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WSET D2 Wine Business > highlights > Flashcards

highlights Flashcards

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1
Q

Factors influencing the demand for wine – social factors

A

S H a R P

  • changes in spending patterns
  • consumption habits
  • changes in reputation
  • consumer preferences
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2
Q

S H a R P

A

demand for wine – social factors SHaRP

S -changes in spending patterns

H -consumption habits

R -changes in reputation

P -consumer preferences

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3
Q

Reasons for consumption of wine to be falling?

A

C H e R r Y

-changes in lifestyle- shorter mealtime, traditional of drinking at lunch is increasingly forbidden by employers

  • health concerns- increasing awareness of negative health effects
  • reduced availability of cheap wine
  • younger people drinking less- old fashioned & turn to other drinks – Spending less time in bars, contact friends through social media
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4
Q

C H e R r Y

A

Reasons for consumption of wine to be falling? CHeRrY

  • changes in lifestyle- shorter mealtime, traditional of drinking at lunch is increasingly forbidden by employers
  • health concerns- increasing awareness of negative health effects
  • reduced availability of cheap wine
  • younger people drinking less- old fashioned & turn to other drinks – Spending less time in bars, contact friends through social media
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5
Q

Factors influencing the demand for wine- economic factors

A

F a C E

  • fluctuation in the currency exchange
  • changes to the market
  • economy strength
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6
Q

F a C E

A

Factors influencing the demand for wine- economic factors FaCE

  • fluctuation in the currency exchange
  • changes to the market
  • economy strength
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7
Q

Factors influencing the demand for wine- legislative and political factors

A

W I L T in G

  • wine laws
  • international trade
  • laws prohibiting or limiting the sale of alcohol
  • taxation
  • government policies to reduce alcohol consumption
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8
Q

W I L T in G

A

Factors influencing the demand for wine- legislative and political factors WILTinG

  • wine laws
  • international trade
  • laws prohibiting or limiting the sale of alcohol
  • taxation
  • government policies to reduce alcohol consumption
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9
Q

What are the contributing factors that are factored into the price of a bottle of wine? (supply side)

A

PLOWing MTS

  • Production -Growing costs
  • Legislation -Marketing costs
  • Over/ Under -Transportation costs
  • Winemaking costs -Sales Costs
  • Importation costs
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10
Q

P L O W I n G M T S

A

What are the contributing factors that are factored into the price of a bottle of wine? (supply side) PLOWing MTS

  • Production -Growing costs
  • Legislation -Marketing costs
  • Over/ Under -Transportation costs
  • Winemaking costs -Sales Costs
  • Importation costs
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11
Q

Factors influencing Supply of wine

-production – what are the influencing factors of supply?

A

C A V E H A N

reasons for loss other

  • Conversion to other uses -Human factors
  • Abandon rural area -Area under vine
  • Vine pull schemes -Natural Factors
  • EU restriction on planting new vineyards
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12
Q

C A V E H A N

A

Factors influencing Supply of wine -production – what are the influencing factors of supply? CAVE HAN

reasons for loss other

  • Conversion to other uses -Human factors
  • Abandon rural area -Area under vine
  • Vine pull schemes -Natural Factors
  • EU restriction on planting new vineyards
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13
Q

Factors influencing Supply of wine -grape growing costs

-Beyond purchasing the land, what are other initial costs of establishing the vineyard?

A

S C A B S W I M P

  • Survey -Stakes/ trellising
  • Clear -Weather hazzards
  • Access roads -Irrigaion / drainiage
  • Buying plants -Machinery / equipment
  • pest protection
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14
Q

S C A B S W I M P

A

Factors influencing Supply of wine -grape growing costs -Beyond purchasing the land, what are other initial costs of establishing the vineyard? SCAB SWIMP

  • Survey -Stakes/ trellising
  • Clear -Weather hazzards
  • Access roads -Irrigaion / drainiage
  • Buying plants -Machinery / equipment
  • pest protection
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15
Q

Factors influencing Supply of wine -grape growing costs

-ongoing costs of managing the vineyard and producing grapes that may start as soon as the vines are planted & before productivity?

