global wine war australia america

1. Prepared By:
Savchuk Andrii
Brunarska Ivanna
Shybitova Anna
Yankovska Olena
Global Wine Wars: The new World
Challenges the Old

2. What's special about Australia's and US wine industry ?

4. Wine production in the United States and in California
from 2006 to 2016 (in million gallons)*

5. U.S. wine industry's sales growth from 2002 to 2016

6. U.S. and Australia Imports and Exports
1989 1992 1995 1998 2001
US 14 13 10 12 15
Australia 2 2 1 2 1
1989 1992 1995 1998 2001
US 1 2 2 4 4
Australia 1 2 3 4 6
Import as % of World Wine Imports
Export as % of World Wine Exports
1988 1994 2000 2002
US 1 2 7 10
Australia 2 2 17 22
U.K. Retail wine sales

7. The influence of size on firm performance
Company Country Wine Sales ($000s)
E&J Gallo U.S. 1 428 000
Canandaigua U.S. 614 000
The wine group U.S. 426 000
Southcorp Australia 376 000
R. Monavi U.S. 325 000
BRL Hardy Ltd. Australia 292 000
Beringer Wine Estates U.S. 279 000
Mildara Blass Australia 260 000
Brown-Foreman
Beverage
U.S. 260 000

8. Quality Premium (Restricted Model)

9. Quality Premium (Full-Restricted Model)

10. Illustration of wine demand by quality/price
segment

11. Innovativeness of Australian wine producers
• Core Competency of Australia is Innovation. Compared
to competitors from New and Old wine companies,
They have separated themselves by going against
traditional ways. In a mature market, this position of
differentiation has proven to be a great strategy for
Australian wine makers.
• Innovative practices are introduced at every stage of
value chain

12. Innovativeness of Australian wine producers
• Screw caps instead of cork screws
• “Wine in a box”
* a type of micro-irrigation that has the potential to save
water and nutrients by allowing water to drip slowly to
the roots of plants
Drip irrigation* was not used until
Australia utilized it on their land when
growing the grapes used to make the
wine. This created larger vineyards
where innovative equipment was
implemented to reduce the labor costs

13. Innovativeness of U.S. wine producers
• Advanced technology is applied and
expertise knowledge is distributed
• Companies are paying much attention
on new branding and packaging of wine
like tetra packs.
• Producers from U.S. are
adopting celebrity endorsement
marketing technique in order to
entice new wine tasters.

14. Customers responsiveness of Australian and US
wine producers
- US have the best correlation between price and
quality
- Australia have wide range of wine
- Australian wine is produced mostly by natural
products without adding impurities

15. Recommendations for American wine producers
• Another problem that affects chasing market share:
consolidation in the distribution and in the retail market.
• Premium brands account for a growing share of the market
which is the United States haven`t.
• Increase advertising and promotions in the United States to
attract more “Millennials” customers.
• Continue to work with exclusive and ultra premium brands.

16. Recommendations for Australian wine producers
• Reposition Australian wines as a premium for US
Millennials consumers.
• Increase the demand for Australian wine, both in Australia
and overseas, through targeted promotion and marketing
activities.
• Continue with the innovation in brand, packaging, and
image.
• Increasing competitiveness .
• Look to emerging markets.
• Increasing demand and the paid premium for all Australian
wine.
• Focus on Exclusive, Premium and Ultra.

17. Thank You For Attention!