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Cork

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Submitted By MadhuSuresh
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In order to succeed as a social network for wine lovers, Cork’d must address the following critical issues:
1. How to differentiate the website in order to obtain a competitive advantage in an industry with many competitors that already have an established customer base.
2. How to increase the customer base to prevent wineries from thinking twice about the value of signing up with Cork’d.
3. How to determine a pricing model in order to increase revenues, keep the business afloat, and maintain current clients.
4. How to determine which target audience the business should appeal to in order to effectively market and gain new customers.
Analysis
Cork’d is a social networking website that has attracted a niche market of wine enthusiasts through the use of its celebrity owner, Gary Vaynerchuk. As shown in the SWOT analysis (Exhibit 1.0), Cork’d has been able to use the success of Gary’s YouTube page and “Wine Library” website to leverage itself and attract to individual wine enthusiasts. However, there have been concerns from the wineries that they are unable to determine the value they are receiving from signing up with Cork’d for the $999 annual fee. Although many individuals are happy with the services they have available, the main revenue stream comes from the wineries. Cork’d has used an ad-free system for their website in order to maintain their customers. This system hasn’t been working because of their inability to keep customers; their user stickiness dropping from 49% in September 2009 to 43% in December 2009. There is the possibility that user’s may have trouble navigating through the website, as the time spent on the website is the 2nd highest in comparison to competitors, while their daily traffic is ranked last.
By investigating the competition comparison (Exhibit 2.0), it can be determined that Cork’d does not have a wide range of customers. With

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