Women react positively to the new Douglas Green TV advertisements

The new TV advertisements of Douglas Green were very well received by consumers. An independent study conducted by Bivio Consulting found that South African women were very positive about these advertisements.

The advertisements are titled: “Do I really need a man” and it focuses on the Twenty and thirty something women consumer group. It is estimated that this consumer group (women age 20-35) accounts for 55% of all wine consumption in South Africa.

The ads effectively and in a humoristic way, portray women to be independent and enjoy life. The study found that women believe that these ads will differentiate and enhance the Douglas Green Brand amongst South African women.

It was bold step from Douglas Green but I believe it was mission accomplished and effective advertisements. Right time, right genre, right consumer group

New Douglas Green TV advertisements

Bivio Consulting - Established Wine Marketing specialists

In the past year Bivio consulting has grown from strength to strength. The company has established itself within the Wine industry of South Africa and numerous projects has been conducted for wine brands.

As wine branding and marketing experts, Bivio Consulting has grown its client and influence base. Apart from consulting services Bivio also implemented and provided certain specialized marketing services

Social Media Marketing and blogging campaigns prove to be very popular amongst clients. Strategic brand development, Datamining, ePR and e-marketing consulting services are also in demand from clients.

Don’t kill the brand that lays the golden egg!

In the recent past wine brand owner s have put a great deal of emphasis on sales volume improvements. Marketing campaigns were specifically designed to increase short term sales volumes. This over emphasis on sales volume increases has caused some wine marketers to lose their focus on strategic branding aspects. These marketers must be cautious not to kill the goose (brand) that lays the golden egg.

South African wine producers in some cases diluted their brand value by focusing on short term sales improvements. These sales improvement strategies usually include price reductions and even brand sacrifice. Prof. Frikkie Herbst of the USB (University of Stellenbosch Business School) indicated that the total cost (price) is only one of the five main factors influencing the consumer’s choice of bottled wine.

These “ other” factors are firstly push and pull consumer’s choice factors. Pull factors include psychological motives like celebrations or value perceptions while pull factors are factors like grower’s reputation and wine variety. Other factors that influence the consumer’s decision are place of purchase and shopping time frame factors.

This implies that wine marketers can focus on different aspects to improve sales without damaging their brand. Although sales growth and market expansions are deemed to be important aspects of wine marketing, the sustainability of the business depends mainly on the brand. Some authors suggest that brands are the atomic core of the consumer-driven economy and companies are dependent on the success of their brands to be able to establish a sustainable business future.

David Higgens , president of Brown-Forman Beverages Worldwide Wine Group, indicated that “in general people in the wine business don’t understand the need to build brands”. He further states that this will become more and more of a problem in mid-sized wineries .

Studies conducted in Australia by the Fosters Wine group found that consumers look at “ brand” and label design more than any other feature when selecting wine. The study found that “brand” is consistently the strongest influence across all consumer segments, when browsing for wine. This implies that medium to long term brand strategies must be formulated to maintain a sustainable business.

South African wine exporters and brand owners have the advantage of organizations like WOZA to promote Brand South Africa. These organizations build a holistic industry brand and open international markets for local wine brands. It must be stated that wine brand owners must still focus on building their own brand and/or their region’s brand. Although the dynamics of local and international wine branding may differ, the basics still stay the same.

Sue Birch, CEO of WOZA, recently indicated that South African producers were heartened that the rate of value growth in the UK wine market was outpacing volume growth . ACNielsen data reflected a 7,2% rise in value, compared with a 2,1% increase in volumes for the year to June. Birch added that the higher value growth suggests that margins will be under less pressure than in the past, offering sustainable trading opportunities.

In the local market, wine producers must realise the importance of value growth. Perceived value growth by the market can be managed by effective brand and communication strategies. In effective sustainable business management it is impeccable, and non negotiable, to maintain the quality of the product (wine). In some cases brand building involves the influencing of consumer perceptions about the different aspects of the product. This implies that brand building and consumer communication goes hand in hand. Marketers must thus find new ways and angles to communicate their brand messages to the consumer.

