PRESERVE THE LUXURY OR EXTEND THE BRAND ?

Chateau de Vallois

•Wine producing estate•Family owned•Record of quality and reputation

Gaspard de Sauveterre•Owner •Possesses 50% of estate•Traditional perspective•Decision maker•Worried about future generations

Claire de Valhubert•Granddaughter of Gaspard•Possesses 25% of estate•Modern perpective•Proposed a change

Francois de Sauveterre•Son of Gaspard•Possesses 25% of estate•Traditional perspective

Jean Paul•Estate manager•Agriculture engineer •Worked for 30 years in estate

Negociants •Merchants and dealers •Traditional perspective•Buy wine from de Vallois •Sell and ship wine•Reputation determine the price

ABOUT COMPANY

• Selling 2 wines • Cost : one wine @1000 euro : second wine @ 100-450 euro• best selling wine

What to

Enter “AFFORDABLE LUXURY “ Market

Claire proposed •Produce third wine and sell it directly.•Keep the price low around 20-25 euro.•Attract more young consumers.•Extend the brand.

Francois perspective •Not enough grapes•More investment•New distribution and marketing channel•Losing negociants.•Who will produce ?

Solution

More grapes

Buy land and growBuy grapes

overseasHere itself

Final decision depends on Gaspard

SOME EXAMPLES

IN 1991

IN 1995

IN 1999 ( INR 5)

IN 2001

TATA NANO• FOR MIDDLE CLASS• KEEPING ITS CORE PROPERTIES• ATTRACTING AN ENTIRE NEW MARKET SEGMENT•MORE DEMAND

HUL•WILL INTRODUCE PACKED ROTI•RESEARCH DONE•HIGH DEMAND

RECOMMENDATION

1.To attract young drinkers and other segments of people Gaspard should consider Claire’s suggestion

2.Claire should proceed with her suggestion while francois should take care of already established estate.

3.The distribution and marketing channel should be new for the third wine and they should adopt different strategy for it.

4.They can give the third wine a new product name and create a new brand so there is no danger of bad mouthing or declination of the estate.

Lets relate this to some concepts in Kotler textbook

BRAND EQUITY

BRAND POSITIONING

BRAND EXTENSION

Created by Jay s. Mehta, SPCE, during an internship by Prof. Sameer Mathur, IIM Lucknow.www.iiminternship.com

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