Professor: Pierre MORA Presented by: NGUYEN Thuy Linh The Secret of Grand Cru Wine Business 1

OUTLINE 1.Case introduction 2.Château Guiraud’s commercial position 3.Consequences of the economic and ecological crisis 4.Luxurious and Organic Markets coexist within a single marketing approach 5.Responsible communication campaign 2

1. Château Guiraud 3 More than 300 years of history The initial name: La Maison Noble du Bayle, since 1766 Competitive position: At the heart of Sauternes appellation district A specific kind of production: First wine (Premier Cru) The ecology of wine Pricing and Market

4 1.Château Guiraud – Specific product 2 kinds of wine grapes Fermentation takes 2 weeks  3 months 2 kinds of Sweet wine: Premier Cru/ Grand Cru(First Wine) Second Wine

5 1.Château Guiraud - The ecology of a wine The term comes from the Green oikos (“house”, “habitat”) and logos (“science”, “knowledge”). Members of a species (fauna and flora coexist) Organizing activities Environment (habitat) -The genetic diversity of Semillon and Sauvignon grapes -Planting hedges that are capable of hosting certain animal species -Managing the natural grasslands

6 1.Château Guiraud – Pricing and market The price of a 75cl Château Guiraud bottle sold online (for instance, by Wine and Co) varied between €40 (for the 2006 vintage) and €60 (for the 2001 vintage)

7 1.Château Guiraud – Pricing and market

2. Château Guiraud’s commercial position Objective 2.2. Segmentation Criteria 2.3. Targeting 2.4. Market Positioning 2.5. Source of volume 2.6. Key marketing mix elements

The top-of- the-range product increases its sales abroad Ex: a duty-free underground in Shenzhen, China Make its mark Premier Grand Cru (1855 classification) with organic certification in these new markets 9 2. Château Guiraud’s commercial position 2.1. Objective

10 2. Château Guiraud’s commercial position 2.2. Segmentation criteria Develop abroad market Age: consumers are getting younger (group of people under 50 years accounts for 44% of total consumption, increase by 15% from 4 years ago Income (high income for Premier Grand Cru Wine) Life-styles (luxury product and organic product) Education and training HR (share human resources talents and trainings) Habit of use (types of spicy food easy matched with sweet wine ) Usage ate (expansion in Asia)

2. Château Guiraud’s commercial position 2.3. Targeting 11 Segment Value LowHigh Segment Potential High Promote (clients get younger for Easy-to-Drink (ETD) ) Target (abroad market: Asia) Low Manage (high income customers) Retain (traditional clients: French, Belgium, Switzerland and USA)

12 2. Château Guiraud’s commercial position 2.4. Market positioning High income Younger people group (under 50 years old) Abroad market Asian market

13 2. Château Guiraud’s commercial position 2.5. Source of volume Mature markets (France, EU and USA): Château Guiraud’s traditional clients  Retain upmarket customers of top-of-the- range sweet wine sector Fast developing markets: New customers in Asia (ex: special in China)

Make the extraordinary of premiere sweet wine quality = Organic product + Luxury product Innovation and Responsible communication approach Product policyCommunication policy Château Guiraud’s commercial position 2.6. Key marketing mix elements

3. Consequences of Economic and ecological crisis 15 Economic crisis has negative impact on the volume of sweet wine sales Face to the lack of the diversify of ecosystem, clients are now concerning more the environment and biodiversity  the motivation for organic wine product’s development

4. Two markets coexist within a single marketing approach 16 It is necessary, if only for cultural reasons. It remains that the two universes are connected at least in one respect, which is our specifically female customer base. We probably need to develop criteria for segmenting our research efforts and commercial actions in this area. Lack of biodiversity  need to care the environment. Combination of 1 st Cru wine and the organic way of production makes the perfect one!

5. Responsible communication campaign 17 Label in black (different from white labels of other wine) Greater freshness with highest source of white Sauvignon combines with grape mixture Innovative packaging, such as wine tubes, which lend themselves to other forms of consumption Using environmentally-friendly winegrowing methods since “the year 1855 classified Grand Cru with organic farming certification”

5. Responsible communication campaign 18 Challenges: The fail harvest (season) Competitors Budget constraint

5. Responsible communication campaign 19 Not to early to talk about “Organic” wine product, even the competitor in Burgundy does not mention it Specific categories customers of age (ex: under 40 years old) Build a coherence between luxury product and organic product for a sustainable future Within capital constrain, which communication is the best way to do? 1.Generation Y loves luxury “Luxury is a pleasure” for most people under Organic product combines with luxury brand in a single product 1 st Grand Cru Wine

20 Thanks for your attention ! “Wine improves with age. The older I get, the better I like it.”