Examples of new brand message communication platform include, but are not limited to the following:

Coopetition: This can simply be defined as collaboration among competitors. Many examples exits of cooptetion in the international and local wine markets. The consortium of Alluvia, Tokara, Sagila, Knorhoek and Yonderhill serves as a classical coopetition example.

Extended service offerings. Wine producers are expanding their brand by introducing new aspects of the brand. These new aspects serves as new communication platforms and brand awareness are taken to a far wider audience. Examples of this include function venues, theatres and conference facilities on wine estates. Spier, Lourensfort. Paul Cluver and Stellenrust are a few examples of brands that have found new angles to expand their brand audiences.

Wine Tourism: Dr. Bouwer from UCT Graduate School of Business indicated that cellar door marketing is a very important brand image tool, especially for the smaller producers. This gives producers the opportunity to sell and communicate much more than just the physical product. This enables wine producers to develop broader communication platforms and thus improving their brand image.

E-marketing: Marketers have not realised the wide array of brand building opportunities of e-marketing. Stormhoek has recently achieved tremendous brand building success with effective blog marketing campaigns. Facebook and other interactive web based platforms will create new opportunities for the expansion of brand communication platforms.

Although the improvement of short term sales are a very important consideration, wine marketers and wine brand owners must also focus on developing their brand. By nurturing and developing their brands, wine marketers can create a sustainable business future and the “goose” will keep on laying golden eggs.

High level of alcohol in wine is getting out of hand

Alcohol is a ratings driver: easy, seductive, showy and impressive. What’s not to love? That it’s impressive for just about a minute, and then it’s also thick, sticky, heavy, overbearing, overripe, bitter, cloying, sweaty and the enemy of food and wine pairing. I hate it.

I know how important it is. To get an idea, taste one of the “non-alcoholic” wines. They are flat and insipid. Alcohol in wine provides body weight and, to an extent, richness. But in the pretzel logic of today’s wine making, the “more must be good” theory has gotten out of hand Balance and harmony in all the wine’s components are critical to its longevity, to its success with food and to your enjoyment of it. When out of balance, the alcohol becomes a negative contribution that kills flavor and numbs taste buds. Simultaneously, it acquires a hot and spicy taste with food - not attractive.

A reason behind the increasingly high alcohol contents in today’s wines is that most winemakers are looking for extreme ripeness. The benefits are twofold. The results please judges - when wines are judged at a blind tasting, the higher-alcohol wine with more extraction and ripeness stands out. Even more importantly, it makes a well-made but lower-alcohol wine appear thin and lackluster.

The other benefit is that these wines please consumers. The world market first was shifted toward these richer, bigger wines by Napa and then perfected to a degree by Australia. Wine drinkers like them on the first sip and on the second sip and, sometimes, forever. They are lush, easy to understand and ripe to the point of being sweet.

Alcohol is not a total enemy of taste. A wine can have up to 14 percent alcohol if the other components - tartness, fruit extract and concentration - are in perfect balance. If there’s too much alcohol, it comes over the top of the flavor profile to annihilate the rest of these nuances.

It also will numb the palate. It’s very much like the way the sugar in ice cream affects you after the second or third spoonful. In extreme examples, the back of the mouth gets a hot sensation and sweat pours from your brow! Most folks push this wine away after a couple of sips or, at the most, a glass. Even salty, savory potato chips have sugar added, and it seems that alcohol is the sugar of the wine world - cheap to produce and depended upon to please.

Lower Alcohol wine gets global support

Lower alcohol wines have received support from a wide array of global wine stakeholders. American winemakers, British retailers and even British lawmakers have shown support for lower alcohol wines.

The trend of New world wines to be bolder and riper flavored are maybe coming to an end. Some winemakers in California are attempting to reduce the alcohol levels of their wines.

Adam Tolmach, one of California’s most celebrated winemakers said that US wine makers went too far in producing high alcohol level wines. He stated that "We lost our rudder when we went for ever bolder, riper flavours. We have to do the right thing."

Tolmach said that, at 15 % or higher, the alcohol content of his wines was too high. California is the fourth biggest wine-making area in the world, after France, Spain and Italy. As in South Africa and Australia, Californian wines tend to be stronger because they are produced in a hotter climate.