A

T I M E M e L d

-Treatments: Conventional: herbicide, fungicide, insecticides

Organic/ biodynamic; may use Sulphur powder or Bordeaux mix

  • Irrigation if needed
  • Materials: replacement vines & trellising
  • Electricity- for irrigation systems, bird scares, frost protection equip
  • Machinery / equipment running à fuel & maintenance
  • Labor costs - seasonal, annual skilled
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16
Q

T I M E M e L d

A

Factors influencing Supply of wine -grape growing costs -ongoing costs of managing the vineyard TIME MeLD

  • Treatments: Conventional & Organic
  • Irrigation if needed
  • Materials: replacement vines & trellising
  • Electricity- irrigation systems, bird scares, frost protection equip
  • Machinery / equipment running- fuel & maintenance
  • Labor costs - seasonal, annual skilled
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17
Q

Factors influencing Supply of wine -winemaking costs

A

I P M P

-Initial costs of establishing the winery

-producing wine

-maturing wine

-packaging wine

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18
Q

I P M P

A

Factors influencing Supply of wine -winemaking costs IPMP

  • Initial costs of establishing the winery
  • producing wine
  • maturing wine
  • packaging wine
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19
Q

Factors influencing Supply of wine- wine making costs:

-producing the wine costs include?

A

F L E W M e M

*Fruit-buying fruit vary with quality & vintage. Blend in cheaper varieties

*Labor- some full time staff & harvest labor to Unloading crates, moving equip

*Electricity- for refrigeration, ventilation, presses, pumps, lighting

*Water- uses large volumes of water for cleaning, invest in water treatment plants

*Machinery & equipment- fuel, electricity, maintenance

*Materials- sugar for enrichment, de-acidification agents, yeasts, carbon dioxide, inert gasses, fining and filtering agents

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20
Q

F L E W M e M

A

Factors influencing Supply of wine- wine making costs: -producing the wine costs include? F L E W M e M

*Fruit-buying fruit vary with quality & vintage. Blend in cheaper varieties

*Labor- some full time staff & harvest labor to Unloading crates, moving equip

*Electricity- for refrigeration, ventilation, presses, pumps, lighting

*Water- uses large volumes of water for cleaning, invest in water treatment plants

*Machinery & equipment- fuel, electricity, maintenance

*Materials- sugar for enrichment, de-acidification agents, yeasts, carbon dioxide, inert gasses, fining and filtering agents

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21
Q

Factors influencing Supply of wine

-sales costs

A

P L E a S e D M

Property costs for on/ off prem

Labor

Equipment & material

Storage

Delivery

Margin

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22
Q

P L E a S e D M

A

Factors influencing Supply of wine -sales costs PLEaSeD M

Property costs for on/ off prem

Labor

Equipment & material

Storage

Delivery Margin

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23
Q

The Impact of Legislation on the Cost of Wine

Cost is affect by types of legislations:

