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Essay Subject: Explores growing potential for sale of Australian wines in the US based on various market factors.... More...

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Paper Abstract: Explores growing potential for sale of Australian wines in the US based on various market factors. Paper Introduction: OVERVIEW Australia is a major wine-producing nation and offers an ideally balanced, delicate wine very much in the French style. In 1991, alcoholic beverages were among the top 15 U.S. imports from Australia, according to the U.S. Department of Commerce. There is clearly a market for this wine product. The U.S. consumer segment is highly educated, affluent, and health conscious. It is focussed on the 35-45 age group, which is expected to grow 16 percent by the year 2000. This group tends to purchase chardonnays and cabernets with ample fruit flavor--the type of wine Australians are now exporting. The market has been changing with demographic shifts in the United States and with changing perceptions of alcohol consumption Text of the Paper: The entire text of the paper is shown below. However, the text is somewhat scrambled. We want to give you as much information as we possibly can about our papers and essays, but we cannot give them away for free. In the text below you will find that while disordered, many of the phrases are essentially intact. From this text you will be able to get a solid sense of the writing style, the concepts addressed, and the sources used in the research paper. )11. consumer segment is highly educated, affluent, and healthconscious. 21.Bullard, R. In 1991, alcoholicbeverages were among the top 15 U.S. Industrial Outlook 1994--Other Consumer Nonendurables, pp. The way matters can shift in a short time is indicated by atelevision broadcast on 6 Minutes in 1991. 149). In terms of all wine drinkers, each consumes on averagea single glass of wine a week, and only 5 percent of Americans can becalled frequent wine drinkers, consuming an average 5.9 glasses, or aboutone bottle, per week. France Domaine du Tariquet Cotes de Gascogne 1989 ($5.75)15. Cover story. (1993, November 4). In America, 42 percent of adults drinkwine, and in all 6 percent sometimes drink alcoholic beverages, some morethan one type. The Wine Spectator, pp. Rounding up Australian reds. Wine Spectator, p. These wines have beenaccepted because they have a taste that is similar to certain Californiawines. (1988, June 6). Chile Miguel Torres Cabernet Sauvignon 1988 ($4.5 ) 9. (1994, March 15). Washington Covey Run Johannisberg Riesling 1989 ($7. Australian growers, like California growers, producewhat are called "Pacific wines," which tend to be forward and fruity intaste and more notable for alcoholic strength than elegance. One of the markets that has been addressed by Australian winemakersis that of the United States, and consumption patterns show that there is amarket for these wines here and a large public that would be good formarketers to note. 24). One key development has been the emphasis on wine as ahealthful product and as a health aid, in part because of news storiesabout reduced heart attack risk and other health benefits. Chile Los Vascos Cabernet Sauvignon 1988 ($6. Meeting theneeds of older shoppers thus becomes important, as does tailoring productsfor older and single-person households for all food and beverage products(U.S. Chile Santa Monica Cabernet Sauvignon 1988 ($6. This group tends to purchase chardonnaysand cabernets with ample fruit flavor--the type of wine Australians are nowexporting. Vintages from down under. (1994, February 1 ). This statement on one broadcast resulted in a 39 percentincrease in sales of red wine in 1992, following a 4.5 percent decreasebetween 198 and 199 . Australia Tyrell's Long Flat White 1989 ($5. (1992). OVERVIEW Australia is a major wine-producing nation and offers an ideallybalanced, delicate wine very much in the French style. Los Angeles Times, Section H, p. Still, the United States ranksonly 29th among the world's countries in per capita consumption of wine.On average, Americans drink 1.8 gallons of wine per year, or 9 bottles perperson. The wine can achieve a larger market share byoffering more value than its competition, and marketing the wine entailsinforming the public that this wine offers greater value than thecompetition. Chardonnay and cabernet remain the customers' red and whitewines of choice. It is focussed on the 35-45 age group, which is expected togrow 16 percent by the year 2 . )5. Power of the paradox. )1 . She typically drinks at home,usually during a meal, and particularly at dinner (Matthews, 1991, p. Australian wines have been achieving a larger segment of the marketwithout a strong push to get consumers to seek out Australian productspecifically. It will also entail attracting the attention of restaurateursso they keep this wine in stock and improving supermarket displays toattract that segment of the market as well. Among the reasons for this arechanging consumer demographics, a slowing growth of population, shiftingbuying habits, and concerns about the economy. Another important factor is convenience, relatedto packaging. (1994, April 11). 