Marketing Mix -2B PDF

MARKETING MIX -2B 1.PRODUCT = The goods-and-services combination the company offers to the target market to satisfy a want or a need A product has tangible and intangible attributes - Physical-tangible: Packaging, colors, logotype - Service-intangible: the image can be built on that , the co...

MARKETING MIX -2B 1.PRODUCT = The goods-and-services combination the company offers to the target market to satisfy a want or a need A product has tangible and intangible attributes - Physical-tangible: Packaging, colors, logotype - Service-intangible: the image can be built on that , the consumer service is important and will influence the company—> put effort in—> part of experience of buying process of client - Symbolic-intangible: specific attribute behind in the customer mind, like champagne for special occasions. Build a BUSINESS PORTFOLIO —> different activities that make the portfolio of a brand, like the vinery RIBERACH that presents all what it can offer. 1 Build a PRODUCT PORTFOLIO—> 4 key characteristics Example of LVMH group, that has different brands. 1. Width = n^ of different business, categories of products non related together (bag, wine, perfumes) 2. Length= different brands into a specific business product 3. Depth= amount of items you have in each line of product 4. Consistency= to maintain the image of brand, be recognizable, all product be aligned to that, maintain the loyalty of customer, ex: LVMH is luxury consistency 2.PRICE Price= the amount of money customers must pay and are willing to pay to obtain the product or service and benefits → importance of well settling price: - too low: no profits - too high: no reach demand → companies should sell value, not price PRICING STRATEGIES basing on your products: from which point start to set price? A. customer value-based pricing a. based on the value perceived of the product by consumer, model of luxury business, riskier but high return, you bet if you have choose the right wine so customer will be validate your strategy or not, but if you do mistakes you won’t have clients B. cost-based pricing a. according to costs for the production of product: fixed + variable cost b. majority of companies, classic way C. competition-based pricing a. you see average price and evaluate the price of wine competitors put in the market b. less common in wine industry c. ex: muscadet must stay between 5-15€ 2 PRICE OF WINE things to take into account while choosing the price→ NOT ONLY VALUE BASED + operational costs + green harvest/ harvest + vinification process→ time is money ageing→ champagne UG takes 10 years of ageing before release, so the company needs ability to store and get cash flows, luxury sector bottling → color, origin, weight (sparkling is heavier and more resistant for this) + commercialization + place of origin → agriculture land (champagne is higher than loire valley) + taxes → more in burgundy and champagne successions fees: sons need to pay for owners’ death (50% of all vinery), for this reasons in bordeaux there are many chine investors 3.PLACE→ CHANNELS 3 Distribution channel = Organizations that help make a product or service available for use / consumption Channel level : - direct - from producer winery to consumer directly→ the winery is also retailer - work well only if you have less quantity item - not well if you need to export to H e R - rarely seen - Le grà is a website in which you can buy directly from different producers to consumer → no storage→ receive the order but for the producer it is a intermediatory→ few impact in margin price - indirect - intermediary figure→ producer to specialized shop that sells to the consumer - different intermediary→ the more you have, the more impact in the price, you have to lower your margin on price, less price at the beginning because at the end it will to be too much - grossiste/coorporative→ you sell grapes you produce to grossiste that can produce and obtain wine and after sell wine to specialized shop and to consumer - agent → for BTC/BTB the price is different→ BTC should be lower because has not the agents in middle, but it has to omologate to market fue to competition of place you sell wine (like shops), so there is not difference. PRINCIPLE: - price in the same range from winery direct sell and indirect, 12 € monoprix = winery - price of BTB to buy a bottle of wine from winery is the price of the glass of that wine you drink, and in the bottle you have ⅚ glasses→ RESTAURANT MARGIN - multichannel - You have your PULE’ (main wine) you will sell to lot of shops, but for a year you will sell only in a way - Ackerman big company, wine for supermarkets, but within company they have a portfolios: high end portfolio, middle for retail and mass market, online sell… - Michel Charcutier group of lorey valley, good reputation to H e R e Specialized shop, range of product of large quantity to sell in the mass markets. - exclusive - you decide to sell the product to limited and selected consumers 4 Strategy: THE LESS BOTTLES THE MORE SELECTIVE/ MORE BOTTLES MORE MASS → factors to look to decide how to distribute: 1. economic: how much money you will get in volume 2. control: check if you will have controls on intermediaries (are you going to control the final price, where they put the product in shelves, discounts..) → depends on contract (more control or at all according to strategy) 3. adaptability: short or long term a. short term contract b. long term contract→ mass market, 3 years, you cannot modify price and conditions, trustful Marketing channel design - Analyze customer needs - Set channel objectives - Identify major channel alternatives Channel members - Conventional distribution channel - Vertical marketing system= within the business portfolio all parts help each other producers, retailers, salers→ all part of the distributions they all help and working with each other→ bordeaux there is a group that has winery, a cooperative, distribution options to brand. 