BRL HARDY: GLOBALIZING AN AUSTRALIAN WINE COMPANY
Answer 1)
Factor
D’istinto situation
Analysis and Comment
Past experience
BRL’s earlier two joint ventures have been unsuccessful, creating high doubts about the success of the present undertaking they are planning. In the first JV, they did not control the brand and in second the partner was acting as a mere supplier and not owner.
The third joint venture was very different from the earlier two. Firstly they were in a joint venture with co-op farmers who had a greater sense of ownership. This would ensure that the farmers would be as dedicated towards the venture. Also Hardy would have exposure to close to 135 farmers, to choose the suppliers which give the desired quality fruit. Secondly, the company offered technical help to ensure quality of the fruit. Thus together with superior harvest and winemaking techniques they ensure the quality of the wine by controlling the two most critical parts of wine making.
Overlapping Price-Cannibalization
The Cabernet Merlot and Syrah Sangiovese labels under D’istinto brand are overlapping with existing Nottage Hill and Stamp wines in the same price points risking cannibalization.
The position of D’istino is entirely different. It is associated with food, romance and Mediterranean life, while the other wines have been repositioned to be more premium. Thus due to different positioning, even in the same price category, cannibalization doesn’t stand as a potent threat. Moreover they are plugging the price gaps in the range £3.99 to 4.49 by offering four labels under D’istinto.
Women Consumers
60% of the UK retail market is women oriented
BRL Hardy wanted to launch a brand which appealed more to women since they are the primary buyer of the wines in UK. Hence it is important that the label should appeal to them. D’istinto with its Mediterranean theme centered on romance and lifestyle with the special card proposal would appeal more to women, compared...