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Marketing strategy plan and Market Overview analysis of English Wine Producers
IDM Diploma in Direct and Digital Marketing
Assignment 1: Strategic Marketing Plan
English Wine Week 2014
Sean Tapper
Table of Contents
1. Identification Information
2. Executive Summary
3. Terms of Reference
4. Marketing Audit and Situational Analysis
5. Objectives
6. Strategy
7. Operating Plan
8. Contingency Plan
9. Budget
10. Appendices
1. Identification Information
To: Matt Housden, Course Tutor, IDM
From: Sean Tapper, Ageas50 Ltd
Date: 19 October 2013
Title: Assignment 1, English Wine Week 2014
2. Executive Summary
English Wine Week is the English wine industry’s annual opportunity to present
themselves and their products to the British wine drinking public. It is the brand and
merchandise showcase of home grown wine production.
Objectives
The primary objective of this event is to promote English wines, vineyards and producers,
raising consumer awareness among the general public and the retailers of wine, both on
and off trade, whilst realising a sales uplift. It is intended that 50K+ bottles of English
wine are sold during EWW 2014.
Secondary objectives will be the creation of a customer database and the formation of a
dialogue between English Wine Producers and their consumers.
Main Findings
During preliminary research and investigation it has become apparent the EWP have scant
knowledge of their end consumer base, one of the chief outcomes of this week shall be the
gaining of a better understanding of customers.
English Wine sales only account for 0.14% of the UK wine market, so there is a vast
potential for growth.
Recommendations
There will be a multichannel media initiative aimed at carefully selected and targeted
consumer segments. Great care has been taken to identify these end users and the channels
needed to be used to engage with them.
It is important to note that this is the beginning of the customer journey and that dedicated
customers must be acquired, engaged, retained and their ultimate lifetime value
maximised.
The establishment of a Customer Database will allow EWP to target and segment its
customers and offer timely, relevant and personalised communications and propositions to
them.
3. Terms of Reference
English Wine Week (EWW) is a national promotion by English Wine Producers, the trade
and marketing organisation representing the UK Wine Trade – both vineyards and wine
producers.
EWW 2014 will run from 24th – 31st May and cover the Spring Bank Holiday weekend. It
is envisioned that consumer awareness of English wine will be raised, with visits to
vineyards and wineries encouraged as well as the sale of English wine.
Carefully selected retailers and members of the hospitality trade will be selected and
included in the promotional activity to boost sales of English wine and bring in new
consumers.
EWP are looking to build upon the previous annual EWWs and achieve sales of 50,000+
bottles of English wine during 2014 EWW. A budget of 100K or 2.00 a bottle has been
allowed for marketing purposes.
4. Marketing Audit & Situational Analysis
The competitive market environment
English wine finds itself in an extremely competitive environment, accounting for only
0.14% of the total UK wine market – this equates to annual sales of £19 million per
annum. However, sales are predicted to reach £100 million by 2015.
Although both still and sparkling wine are produced by English Wine Producers, a change
in focus has meant that the production of sparkling wine is now taking precedence. This
decision is influenced by the fact that, in the last 6 years, English sparkling wine has won 9
trophies in international competition, a feat no other country has achieved. This has led the
industry to concentrate on what is perceived to be its strongest asset, the production of
English Sparkling Wine (ESpW).
The market sector
Sales of wine have been stagnant over the last few years (Nielsen Wine Report 2011) but
are expected to pick up now that the UK is entering a period of cautious growth and
consumer confidence grows in strength.
Naturally the market sector is dominated by foreign rivals, both by imported still and
sparkling wines. The size of the UK wine market stood at 10.6 billion at the end of 2012
and is predicted to rise to 11.3 billion by 2017. The target market of wine drinkers in the
UK currently stands at around 13 million individuals or 55% of the overall
alcohol-drinking adult market (Mintel UK Wine Report 2012). This share of the market is
in decline and has slid 12 percentage points since 2008. See appendix.
White and Red wine continue to be the major types of wine purchased – enjoyed by 58%
and 52% of adults respectively, while Rose has shrunk over recent years (now only
imbibed by 43%).
Growth in this sector has been at 3% a year and 56% of alcohol drinkers enjoying
sparkling wine at least once a year (Mintel 2012). Also, we have seen the emergence of the
‘committed sparkling wine drinker’ – who enjoys this beverage at least once a week.
Imbibe.com puts the figure for these people at around 5 million consumers.
Sparkling wine is dominated in particular by Champagne, but also by the growing
contribution made by other sparkling wines especially Prosecco and Cava.
90% of the sparkling wine drinkers drink at least once a month with 41% coming from the
AB social group and women slightly more prevalent than men. 14% of this group also
state that they drink ESpW at least once a month, which using these figures gives us a
target audience of 3.5 million people out of a total wine drinking population of 24 million
adults.
Consumer insight
Although the economic downturn has had an effect in recent years on the spending power
of households, affecting consumer interest in premium goods, member s of the AB social
group and the over 55s are more likely to pay for quality (Mintel 2012).
Half of all adults visit pubs and bars on a monthly basis, but many now drink at home in
order to save money. 42% of adults drink alcohol at least twice a week and an additional
27% consume alcoholic beverages once a week. There has been an uplift in sales values
within the on trade environment at the same time as a drop in volume suggesting that
consumers are moderating alcoholic intake and trading up at the same time.
31% of adults aged 18+ say that they are prepared to pay more for good quality wine – an
insight which should help sales of English Wine given its median price point of £20 a
bottle. However, the challenge here is that, according to TGI, 97% of regular wine
purchasers spend less than £9 on a bottle of wine – the starting price point for English still
wine.
The key market for English wine will be the following segments – the AB social groups
with household incomes greater than £50,000 and the age groups 25-34 and 50-65. The
aim here is to encourage them to try English wine and to trade up to this price point if they
do not already inhabit that pricing zone.
Another option for English wine is price-led promotion; 58% of wine consumers are
influenced by promotional activity (Mintel 2012) and this could bring English wine to a
much larger audience. Dropping the entry price from 9.00 to 7.50 would triple the adult
population willing to spend that much money on a bottle of wine. This would open up the
English wine market to C2 households (with incomes of 15k to 24.9k), who are just as
likely as ABs to be open to English wine according to Mintel.
Internal Analysis of the Case Organisation – English Wine Producers
EWP is the marketing organisation that represents the vineyards and wineries of England
and Wales. It is funded through its members to promote English wine to the UK wine
trade, tourism industry, media and the wine consuming public at large.
It runs English Wine Week each year to raise awareness and drive retail sales. Its budgets
are limited and its website is in need of an overhaul to make it more appealing and user
friendly. EWP have scant information about their consumers in the UK, so it is vital that
they establish a customer database and gain key strategic insights about the end users of
their products.
EWW is in its tenth year and has targeted sales of over 50,000 bottle and build on the
momentum gained in previous years at bringing English Wine to the attention of the
broader public.
4.1 External Factors
The wine market in the UK remains fiercely competitive, being one of the largest volume
importers of wine in the world.
Political
Alcohol taxation in the UK remains amongst the highest in the EU with tax on a bottle of
wine being 1.90 duty plus VAT of 20% of the retail price. On an average bottle of wine
retailing for 4.99 taxation forms 55% of the purchase price.
The alcohol duty escalator, which pushes taxes on alcoholic beverages up above the cost of
