Marketing Synopsis

VODKA

Nandan Shahane
Deepa Shahane

Product introduction
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Most vodka today is produced from grains such as sorghum, rye, corn or wheat.
Among grain vodka, rye and wheat vodka is considered superior.

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If vodka is made from sugarcane, it’s called a neutral cane spirit; if made from a
fermentable grain, it’s called a neutral grain spirit.

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Most of today’s commercial vodkas are made using a continuous still, which
neutralizes much of an alcohol’s flavor.

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The fact that most commercial vodkas have little or no smell or taste is what makes
them so versatile and popular and as a mixer.

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Due to carbon filtering, Vodka is a purer form of alcohol than the rest.

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The alcohol content in vodka usually ranges from 35 to 60 percent by volume. Vodka
may be classified into two main groups: clear vodka and flavored vodka.

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Flavorings often include red pepper, ginger, various fruit flavors, vanilla, chocolate
(unsweetened), and cinnamon.

Brands Available

Brand Introduction

Type - Vodka

Manufacturer - Diageo
Country of Origin - Russia

Introduced - 1860s

Smirnoff Products
Each Smirnoff product has a unique identifying number that is displayed on its label. Some of these
numbers are:
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21 - Smirnoff North (previously Smirnoff Norsk). The classic Smirnoff Red Label vodka flavored with
Nordic Berries. In some markets, including the United Kingdom, it is called Smirnoff Nordic
Berries.
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27 - Smirnoff Silver Label Vodka, 45.2% ABV
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55 - Smirnoff Black, 40% ABV. A small-batch vodka that is produced in copper stills.
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Smirnoff Black No. 55.57 - Smirnoff Blue Label Vodka, 50% ABV
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63 - Smirnoff Twisted V Green Apple
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64 - Smirnoff Ice Pomegranate malt beverage, 5.5% ABV
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66 - Smirnoff Ice Raspberry Burst malt beverage, 5% ABV
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66 - Smirnoff Twisted V Raspberry malt beverage
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67 - Smirnoff Twisted V Mandarin Orange malt beverage
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68 - Smirnoff Twisted V Black Cherry malt beverage
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75 - Smirnoff Ice Double Black. Sold in Australia and New Zealand.
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76 - Smirnoff Ice. Sold in Canada. 7% ABV
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83 - Smirnoff Ice Wild Grape malt beverage, 5% ABV
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85 - Smirnoff Twisted Raspberry. Sold in Canada.
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97 - Smirnoff Ice Triple Filtered. Sold in Germany. 3% ABV
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103 - Smirnoff Twisted V Arctic Berry
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110 - Smirnoff Ice Double Black & Cola
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111 - Smirnoff Ice Double Black. Sold in Australia.

SWOT Analysis

SWOT Analysis


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Strengths

High brand recall and recognition
Ads reinforce brand name and identity
Distinct bottle shape
Variety of flavors and pre-mixed drinks
Building international brands which enhances
the sale potential

SWOT Analysis


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Weaknesses

Not present in all price points
Arch-rival Absolut may have the edge as far
as trend-setting is concerned
Inability to launch variety of flavors in the
Indian Market
No ownership in many global brands.

SWOT Analysis

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Opportunities

The market for pre-mixed drinks have
developed a rapid pace in last few years.
Change in social pattern, lifestyle and
population profile.

SWOT Analysis


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Threats

Continued fears about the social impact of
alcohol abuse
Volatility in raw material prices
Change in regulatory environment
Falling sales of spirits brand could lead to an
international price war
Insufficient marketing instruments in India

Marketing Environments

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The Internal Environment

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The Micro Environment

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The Macro Environment

Macro Environment

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The factors that influence an
organization indirectly

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They are out of their direct control.

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PEST Analysis

Macro Environment
(PEST Analysis)…

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Political Factors

State and national government’s

Economic Factors
nIncrease

consumption and vice versa

regulation hours and days of sale
of alcoholic beverages.
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nMajority

may/may not afford the higher priced
beverages .

