e incluir a los miembros de la familia y negocio en las decisiones?. Con la compra del nuevo hotel la familia fue puesta a prueba en cuanto a sus valores familiares teniendo que preguntarse ¿qué vale más: el prestigio de la familia o la utilidades que pueda generar un negocio?. Otra polaridad que se observó recurrentemente la podemos ilustrar como: ¿puedo retirarme de mi negocio y sentirme realizado?. El mismo dilema desde otro punto de vista sería ¿puedo realizarme profesionalmente en la empresa familiar sin desplazar a mi padre o predecesor? y ¿es más importante la familia que tengo con mis padres y hermanos o la familia que voy a formar con mi esposo (a)?. Al observar continuamente la falta de órganos de gobierno en la familia Dupont probablemente la polaridad que tendrían que vencer sería ¿qué es más importante conformar órganos de gobierno o mantener baja la burocracia?. Al postergar Paul su plan...
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...Executive Summary Chateau de Margaux is one of the world’s most renowned premium wine brands for many decades. Their wine offerings include only the first-growth and the second-growth wines. The company been profitable and is considered a very highly reputable and successful premium wine brand from the region of Bordeaux, France. Being successful and profitable often bring up questions like, how can the company do better? With the increasing demand for wine around the world and the increase of number in new wine producers around the world with exceptional potential, could the Chateau de Margaux still be competitive in the future? What are the possible ways for this company to expand and what are the pros and cons of each? In this research paper, we examine the situation of this company, the wine market international viewpoint, and the domestic influence of the wine industry and tradition in Bordeaux. With all the information and data that we researched and analyzed, we were able to locate the problems of the company. In turn, we came up with objectives for the company to fulfill in order to solve all of the problems that arises and to increase profit, increase their skills of today’s new world marketing, increase their knowledge of the consumers and the market, and capture new market opportunities. We come up with a new business model to expand the Chateau de Margaux Company and to help this company fulfill these objectives. The new business model is called the international...
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...Ottawa Itinerary Attractions Royal Canadian Mint 320 Sussex Drive, Ottawa, ON K1A 0G8 Hours Everyday 9:30AM - 5:00PM Prices | Weekdays | Weekends | Adults (18+) | $6.00 | $4.50 | Kids (5-17) | $3.00 | $2.25 | The Royal Canadian Mint's headquarters occupy the historic building in central Ottawa where the Mint was founded in 1908. Today, the Ottawa facility produces hand-crafted collector and commemorative coins, gold bullion coins, medals and medallions. This is where the master tooling is done to create the dies that strike coin designs for both circulation and commemorative issues. The Mint's gold refining and advanced engineering operations are also located here in Ottawa Canadian War Museum & Museum of Civilization 1 Vimy Place, Ottawa, ON K1A 0M8 Hours Monday – Wednesday 9:00AM – 6:00PM Thursday & Friday 9:00AM – 8:00PM Saturday & Sunday 9:30AM – 6:00PM Prices | 1 Museum | 2 Museums | Adults | $12.00 | $18.00 | Students | $10.00 | $15.00 | Discover the military history of Canada through a vast collection of artifacts, moving personal stories, works of art, and unforgettable photography. Explore the human conflicts that have shaped Canada, Canadians and the world. With its prize-winning, richly symbolic architecture, the War Museum, provides a spectacular setting for exhibitions, public programs and other events that illustrate the way in which human conflict, in Canada and around the globe, has changed...
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...Chateau Margaux Case Study International Business March 19th, 2012 “Who knows whether this ancient system will still be working in 20 years or so?” (Executive Manager of Chateau Margaux). This quote, spoken by an executive manager, very proficiently sums up what is happening to the Chateau brand. The Chateau brand has always prided themselves in their unique process for creating one of the world’s finest wines. However they refuse to change their ways because they are afraid it would damage “their soul” (Deighton 9). As the world markets expanded, other companies began changing formulas or changing how they produce their products n order to keep up with the demands for mass production across the globe. Chateau refused to do this because they wanted to keep their identity intact. They were not being affected because of their product but instead were affected due to their management. They refused to market their product or even sell directly to the customer. As other companies began running ad complains, Chateau did not even know who their target market was because they had no information and their suppliers had little information as well. Take the Coke vs. Pepsi war. Both of these companies have mass produced their product and have found the shortest, simplest, and cheapest way to produce their cola and ship it world wide. This does not mean that their product is better than any other cola, in fact there are some minor brewing companies that also make really good cola. Chateau...
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