Global Wine War Case 2015

Global Wine War Case 2015

Daredevils Group-Section A

Shubham Saket p39051

Abhinav Dubey p39003

Sarvesh Tiwari p39048

Saurabh Hirekhan p39049

Sumit Prakash p39055

Sujaya Kumara p39054

Case Analysis

The case is about wine war between the two world companies the old against the new one. The old one includes Italy France and Spain, and the new ones include US, Australia, Chile, etc. European producers started losing market in wine making as the new entrants ate up their market. Themain reason was less cultural tradition and associated reservation regarding how wine should be made leading to freedom for using improved technology. Also, in the old world countries land was becoming highly fragmentedwhile in new world countries vineyard existed in more than 100 hectare land holding. This coupled government supportive policies helped the new world wine makers to enter global wine markets. Further, the old world wine manufacturers could not prove their wine’s superiority to the new entrants. Old wine makers were not able to provide consistent products because of weak inventory management. They also lagged behind in marketing and packaging. This led to a price war but the low pricing strategy helped the new world wine makers to flourish.

A new wine market emerged in China with its domestic demand from import soaring as high as 67% within a short time spam of 2000-2012. As the market grew, consumption patters shifted due to decline in consumer preference for table wine to red wine.To en-cash this opportunity France started promoting its premium wine image. They started blending low price wine of China with their own wine and sold it with a Boudreaux label. They also started joint venture partnership with Chinese wine makers. On the other hand, the Australians also adopted a similar strategy of blending wines and selling it in the low price segment. After sometime, French exports began to decline in China as the Australians started educating the customers through various campaigns. Currently, the Australian wine makers are gaining over the French wine makers owing to that free trade agreement with China. Also, the