Californian winemakers have responded by picking grapes earlier and employing other tactics designed to produce the more "balanced", lower alcohol wines that are popular in Europe.

This move has in part been prompted by demand from US restaurants, which often hire European-trained wine buyers (sommeliers) who want lighter wines. The producers of lower alcohol wines also received a boost from the British government. The UK delegates are putting pressure on the European Commission to relax their stick wine making rules and regulations. This will make it easier for producers to sell wines with very low alcohol content, even as low as 6.5 %.

Jeremy Beadles, the CEO of the British Wine and Spirit Trade association welcomed this move by the British government. He added that retailers are interested in expanding the range of lower alcohol wines which they can offer the consumer. In a recent article, the Telegraph (UK) indicates that British retailers are starting to show signs of a backlash against high alcohol wines. Last year, Sue Daniels, Marks and Spencer's wine technologist, said the company would be trying to find more 12% wines in future.

Adam Tolmach also states that trying to limit alcohol content while retaining flavour is an increasingly major challenge for wine producers as the effects of climate change become more marked.

In South Africa some producers has been embracing the making of lower alcohol content wines for quite some time. Danelle van Rensburg, winemaker of Van Loveren indicated that the making of light wines have its challenges. She indicated that it is more challenging to achieve the right balance between the sugars, acids and the fruit of lower alcohol white wines.

Because of the lower alcohol levels, the other components of the wine are more prominent and thus grape cultivars with natural lower acid levels , like Semillon are usually used for light wines.

Adi Badenhorst, a wine consultant from Stellenbosch, indicates that higher alcohol wines are the more popular choice in South African wine competitions. The average alcohol level of the recent John Platter’s 5 star wines are in the region of 15,3 %. This higher alcohol in wine has even affected French wines. The average Bordeaux's alcohol content has grown slightly, up from 12.5% to 13%, the Telegraph reported.

Badenhorst added that some wine producers feel that the physiological ripeness of our (SA) grapes are incline to have higher sugar levels and thus are prone to higher alcohol content wines.

Badenhorst further stated that higher alcohol wines are favored by wine judges because the “alcohol carries the wine out of the glass” better. He concluded that the lower alcohol wines tend to have an inherent elegancy and balance with better potential to mature.

Taking a local brand to the global arena

This is the view of Mr. Justin Letschert the CEO of Union-Swiss. Letschert was the speaker that the University of Stellenbosch Business School (USB) business breakfast gathering held on 27 June.

The first thing businesses must realize is that expansion to global markets can not be exclusively done by just starting a new export division. The experts, who established and managed the business and brands on the local market, must be involved in the executing of the strategies for entering global markets.

South African brands may have brand equity on the local market, but on the global stage is just another product. This implies that entering a new market is launching this new product form scratch.

Government regulation and duties, capital expenditure (cost) and the lack of established networks are some of the main difficulties in entering new global markets.

Letschert indicated that a simple calculation can determine the most viable international markets. By adding a country’s GDP/ Capita ranking and the population rankings the possible best export markets can be identified. This figure gives a more accurate indication of potential markets. The top 10 countries on this list are USA, Japan, Germany, UK, France, Italy, Canada, Spain, South Korea, Russia.

The cost of the media in the specific country as well as the duties and regulations must be taken in consideration when evaluation potential new international markets. Language and counterfeit problems must also be taken into consideration when evaluating proposed new markets.

Letschert emphasized the importance of effective distributors in foreign countries. These distributors must be able to communicate and deliver what they are hired for.

Letschert further added that to succeed in the global business area you must out-think the opposition. The geographical and other practical drawbacks imply that you cannot out-do the opposition, you must out-think them.

You must conduct your business in a more professional manner than the first world standards. The reason for this is because the foreign market participants have preconceived negative ideas about (South) African businesses. You must give them no reason to believe or confirm their preconceived ideas.

Letschert concluded by quoting Mr. Koos Bekker form Naspers. Bekker once said that it is difficult for first world countries to do business in China. South Africa is not from the first world which gives us a business advantage.

South African tenacity is your biggest advantage when we compete and enter new global markets.