Like Scandinavians, the Dutch have high per-capita incomes are willing to spend for super-premium wines. They are unwilling to 'overpay' for quality, however, and are likely to compare the quality of an 8 pound Chilean wine to similarly-priced products from Australia, the U.S. And other major wine exporting countries.
Chilean Wine Promotion in Europe
Chile is not alone in wanting to increase wine exports to Europe. Australia and the United States have developed significant market share and see growing exports to European markets. The Wine Australia organisation has researched the European market, and predicts country- and segment-changes in wine demand. The UK has long been Australia's number one wine importer, but overall trends there are static. The biggest growth is coming from "secondary" markets, such as Belgium, Denmark, Sweden and the Netherlands. In those countries, Australian wine imports in which the per-case prices have exceeded AU$90 have changed as follows (Thomas 2007):
Country change
UK
Belgium
Netherlands
Sweden
Denmark
Chile signed a free trade agreement with China in 2007, which envisages a cut in tariffs on Chilean wine exports to China over the next 10 years. Chile's target is to become China's number one wine import source (Alcyon 2007).
Chile's largest wine producer and exporter by far is Concha y Toro, which has seen year-on-year growth between 12 and 30% in recent years (Food&DrinkEurope.com 2003). Concha y Toro has pursued a policy of emphasizing "super-premium" wines, which sell for over US10.00 per bottle at retail. As a result of their success in exports, the overall image of Chilean wines has been improving vis-a-vis other world wine exporters.
Segmentation by Retail Outlet
Wine is sold at significantly different prices in different retail venues. The lowest-priced (wholesale) prices come from sales for private label and bulk wines. Discount superstores (e.g. Tesco, Metro, and Carrefour) come next in pricing, although some hypermarkets attempt to use premium wines at lower prices in order to attract wine-savvy customers. Retail shops and liquor specialists are higher in pricing, while restaurants offer mark-ups of 2 to 4 times the retail "High Street" price.
The customer expects different levels of personal interaction and advice depending on the venue. One way to regard wine price vs. venue is the amount of interpersonal interaction and recommendation used in the wine purchase decision:
Venue
Price
Advice
Private label grocery store
Lowest (wholesale)
None -- depend primarily on store reputation
Bulk purchase (e.g. "wine from Chile")
Lowest (wholesale and retail)
None -- no personal interaction; sold primarily in hypermarkets
Corner grocery
Some, if store owner is enthusiastic
Corner wine shop
Shop owner and employees "push" favourite wines; know their customer and what they like Restaurant
Highest (2-4X retail)
Most important: most people try new wines at restaurants (Frost 2007)
Internet
High -- with tailoring to specific wants or needs
National market, chosen retail segments
This medium-sized producer has several positive trends in its favour in entering the European market now as opposed to a few years ago. The perception of Chilean wines as competitive on the world market, particularly through the active promotion of Concha y Toro, has opened retailers' and consumers' minds for other super-premium wines from the region.
Confusing brand images from major EU producers has made it easier for well-positioned non-EU wines to gain share, particularly in those countries which do not have significant wine production. Favourable exchange rates vis-a-vis the Euro and the UK Pound have made Chilean wines more affordable when compared to super-premium wines from Europe. The earlier success of the Australian and U.S. wine brands has also opened peoples' minds in some European countries.
As we've seen from the above analysis, some very large wine markets would not be wise choices for the Chilean producer; regional preferences and a high market-entry cost make it unlikely that a marketing effort in those countries would be a wise investment.
Given that this wine producer has no market share in Europe at the moment, it would be wiser to establish its brand and a loyal customer following in smaller markets....
Yet another argument in favour of the expansion towards Luxembourg is the fact that the country is most specialized on producing high quality white wines. This means that Vinos Andinos has an increased chance of selling their red and rose wines to a population that might desire a change from Luxemburg's white wines. Switzerland Switzerland (fifth by GDP and sixth by wine consumption) produces low amounts of wine internally, but has an
The statistics show that the table wine enjoys the largest popularity of all wines. Table wine is not just a tasty, but also handy. Its level of alcohol is reduced compared to the other two types, which explains why its consumption in litres is higher than for the other types. From this point-of-view, virtually all European countries qualify as exporting countries, although their wine consumption in general is higher in
Shareholder Capitalism as a Model for Economic Development The idea that shareholder capitalism may serve as a powerful type of economic progression model has been made practical with the growth of credit along with a large marginal tax that delivers a security net for Americans, but additionally has its own limits. Shareholder capitalism, and also the American structure of corporate governance which can serve as its main-operating-system, continues to be held out
Blueberries A BRIEF synopsis of the Australian Blueberry Industry Introductory Production Information Australian and World production Average Yields Plant Description Botanical Classification Important varieties Morphological features Seasonal growth cycle Native to North America, the blueberry, is also known as bilberries, whortleberries and hurtle berries, (Filippone 2006). The blueberry is a member of the Ericaceae, or Heather family and its growth was regulated by the indigenous peoples of North America (Agriculture and Agri-Food Canada 2005). Blueberries are of the genus Vaccinium,
Those officials who did look at the question of Japanese intentions decided that Japan would never attack, because to do so would be irrational. Yet what might seem irrational to one country may seem perfectly logical to another country that has different goals, values, and traditions. (Kessler 98) The failures apparent in the onset of World War II and during the course of the war led indirectly to the creation
While this may not sound controversial now, at the time it was, as Brazilian scientists and doctors would typically attempt to conform to whatever had recently been discovered in Western Europe without trying to generate any of their own original contributions to their fields. The Escola Tropicalista Bahiana, on the other hand, would attempt to merge tropical medicine with the latest European advances, in an effort to producing medical
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now