A Study on Marketing Strategy of Domestic Wine

YOO, DAE HEE(The Graudate School of Business Administration YONSEI University)

I. Introduction

Product life cycle(PLC) is a crucial forecasting and control tool in the managerial decision-making for certain products in accordance with the increase/decrease of turnover/profit and marketing strategy over time.

Yet, Korean enterprises tend to misuse the PLC in formulating marketing strategy.

Therefore, this thesis is to perform a systematic analysis and formulate a competitive marketing strategy for a domestic wine, "MONTBLEU" of "J" Co.Ltd.

II. The concept and application of PLC

PLC consists of 4 steps ; Introduction, Growth, Maturity, Decline, which demonstrate different characteristics and require different marketing strategies.

For an effective utilization of the PLC concept, first, this thesis points to the need to accurately recognize the product life cycle(stage) and determine the appropriate marketing strategy.

However PLC possesses some weakness such as the simplicity of theory, ambiguity of each cycle, and the difficulty of measurement or standard.

III. Industry and Case Study

Started in 1967, the industry of domestic wine has recently demonstrated Some growth ; production of 6.874㎘ and product amount of 29.3 billion won in 1989.

In consideration of tendency for expensive or low-alcohol beverage and Westernization of consumption, it is estimated that domestic wine will show a continuous growth in the future but that its product life cycle is recognized to be at the stage of "Introduction".

In view of the weak recognition and low market share and low level of product image, the marketing strategy of "MONTBLEU" is as follow;

ㆍDirection of marketing strategy : differentiation of marketing expansion strategy for wine consumers, development of home market, target re-positioning by market segmentation

ㆍTarget

- Main : men(Age from 30's to 40's), level of white collar

- Sub : women (Age from 20's to 40's), level of white collar

ㆍProduct strategy : development of new product, quality development of domestic wine, reconsideration of product quality

ㆍprice strategy : development of low priced wine, maintenance of competitive priced products to current products.

ㆍdistribution (place) strategy : intensive distribution strategy, expansion of dealing on/off premise outlets.

ㆍpromotion strategy : appeal to consumers through image advertising light wine drunk as a French type low alcohol and consumer-oriented promotion in order to stimulate primary demands.

IV. Conclusion

The theory of PLC represents a useful standard in grasping the product life cycle of domestic wine.

However, it was insufficient in the presentation of concrete and actual strategy for "MONTBLEU" due to the simplicity of the PLC theory.

In order to overcome this weakness, a long-term and competitive marketing strategy should be formulated by analyzing the marketing cases of developed countries of wine, for example that of Japan.