5 3.PLACE → RETAILING = All the activities involved in selling goods or services directly to final consumers for their personal, nonbusiness use → where the final consumer is going to buy your product (indirect) →They connect brands with final consumers→ search for suggestions, info (i wanna special eco wine not conventional) → they should be educated to your product, tasting, story in the BtB sector before the BtC it is more common in small retailers → The buying process starts when consumer is looking for information and learn about products in the retailer → Choosing your retail, pay attention to: - can match your image of brand, because ex. specialized shops have their own costumers and segment - The amount of service they offer - The extent and depth of their product lines - The relative prices they charge - How they are organized - their own strategy, ex online so you have to agree to their policy → ex. Le petit Baloon is a web site that sell you 2 bottles according to your taste monthly and also has opened a shop in paris, so the wine you have product can be sold also in this way → Lots of retail stores: TURISM opened the cellars doors, MASS RETAIL make more people consume large volume, INTERNET help to buy online not physically PLACES TO BUY WINE? 1. PRODUCER 6 2. WINE MERCHANTS 3. MASS RETAILER 7 4. WINE FAIRS 5. AUCTIONS 8 6. INTERNET 7. PRIMEURS 9 8. WHOLESALERS 10 4.PROMOTION Refers to the different activities that communicate the merits of the product and persuade target customers to buy it —> goals: communication and engaging It is changing a lot: from mass media communication that target everyone (tv, radio, pannels) to online, social, new-age medias—> now it is more fast and personalized, talk directly with a client and create a unique link—> because of to the experience of the single consumers-good from A to Z-, to the specialization of companies on 1 segment. 11 Budget in digital marketing very huge—> 100% in some cases—> it works but depends on your target Integrate all medias in a way that: - Best engage customers—> LINK - Communicates the brand message - Enhances the customer’s brand experiences How to build promotion? 1. Identify the target audience: segmentation and where do they find info the most (social, tv…); you will also have retailers as buyers that after will sell to the final consumer, so the communication to retailer will be different and probably more technical 2. Determine the communication objectives—> attention to interest and desire of consumers 3. *Design the message—> messages can be: - RATIONAL (show product quality) - EMOTIONAL (storytelling, link with consumer to create feeling of belonging and create emotional attach) - MORAL (about what is right for you, like ecological and biological that is good for environment) —> it depend on the target you choose You can be creative in the design—> important thing is to be recognizable→ you message can be: COMMON, RARE, UNIQUE and this influences the value perceived, the price, the substitution rate. COMMON: high price elasticity (consumers are sensitive to price changes) and high substitution rates (many similar products are available). RARE: attributes shares with few other brands. UNIQUE: make exclusive the product, with unique origin stories, exclusive processes, or personal narratives that only the winery can communicate→ higher perceived value→ higher price→ competitors cannot easily replicate them→less substitution→ more consumer attraction and loyalty. 12 In order to build a good message, you need to PUT EFFORT ON EMOTIONAL LINK WITH CONSUMERS→ the right part of brain 90% decisions→ the power of storytelling. 2 TOOLS to COMBINE to build a strong brand message-storytelling: COOL & SAM SAM: stories + anecdotes + metaphors COOL: character + objectives + obstacles+ landing - Stories A narrative with the COOL structure designed to emotionally connect with the listener. COOL= Character Objectives Obstacles Landing So you can add also Anecdotes and Metaphors - Anecdotes An anecdote is a short, amusing account of something that has happened. More straightforward than a story, the anecdote is often surprising and can reinforce your argumentation —> it is more easy to understand within a complicated story using a REAL FACT - Metaphors A metaphor is a figure of speech that describes an object or action in a way that isn’t literally true but helps explain an idea or make a comparison —> it helps to explain a story using a NOT REAL FACT For example in the wine process, or for millesime wine—> same soil terroir and different weather = same DNA but differences (the Cloudy bay metaphor) 13 4. Chose communication channels and media: can be: - PERSONAL (face to face, email , social.. it work because you create links; also includes recommendations) - IMPERSONAL (tv, radio, billboards) —> it depend on the target you choose, ex: mass market=mass