Anti drink and drive policies of
government

of Indian population comprises

of lower to lower middle class which

Restriction on availability of narcotic
drugs other than alcohol.

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in price leads to decrease in

nPrice

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hike

Macro Environment
(PEST Analysis)…
Socio-Culture Factors
nSocial

interaction- major reason for
drinking in bars.
nYounger individual are more likely to
drink in group.
nChange in lifestyle and population
profile.
nReligious barriers.
nEntertainment and games in drinking
setting.

Technological Factors
nFaster
nHigh

Transportation

quality manufacturing facilities.

nVodka

production has been increasing

over the last few years
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Michael Portar’s Five
Forces Model
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Meaning : The model of five Competitive Forces was developed
by Michael .E. Porter in 1980. These forces determines the
intensity of competition and hence the profitability and
attractiveness of an industry. Its five forces are:
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Bargaining power of Suppliers
Bargaining power of Customers
Threat of new Entrants
Threat of Substitutes
Competitive Rivalry between existing players

Based on the information derived from the five forces analysis,
we will see the characteristics of a Liquor Industry.

Bargaining Power of
Suppliers
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In Indian Liquor Industry some of the Suppliers areUnited Breweries Holdings LTD , Eshix Impex , Amber Distilleries , Cipla ,
Govindraj Exports.
Bargaining Power of suppliers is high when :n

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Market is dominated by few large suppliers rather than a fragmented source
of supply. The Indian Liquor Market is dominated by United B.Holdings
Ltd and the foreign market is dominated by brands like Smirnoff ,
Absolute.
There are no substitute for a particular product. Example is Grey Groose.
Switching cost from one supplier to another is high
If the product is unique. For example :n
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Absolute , manufactured in Sweden has the largest market share.
Romanov and White Mischief in India.

Bargaining Power of supplier is low
When supplier’s customers are fragmented

Bargaining Power Of A
Customer
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A customer bargaining power is high when:n

Large volumes of products are being bought.

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The product is undifferentiated and can be replaced by substitutes.

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Presence of few numbers of customer.

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Customer knows about the production cost of the product.

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Presence of alternate suppliers.

Threat Of New Entrants…
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There are some barriers which prevent any new company to
enter into a new industry. These entry barriers are:n

Government Rules and Regulations
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All liquor manufacturers has to abide by The National Liquor Act 59
of 2003.It says its an offence if

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Manufacture or distribute liquor if not permitted to do so.

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Manufacture or distribute methylated spirits.

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Manufacture ,sell or supply any impotable substances mixed in the
liquor.

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Advertise liquor in a misleading way and should not include a minor
at all.

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And many more strict rules are there in this law.

Threat Of New Entrants…
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Higher capital requirement
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Brand Loyalty
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Liquor production goes through stages fragmentation, Distillation
and Rectification, Filtration and Purification, Dilution and Bottling.

About 70% of Indian liquor industry is captured by U B Holdings
Ltd. Its products are Vodka ( Romanov and White Mischief),
Whisky, Gin, Rum, Brandy etc.

Product Differentiation
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U B Holdings Ltd produces a large range of products leaving a little
room for any new company to enter. Its a strategy.

Threat Of Substitutes
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Some factors determining Threat of Substitute are:n

Brand Loyalty.

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Switching cost for the customers.
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If switching cost from one product to another is high a customer will
stick to the former and vice versa.

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Following current trend
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Adding new value to the product

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Adjustments in price from time to time

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Market survey

Competition Rivalry
Between Existing Players
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A healthy competition is the need for any industry to grow.

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Competition between players is likely to be high due to

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Competitive Structure

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Fragmented structure

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Consolidated structure

Demand structure
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High demand less competition, low demand stiff competition

Exit barriers
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Economic factors

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Strategic and emotional factors

Thank You !!

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