EXECUTIVE SUMMARY Project title: - A study on marketing analysis and strategic distribution of wines. Objectives of the project:- Following are the objectives, To determine the size of wine market. To identify the market share of the other brands of wines available in the market. To identify the effectiveness of advertising and sales promotion schemes of the company. To identify the pricing aspects of the product. To identify the market potential with reference to the various marketing strategies of the company. Research methodology:- In research methodology we have used the following methods to collect the information. 1. Primary data: - It is collected with the help of structured questionnaire. 2. Secondary data: - It is collected with the help of Company manuals and records Websites on the internet 3. Research instrument: - Questionnaire 1 4. Sampling plan:- Universe: - All wine shop owners, distributors and wholesalers. Frame: - All the individuals between the ages of 20 to 65 years. Sample size: - The project maintained a sample size of 25. 5. Contact method: - The method of personal interview was conducted to gather information in detail. Findings:- Analysis and interpretation of information collected Analysis of advertising information Analysis of sales promotion activities Analysis of the channel of distribution Analysis of the prices Analysis of impact of the advertisement Recommendations:- Price sensitivity Promotional schemes N.D Shoppe Availability of the product Database and information Bottling and labeling 2 INTRODUCTION TO PROJECT WINE¶S &VINERYARADS IN NASIK WINE PRODUCTION IN INDIA India has about 1, 23,000 acres of vineyards, but only seven percent of these acres are used for wines. Only five major wine companies are currently producing wines in Maharashtra namely, Chateau Indage Limited ,pune N.D. wines, Nasik Sula Vineyards, Nasik Vinsura wines, Nasik Vintage wines, Nasik 3 The overall production of these units is approximately 210,000 cases (Each case is of 12 bottles). In addition, they also import about 30,000 cases of wines in bulk and bottle them in other plants. About 120,000 cases of inferior quality wine are produced by small local winemakers which is called ³pro-wine´. CATEGORIES OF WINES There are basically three types of wine: 1. Premium Wines (Still wines) 2. Sparkling Wines 3. Fortified wines This report focuses on the largest and most important category of wines (Premium wines), ignoring the cheaper country-made fortified wines, which is also not yet made or regarded as quality wines. In the Still wine or premium wine category the Indian market is divided mainly into two major categories: White and Red wines. Note: Sparkling is generally considered in White category by many consumers. Further all the wines available in the above categories is divided in following three categories 4 INDIAN WINE - BY SEGMENT CONSUMER SEGMENTATION The Indian Market largely can be classified into two Segments , 1. Domestic 2. Foreign Tourists 1. Urban The Urban population amounts to 48% of the total population in India and the target segment amounts to 1% of the total urban population. E.g. the Total Population of Mumbai is 1.5 crs The Total Urban population is 70 lacs, so the target population is 7lac. The characteristics of the target urban population, a. Income above Rs. 10 lac i. Self employed ii. Service class b. Income between 3 lac to 10 lacs (Great Indian Middle Class) i. Highly educated upwardly mobile ii. Small business families c. Income between 3 - 6 lacs 1. Upper Middle class 2. Rural a. Large farming community b. Small business class 5 c. Govt. Service class The tourism boom has resulted in 2.5 million of tourist visiting India last year with a projected growth of 15 %. Embassies in the country also provide good market for Indian wines. 6 DISTRIBUTION CHANNEL FOR WINE INDUSTRY The importance of supply chain in wine industry. For wine segment the distribution channel involves importers, distributors & retailers the enclosed distribution chain will put more light on the level and cost implication at various stages. This is following: WHOLESALERS DISTRIBUTORS RETAILERS HOTEL,RESTAURANTS WINERY WINES TRADERS EXPORTS & IMPORT 7 MARKETING STRATEGIES OF THE COMPANY Stage -I: Creating awareness It is imperative to create awareness about wine among Indian consumers, primarily to shrift their preferences from other alcoholic drinks. The liberalization policy has provided an entry to renowned foreign wine brands into the Indian market. The availability of the foreign brands is increasing as one can pick up the brand of one's choice from the neighborhood wine store. Wine can be relatively light on the pocket (there are a whole range of wines to choose from, starting at Rs. 280 per 750 mi. Bottle) and fashionable. In addition, recent reviews arc indicative that wine has positive health effects