Posts Tagged ‘business’

Your money or your wine ...

Your money or your wine …

 

Need a loan? Why not offer up those thousand-dollar wines as collateral

The next time you need a loan, consider throwing in the vintage you’ve been saving for a special occasion.

According to Bloomberg News, Goldman Sachs accepted nearly 15,000 wine bottles as loan collateral from Andrew Cader, a former senior director of the bank’s specialist-trading unit. Loans are typically secured by assets like real estate, yachts, and artwork, but because of the low-seven-digit dollar market value of the wines, Goldman accepted the collection. Included in the mix of bottles, mostly from the Burgundy and Bordeaux regions of France, is a 1929 bottle of Domaine de la Romaine Conti that would normally sell for nearly $4,000.
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The health lobby in France has invoked the Evin Law in a call for stricter limits on what bloggers and social media users can write about wine online.

 
A report on the issues of addiction in France entitled ‘Les Dommages Liés Aux Addictions et les Strategies Validées pour Reduire Ces Dommages’ (Damage related to addictions and strategies for reducing the damage) is being prepared as part of the background to forming government policy from 2013-2017.

One of the suggestions put forward is that alcohol promotion should be formally forbidden on the internet and social media, including promotion of wine.

Specific sites belonging to producers, online wine merchants or wine tourism sites would be exempt, but wine bloggers would fall under the definition of sites that would be no longer authorised, as would any specific advertising or promotion of wine.
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The drinks business has compiled a list of the current top 10 Champagne brands by global volume sales.

While there are few dramatic changes to this year’s rankings – the slide by Piper Heidsieck was widely forecasted as a result of the brand’s recent repositioning – what does stand out is the decline in sales seen by so many of these major players in the Champagne category.

For many consumers, especially in more traditional markets, Champagne stands firm as the ultimate celebratory drink. However, this slide in sales appears to be the result of two aligning forces: ongoing economic difficulties in some of the category’s biggest markets and the growing competition Champagne faces from an increasingly ambitious sparkling wine market.

Read on to find out which brands are dominating today’s Champagne market.

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With the relatively large 2012 crop came the expectation that the 2013 grape market would be less active than last year. That has proven to be somewhat true, but only in the realm of “hyper” activity that leads to rapidly increasing prices.

Grapes are being traded, at least to the extent they are even available, since most of them are tied up under multi-year contracts. However, there is no “reckless competition” for grapes experienced last year. Pricing seems to be at or slightly above last year’s levels.

Depending on the variety, the coastal market is arguably more robust than last year at this point. With much less spot market fruit available, buyer interest is high. Reds in particular have brought great interest in 2013; Cabernet Sauvignon specifically.

Coastal areas outside of the most premium growing regions seem to be bringing the most interest for all varieties. This is due to buyers wanting to purchase great quality coastal fruit that allows them to average down the grape cost of their higher end programs. With that being said, there is much less hyper-activity around Napa Valley Cabernet and Sonoma County Pinot Noir. There is still strong demand, but buyers seem to be more interested in averaging down the cost of their high-end programs rather than fervently competing for additional high-end fruit at historically high prices.

 

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Kate Hudson, not just an actress...

Kate Hudson, not just an actress…

 

Actress Kate Hudson and her rock star fiancé Matt Bellamy of Muse have become the latest in a steady stream of celebrities to enter the wine business.

According to Life & Style magazine, the couple were so pleased with their 2010 HudsonBellamy rosé that they now plan to start selling it into bars and restaurants.

The pair are reported to have offered friends and family the chance to buy cases before it goes on sale to the public, describing the wine as “crisp, bright and perfect for upcoming summer.”

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Neft Vodka ad...

