Phillipos Solomon

Marketing Plan: Chateau Marguax

- Executive Summary
Mentzelopoulos with the Margaux team which includes
General Manager Paul Pontallier, Technical Director Thomas
Du Chi Nam, Cellar Master Philippe Berrier, Commercial
Director Aurelien Valance, Chief Financial Officer Pinon and
their consulting oenologists Jacques and Eric Boissenot
decided to launch the third growths of their first and second
wines. A rare incident. In most cases, the third growths were
sold in bulk to merchants but the 2009 batch, after tasting
proved to have enough quality to enter the market as a
Chateau Marguax wine.
The supply of wine changed drastically in the 21 st century. As
more vineyards were in business in the New World instead of
the primarily locations such as France, Italy and Spain,
269,000 hectares of vines were dug up in Europe.
Exportation of wine was dominating in the Old World,
consisting of 55% of the market while United States only
shared 8%. Demand of wine was uneven. The demand was
gaining momentum from other parts of the world such as
Australia, United States and China.
Selling the third wine was prompted to Mentzelopoulos by a
Chinese visitor but was neglected due to the common lack of
quality with the third batch of the wines. The idea of selling a
lower quality wine went against the increase quality and
build a reputation for spectacular wines motto. The third
wine, consisted of 20% of the entire batch and once tasted
and gained recognition by the management team, they
could not ignore this potential market.
The team decided on bottling the third wine and selling it to
a select group of negociants. Their primarily questions were
on where and how to necessarily market this third wine.

- Marketing Situation
o Industry Analysis
The wine industry has changed dramatically in this
century. Due to the rise of vineyards across the globe,
most vineyards have exited or downsized the industry.
Due to the rise of vineyards in the 20th century, the
price of most bottles decreased so to gain consumer
establishment. In Europe to maintain a steady market in
the wine industry there have been policies that resulted
in the decrease of hectares. There are hundreds of
thousands of producers with over 30 billion bottles
produced per year. Global wine exportation shows that
France, Italy and Spain take up 55% of that supply,
while Australia, Chile and Argentina take up 33% and
United States at a low 8%.

o Competitive Analysis
Although they do not face any direct competitors in
establishing this third wine Chateau Margaux have to
face their normal competitors that they face while

marketing their first and second wines. These are a few

of their primary competitors:
Lafite Rothschild
Latour
Haut Brion
Mouton Rothschild
o Customer Analysis
The wine consumption in Liters show that France is
number one in the demand of wine. United States,
Portugal, Australia, Russia, China, Japan and Canada
prove to increase yearly on their demand and
consumption rate. Since the third wine will be
marketed to the United States, the customer analysis
portrays their segments.

Overwhelmed 23%
Image Seekers 20%
Traditionalists 16%
Savvy Shoppers 15%
Satisfied Sippers 14%
Enthusiasts 12%

Although Enthusiast are lowest in United States, the

over all consumer rates are highest in that area by 25%.
o Company Analysis
The Chateau Marguax is located on the left-bank of the
Grodone estuary in the Medoc region. The ownership of
this company dates back to the 12th century but didnt
really become a key component of the wine industry
until the 16th century by the Lestonnac family. Andre
Mentzelopoulous purchased the company in 1977 for
$16 million during the downfall of the Bordeaux wines.
He restored this pit by orchestrating a complete
overhaul of the vineyards, improving drainage and
building the first underground cellar. Andrs vision,
attention to quality and innovation inspired many
Bordeaux winemakers.

Currently the management team consists of

Mentzelopoulos,, General Manager Paul Pontallier,
Technical Director Thomas Du Chi Nam, Cellar Master
Philippe Berrier, Commercial Director Aurelien Valance,
Chief Financial Officer Pinon

- Marketing Opportunity
Selling the third wine was prompted to Mentzelopoulos by a
Chinese visitor but was neglected due to the common lack of
quality with the third batch of the wines. In 2009, the vintage
changed that perspective. During their assemblage of the
vintage, tasting the third wine, which consists of the first two
did not disappoint. Immediately Pontallier knew that this
could have potential. After aging the product, they came to
realize the possibility of bottling the third wine and
expanding the market. They realized that there was a
potential financial market due to the reputation of the
company. Having their Pavillion Rougue triple in prices only
brought brand recognition and allowed them a chance into
this industry with a third wine. In 2011, after tasting the
aged wine, they decided to move forward in bottling this
third wine. They decided to sell to the simplest option which
was to selected negociants who sold 10-20% of the first two
wines. They chose the negociants primarily because they
knew that they could get 50% of what the Pavillion Rouge
went for. They saw the opportunity going to China. Their goal
of this third wine was to bring back lost consumers from the
first and second wines. They wanted to go after consumers
new to the wine loving world and introduce them their
brand. This third wine was their opportunity to attract a new
generation of wine sippers while gaining the trust of their
previous consumers.

- Business Model

The business model of the third wine consists of letting the

negociants pay the highest price possible to introduce it to
the market. On average the first and second wines went for
roughly 600 changing constantly due to the demand of the
industry. Customers will be able to purchase the wine from
retailers and merchants just like all other wines in the
industry. To show that consumers will get value for their
money the team decided on a range between $100-$150
per bottle with the hopes that eventually the market itself
will increase the price for them. In the US, an importer brings
the wine into the country and sells it to distributors licensed
to operate in each state. The distributor in return sells to
retailers.

- Marketing Objectives
The objective of the third wine is simple. The management
team wants to attract new wine lovers by giving them a new
item while keeping their renown brand. Another objective is
to slowly bring back consumers who were loyal to the first
and second wines but lately have switched to other wines.

- Marketing Strategy
o Target Market
The target market of the third wine is simply current
and new wine consumers.
o Positioning
The positioning for the third wine is simple. value for
the money. Instead of initiating this wine as a high-end
brand, the management team is going to allow the
market depend its price. Starting off low, itll give the
consumers an opportunity to be attracted to the price
first.
o Product Strategy

o Product Design
The product design will be similar to the first two wines.
Bottled and branded.
o Patent pending
There isnt a specific patent pending, but the
established brand of the Bordeaux wines has their own
formula for the grape and harvesting ratios.
o Pricing
The third wine will be priced at approximately $100$150 per bottle to perceive to customers that theyll
have value for their money. Since their first two wines
are more expensive than the third, and they already

have brand recognition, $100 seems reasonable.

o Promotion
Promoting this wine will mainly be about influencing
decision makers. Since the perception and attitude of
Bordeaux wines were a bit underwhelmed the past
couple of years, convincing sommeliers to order it
prestigious restaurants was the primary marketing goal
of promoting this third wine.
o Place/Channels
The channels will rely on importers and large
distributors to directly reach desired end consumers.
These places could be high end restaurants. Another
alternative was to focus on wine shops, primarily
boutique ones.

- Marketing Budget/Financials

- Management Team

Corinne Mentzelopoulous Owner

Paul Pontailler General Manager
Thomas Du Chi Nam Technical Director
Philippe Berrier Cellar Master
Aurelien Valance Commercial Director
Oliver Pinon Chief Financial Officer
Jacques and Eric Boissenot Consulting Oenologists