Thinking back to last week's case on Wine in China, I was reflecting on how French wine was described as "the ultimate status symbol among China's wine consumers." The consumer perception that Bordeaux and Burgundy wines are by default more high-end than wines from anywhere else in the word gives wine producers and exporters from these regions a huge competitive advantage. Given the preference in China for luxury, brand name products, I think that wines from other regions seeking to make a similar status-play in the Chinese market should consider a marketing partnership with one of the top international retail brands.
This is not to say that they have to go the LVMH route and actually get into both the luxury apparel and wine markets (though that has certainly been a winning strategy for LVMH). How about a Mumm Napa / Tiffany & Co partnership, for example? To be fair, when I first pictured this, I was considering partnerships with the most popular luxury brands in China (Chanel/Cartier/Gucci etc.) but I doubt these European-based companies would be too eager to align themselves with wines from the US. Perhaps this luxury brand affiliation strategy is not best for Napa wines then? Italy, on the other hand, could definitely move the market with a well-executed Versace or Gucci partnership. And just think how gorgeous the ads would be! The wines in question could even take a page out of Lafite Rothschild's book and use packaging tactics like placing the Chinese character for the lucky number 8 on their bottles. And why not on the luxury clothes as well? An exclusive line marketed directly at Chinese consumers that involves both exclusive wine partnerships and includes nods to important elements of Chinese culture could ignite demand and create status symbolism around many deserving regions beyond just Bordeaux and Burgundy.
Thursday, February 21, 2019
What to learn from Mondavi in China
If you go to China's top supermarkets, you will see Mondavi dominating the wine section. This article highlights three key lessons to learn from Mondavi's launch in China in retail and online:
1. Content matters: creating stories, videos that bring the whole cultural experience online
2. Localization: including changing the tasting notes, replacing gooseberry which is not common in China, and adding lychee
3. Use big data to understand customers including age, gender, and other social and demographics characteristics for better targeting
More here:
https://www.alizila.com/three-things-mondavi-selling-wine-china/
1. Content matters: creating stories, videos that bring the whole cultural experience online
2. Localization: including changing the tasting notes, replacing gooseberry which is not common in China, and adding lychee
3. Use big data to understand customers including age, gender, and other social and demographics characteristics for better targeting
More here:
https://www.alizila.com/three-things-mondavi-selling-wine-china/
Own your own AVA?
I came across an interesting SF Chronicle article yesterday about a small AVA being up for sale for $3.3 million. Looking at the map in the article, this plot of land looked significantly above where Napa and Sonoma are. With our final projects, I began thinking how I might use a "large fortune to make a small fortune". What we haven't discussed yet in class is the water consumption and how strategic of an asset it is (or whether the real estate agent is simply trying to drive a higher price).
With the major droughts in California over the past decade, at first glance this winery seems to have attractive traits to succeed. What gives me pause is the latest owners selling after just three years. Are there more challenges here than meets the eye?
With the major droughts in California over the past decade, at first glance this winery seems to have attractive traits to succeed. What gives me pause is the latest owners selling after just three years. Are there more challenges here than meets the eye?
Boozy Brotherly Angst
Reading the Mondavi Winery case, my jaw actually dropped when I read that in fighting over moving toward a new way of making wine, Peter accused Robert of stealing money from the company, and after being denied the apology he sought, Robert struck his brother and was barred from the business.
It immediately reminded me of an article I had read about a pair of twin brothers who both brewed beers and could not stand each other.
Their story is an interesting one - they grew up in Denmark, and until 2010 they worked together, not always harmoniously. Jeppe Jarnit-Bjergso, on the left, started a beer club and in 2005, opened a speciality beer store called Olbutikken. Mikkel Borg Bjergso, on the right, was the tinkerer who started creating craft beers, founding Mikkeller and becoming the marquee beer at his brother's store. It all fell apart when Mikkel opened his own bar in 2010, not far from the bottle shop, and began competing. Jeppe then decided to create his own brewery; he first decamped to Brooklyn, then cheekily named it Evil Twin. Legend has it they've hardly spoken since.
Evil Twin is all over the New York beer scene; Covenhoven, my local and wonderfully loved beer bar in Brooklyn, used to stock it all the time, and I've had a number of their generously high abv imperial stouts. Jeppe and his wife also operate a Danish restaurant and bar called Tørst that pairs their foods with his beers. I never saw Mikkeller beers as often in New York, but it turns out the Danish brand has physical presence on the west coast, with beer bars in both LA and San Francisco.
Until last year, both brothers were "gypsy" or phantom brewers - they borrowed space from other brewers to make their beers, rather than owning breweries of their own. As if to add another chapter to their rivalry, they both decided to expand operations at the same time, opening breweries and taprooms in 2018, and both doing so in Queens. Coincidence?
I find it striking (and disappointing on this side of the country) that they both plan to lean into making some New York themed beers that are only available in the state. How much of that has to do with developing a local brand and mystique, and how much of it is due to issues with distribution for a niche beer in the 3 tier system? I had never really thought about how beers make themselves available around the country before this quarter, and I'm looking forward to figuring out the answers to that question.
It immediately reminded me of an article I had read about a pair of twin brothers who both brewed beers and could not stand each other.
Their story is an interesting one - they grew up in Denmark, and until 2010 they worked together, not always harmoniously. Jeppe Jarnit-Bjergso, on the left, started a beer club and in 2005, opened a speciality beer store called Olbutikken. Mikkel Borg Bjergso, on the right, was the tinkerer who started creating craft beers, founding Mikkeller and becoming the marquee beer at his brother's store. It all fell apart when Mikkel opened his own bar in 2010, not far from the bottle shop, and began competing. Jeppe then decided to create his own brewery; he first decamped to Brooklyn, then cheekily named it Evil Twin. Legend has it they've hardly spoken since.
Evil Twin is all over the New York beer scene; Covenhoven, my local and wonderfully loved beer bar in Brooklyn, used to stock it all the time, and I've had a number of their generously high abv imperial stouts. Jeppe and his wife also operate a Danish restaurant and bar called Tørst that pairs their foods with his beers. I never saw Mikkeller beers as often in New York, but it turns out the Danish brand has physical presence on the west coast, with beer bars in both LA and San Francisco.
Until last year, both brothers were "gypsy" or phantom brewers - they borrowed space from other brewers to make their beers, rather than owning breweries of their own. As if to add another chapter to their rivalry, they both decided to expand operations at the same time, opening breweries and taprooms in 2018, and both doing so in Queens. Coincidence?
I find it striking (and disappointing on this side of the country) that they both plan to lean into making some New York themed beers that are only available in the state. How much of that has to do with developing a local brand and mystique, and how much of it is due to issues with distribution for a niche beer in the 3 tier system? I had never really thought about how beers make themselves available around the country before this quarter, and I'm looking forward to figuring out the answers to that question.
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