A

S M a L D o T T

Subsidies Duties

Minimum Pricing Taxes

Labeling law Trade barriers

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24
Q

S M a L D o T T

A

The Impact of Legislation on the Cost of Wine

Cost is affect by types of legislations: SMaL DoTT

Subsidies Duties

Minimum Pricing Taxes

Labeling law Trade barriers

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25
List type of producer engaged in the production of wine?
M E G G a V a C C C Merchant Virtual Winemakers/ Wineries Estate Co-Operatives Growers Custom Crush Facilities Grower-Producer Conglomerates
26
M E G G a V a C C C
List type of producer engaged in the production of wine? MEGGa VaCCC Merchant Virtual Winemakers/ Wineries Estate Co-Operatives Growers Custom Crush Facilities Grower-Producer Conglomerates
27
The Impact of Fluctuations in Currency on the Cost of Wine -mitigation methods to a fluctuation exchange rate include?
F E B T O O L - **Fixing price** in the currency of the importer on date of ordering - **Entering** a contract to fix the exchange rate - **Buying** currency to cover specific order - **Trading** in USD/EUR -**Options** - open an account in an **overseas** bank - open a foreign currency account in a **local** bank
28
F E B T O O L
The Impact of Fluctuations in Currency on the Cost of Wine -mitigation methods to a fluctuation exchange rate include? FEBTOOL - Fixing price in the currency of the importer on date of ordering - Entering a contract to fix the exchange rate - Buying currency to cover specific order - Trading in USD/EUR -Options - open an account in an overseas bank - open a foreign currency account in a local bank
29
Disadvantages of a free market for the producer selling directly to retailers?
F A C T D E E L Freight forward Delivery Administrative Burden Extra staff Collection Exported duties/ taxes Transportation Label/ package compliace
30
F A C T D E E L
Disadvantages of a free market for the producer selling directly to retailers? F A C T D E E L Freight forward Delivery Administrative Burden Extra staff Collection Exported duties/ taxes Transportation Label/ package compliace
31
Advantages for using a distributor?
**C A L L K C-** ## Footnote **Contacts** -timesaving for proucers **Admin** burden relief **Logistics** - collection, trans/ delivery / risk of damage **Language barriers** -retailers like one point of sales **Knowledge of the market** -key players, preferences, trends **Compliance Experience** & staff to deal with legal
32
C A L L K C
Advantages for using a distributor? C A L L K C Contacts -timesaving for proucers Admin burden relief Logistics - collection, trans/ delivery / risk of damage Language barriers -retailers like one point of sales Knowledge of the market -key players, preferences, trends Compliance Experience & staff to deal with legal
33
List the options for direct sales?
C O E W Cellar door sales Online Events Wine clubs
34
C O E W
List the options for direct sales? C O E W Cellar door sales Online Events Wine clubs
35
List the retail wine buying options?
D o G S S C H O W Deep Discounters Convenince Retailers Global Travel Retail Hybrids Supper markets Online Retailing Specialist wine retailers Wine Investment company
36
D o G S S C H O W
List the retail wine buying options? D o G S S C H O W Deep Discounters Convenince Retailers Global Travel Retail Hybrids Supper markets Online Retailing Specialist wine retailers Wine Investment company
37
Reaching the end consumer - Deep discounters -how does the busines model work?
B R O i L S Buy direct from producers Rarely stock major brands Often basic Limited product range Specialty items around holidays in affluent areas
38
B R O i L S
Reaching the end consumer - Deep discounters -how does the busines model work? B R O i L S **Buy** direct from producers **Rarely** stock major brands **Often** basic **Limited** product range **Specialty** items around holidays in affluent areas
39
Reaching the end consumer - Supper markets -private labels- producer’s risks
**D O N E P Q** **Delisted** if volume & profit not achieved **Over supply** **Negotiating power** of spmk **Ensure variation** for Spmk **Pay** for product **placement** **Quality control**- pkg, label, delivery
40
D O N E P Q
Reaching the end consumer - Supper markets -private labels- producer’s risks D O N E P Q **Delisted** if volume & profit not achieved **Over supply** **Negotiating power** of spmk **Ensure variation** for Spmk **Pay** for product **placement Quality control**- pkg, label, delivery
41
Overview of the marketing process?
