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MARKETING THE OF Collette Pomeroy Journalism 500 – Summer 2010 WINES OF ARGENTINA – A HISTORY

 The first cuttings were brought to Argentina by Spanish colonists in the 16th century  were originally cultivated by monks so as to ensure the provision of for Catholic mass  The of western Argentina proved perfect for , and eventually the monastic vineyards commercialized and began producing copious amounts of wine  Historically, Argentine vintners were more focused on quantity than quality

Sources: “,” www.wikipedia.org, May 11, 2010; “el Vino Argentino,” www.winesofargentina.com, May 12, 2010 WINES OF ARGENTINA – A HISTORY

 During the beginning of the 20th century, Argentina was the eighth richest country in the world and the wine industry grew due to domestic consumption  The Argentine wine industry continued to be dependent on economic conditions in the country  During the military dictatorship of the 1960s and 1970s, the Argentine wine industry was sustained by domestic consumption of cheap, mass-produced  During the 1980s and 1990s, as the economy stabilized and with the influence of French and American vintners, the Argentine wine industry began to focus itself on exports

Sources: “Argentine Wine,” www.wikipedia.org, May 11, 2010; “el Vino Argentino,” www.winesofargentina.com, May 12, 2010 WINES OF ARGENTINA – RECENT HISTORY  As Argentine viticulture has developed over the past 20 years, the nation has grown to become the 5th largest exporter of wine in the world  Argentina was the fastest growing export country from 2002-2008, more than doubling the annual growth rate of its nearest competitor Wine Exports – Growth By Country (2002-2008)

Argentina South Africa Spain U.S.

Chile Compound annual growth rate Germany (in percentage, 2002-2008) Australia Portugal Italy

0 5 10 15 20 25 Source: International Organization of Wine and Vine, 2008 WINES OF ARGENTINA – IT TAKES TWO TO TANGO

 There are two “signature” associated with Argentina  The most known is which produces an intensely rich plum-colored wine  The lesser known white native to Argentina is the Torrontés grape, which produces an acidic light yellow wine with a fruity bouquet

Source: “el Vino Argentino,” www.winesofargentina.com, May 12, 2010 WINES OF ARGENTINA – IT TAKES TWO TO TANGO

 Most of the exported wine from Argentina is the Malbec varietal  Malbec was considered a “reject” grape in old world wine-making countries– it was used to add color to other wines  Malbec adapted beautifully to the terroir in the foothills of western Argentina and now accounts for 38.3% of the country’s exports of bottled wine

Source: “Wine ,” ProsperAr: Invest in Argentina, www.prosperar.com, May 11, 2010 WINES OF ARGENTINA – IT TAKES TWO TO TANGO

 An up-and-coming white varietal is the native Torrontés grape  Torrontés is grown mostly in the region in the Northern part of Argentina  Torrontés is beginning to gain a following among wine connoisseurs outside Argentina and has been called “Argentina’s Other Great Grape”

Sources: “Wine Industry in Argentina,” ProsperAr: Invest in Argentina, www.prosperar.com, May 11, 2010; “Argentina’s Other Great Grape,” www.corkd.com, May 18, 2010. WINES OF ARGENTINA – MARKETING A NATION

 The Wines of Argentina organization is a government-sponsored entity that represents more than 190 that account for 95% of Argentina’s wine exports  Their is to promote and support what they call “Vino Argentino” – Argentine wine as a collective brand rather than focusing on individual vintners

Sources: “Nosotros,” www.winesofargentina.com, May 12, 2010; “Argentina’s Grapes of Success,” www.newsvote.bbc.com.uk, May 11, 2010; meeting with Lis Clement of Wines of Argentina, Mendoza, June 23, 2010. WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Improving the global positioning of Argentine wines

 Increasing Argentina’s world market share

 Anticipating world consumption trends

Source: “Wine Industry in Argentina,” ProsperAr: Invest in Argentina, www.prosperar.com, May 11, 2010 WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Improving the global positioning of Argentine wines  Wines of Argentina has offices in Mendoza, New York, the UK, Sao Paolo, and Colombia with staff dedicated to promoting the Vino Argentino brand across the world  Staff members place media, host tastings and wine tours, participate in wine fairs, and invite wine journalists to Argentina to help grow knowledge of and interest in the Argentine wine industry

Source: “Nosotros,” www.winesofargentina.com, May 12, 2010 WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Improving the global positioning of Argentine wines  Wines of Argentina has established a 10-year marketing plan focused on a “quality for value” message abroad and assisting smaller vintners and wineries domestically

Source: “Nosotros,” www.winesofargentina.com, May 12, 2010; “Argentina’s Grapes of Success,” www.newsvote.bbc.com.uk, May 11, 2010; meeting with Lis Clement of Wines of Argentina, Mendoza, June 23, 2010. WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Increasing Argentina’s world market share  Wines of Argentina has set a goal of 10% world market share by 2020

Ranking of Wine Producing Countries

Italy France Spain U.S. Argentina Australia Market Share in percentage (2008) Germany South Africa Chile Portugal Other

0 5 10 15 20 25

Sources: International Organization of Wine and Vine, 2008; “Wine Industry in Argentina,” ProsperAr: Invest in Argentina, www.prosperar.com, May 11, 2010 WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Increasing Argentina’s world market share  The government has pushed for investors from both inside and outside Argentina to continue to invest in development of the viniculture in the region

 Areas for continued development and growth include vineyards, wineries, real estate, tourism, and secondary supplies such as glass bottles and cardboard cases

Source: “Nosotros,” www.winesofargentina.com, May 12, 2010; “Wine Industry in Argentina,” ProsperAr: Invest in Argentina, www.prosperar.com, May 11, 2010 WINES OF ARGENTINA – CHALLENGES FACING THE INDUSTRY

 Anticipating world consumption trends  Efforts to meet this challenge include increasing Argentine wine production to meet world demands, and capturing new consumers and markets  Lis spoke of this challenge in reference to the United States, which is considered a “young” wine market

 She spoke to the ad featuring a young urban couple moving into their home with a box of pizza and a bottle of Malbec, noting that those consumers are the target audience for Wines of Argentina in the U.S.

Source: “Nosotros,” www.winesofargentina.com, May 12, 2010 WINES OF ARGENTINA – POISED FOR A BRIGHT FUTURE

Argentina’s perfect terroir, continued investment in its viticulture, established long-term marketing plan, and sterling reputation in the wine industry ensure that this industry will see success and growth for a long time to come