149). Bottoms up, down under. 48Elson, J. )12. There is a beliefthat wine can be healthful (Matthews, 1991, p. MARKET ANALYSIS Australia has emerged as one of the more important wine exportingcountries and is known as among the best for overall quality, variety,value, and image. Presentation can be especiallyimportant in the supermarket, for only about 1 percent of supermarketcustomers pass through the wine section, while an overwhelming percentagepass through the meat, produce, dairy, and deli sections (Trinchero, 1992,p. Industrial Outlook 1994--Other ConsumerNonendurables, pp. ) (Source: The Wine Spectator Magazine, December 31 , 199 ) REFERENCESBentley, D. What might bode well for the importation ofwine is the increase in an older population more identified with wineconsumption--the 35-44 age group is expected to grow almost 16 percent by2 , and the 65 and over segment will grow by eleven percent. 1). The segment hasbeen growing somewhat because of demographic shifts, but there are otherchanges that militate against growth in this market, such as a perceptionof economic troubles. American wine-drinking habits generally shift very slowly, andchanges are first noted by restaurateurs. 26). California Handley Gewurztraminer 1988 ($7. 31-32.Matthews, T. )2. Up from down under. )8. Italy Tenuta Farneta Chianti 1988 ($6. The importation of Australian wines was seen as a newtrend in 1987 when Australian imports reached one million gallons, morethan triple the volume of 1986. Time, p. In 1993 Australianwine imports to the U.S. )13. 27-28). 73). The improvement in Australian wines was noted in the early 198 s as anew and greatly improved generation of Australian wines reached the UnitedStates. The Australians have also maintained afavorable price-valued relationship across a range of price points, andquality wines cost as little as $6 to $12 a bottle. Since the early 198 s, Australian wines have been gaining favor withAmericans. 7A.Scarpa, J. )14. Other media also covered this story and added tothe growing belief in the United States that red wine was healthful, andthis contributed to growth in this segment of the wine market (Bullard,1994, p. Various shifts have been taking place in the U.S. The taste and quality of the wineis one important consideration, but overall value is probably moreimportant and is related to price. 86.Fried, E. Americans look forcertain things in the wines they buy. This product could be marketed more aggressively than hasbeen the case to date, and this should help the product achieve a largermarket share and even more acceptance than they have already achieved.These wines have certain advantages which need to be emphasized and whichwould appeal to the American consumer. U.S. New South Wales produces 2 percent of Australia's highestquality wines, while Hunter Valley produces 5 percent. )3. (1993, February). Australia Tyrrell's Cabernet Sauvignon Classic 1984 ($7. imports from Australia, according tothe U.S. They noted in the 197 s whenpeople began moving to chardonnays. households shrinks (U.S. reached one million cases, a 25 percent increasefrom 1992 (Scarpa, 1994, p. 34-15). population isexpanding by less than one percent annually, and immigrants make up one-quarter of this increase. More recently, a shift has been noted toward alternatives such asPinot Noir. This broadcast includedinterviews with doctors referring to data on French health and offeringexplanations as to why the French affinity for fatty cheeses andindulgently heavy sauces still resulted in one of the lowest national ratesfor heart disease. Australianwines have found a market in the United States, a market that has beengrowing, and there are signs that these wines are being accepted more andmore by the consumer who might previously have turned to French andCalifornia wines only. The U.S. International Management, pp. At the same time, there is a growing trend toward valuewhich has brought about a reduction in prices in many restaurants. Tyrell's is afamily-owned winery that exports Long Flats and the expensive Vat series,and among the other important names are McWilliam's Mount Pleasant Semillonand Pinot Noir (Fried, 1993, p. Industrial Outlook 1994--Other Consumer Nonendurables.----------------------- 1 86). On average, wine drinkers are better educatedand earn more money than non-wine drinkers, and frequent wine drinkersclimb even higher in these categories. The taste of Australian wines has compared favorablywith California wines (Elson, 1988, p. The Wine Spectator, pp. The market has been changing with demographic shifts in the UnitedStates and with changing perceptions of alcohol consumption both positiveand negative. There aremore than 55 wineries in Australia, and roughly half of them came intoexistence after 1975. There is clearly a market for this wineproduct. Black Enterprise, p. Restaurant Business, p. Wall Street Journal, Section B, p. Wine drinkers in the United Kingdomhave been leading the move toward a rapidly growing European taste forAustralian wines, consuming 73 percent more in 1992 than in 1991 (Bentley,1993, pp. These wines have improved their quality and their valueconsiderably over the past decade, and this as well has helped them achievea growing market share. Wine exports from Australia have been a boon to theindustry and have offset a domestic sales decline (Milverton, 1994, B7A). APPENDIX The Wine Spectator's 15 Best Value Wines for 199 1. 