Market Strategies of Treasury Wine Estates †MyAssignmenthelp.com

Question: Discuss about the Market Strategies of Treasury Wine Estates. Answer: Treasury Wine Estates (TWE) is an international winemaking and distribution company based in Australia. Until a demerger in 2011, it was the wine segment of the global brewing brand Fosters Group. The companys business is segregated into 4 global regions: New Zealand and Australia; Africa, Middle East and Asia; Europe; and The America. Before entry into any new region or market, the company conducts a new market entry risk evaluation. Such analysis entails an assessment of the probability and implications of myriad risks, covering reputational and legal risks, through which the threat of human trafficking or slavery might be taken into account[i]. Treasury Wine Estates distributes its wines to a variety of clients across different regions, and it tailors its route-to-market framework by the nation to capitalize on regional opportunities. The organization is now planning to shore up its business in China and intends to open restaurants, wine bars and outlets for entertainment. Such move from B2B to B2C could be risky but is one route that companies seeking to enter China need to consider. Keen on capitalizing on this opportunity, TWE is reexamining its conventional distribution framework and making the transition to selling the products to its customers directly[1]. Another strategy used by TWE planning to enter other regional markets through its branded stores is that of market penetration and cost. It tries to be strategic in communication activities, brand development etc. to develop a powerful brand. Though TWE is normally perceived as a low-cost winemaker, the company tries to position itself as a premium brand in some regions. However, when planning to enter China, for instance, this may be a tricky proposition. For a market in China that has a high-end consumer class, several organizations are moving toward premium positioning. Usually, it is a decent strategy, because it can yield high margins. Nonetheless, some customers typify TWE as a low-cost brand in its domestic marketplace[2]. Hence, there could be a risk that customers of premium products become eventually discerning and knowledgeable to be exposed to foreign products and brands. The company also uses less capital-intensive market entry strategies like e-commerce and digital marketing in other regions. TWE strives to scope out opportunities in the marketplaces within the 2nd and 3rd tier towns and tries to rebrand its product lines to a luxury one. This is the reason why it operates B2B globally but is interested in introducing a B2C brand in China for stimulating demand via every channel and augment sales. As far as the American market is concerned, the barrier to market entry are very low and hence the competition is high. Therefore, TWE tries to establish a competitive advantage in the market through targeting varietal segments, entering into strategic distribution and supplier partnerships, and differentiating itself based on price and image[3]. In the UK market, TWE employs a joint market penetration strategy because this is the only rational and economically feasible strategy. Bibliography Cole, Brett. Treasury Wine Estates to Buy U.S. and British Brands From Diageo. The New York Times, 13 October 2015, https://www.nytimes.com/2015/10/14/business/dealbook/treasury-wine-estates-to-buy-us-and-british-brands-from-diageo.html. Granata, Julien, et al. "Organisational innovation and competition between SMEs: A Tertius strategies approach."International Journal of Technology Management71.1-2 (2016): 81-99. Granata, Julien, et al. "Understanding the evolution of competition among SMEs in a wine cluster: a social capital approach."International Journal of Entrepreneurship and Small Business31.1 (2017): 67-84. Perdue, Lewis. Treasury Wine Estates other Oz vintners boosted by Australia/China Free Trade Agreement. Live Oak Bank, 24 January 2017, https://wineindustryinsight.com/?p=77923.