 

New research suggests that market leaders in the alcohol industry are being left behind in social video marketing because “they are not optimising their content for social web”.
Video technology company Unruly, has published a report called “Untapped Potential: The State of Sharing in the Alcohol Sector”, which found that despite enjoying significant growth in the last quarter, a staggering 97% of the alcohol sector’s video shares came from just four adverts. The four ads, which came from Budweiser, Carlsberg, Heineken and little-known Russian-Austrian vodka brand, Neft, represent less than 1% of the alcohol adverts released in 2013.

The report also suggests that market leaders such as Diageo and SAB Miller are lagging behind in social video sharing, while wine brands have remained the slowest to embrace social video, attracting less than 1% of the sharing activity during the final quarter of 2012 and the first of 2013. This trend was also noticeable earlier this year, when db revealed the Top 10 brands ruling social media.

Ian Forrester, Unruly’s insight director, said: “The research found that some of the big alcohol brands – and subsectors – are vastly underperforming in social video.

“For wine and spirit brands, the opportunity to increase brand awareness and sales conversion rates through social video is huge, as there has been very little mass movement from these brands in creating shareable video content.

“Additionally, leading brands like Diageo and SAB Miller that have very strong market share are lagging behind competitors when it comes to social video share of voice.”

The report also highlighted the impact of spirits brands on beer brands, which historically dominate alcohol advertising. Beer brands’ share of voice dropped from 97% in the fourth quarter of 2012 to 75% in the first quarter of 2013.

The report also published details of the most shared alcohol videos of all time, and you can click through the following pages to find out which these videos were.
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Selling commodities is difficult because people buy on emotion, or instinct if you will. Want and desire are powerful emotions that can stimulate the release of endorphins. It’s why some people are shop-a-holics. It feels good to buy. But it’s not that easy to get emotionally worked up about borax, chlorine, and salt. As an economic good, a commodity has no real differentiation, so small price differences in competing products can make huge differences in total sales.

Think about how you won’t buy gasoline at one gas station because it’s four cents cheaper around the corner. That’s a commodity. Ever buy a piece of art that way? Of course not because art’s value is in the eye of the beholder, is easily differentiated, and consequently will have wide price ranges. When art is sold, it’s sold on the artist’s reputation or the emotion the piece evokes for someone. Marketers work overtime to take commodity-like goods and then pretend they aren’t commodities by creating and building an emotional appeal around the brand.

 Take the above deodorant commercial. Did you hear mention of the product characteristics as a differentiator? Nowhere does this commercial say Old Spice is made with orange, lemon, clary sage, heliotrope, pimento berry and musk, even though those were the original Old Spice ingredients. The creative team instead focused on delivering an emotional image; something with a human connection that ties back to the product.
 
In this case in a humorous way, they are talking about sex-appeal and are really targeting women who are by far the larger purchasers of family groceries still. The subliminal note is if you get Old Spice for your husband, he will look like this …….. or maybe the message is he will ride a horse? I don’t know but I am wearing Old Spice and on a horse right now. Look at me….

 

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Starting a business can be exhausting, exciting and exhilarating–all at the same time. This is precisely why it’s refreshing to hear words of encouragement from those who have done it before–and succeeded. We spoke with entrepreneurs we admire to cull the single best bit of startup advice they could muster–and the experiences that led to it. They’re simple mottoes, to be sure, but their impact can be tremendous.

“Don’t think, do.”
So said a stranger to Jeff Curran, founder and CEO of Curran Catalog, a high-end home furnishings company in Seattle, more than 20 years ago.

The two men were sitting next to each other on a cross-country flight, and Curran, then 25, had just broken into the catalog business. They got to talking, and Curran spilled his idea for a startup while his neighbor interjected with devil’s-advocate questions. When the plane landed and the two rose to claim their bags from the overhead bins, the stranger finally opened up his can of insight. Those three words inspired Curran to pour $15,000 of his own cash into launching his company, which has grown into a profitable B2B and B2C brand.

“After that plane flight, I’m sitting in the bathroom at my parents’ house and I pick up [a financial] magazine, and this guy was on the cover,” remembers Curran, now 47. Turns out the man was mutual-fund maven Mario Gabelli.

