MY Kind of Case Study
Thursday, October 18th, 2007 | School
Not all of the papers and case studies we are forced to read and conduct are without their true merit. This one particular case that is due tomorrow before class is on Robert Mondavi and The Wine Industry.
How appropo since I just applied for two jobs with two different wineries (talk about a hell of a commute, but seemingly well worth it if you ask me). Anyhow! Learned a ton about wine and the industry itself.
This particular case study was performed in 2002, so not TOO off of what possibly is happening still today. What is interesting is the cross pollination of contenders in the industry. I just find it wrong to discover that one entity will operate businesses solely in wine and others will operate businesses in wine, packaging, appliances and water heaters ??? Huh? One of these things certainly does not sound like the other. I guess that’s diversification for you.
To think of that CEO saying, “hmmmm our appliances and water heaters just aren’t fittin’ the bills…I know… how about we purchase a wine business”. Nevermind, it’s really not their business forte, nor do they have any experience in it… it sounded good!
Funny, but I did have a Robert Mondavi wine at Happy Hour at Macaroni Grill a few months back and remember it being quite good and then seeing it at Costco. Which makes another point. Costco has become quite the popular “off-premise” distributor of a number of high end-premium to mid priced wines. I believe “Snooks” was telling me that they bought out almost all of the Chateauneuf-du-Pape’s that were released like last year, since the harvest was so plentiful.
Please correct me if I am wrong, but I do remember seeing the bundles of cases on numerous pallets and teetered and tottered over buying a few the last I was at Costco. I think purchasing a bottle of wine over $25.00 would just reveal me as too much of a profligate. With unemployment out in about a week, I’m going to have to be minimizing my wine budget, amongst many other things (that I’m currently in denial about.. like shoes, mascara and jewelry).
Chateauneuf-Du-Pape is the BOMB of red wines too, if you get a chance take the time and indulge (invite me along too would ya?).
Anyway, I digress. I did learn throughout the case that there is a ton of Industry consolidation happening. Jug wines are reinventing themselves as being more sophisticated and equally comparable to the Premier priced wines and basically it’s a relatively spendy process.
I’m proud of Mondavi in that their new strategy is no longer joint ventures or mergers or acquisitions. They want to grow organicially (maybe it’s just because I like that word organic), but either way they are continually investing in creating brand equity as a premier brand. “Wine properties have grown increasingly expensive in recent years, and as a result, we are not relying on acquisitions to stimulate our growth. Nor should we. The brands in our portfolio are all high-quality wines with strong market positions and excellent management” (Roberto, 2002, P.16).
Did you know that Mondavi spent $11 million on the Golden Vine Winery at Disney’s new California Adventure Theme Park? The attraction opened in 2001 and had a mini vineyard, exhibits that demonstrated the phases of the winemaking process, an open-air terrace for wine tasting and dining at an upscale restaurant with fine food and a gift shop. Geez, that was the time to go there with Kids. I’d have to say they may have done better in Las Vegas than Disney. “I’m sorry Edward mommy & daddy can’t go home or back to the hotel or take you on Magic Mountain yet until we get over our nice wine buzz” 
Yes, the project flopped, but hey, nothing like a nice break for ma and pa while at Disneyland. I like the idea of a little bit a wine, vineyard, eclectic experience action while the kiddies are running like the day is long around Disneyland. Works for me. Although I still think it woulda most likely worked better in Vegas. Geez, they have everything now, even a Hofbrauhaus!
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