The document discusses strategies for extending luxury wine brands to new markets. It notes that Chateau de Vallois currently sells 150,000 bottles annually of its Grand Vin at $999 per bottle, with the best remaining grapes used for 200,000 bottles of Puine. Clarie de Valhubert proposes introducing a new, more affordable $20-25 wine targeted at young drinkers, and investing in new marketing. However, others worry this could damage the brand. Potential options discussed include staying traditional, expanding internationally, partnerships, or a mid-range domestic and international wine at minimal risk. The document argues these insights apply to extending other luxury brands internationally or across price points.

4. 150,000 bottles of Grand Vin
du Cheateau sold annually
The best of remaining grapes
are used to sell 200,000 bottles
of Puine
The rest sold to other estates

5. The average US customer paid $999 for a
bottle of Grand Vin du Cheateau, of which de
vollois collected between £ 100-£ 450.

6. Stake holders
1.Gaspard de
Sauveterre
2.Clarie de Valhubert
3.Francois de
Sauveterre
4.Jean-Paul Oudineaux
5.Negociants

7. Gaspard de Sauveterre: Owner ofChateau de Vallois
• Possesses 50% of the estate
• Traditional perspective
• Worried about business sustainability for future generations
• Must make decisions

8. Clarie de Valhubert: Granddaughter ofGaspard
• Possesses 25% of the estate
• Graduate of one of the France’s elite grandes ecoles with an MBA
• Modern perspective: prosper of change

9. Francois de Sauveterre: CEO ofChateau deVallois
• Possesses 25% of the estate
• In control of day-to-day operation
• Traditional perspective
• Worried about reputation and loss of exclusivity of brand
• Does not believe in investment of low quality low-priced wine

10. Jean-Paul Oudineaux: Estate manager
• Worked 30 years for the estate
• An agricultural engineer
• Does not want to make wines with other grapes
• Believes production of two wines is enough

11. Negociants: Merchantsand Dealers
• Wholesalers who buy the wine from de Vallois
• Sell and Ship wine to distributors and imports
• Reputation determine the price
• Hold a good reputation with de Vallois
• Traditional perspective

12. Clarie de Valhubert had observed that the de vollois wine
was very expensive and young drinkers were unable to afford
the wine.

13. Clarie de Valhubert’s proposals:
• Introducing a new “affordable wine” which costs between £20- £25
• Targeting young drinkers to buy the wine
regular
• Investing in new marketing and distribution
channels
• Buy land overseas and capitalise the brand

14. Conflicts:
• Erosion of the brand
• Disruption to routines is not liked
• Family pressure
• Financial losses
• Profit reduction
• Lack of experience in Marketing and distribution chain

15. Preserve the Luxury
Or
Extend the Brand?

16. Possible Options:
• Stay true to tradition
• Expand internationally
• Joint-venture or Partnership
• Minimal Risk: Distribute a mid-range wine both domestically and internationally.
• The best of the best: The company should create a wine that is even more
exclusive than their already present wines, and sell directly from the Chateau.

17. These insights can be applied to
many Brands in the Indian markets.

18. Volkswagen

19. Volkswagen group is one of the biggest car making companies. It
produced the second-largest number of motor vehicles of any
company in the world. Volkswagen India Pvt. Ltd. operates a
manufacturing plant in Chakan, Maharashtra which is capable of
producing 200,000 vehicles per annum.

20. Volkswagen Group company Bugatti Automobiles launched its super premium
sports car 'Bugatti Veyron 16.4 Grand Sport' in India. Starting from Rs.16 crore,
Bugatti Veyron is the most expensive car to hit the Indian roads.

21. The company launched Volkswagen Polo which is affordable car at Rs. 6
lakhs. The Volkswagen Polo won the 2010 World Car of the Year.

23. Titan seemed to be too elite for the mass markets and given the
fact that a large population of watches in India are sold in the
lower price range, the company has created Sonata at the lower
end of its product /price line

25. TRESemmé

26. TRESemmé is a brand of haircare products first manufactured by Godefroy
Manufacturing Company in St. Louis, Missouri, United States, starting in 1947.
TRESemmé create different formulas to suit different types of hair. Products
include Shampoos & Conditioners, Dry Shampoos, Mousse, Gels, Hairsprays,
Crème & Milk, and other styling sprays. It’s products are used by the
professional saloons and the price range is quiet high. TRESemmé has
launched its products in India for a cheaper rates.

27. A decade back, Lux was a beauty soap brand at a higher level than other brands
in terms of price and brand value. But as the other brands started growing, Lux’s
brand value had started falling down. Lux re-launched with ‘the international’ tag.

28. Dabur India Ltd. Is India's largest Ayurvedic medicine & related products
manufacturer. Dabur was founded in 1884 by Dr. SK Burman, a physician in
West Bengal, to produce and dispense Ayurvedic medicines.

29. Line Extension Strategy was adopted by Dabur because:
• It could attract different target audience.
• Could renew Interest and liking for the brand by introducing new variants.
• It could increase its market share.
• Diversify without much risk.
• Moved from its Core strategy and hence could give customers something
better and different.
Example: Real fruit juice

31. Nikon is the leading producer of Digital cameras from over many years. Its
products include cameras, camera lenses, binoculars, microscopes, ophthalmic
lenses, measurement instruments, and the steppers. It sells high end Digital-
SLRs. The company has introduced ‘Cool pix’ series which are Point-and-shoot
cameras, available at cheaper prices.

32. Brand Extension has been the
pillar of success for many
companies for over years.

33. Advantages of Brand extension:
• It increases brand image
• Consumers can now seek for a variety
• The new brand is affordable
• The likelihood of gaining distribution and trial increases. An established
brand name increases consumer interest and willingness to try new
product having the established brand name
• It increases market coverage as it brings new customers into brand
franchise

34. Advantages of brand extensions-----------------------------------------------------------------------------------------------------------------------------------------------------------
• Improved odds of new-product success
• Positive feedback effects
• Avoid costs of developing a new brand
• Allow for packaging and labelling efficiencies
• Permit consume variety seeking
disadvantages of brand extensions
• Brand dilution
• Can confuse or frustrate consumers
• Can fail and hurt parent brand image
• Loss of reliability
-----------------------------------------------------------------------------------------------------------------------------------------------------------

36. 1. www.google.com
2. www.bendaggers.com
3. hdw.eweb4.com
4. thepaperwall.com
5. pinterest.com
6. Flickr.com
7. www.desktopimages.org
8. absolutfoundry.com
9. www.behance.net
10.www.theleagueofmoveabletype.com
11.fontfabric.com
12.http://www.slideshare.net/jogiyadav/brand-equity?related=1