Marketing Synopsis

VODKA

Nandan Shahane
Deepa Shahane
 Product introduction
n Most vodka today is produced from grains such as sorghum, rye, corn or wheat.
Among grain vodka, rye and wheat vodka is considered superior.
n
n 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.
n
n Most of today’s commercial vodkas are made using a continuous still, which
neutralizes much of an alcohol’s flavor.
n
n 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.
n
n Due to carbon filtering, Vodka is a purer form of alcohol than the rest.
n
n 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.
n
n 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:
n 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.
n 27 - Smirnoff Silver Label Vodka, 45.2% ABV
n 55 - Smirnoff Black, 40% ABV. A small-batch vodka that is produced in copper stills.
n Smirnoff Black No. 55.57 - Smirnoff Blue Label Vodka, 50% ABV
n 63 - Smirnoff Twisted V Green Apple
n 64 - Smirnoff Ice Pomegranate malt beverage, 5.5% ABV
n 66 - Smirnoff Ice Raspberry Burst malt beverage, 5% ABV
n 66 - Smirnoff Twisted V Raspberry malt beverage
n 67 - Smirnoff Twisted V Mandarin Orange malt beverage
n 68 - Smirnoff Twisted V Black Cherry malt beverage
n 75 - Smirnoff Ice Double Black. Sold in Australia and New Zealand.
n 76 - Smirnoff Ice. Sold in Canada. 7% ABV
n 83 - Smirnoff Ice Wild Grape malt beverage, 5% ABV
n 85 - Smirnoff Twisted Raspberry. Sold in Canada.
n 97 - Smirnoff Ice Triple Filtered. Sold in Germany. 3% ABV
n 103 - Smirnoff Twisted V Arctic Berry
n 110 - Smirnoff Ice Double Black & Cola
n 111 - Smirnoff Ice Double Black. Sold in Australia.
SWOT Analysis
 SWOT Analysis


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

 Weaknesses
n Not present in all price points
n Arch-rival Absolut may have the edge as far
as trend-setting is concerned
n Inability to launch variety of flavors in the
Indian Market
n No ownership in many global brands.
 SWOT Analysis
 Opportunities
n The market for pre-mixed drinks have
developed a rapid pace in last few years.
n Change in social pattern, lifestyle and
population profile.
n
 SWOT Analysis


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

n The Internal Environment

n The Micro Environment
n The Macro Environment
 Macro Environment

n The factors that influence an

organization indirectly
n They are out of their direct control.
n PEST Analysis
 Macro Environment
(PEST Analysis)…
Economic Factors
 Political Factors
nIncrease in price leads to decrease in
n State and national government’s
regulation hours and days of sale consumption and vice versa
nMajority of Indian population comprises
of alcoholic beverages.
n Restriction on availability of narcotic of lower to lower middle class which
drugs other than alcohol. may/may not afford the higher priced
n Anti drink and drive policies of beverages .
government nPrice hike

n
 Macro Environment
(PEST Analysis)…
Socio-Culture Factors
Technological Factors
nSocial interaction- major reason for
nFaster Transportation
drinking in bars.
nHigh quality manufacturing facilities.
nYounger individual are more likely to
nVodka production has been increasing
drink in group.
nChange in lifestyle and population over the last few years
profile. n

nReligious barriers.
nEntertainment and games in drinking

setting.
 Michael Portar’s Five
Forces Model
n 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:
n Bargaining power of Suppliers
n Bargaining power of Customers
n Threat of new Entrants
n Threat of Substitutes
n Competitive Rivalry between existing players
n Based on the information derived from the five forces analysis,
we will see the characteristics of a Liquor Industry.
 Bargaining Power of
Suppliers
n In Indian Liquor Industry some of the Suppliers are-
n United Breweries Holdings LTD , Eshix Impex , Amber Distilleries , Cipla ,
Govindraj Exports.
n Bargaining Power of suppliers is high when :-
n 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.
n There are no substitute for a particular product. Example is Grey Groose.
n Switching cost from one supplier to another is high
n If the product is unique. For example :-
n Absolute , manufactured in Sweden has the largest market share.
n Romanov and White Mischief in India.
n Bargaining Power of supplier is low
n When supplier’s customers are fragmented
 Bargaining Power Of A
Customer
n

n A customer bargaining power is high when:-

n Large volumes of products are being bought.
n The product is undifferentiated and can be replaced by substitutes.
n Presence of few numbers of customer.
n Customer knows about the production cost of the product.
n Presence of alternate suppliers.
 Threat Of New Entrants…
n There are some barriers which prevent any new company to
enter into a new industry. These entry barriers are:-
n Government Rules and Regulations
n All liquor manufacturers has to abide by The National Liquor Act 59
of 2003.It says its an offence if
n Manufacture or distribute liquor if not permitted to do so.
n Manufacture or distribute methylated spirits.
n Manufacture ,sell or supply any impotable substances mixed in the
liquor.
n Advertise liquor in a misleading way and should not include a minor
at all.
n And many more strict rules are there in this law.
 Threat Of New Entrants…
n Higher capital requirement
n Liquor production goes through stages fragmentation, Distillation
and Rectification, Filtration and Purification, Dilution and Bottling.
n Brand Loyalty
n 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.
n Product Differentiation
n 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
n Some factors determining Threat of Substitute are:-
n Brand Loyalty.
n Switching cost for the customers.
n If switching cost from one product to another is high a customer will
stick to the former and vice versa.
n Following current trend
n Adding new value to the product
n Adjustments in price from time to time
n Market survey
 Competition Rivalry
Between Existing Players
n A healthy competition is the need for any industry to grow.
n Competition between players is likely to be high due to
n Competitive Structure
n Fragmented structure
n Consolidated structure
n Demand structure
n High demand less competition, low demand stiff competition
n Exit barriers
n Economic factors
n Strategic and emotional factors
Thank You !!