Curran still lives by Gabelli’s advice. Earlier this year, after learning about profit margins in the high-end car-accessories business, Curran Catalog launched a new product line: designer flooring for collector and European automobiles. “There is such a thing as overthinking a big decision,” Curran says. “Sometimes you just have to get it done.”

“Let your customers lead the way.”
Anupy Singla never intended to build her business around this philosophy, but the more she looks back on the history of Indian as Apple Pie, her Chicago-based Indian food-products business, the more she credits customers with driving her strategy.

 
Exhibit A: When Facebook followers complained they were having trouble finding certain Indian spices, Singla equipped her company to buy those spices from manufacturers and offer them for sale. Exhibit B: After friends and neighbors asked her to show them around Chicago’s Little India, Singla began hosting intimate tours of the shops on Devon Avenue for $50 per person. Even her Spice Tiffin, a modernized version of a traditional Indian storage container for spices, went to market at the behest of customers.

“The point of view for this company is to make Indian food easy and accessible,” says Singla, who was born in Chandigarh, India, and immigrated to the U.S. with her parents when she was a child. “If customers are saying they want certain things, it’s up to me to give them what they want.”

Singla’s ultimate goal is to sell her products in retail stores across the country. Until then, however, she plans to leverage her responsive customer base to test-market products and see what sticks. “If something isn’t right,” she says, “they’ll let me know.”

 

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The other day I  stopped in at Wal-Mart to get some things. While checking out, a very large woman in very tight clothes came up from just outside the store and angrily told my cashier she lost her debit card after she paid. While I looked around the floor for the card the cashier said, “Yes, I remember you putting it back in an envelope” to which the woman replied, “Its not in there. I put it in the envelope but you rushed me to get out of line. You rushed me. I want to see your manager!”  ….. Are you kidding me? I had to work at holding my tongue.

What is it about the human condition that makes it so hard to accept personal responsibility? A similar version of that is the medical condition known as …. Headinthesanditosis.

Quite sometime ago I had a client come in the office to talk. Already three vintages behind the market and unable to meet financial obligations, it was time to have a direct discussion about viable solutions. She was really quite an intelligent person but before we could even get to the part where we discussed alternatives in her control like sales strategy, ranking distributors success, branding, market presence, pricing strategy, proper cost allocations, ways to use inventory to raise cash, etc., I was offered the following:

“Its not like I’m the only one with financial problems. The whole industry is suffering and not current with releases. The only problem I have is you wont give me more money.”
I had to tell her the view she held of the market was askew. We didn’t have any other clients who were three vintages behind and in fact because of our financial benchmarking database, I was able to show her just how far out of the norm she was. She was so shocked at the information (see her in shock in the picture —-> ), that rather than accept what was in front of her, she instead tried to poke holes in the database. “Wait, are there foreign wineries in there?”

What is it about the human condition that makes us stretch the bounds of credulity rather than accept it when we aren’t measuring up?

 

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Don't forget the consumers with a sweet tooth!

Don’t forget the consumers with a sweet tooth!

 

The wine industry is failing to keep up with changing tastes among consumers, according to drinks analyst Jonny Forsyth of Mintel, speaking at the LIWF today.

 

Forsyth said consumers are becoming increasingly sweet toothed and adventurous in the products they choose.

 

However, he added, unlike other industries the wine trade is failing to keep up, to its commercial detriment.

 

Forsyth said: “Consumers are evolving, I’m not convinced that wine is evolving quite enough to follow this.”

 

He added sugar consumption in the UK had risen by 31% since 1990, with the average Brit now consuming 700g of sugar each week while in the US each American consumes 130lb of sugar per year.

 

Forsyth said the impact can already be seen in the industry, with rosé now having a market share in the UK of 11%, up from just 1% 10 years ago.

 

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