Upload
sameer-mathur
View
29
Download
1
Tags:
Embed Size (px)
Citation preview
Preserve the Luxury or Extend The Brand?Based on a HBR Case by Daniela Beyersdorfer and
Vincent Dessain
Should Château de Vallois begin producing a more-affordable wine?
A presentation by Shalvi Rathi MNNIT Allahabad,under
Prof. Sameer Mathur,IIM Lucknow,Marketing Internship 2015
www.IIMInternship.com
About Gaspard de Sauveterre,the 75 year old owner of
Château de Vallois…
… a famous wine-producing estate in the Bordeaux region of France
In 1855, this estate was allowed to charge top prices for wine and was classified as a Premier Grand Cru Classe
CEO: François de Sauveterre
Estate Manager:Jean-Paul Oudineaux
Owner: Gaspar de Sauveterre
Some important characters of the story:
150,000 bottles of Grand vin du were sold annually
The average US customer paid $999 for a bottle of Grand Vin,of which de Vallois collected between £100-£450
Then came the hero..Claire de Valhubert,
granddaughter of the owner, who wanted to produce a brand of wines which could be afforded by the average
earner as well!
She observed that the younger
drinkers were unable to
afford wine produced by their estate
due to its high price.
Now this, was a step towards introducing “affordable luxury”
in contrary to the core idea on which the age old enterprise had been working on so far.
To capture a new set of customers
Gain their trust until they can
afford the expensive brand
Increase the revenue and
profitsCapitalization
Added flexibility
Building relations with people from
all sets of the social structure
Why should Gaspard accept this new idea ?
Why Gaspard should reject this idea?
Dilution of brand equity
Alienation of core
customers
Added expense
Buying of extra assets
Loss of negociants
Lack of expertise in lowly wines
In nutshell, It can be extremely beneficial to introduce Brand extensions as long as the new brand sets as a perfect fit with the parent brand and resonates with the customer’s needs.