Question: Customer Perceived Value - Yellow Tail (Wine) Market in China

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Customer Perceived Value - Yellow Tail (Wine) Market in China

The wine production industry in China constitutes a small segment of the production of alcoholic drinks, accounting for less than 2% of the total revenue that the government of China collects from alcoholic drink production. There has been a decline in domestic demand for Wine in the China Market since 2013, and the decline worsened in 2020 when the China economy was hit by the Covid-19 pandemic (Dutto & Normand, 2019). Yellow Tail (Wine) is a brand of Wine produced by Casella Family Brands in Australia. The Wine was launched in China in 2007 with four brand ranges: Chardonnay, Shiraz, Merlot and Cabernet Sauvignon.

Since the launch of the Yellow Tail (wine) in the China Market, a fantastic and loyal consumer base has been witnessed, according to the Marketing and Exporting Sales General Manager of the Casella Family Brands. The Yellow Tail Wine has a fantastic flavor blended from the brand with a fun and vibrant personality team in the market (Mick, 2018).

Based on the Casella Family Brands financial report of 2020, the China Market accounts for only 3% of its Casella annual turnover. The other popular brands in the market included Vegan Wine Box, Waistcoat Wines and Henley Wines, among others. The Consumer perceived value is what the consumers of Yellow Tail are believed to gain from the consumption of the wine apart from the price they pay to gain the product. Marketing professionals in China Market can use consumer ideas and opinions and give predictions of how the consumers will view the product (Suter, 2020). An increased consumer perceived value leads to high sales volume and profitability.

The total customer benefits include increased brand variety to choose from. For the retailers and wholesalers, there is an expanded market and an increased variety of wine products to be sold. The total consumer costs include purchasing the Yellow Tail Wine either per bottle or per pack of six bottles which, according to JD.com, a bottle is RMB 53 while a value pack of six bottles is RMB 318 (Suter,2020). Some of the product benefits include health benefits such as protection from heart diseases and boosts the brain and gut in the body. The monetary costs incurred by consumers are affordable at RMB 53 per bottle of Yellow Tail Wine or RMB 318 per value pack of six bottles of the wine.

The service's benefits include a fun and memorable experience from the consumption of the wine, and the product is ideal, especially for the family, during dinner or any other events with friends. The product's time cost was launched in China Market in 2007 and has so far received great reception despite the COVID-19 pandemic challenges experienced in 2020 (Suter,2020). The personnel benefits of Yellow Tail products are that there is perceived value offered by the staff or employees in the system who are also involved in the process and assist consumers in the buying process.

In energy costs, the production of wine requires between 5.8 to 7.2 Kwh/h, and the product has 10.1 units with an ABV of 13.5%. The image benefit of the wine is that it has been very easy to introduce other products or ranges alongside the Yellow Tail Wine in the market (Mick, 2018). On the other hand, the psychological cost which comes with the product is that its price has slightly been placed below others, thus attracting many consumers and being easy to penetrate the China Market.

References

Dutton, J., & Normand-Marconnet, N. (2019). Visual Codes on French Wine Labels for Cross-Cultural Marketing in China and Australia. In Proceedings of the 11th Conference of the Association of Wine Business Research (pp. 53-67).

http://academyofwinebusiness.com/wp-content/uploads/2019/05/5.-VISUAL-CODES-ON-FRENCH-WINE-LABELS-FOR-CROSS-CULTURAL-MARKETING-IN-CHINA-AND-AUSTRALIA.pdf

Mick, H. (2018). Top 20: Australia's largest wine companies and the best of New Zealand. Australian and New Zealand Grape grower and Winemaker, (651), 14-31.

https://search.informit.org/doi/abs/10.3316/ielapa.265711874958518

Suter, K. D. (2020). The consumer of the future. In 17th Australian Wine Industry Technical Conference Adelaide, South Australia 21–24 July 2019 Edited by (p. 136).

http://ecite.utas.edu.au/138552/3/138552%20-%20Conference%20proceedings%20AWIT.pdf#page=140