The paper “ Globalization and Marketing Strategies in Wine Industry, Marketing Plan for Australia’ s Casella Wines Pty International” is a meaningful example of a case study on marketing. Casella Wines won the coveted Australian Agribusiness Exporter Award in 2004 for a record third consecutive year. Winning the award meant Casella Wines joined the few select companies in Export Awards Hall of Fame. On receiving the Award, John Casella as the managing director was quoted commenting how the Yellowtail brand propelled the company’ s fortunes to winning the prestigious award despite its five-year stint on the market (Steane & Dufour 2006).
It is true that Casella Wines ascended too fast into the legion of Australia’ s top twenty wine exporting companies. The company was ranked at position eighth in 2001, moving consecutively to fifth, fourth and third by 2004. The order of Australia’ s top five wine exporters has drastically been reshaped with the arrival of Casella both in terms of value and volume. At present time Casella is credited with over one-third of Australian wine exports to the US market. It is amazing how Casella Wines, in just less than ten years it has managed to grow from five to over three hundred employees in its winery business alone (Steane & Dufour 2006). Mission statement (goals domestic and international)The vision and mission of Casella wines as its managing director John Casella asserts is by protecting, maintaining and improving yellow tail’ s winning formula now and in future.
This vision is envisaged in “ a basic, easy-drinking and full-fruit flavored wine with reasonable complexity and palate length” (Steane & Dufour 2006). This paper has the goal of providing strategic analysis concepts in understanding how globalization enabled transformations in the Australian wine industry.
The analysis used two strategic management perspectives. First is the concept of Michael Porter on market positioning and second is Richard D'Aveni's hypercompetitive framework, with particular emphasis on the Australian Yellow Tail brand. Michael Porter’ s strategy encompasses leadership cost, focus or differentiation while the hypercompetitive framework draws from simultaneous importance of both quality and price in winning competitive advantage. D’ Aveni emphasis is also known as industry disruption using global economies of scale as the basis of bringing change in the wine industry.
In contrast, porter’ s differentiation model elaborates on the consistent success of relatively expensive wines in the mid-price market portfolio (Cox & Bridwell 2007). Company overviewWinemaking in Australia has been going on since the first convict settlers arrived in 1788. The industry remained obscure until the 1980s when government officials and entrepreneurs discovered opportunities in the US and UK resulting from demand growth. Investors were offered incentives to plant vines and within a short period, wineries opened up at breakneck speed (New York Times, 2009). Casella Wines started operating in 1969, and since then it has positioned itself primarily as a low-profile bulk wine producer.
Filippo Casella and his wife, the post-war immigrants of Italian origin managed the firm. The winery is stationed 600 kilometers south-west of Sydney along Riverina region in New South Wales. The site is in a prime and efficient region for wine production due to the availability of mechanical pruning and harvesting as well as easy access to greater volumes of cheap but high-quality grapes. The success of Casella Wines may be attributed to Sicily skills brought by the founders who acquired them through three successive generations in the hinterland of Italian grape growing dating back to 1820.
The founders started Casella Wines as a way of adding value to their newly acquired 16-hectare farm, purchased from laboring savings as itinerant workers in North Queensland cane fields and New South Wales fruit fields. Similarly, they wished to transfer winemaking skills to their next generation as well as perpetuating ancestral traditions of sharing and selling good wines with friends and family. There is nothing satisfying currently to the patriarch Filippo Casella like seeing his sons and recently grandchildren working on the vineyard and attending luncheons at their family farmhouse (Steane & Dufour 2006).