Caso 5 Deutsch Casella

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For the exclusive use of c. muller, 2015. NA0302 The Deutsch–Casella Joint Venture and [ yellow tail ]® Wines: Trading Up or Trading Down? Armand Gilinsky, Jr., Sonoma State University Raymond H. Lopez, Pace University We should be very proud of our portfolio of wine brands, but we admit that the [ yellow tail ]® story has redefined and refocused our firm over the last decade. While the current economic environment creates uncertainty for most businesses, we must be confident of our ability to navigate uncharted waters and continue to compete in global markets. —Bill Deutsch These were the words of Bill Deutsch, founder and chairman of W. J. Deutsch & Sons, a New York-based importer, to his son, Peter. W. J. Deutsch & Sons was joint…show more content…
This demographic segment was not only aging, but also increasing in spending power, and thus willing to spend its disposable income on wine, at least up until the global financial crisis began in 2008. Wine consumption in the United States increased every year from 2000–2008, according to the U.S. Department of Commerce and Adams Wine Handbook, the latter an industry trade publication, as shown in the analysis presented in Exhibit 1. Domestically produced wine, predominantly from California, made some inroads into the United States market. From 2000–2008, the consumption of domestically produced table wine grew 22 percent, while over the same period inroads made by wine imports led to expansion in that category approximately 74 percent. By comparison, however, imported table wine, which accounted for 10.3 percent of total United States wine consumption in 1991, accounted for 23.5 percent by 2008. Also, share of imports by volume, which was 14.5 percent in 1991, grew to 25.6 percent in 2008, according to the U.S. Department of Commerce and Adams Wine Handbook. Exhibit 2 presents an analysis of wine imports from 2003–2008 by country of origin, showing that Italy and Australia led in total exports to the United States. Exhibit 3 shows the analysis of sales and market shares of the twenty-five largest wine brands imported to the United States from the

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