Australia Wine Exporting Plan - Case Study Example

The paper "Australia Wine Exporting Plan" is an outstanding example of a marketing case study. In recent years, there has been an increasing preference for imported bottled wines to imported bulk wines over the last few years. By 2005, the volume of bulk imported wines (exceeding two litres packaging) was more than two times higher than the volume of bottled imported wines (Euromonitor, 2010). However, in 2009, the volume of bottled wine imports was more than 90 million litres while that of bulk imported wine was approximately 80.2 million litres. This has largely been caused by expanding cultivation of vines and grape production in China leading to a rise in the level of supply to the local producers. The market for Australia’s bottled wine in China grew by 47 percent over the same period. According to Topwinechina.com (2009), Chena’s consumers recognize Australia as producing high-quality products, raising the probability for Australian wine to be accepted in this market. In 2007, the Chinese government reduced the import tariff rate charged on bottled wine from 65% to 14%. The value-added tax (VAT) rate was also reduced to 17% and the consumption tariff rate to 10%. Generally, China is a preferred market for Australia’s Casella wine's firm (China Customs Bureau, 2009).23

Wine is slowly but surely becoming a lifestyle drink for many consumers across the globe. A survey conducted in 2009 by Gallup Poll showed that more than fifty per cent of United States women are wine consumers. In recent years, wine marketing has become a highly competitive aspect, as a result of the saturation of wine brands on the international market. This has forced wine marketers throughout the world to look for new wine consumers while at the same time, maintaining the existing wine drinkers (Allhoff, 2009).

Australia is one of the leading wine exporters throughout the world, and China is one of the greatest importer. Wine export is a key contributor to the Australian economy. During the 2006-2007 financial year, wine exports were ranked second to the beef exports. Australia is a large Island with warm and dry weather conditions. The country is located at the Southern Hemisphere, and thus the seasons are different from those in other regions like the US and European countries. Wine grapes in Australia are planted in regions with warmest climatic conditions. Wine harvesting season is mainly practiced from February to April, and this enables Australia to get young wines to the market six months earlier than those made in other countries.

Wine marketers in Australia mainly focus on finding new populations in other countries. In the face of global competition, this strategy allows them to target a large client base, as opposed to the local wine consumers. According to the Australian Bureau of Statistics (ABS), the wine industry earned a total revenue of 43.9 million dollars during the 2011-2012 financial year. According to ABS, the total revenue was a 28% increase in value against the last two financial years. That notwithstanding, the Australian wine industry faced numerous challenges that hindered the realization of its full potential. One of the greatest challenges is the unreliable weather conditions in Australia. The warm weather normally affects the growing and ripening of wine grapes. Wine quality is mainly influenced by weather conditions. The warm weather in Australia often leads to untimely maturity of wine grapes. This, in turn, has adverse effects on wine quality. In addition, wine grapes are usually affected by diseases, and hence, causing an increase in the cost of production. To address this challenge, wine connoisseurs have embarked on researches aimed at developing effective farming methods to counter the effects of climate predicament (Seal & Penrith, 2008).