Friday, May 4, 2012

mondavi

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Strength


• Mondavi’s brand name is possibly the most famous name in the premium wine business, with a production line that offer 16 different wine across all market segments, thus creating a broad brand image. The company has continued to broaden its customer base by increasing its radio and television advertising campaign. Also, Mondavi is trying to educate customers and enhanced their knowledge and appreciation of Mondavi’s wines, by offering wine tasting, seminars, tours of the Oakville winery, and training sessions at fine restaurants and hotels. Michael Mondavi’s goal is to “grow the customer base by removing wine’s mystery, while still maintaining the magic.”


• With the recent company reorganizing effort, Mondavi has created a structure that presented each business unit the opportunity and authority to develop and customized marketing and sales strategy with respect to its product lines (RMV, Woodbridge, and Joint Ventures & Small wineries). In order to enhance its reputation as the world’s finest; Mondavi has established joint ventures with high-end wineries around the world such as Opus One and Frescobaldi. This gave them a geographic and demographic market diversification and production expertise from the “Old World” wineries.


An analysis and assessment of Gucci competitive position particularly its strengths, weaknesses and resource capabilities relative to competition.


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Resource capabilities


• Mondavi seems to have been a forward thinker and first mover in many of the technologies that they use to make wine. They pioneered the use of oak barrels and were the first winery to use refrigerated stainless steel fermentation tanks. Unwilling to sacrifice quality for quantity and lower cost, Mondavi is one of the few wineries that continued to age their lower quality wine in oak barrels.


• Mondavi have devoted significant resources and time to develop natural wine growing programs. Given today’s market that highly values “all-natural” products, this can be used as a unique and marketable advantage over their competitors.


• Mondavi was working with NASA to help develop accurate digital maps of its vineyards to assist and enhanced grape harvesting and irrigation management.


Strength


• Mondavi’s brand name is possibly the most famous name in the premium wine business, with a production line that offer 16 different wine across all market segments, thus creating a broad brand image. The company has continued to broaden its customer base by increasing its radio and television advertising campaign. Also, Mondavi is trying to educate customers and enhanced their knowledge and appreciation of Mondavi’s wines, by offering wine tasting, seminars, tours of the Oakville winery, and training sessions at fine restaurants and hotels. Michael Mondavi’s goal is to “grow the customer base by removing wine’s mystery, while still maintaining the magic.”


• With the recent company reorganizing effort, Mondavi has created a structure that presented each business unit the opportunity and authority to develop and customized marketing and sales strategy with respect to its product lines (RMV, Woodbridge, and Joint Ventures & Small wineries). In order to enhance its reputation as the world’s finest; Mondavi has established joint ventures with high-end wineries around the world such as Opus One and Frescobaldi. This gave them a geographic and demographic market diversification and production expertise from the “Old World” wineries.


Weakness


• One of the weaknesses of Mondavi is the single sales force that supports the company’s entire brand. The sales force could not support or market the company’s product line effectively. The sales force needs to spend more time introducing and educating Mondavi’s ultra premium line, rather than focusing on increasing sales on the receding Woodbridge line.


• In addition to diversifying in to different wine segments, they should diversify into different products (beer and spirits). As is evidenced by Foster and Diageo, an expansion into spirits would be an expected and not uncommon area of growth for Mondavi. This would provide additional revenue and limit the threat of substitute product.


• Another source of weakness is the company’s distribution practice. There are no vertical alignment that exists with the supplier and buyer. Unlike Gallo, Mondavi’s suppliers, distributors, wholesalers, and shipping were all contracted independents and overall production costs are not competitive. With more than 100 independent distributors and 60 suppliers with long term contracts, it leaves little to no room for vertical alignment.


Map out the competitive positions of the different players in the industry and analyze.








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