27-28.Berger, D. California Bonny Doon Clos de Gilroy Grenache 1989 ($7.5 )4. 149.Heimoff, Steve. The health benefits are important at this time and probably forthe future as well, so long as contrary scientific evidence does not appearand become confirmed and widely disseminated. Serving the needs of consumers and retailers. The U.S. In the late 198 s the shift was toMerlot. France Domaine de la Quilla Muscadet de Sevre et Maine 1989 $7. The explanation offered was the consumption of alcoholin red wine. )7. Jobson's Wine & Spirits Industry Marketing 1992, 73.U.S. 25). consumer marketthat would be important for any plan to import wine. The prototype of the American winedrinker is a female about 45 to 64. 1 .Trinchero, B. They still have only a small part of the totalpossible, but they do constitute a growing segment of the market. California Gundlach Bundschu Zinfandel 1988 ($7. (1991, February 28). She is college-educated and probablylives in a household that is upper income. Department of Commerce. )6. 48). consumerspending for food and beverages has been increasing at only about .2percent per year between 1989 and 1992. The population continues to age as the size ofU.S. The wines have increased in price since the early 198 s, but thequality has increased as well (Fried, 1993, p. 25-27.Milverton, D. Retailers also need to be provided with the materials andtools to sell as much wine as possible. America is not usually considered a wine-drinking nation,but these figures are not insignificant. California Markham Sauvignon Blanc 1989 ($7. A recent survey indicates much about the wine-drinking public inAmerica today and its preferences. Wine is generally used to facilitate somesocial interaction in the home, and there is a positive association withsociability (Matthews, 1991, p. Australian wines of the sort beingimported came about in the 195 s when Australian winemakers, who hadpreviously concentrated on either cheap, fortified sherries and ports forexport to Britain or rough-edged red and white table wines, shifted to ahigher-grade product. The industry is over 2 years old and has some of thebest growing conditions and most advanced technology in the world.Australian wine marketers are also exporting the type of wine thatAmericans like best--chardonnays and cabernets with ample fruit flavorsthat are easy to drink. Thisdoes not necessarily bode well for some low-priced wines, however, for somerestaurant owners have been eliminating their lowest-selling selections,such as wines from Italy, Australia, and Spain (Heimoff, 1993, pp. The data indicate as well that there are demographicdifferences that are strong. Australians drink to change of labels. Wine has a particular image in America as well, a generally positiveimage when compared with other alcoholic beverages. CONCLUSIONS AND RECOMMENDATIONS The wine market in the United States is confined to a relativelyspecific and small portion of the consuming public, but it is a segmentthat is highly educated, affluent, and health-conscious. Australian wines in particular have been making inroads because thesewines are seen as having good value for the price. The product must first have qualityand value, and consumers favor brands that consistently deliver a qualityproduct at a fait price. Wine also has an imageas a status symbol, which helps explain why its use increases witheducation and income level. Report from the front. The Australians have put their own spin invarietal wines and blended wines and are proficient at blending varietalsinto a complementary whole. Spain Las Campanas Navarra Crianza 1984 ($6. Australian red wines have benefited from this trend, andAustralian red wines compare well with Merlots by being soft andapproachable when young (Berger, 1993, H21). (1993, October). Acceptance of winedrinking seems to rise with educational level, and this may be related toan increased awareness of health trends and study data. (1993, May). Australian wines are reasonably priced,and this should serve the needs of any distributor who brings them into thecountry. Spain Vina Berceo Rioja Crianza 1986 ($7. 34-17). Most Americans who do drink wine do soonly occasionally. 31-32). The importation of Australian wine should be geared to increasing theshare of the existing market, since the size of the market itself isincreasing only very slowly. The French, by contrast, lead with an average 19.5 gallons peryear or 98.5 bottles per person. Booming exports of Australian wine help to offset sales decline at home. 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