A strategic framework for marketing Sweet Reinforced and Fortified Wines

In the last thirty years, the global wine business has become more and more crowded (Zanni et al., 2005). Wineries have been spurred to increasingly adopt strategies in order to succeed or maintain their position, while distributors have enhanced their market power by changing their approach to the category. The augmented number of competitors, either as producers or retailers, enable customers to choose among a multiplicity of heterogeneous products, amplifying both intra- (between wines) and inter-competition (in the comprehensive beverage category). On the other part, thanks to the spreading of technology and production competences, average quality of wines is higher and higher in all producing countries. Hence, the necessity to defend the achieved position on the part of incumbents, and to penetrate the market by new entrants, trying both to catch untapped demand and to conquer market shares from existing players. Market innovation within the industry is pulled by these opposite forces. At the demand-side level, consumers are more and more sophisticated and capable to look for available information in the prior-to-purchase phase: wine guides, internet-based apps, wine magazines, wine rankings, and so on, constitute an impressive information set for all wine purchasers. Hence, everybody is today able to satisfy personal needs (e.g. a gift) and desires (e.g. discovering a new brand) with relation to wine, in compliance with the budget disposal. The rise of new wine industries (the so called New World) and the changes in living standards led by globalization, generate also cross-cultural eating and drinking habits, leading to a growing level of wine consumption in traditionally non-consuming countries – such as California, New Zealand, Australia and, to a lesser extent and more slowly, Asia. At the same time, per capita consumption in traditional markets such as France, Italy, Spain, and Portugal has been declining in volumes but, at the same time, moving towards higher quality (and higher price) wines. In this changing world, sweet, reinforced and fortified wines represent a very specific and circumscribed wine class, that is a sub-cluster of the wider category of wines – as we will explain in the following paragraphs. While basically neglected by the management and marketing literature – mainly focused on other wine classes, such as, sparkling and still wines – these products constitute an interesting research topic: consumption habits, price variety, distribution policies, tradition/innovation dilemma, are a few examples of the multiple market peculiarities that make sweet, reinforced and fortified wines worth to be investigated. As any other wine class, though, it is extremely hard to work out a univocal marketing framework and strategy for the entire class of sweet, reinforced and fortified wines. Product variety, for instance, that turns into a plethora of different value offerings (from value to premium reaching sometimes the luxury segment) inhibits the development of a single effective marketing plan, suitable to any situation. As we will see here below, marketing management has to be interpreted as a general tool-kit that provides concepts, methods, and techniques that have to be adapted from time to time both to products’ and to consumers’ characteristics. The first part of this contribution is dedicated to briefly illustrate the theoretical background of wine marketing and clarify the meaning of market exchanges according to a marketing point of view. The second section aims to point out the most relevant drivers of wine buying and consumption behavior, while the third part tries to identify both main features and critical aspects of sweet and fortified wines. The last section aims to provide a possible framework for marketing these wines taking into account both consumers’ purchase and consumption behavior and products’ characteristics