In India, the target segment for the product has to be affluent and the young "upwardly mobile" consumer. Obviously creating brand awareness would be the primary target of any marketing strategy and the launch of the wine needs to be done with a "splash". Advertising of alcoholic drinks is banned in India and as such a promotion through "wine & cheese" evenings or a dinner party would be the only alternative. Publishing of articles on wine in select food magazines, emphasizing wine suitability to accompany Indian vegetarian and non -vegetarian food is also worthwhile Creating retailer, dealers, and push for the brand: It is essential to create a strong push strategy aimed at dealers and retailer for the brand. This is the most crucial sales channel and a commission of around 12% would have to be set aside for these sales channels. A beginning can be made 8 with the training distributors on wine basics, and most importantly storage and transportation requirements. This would be an important aspect in the relationship building exercise and would also he beneficial to ensure that the wine we produce is handled correctly. Meeting with retailers would provide an opportunity to obtain key inputs in understanding the preference and psyche of the target consumer within the target market towns. The retailers could be taken for a guided tour to the vineyards during grape crushing festival and/or to see the entire process as well as the establishment. The F&B staffs of star hotels and restaurants are also a crucial sales channel and promoting the brand with them before launch would also be essential. STAGE-II: PRODUCT PLACEMENT AND BRAND POSITIONING Intense promotional campaigns would need to be conducted at premier locations such as up market Pubs, Bars and Clubs, particularly pubs, where anything new is always welcomed and patronized. Business & Recreation Clubs: - These are the places where wine is consumed on a selective basis. Generally it is as these clubs where one can find the real Connoisseur of wine. They are the people who are fond of drinking different types of wine and make their own judgment of wine. Premium Category Caterers: -Caterers will be an important segment to market the company's wine as they organize events for the "elite". Event Managers: This is a recent phenomenon in India and these specialized professional agencies organize mega activities/ events, 9 arranging corporate luncheons, dinners, conventions, etc, for which they are by and large the 'decision makers' in terms of food and wine. These activities can be organized through a strong sales team, perhaps organized district wise 10 Maharashtra's grape policy 2001 (source MIDC) Accordingly, to give impetus to the grape processing and wine industry in the state, preparation of a separate policy was under active consideration of the State Government. Declaration as a Preferential Area: As the Winery industry does not fall in the preferential area of granting loans, the financial institution like NABARD does not grant loans in such industries. Therefore to get the high price of the product for farmers and to create better employment in the state, NABARD may be requested to declare preferential area for Winery Induct rise, enabling to grant such requisite loans. Declaration as a Small Scale Industry: Within the limits of investments prescribed for the Small Scale Industry, wineries should be considered as a Small Scale Industry. Concessions in Excise Duty: For those wine industries whose production has been started before 19th September, 2001, the excise duty will be charged at the rate of 50 per cent of the production expenditure incurred by such units instead of present 100 per cent rate. For those wine industries whose production have been started or would be started on or after 19th September, 2001, the excise duty will 11 be charged at the rate of 25 per cent of the production expenditure incurred by such units. Such concessions will be admissible for period of 5 years. Concessions in Sales Tax: It has been decided with the consent of all states in the country that the floor rate of Sales Tax on liquor will be at the rate of 20 per cent. However, the Wine Process is totally different from the Liquor Production Process and wine unit is considered as agriculture process unit by the Central Government. Therefore, to encourage the Grapes Processing Industry in the state, a request will be made to the Empowered Committee of Finance Ministers of all states constituted by the Government of India to reduce the floor rate of Sales Tax on wine. Wine Sales License: Wine will be permitted for sale by Beer Bars and also licenses will be given to Wine Bars to sell wine on the basis of Beer Bars. Wine Sales License Fee: An amount of Rs. 5000/- per year will be charged for License Fee for the sale of wine And this rate will not be changed for next 10 years.