Slide 8 of 18
Notes:
- Our first initiative is to increase sales. Now, you can see here that the Robert Mondavi portfolio already includes winning brands across the premium spectrum, from less than $10 per bottle to more than $100 per bottle.
- Our approach here is two-fold: first, we are devoting attention and marketing resources to our core brands; second, we are launching new brands to reach new consumers in segments where we don’t have as strong a presence – you can see that even our brand portfolio has some “white space” in it.
- [click] A good example of our attention to core brands is our recent extension of Woodbridge called Select Vineyard Series, priced between $8 and $10 a bottle. Response to Select Vineyard Series has been very good, with little cannibalization of Woodbridge or our other wines in that price segment.
- This is one of the ways we are keeping Woodbridge strong and the brand fresh in the face of constant price attacks. Another innovation here is our new single-serving bottles of Woodbridge varietals, which have been very popular.
- Our core brand focus also drove the successful re-launch three years ago of Robert Mondavi Private Selection. Earlier this year we introduced a Pinot Grigio that spurred renewed interest in the other Private Selection varietals, so the entire brand has accelerated its growth curve.
- Our second path for sales growth is developing and launching new brands, including Kirralaa, which we make in Australia with Southcorp, and Hangtime, which is aimed at the market for “discovery” wines on restaurant wine lists. The most recent launch was Papio, the first product developed by our in-house group, Prospect Peak Cellars. This group is creating new brands to attract consumers to the premium wine market, and Papio has proven a successful first effort. The brand presentation is fairly irreverent and the flavor profile is fruit-driven, not oaked. It is ready to drink at a very attractive price, about $4 to $5 per bottle. It’s already a hit in Japan.
- All of these new products have launched well, but we are watching them carefully. We will only support new products that we know will make a contribution to our bottom line.