P A T O D I M 1 identifying the **Product**/ brand to be marketed 2 **Analyzing** the current **market** 3 **identifying the Target** market 4 **setting the Objective** of the marketing strategy 5 **Devising the marketing strategy** (the marketing mix) 6 **Implementing** and **Monitoring** the marketing strategy
42
**P A T O D I M**
Overview of the marketing process? **PATODIM** 1 identifying the **Product**/ brand to be marketed 2 **Analyzing** the current market 3 identifying the **Target** market 4 **setting the Objective** of the marketing strategy 5 **Devising the marketing strategy** (the marketing mix) 6 **Implementing** and **Monitoring** the marketing strategy
43
A successful brand with a positive image in the consumer’s mind can be achieved through?
Successful ___ can be achieved: L e S s S T E P S Longevity Story Substance Trust Engagement Price premium Strong brand name
44
L e S s S T E P S
A successful brand with a positive image in the consumer’s mind can be achieved through? L e S s S T E P S **Longevity Story** **Substance Trust** **Engagement** **Price premium** **Strong brand name**
45
Types of branding include?
P P L L ea S e Position Private Label Ladder brand Luxury brand Soft Brand
46
P P L L ea S E
Types of branding P P L ea S E Position Private Label Ladder brand Luxury brand Soft Brand
47
Segmentation is often based on variable which include:
B a D G a P **Behavior** **Demographic** **Geographic** **Psychographic**
48
B a D G a P
Segmentation is often based on variable which include: B a D G a P **Behavior** **Demographic** **Geographic** **Psychographic**
49
Wine Intelligence segregation model known as Portraits Name the US Portraits?
E M P ty B a S K e t Experienced explores Bargen hunters Millennial treaters Senior Sippers Premium bran suburban’s Kitchen Casuals
50
E M P ty B a S K e t
Wine Intelligence segregation model known as Portraits Name the US Portraits? **E M P ty B a S K e t** **Experienced explores Bargen hunters** **Millennial treaters Senior Sippers** **Premium bran suburban’s Kitchen Casuals**
51
Key marketing objectives include?
**T A S P** 1 what **TYPE** of marketing strategy does the company want to pursue 2. what are the **AIMS** of the marketing strategy 3 how will the **SUCCESS** of the strategy be measures 4. within what time **PERIOD** should the objectives be achieved?
52
T A S P
Key marketing objectives include? **T A S P** 1 what **TYPE** of marketing strategy does the company want to pursue 2. what are the **AIMS** of the marketing strategy 3 how will the **SUCCESS** of the strategy be measures 4. within what time **PERIOD** should the objectives be achieved?
53
Marketing mix factors- 5Ps
The elements of the strategy are often referred to as \_\_\_\_\_\_ ## Footnote **Product Price** **People Place** **Promotion**
54
PPPPP
Marketing mix factors: The elements of the strategy are often referred to as \_\_\_\_\_\_ ## Footnote **Product Price** **People Place** **Promotion**
55
Marketing strategy – Place Model of wine market maturity by Wine Intelligence
-Markets can move up and down categorization M E G E N **Mature Market** **Established Markets** **Growth Markets** **Emerging Markets** **New Emerging Markets**
56
M E G E N
Marketing strategy – Place Model of wine market maturity by Wine Intelligence -Markets can move up and down categorization M E G E N ## Footnote **Mature Market** **Established Markets** **Growth Markets** **Emerging Markets** **New Emerging Markets**
57
Marketing strategy – Promotion AT THE POINT OF SALE -list ?
**F P o L i C C I e S** **Free Merchandise** **Price promotions** **Limited edition packaging/ presentation** **Competitions Consumer tasting** **Incentives Staff Training**
58
F P o L i C C ie S
Marketing strategy – Promotion AT THE POINT OF SALE F P o L i C C I e S ## Footnote **Free Merchandise** **Price promotions** **Limited edition packaging/ presentation** **Competitions Consumer tasting** **Incentives Staff training**
59
Marketing strategy – Promotion AWAY FROM THE POINT OF SALE
W A S P S S W E a R ## Footnote **Websites Smartpones Apps** **Advertising Wine Tourism** **Sponsorship Events and Festivals** **Public relations Reviews and Awards** **Social Media**
60
W A S P S S W E a R
Marketing strategy – Promotion AWAY FROM THE POINT OF SALE W A S P S S W E a R ## Footnote **Websites Smartpones Apps** **Advertising Wine Tourism** **Sponsorship Events and Festivals** **Public relations Reviews and Awards** **Social Media**

WSET D2 Wine Business (12 decks)

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