Impact of internet on marketing mix of the wine industry

Remember the days of walking through the door after a long day on the tools with two bottles of Jacobs creek wine for only $15.99. Thinking Honey, I’ve absolutely robbed the bottle’o for all their fortunes. Well I personally don’t remember this because I’m 22 and didn’t drink in the early 1990’s but I’m sure they were the glory day’s. These days, throw out Jacob Creeks glorified goon and open your fridge to the many wine regions of the world because the Internet delivers to you.

To break down how the marketing mix has changed in the wine industry, we firstly need to understand the concept of marketing mix. According to Singh, “Marketing mix is a set of relevant factors and solutions that enable customers to meet the needs and achieve the goals of the company” (Singh in Išoraitė, 2016, p.2). Therefore, it’s the process of marketing your business so that customers are satisfied and company’s make money. Furthermore, there are 7 p’s which are crucial in forming a company’s marketing mix. According to Business Queensland, these include; “price, promotion, physical evidence, people, product, process and place” (Business Queensland, 2019). Together they form the relevant factors and solutions that enable customers needs and achieve goals for the company.

Product/Place: The product being sold hasn’t changed, however the Internet has allowed you to access a greater variety of product. “Australia exported 850 million litres of wine in 2018, costing foreign consumers 2.82 billion dollars” (Wine Australia, 2018). These statistics demonstrate the world as a market place rather than wineries being limited to the region they operate in. For example, recently I ordered a box of wine from a website called Cellar Masters. This box contained 12 bottles of Sauvignon blanc. All 12 bottles were from different regions of New Zealand. This example represents the ability of a consumer to obtain a greater selection of product without even leaving their house and has helped both the wineries and retailer to expand their market via using the Internet.

Price: The price of wine is dependent on commonality and product variation. Lynch and Ariely stated “When 90% of merchandise is common and 10% of products unique. It increases the risk of consumers looking for lower price elsewhere” (Lynch & Ariely, 2000, p.101). Therefore, by the Internet expanding the market and making bottles of wine a commonality, wineries must reduce prices or otherwise they will be forced out of the market.

Promotion/People: The capacity of the wine industry to promote their product has expanded immensely with technological advancement. The industry hasn’t stopped opening the cellar door and greeting wine tasters face-to-face, but has grasped the Internet as a tool for self promotion and mass product distribution. Wine companies have now expanded into social media platforms such as Instagram, Facebook etc and contain websites for consumers to purchase wine directly. Furthermore, middleman websites such as Cellar Masters operate as platforms for consumers to access a variety of brands for lower prices. Therefore, wineries must have an online platform to stay competitive.

People: When consumers search online they are flooded with a million different brands of wine they could potentially buy. Therefore, wine companies must employ web designers, digital marketing managers and social media influencers to communicate a polished message. Marketing scholar Natiala Viana stated “Now days consumers have more quality wine choices, they can count on apps, blogs and online reviews to be informed on your brand and in this scenario being fearless, adaptive and using new technologies to communicate your brand is the way to go”(Viana, 2016, p.1). Therefore, the implementation of these workers is a necessity for operational success.

Process/ Physical evidence: Customers physical environment when ordering wine has shifted towards being drawn in by an ascetically pleasing website. This type of website invites and entices the consumer to purchase a product. Once drawn into buying the wine, the consumer puts the bottles of wine in the online shopping cart, proceeds to the checkout and pays. From there the company is responsible for delivering it to the consumer’s door. This example demonstrates the Internets impact of bringing products to the customer directly, without the customer making the effort to go to the seller.

