Robert Mondavi and the Wine Industry

2003 Words9 Pages
ROBERT MONDAVI AND THE WINE INDUSTRY CASE ANALYSIS by Alberto Vicentelli
Global wine industry structure. How and why is this structure changing?

Production and consumption of wine was mostly localized until the early 1990’s. Wine producers in different countries were traditionally isolated from each other, and most of the world’s wine drinkers consumed either local wines or imports from nearby producers. Winemakers had minimal cross-border interaction and followed local traditions.

The wine industry is divided geographically in two areas:

 The Old World countries, defined as those within Europe, have a long, uninterrupted history of wine production and consumption. The four largest European producers, France, Italy, Spain, and
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Similarly, in the United States, jug wines sales had declined approximately 3% per year during the past decades, while premium sales grew 8%-10% annually. Pushing affordable wine on to the shelves of new world markets will not necessarily increase global consumption by itself. Consumers have to pull the bottles off the shelves in consistent purchases. Although US per-capita premium consumption has been increasing, in order to increase further wine must be marketed in a way that will promote everyday drinking among a greater percentage of the population in a socially responsible manner.

The vast majority of US wine consumers consider themselves uneducated in wine matters and have trouble remembering which wines they liked. Researches in consumer behavior have shown that people appear to be confused during the wine selection process. Customers have expressed that they want to be able to easily identify the wines they will enjoy without having to solicit personal assistance in the store. Many inexperienced wine drinkers feel confused about all the wine choices, especially the intricacies of foreign appellations. Producers need to design and label wines that consumers can better understand .
Competitive Advantages

Some countries are better positioned to gain from globalization than others. Old World producers were the first to define tastes

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