communication 5. Select the message source: has to be CREDIBLE, for ex influencer have to transmit the same message of the brand, also agent needs to be educated—> important is choose who will talk about you 6. Collect feedbacks: helpful to improve and know better were to adapt for the target INFLUENCERS are not only people but also magazines IN WINE Who make buying decision? Parents decide to go satisfy the children and go to the place and probably they will have the occasion to consume also wine Who influence the buying decision? Children want to go horse and in your vineyard there are also animal —> SO you want to persuade and attract children that influence parents decision Purchase step is the final step of a long process 14 WINE LABELS ORIGIN: Greeks, V° BC used to mark the neck of their amphoras—> it was a print on the content in which they stored wine BUT Label as we know today —> when we start selling wine in bottles, 18^ century. n^ Producer, place origin and sometimes vintage millesime (not usually) First half of the 20° century : AOP were created and written on label - To protect against fraud, ensure place of origin - To regulate the wine industry and have trustability - Mandatory ensuring better quality - to protect your production and consumers Organic and biodynamic wine process appeared in half 20 century but not mandatory Now there are sanitary preventions added in the labels Most: born in france and approved by EU European Union is the source of rights & rules Mandatory mentions - Volume of content (0.75cl), alcohol degree, wine category AOP IGP vin de france, name and address of bottling place (only the place of bottling because in some case grapewine can be from abroad and exported), sanitary prevention (sulfites not, pregnant women cannot drink), country of origin - 2021 voted for have for wine producted after dicember 2023 all ingredient in the label and there will be a qr code for see the of them in smartphone - level of sugar in sparkling wine Facultative mentions—> doesn’t mean no control—> put the TRUE - Brand, vineyard, Grapevariety, vintage, “mis en bouteille à la propriété”, classement, type of agriculture, style of wine and vinification practices, medal Name of Cuvèe is free Front label—> mandatory thing with something that attract you Back label—> decide if be informative or legal: non mandatory, story or appealing IT DEPENDS—> IT IS THE BIGGEST MARKETING CHALLENGE for who is not addicted to—> according to the target you choose you will choose the label strategy—> the important thing: include mandatory info 15 ex: bordeaux —> old target—> traditional label / young target—> more attention to design, color…. 16 Evin Law 1991 = REDUCE the consumption of alcohol and tabacco—> with an impact on communication and limitations rule ADV with no people drinking or attitude of drinking (even of inanimate objects) allowed only winemakers or staff that are recognizable as this role. Should be present a link with the winery. Consumption of wine in France DROPPED -20% from 1990 and 2010 Exporting Wine Responsibility of bottle broken? How to transport natural winery? Because everything in the bottle is living, so don’t do it under the sun—> it impact the price There are also companies that elps with exports—> label and recommendations To sell and even mor to export wine, a lot of administrative work needs to be done. Aggregated warehouse Aggregated exporter Aggregated economic operator Know the rules of circulation of wine according to different countries, and each fiscal regimes Knowing and chose the value, the incoterms 17 CUSTOMS→ french tax stamps CAPSULES- CONGE’ in french bottles in the top of the cork there is a free pass that say “ I have paid all my taxes in alcoholic beverages”—> easily exported Marianne: The stamp typically features an image of Marianne, a symbol of the French Republic. - DGDDI’ for Direction Générale des Douanes et des Droits Indirects (Directorate-General of Customs and Indirect Taxes) - volume of the bottle 0.75 - The number before the letter: the French département in which the wine was bottled - The number after the letter: reference or database number assigned to the bottler - The letter between the two numbers: the bottler’s status - R stands for ‘Récoltant’ (literally ‘harvester’): the producer bottled the wine themselves, and managed all processes from the harvesting, to vinification and bottling → BETTER - N stands for ‘Négociant’ (‘merchant’): the bottler is not the harvester. - E stands for Entrepositaire(‘authorised warehouse’): this often refers to a wine cooperative or large retailer who buys and sells wine under its name. 18 Fiscal Aspect of Intra-Community Shipments with Suspension of Excise Duties → The diagram shows different scenarios for the payment of excise duties on wine products Incoterms: A set of internationally recognized commercial terms that define the responsibilities of buyers and sellers in international trade. EXW, FCA, FAS, FOB, CFR, CIF, CPT, CIP, DAT, DAP, DDP: These are different Incoterms that specify the point of transfer of risk and responsibility between the buyer and seller. Key Points: Excise duties are taxes levied on the production or sale of certain goods, including alcohol. Intra-Community shipments refer to movements of goods within the EU. The suspension of excise duties means that the tax is not paid upfront but at a later stage, depending on the scenario. 19