Transcript Document

Issues and Challenges for the
Israeli Wine Industry and the Role
of National Branding
Roderick J. Brodie,
University of Auckland Business School
New Zealand
Agenda
1. Current Situation
2. Global Trends
3. Building a National Brand
4. Challenges for the industry, companies and branding
1. Current Situation
• Strong heritage
– Traced back to Talmudic period
– Rothschild heritage from 19th century
• Relatively small
– 46,000 tonnes (NZ 270,00)
– 5 large wineries 80% of harvest
– 250+ small wineries
• Domestically based
– Per capita consumption 4.5 litres
– Imports 20%
Export Profile
• Exports tripled in the last decade last decade
• But 2011 exports still small
– $27US million (NZ $800US million)
– Less than 10% of local market (NZ 150%)
• 90% of exports from 12 wineries
• 55+% exports to North America 35+% to Western
Europe
• Low international awareness of National Brand
Is there a revolution transforming the industry?
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expertise of young winemakers who've studied abroad
new, quality grape varieties
modern viticulture & wine-making prractices
wine critic endorsements
2. Global trends facing the Israeli industry
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Increased production
Increasing international competition
Shifting patterns of demand
Internationalisation of ownership structures
Altered institutions of governance
Increasing retail power
Increasing importance of marketing and branding.
Issues and their importance for Israel
Issues and their importance for Israel cont’d
3. Building a National Brand
• Management of brands at the heart of any successful marketing
strategy
• For wine this is complicated by the hierarchical character of the
brand identity
– Rather than there being a single identity there is a brand
architecture involving multiple identities.
– Traditionally this has included:
• Country of origin, region and/or appellation,
domaine/bodega/estate,
• Producer (and commonly also distributor) labels, and retailer
labels.
– New World producers:
• Country and region have had a particular significance,
• Variety has also played a major role.
• Wine tourism and hospitality place a new emphasis on
developing broader identities of the various wine regions
Lessons from Brand “New Zealand Wine”
• Comprised of a number of elements:
– its core is a discourse of quality, promoted by industry participants,
local wine media and the industry’s representative organisations,
– discourse is sustained by continued attention to quality from
winemakers, effective programmes of collective marketing and
careful cultivation of key gatekeepers – supermarket buyers and
international wine media.
• Brand is supported by:
– effective information exchange in production, commitments from
winemakers,
• collation and dissemination of industry information made
available through the industry website,
– over fifty trade shows and tastings around the world annually,
– new logo of “pure discovery” which is underpinned with the theme
of the previous logo of “the riches of a clean green land”.
Different Perspectives of Branding
• 4 perspectives:
– Customer
• End consumer vs. trade vs. other stakeholders with different attitudes and
perceptions
– end consumer market segments vary considerably
» connoisseurs, aspirational, enjoyment, new,…
– Managerial
• Resource, asset or capability that creates value (equity)
• Need to understand the trade-offs
– Legal & Socio-political-economic
• Government and national interest
– Institutional
• The filière
– innovation, historical background, institutional and social linkages
– co-ordination and co-operation among industry participants
– based on an agribusiness/rural/lifestyle
• Regional and geographic indicators.
How a National Brand Creates Value?
• Brands are intangible (relational) assets
– a brand’s role in a marketing system is much more than end
consumer associations with a name or logo
– brands facilitate processes within value systems
• multiple networks
• Brand “Israel Wine” is an umbrella brand within a
complex network
– Complex interactions between national & regional terroir
identities and other elements in value networks
A National Brand is an Umbrella Brand
• Acts as an umbrella for:
– Winery Brands
– Event Brands
– Varietal Brands
– Regional & Sub Regional Brands
– Allied Brands
• Other National Brands e.g. Tourism
Characteristics shared by the worlds strongest
brands: Brand ISRAEL WINE?
Necessary to have:
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distinctive positioning, delivery of customer benefits & value, relevance,
consistency, a sensible portfolio
integration of marketing activities, management involvement, understanding
and support
Most critical characteristics are:
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Clarity
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distinctive values are understood and lived and loved by those who deliver
them
Consistency
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in what (who) they are)
Leading the market with delivery
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ability and exceed customer expectations and create delight
4. Challenges for the industry, companies and
branding
1. Balancing national, regional interests and individual
winemakers’ interests.
2. Production issues
3. Organizational and governance issues
4. Coordinating national, regional interests and individual
winemakers’ marketing activity
– One national organization?
– How to engage the members of the industry.
– How to engage other stakeholders
5. The importance of sustainability.
6. Broader national issues.
Thank you!
Any questions or comments?