(This article is an executive summary from an exclusive 40 page VitaBella Report).(More wine news on www.vitabella.fr).
At the end of March 2010 will be held the official annual Bordeaux "En primeur" tastings. It will be a great opportunity for wine professionals, members of the trade and the media from all over the world, to gather in Bordeaux and taste Bordeaux 2009. And, even if the common thought is that "the ‘market’ dictates what prices the wines sell for", First Growth Chateaux and other prestigious names will have to define a pricing strategy like it happens in any industry where a luxury positioning is at stake.
Mouton Rotschild, Petrus, Lafite Rotschild, Haut Brion...All these great names will announce their release prices after the "en primeur" tastings. Defining a pricing strategy is a complex issue and some points should be considered before taking any decision:
- Chateaux should analyze their release prices' history in order to define a pricing strategy for 2009. Considering (or not) volatility a part of the prices' history at the chateau, owners should be aware that the pricing for this 09' vintage will show a big sign to the market.
- Chateaux should consider the economic situation, not only the economic realities of their own property but also the current situation on international markets.
- Chateaux should anticipate the "appreciation" of the vintage by top international wine critics. This is a very important point which is not made easy after a 2008' campaign which highlighted some divergent positions on wine tasting notes from key critics.
- Chateaux should speak with their customer base (brokers, wine merchants...) and anticipate opportunities that could influence positively the marketing of their wines. Among some opportunities, the "En primeur" on March 2010 may attract for the first time a community of chinese buyers who were more keen, over the last few years, on buying old or recent vintages. Chateaux owners should ask thewselves how these opportunities would impact positively their sales?
- Chateaux should evaluate the potential of their wine over a long-term. In fact, Over the life of a wine, critics make some "tasting reviews" to analyze the initial evaluation they gave during "en primeur". Major critics will review their notes and may give a "Second Life" to the wines.
- Above price, chateaux could decide and define an allocation on what is called the "first tranche": how many cases should the chateau propose for the first "offering". Chateaux are aware that the release price is the one that will be communicated to the world, that journalists will refer to when talking about the price of their 2009. Considering this point is all the more important as a price can rapidly make a positive or negative buzz among brokers and wine merchants.
Defining a successful pricing strategy for "En Primeurs" Bordeaux is not an easy task. A lot of aspects are not directly related to what the chateau actually did in 2009. And this year seems even more impacted by external issues with so much uncertainty still hanging on. In fact, after a tasting of some of the most prestigious Bordeaux 2009, the only certainty we can have is: 2009 is unbelievably spectacular! (More wine news on www.vitabella.fr).
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