Boosting your sporting brand via social media

When planning the launch of your new sportswear and equipment company, you need to have a social media plan. For boosting your sporting brand via social media, this blog suggests the implementation of affiliate marketing and the SMART goals framework to successful marketing scheme . Lawlor and Hornyak stated “SMART goals are written using the following 1) specific- define exactly what is being pursued? 2) Measurable- is there a number to track completion? 3) attainable- can the goal be achieved? 4) realistic- is this doable from the business perspective and 5) timely- can it be completed in a reasonable time” (Lawlor&Hornyak, 2012, p.259). The framework will surround your use of affiliate marketing. Affiliate marketing is defined as “the process of earning a commission by promoting other peoples products”(Patel, 2019).

Specific: Identify high profile athletes and reach out to them to see if they will endorse your product. For example, professional soccer player, Lionel Messi, participates in affiliate marketing for Adidas through Instagram. Set athletes specific goals for how many people on social media engaged with the product via their social media platform.

Measurable: The company will measure the success of the affiliates posts by tracking whether there has been spikes in sales after content has been uploaded by the athletes. Furthermore, the company should purchase analytics from social media platform to track click and view rates.

Attainable: Making sure the athlete is within budget and actively uses social media to ensure that the goals set out are achievable and realistic. Also providing the athletes with plenty of material to post on their platform is important to making sure that the athlete’s can realistically achieve their goals in being active on social media.

Relevant: Is the affiliate allowing you to achieve the company’s visions and goals. For example, is the affiliate allowing you to achieve revenue through social media. Furthermore, ensuring that the athletes that you company partners with are within industry and have a reputation that aligns with your brand. For example, professional cyclist Lance Armstrong is within the industry because he is an athlete however, you wouldn’t want to associate with him due to his history of doping violations. A more preferred athlete would be Australian tennis player Ashley Barty, who is both an athlete, has a good reputation and is relevant today as she is currently the world no.1 tennis player.

Time specific: It is important to set specific time-based goals for the athletes to achieve when being active on social media. For example, posting a photo that incorporates your product at least 3 times per month. Furthermore, you should set monthly revenue targets to track and measure the success of your marketing strategy.

References

Viana, N. (2016). Digital wine marketing: Social media marketing for the wine industry. Retrieved 9 12, 2019, from Research Gate : https://www.researchgate.net/publication/309469567_Digital_wine_marketing_Social_media_marketing_for_the_wine_industry

Business Queensland . (2019). The 7 Ps of marketing. Retrieved 9 12, 2019, from Business Queensland: https://www.business.qld.gov.au/running-business/marketing-sales/marketing-promotion/marketing-basics/seven-ps-marketing

Išoraitė , M. (2016, 6). Marketing mix theoretical aspects . International journal of research , 4(6), 1.

Lawlor, K., & Hornyak, M. (2012). How the application of smart goals can contribute to achievement . Developments in Business Simulation and Experiential Learning, 39, 259.

Lynch, J., & Ariely, D. (2000). Wine Online: Search Costs Affect Competition on Price, Quality, and Distribution. Retrieved 9 12, 2019, from Semantic Scholar: https://pdfs.semanticscholar.org/63e6/ae98e998251d98911874f740f19836867ca2.pdf

Patel, N. (2019). Affiliate Marketing Made Simple: A Step-by-Step Guide. Retrieved 9 12, 2019, from Neil Patel: https://neilpatel.com/what-is-affiliate-marketing/

Wine Australia . (2018). Impressive year for Australian wine exports. Retrieved 2019, from Wine Australia : https://www.wineaustralia.com/news/market-bulletin/issue-140

Join the Conversation

3 Comments

  1. Insightful article Michael. I feel there may have been an 8th P that’s been missed. (P)utting away a few reds to get the marketing juices flowing is almost essential. Hope this helps

    Like

  2. Hi Michael,

    Great post I learnt a lot from it and you had me at wine ha ha ha. It would be grouse if we could meet up to discuss these topics more, can you meet me at fiction on a Saturday’s? Also let’s add each other on Facebook and Snapchat and Instagram and Tumblr and Pinterest @AidenMcShane.

    P.s. if you see Chip ask him to check his snapchat I don’t think it’s working cos he never replied to my last 36 messages

    Like

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