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Wines of Kentucky

Doug Back, Tony Fernand, Tyler Hamilton and Daryl Love

Strategic Marketing Management

Midway College BUSM600

Nov. 6, 2009

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History of Kentucky Wines

Jean Jacques du Four became discouraged by reports from French veterans on the scarcity of wine in America

Explored the possibilites of wine making in the temperate Ohio River Valley

Founded the Kentucky Vineyard Society in 1798

Established the first commercial vineyard in 1801 on the Kentucky River southwest of Lexington.

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History of Kentucky Wines

By 1870 Kentucky was a leading wine producer and was responsible for more than half the nation’s wine production

During the 1920’s, many vineyards were destroyed due to prohibition and Kentucky’s wine production stopped

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History of Kentucky Wines

During prohibition Kentucky farmers began growing other cash crops.

By the time prohibition was repealed many of Kentucky’s vineyards had been converted into tobacco farms and the wine industry was lost.

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Kentucky Wine Industry Today

Today, the Kentucky Wine Industry is experiencing a revitalization.

New vineyards are being planted and new wineries are being built across Kentucky

Many Kentucky wines have also been recognized for excellence. Eight Kentucky wineries won 30 medals at the 18th

annual Indy International Wine Competition in Indianapolis this year.

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Kentucky Wine Statistics

Kentucky has over 113 grape producers growing 583 acres of grapes, 280 of which are ready for production

There are currently 46 wineries operating across Kentucky with 36 selling wine

200,000 gallons of wines produced annually

436 acres of vineyards planted in 2008, represents a 60% increase since 2002

The average price for a bottle of Kentucky wine is $12.26

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Growth of Wine Industry in Kentucky

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Kentucky Wineries

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State Sponsored Grant Programs

Winery Marketing Cost Share Program

Wholesaler Reimbursement Program

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Grant Programs for Kentucky Wineries

Winery Marketing Cost Share Program

Purpose: Provides a 50% reimbursement of total expenditures for approved marketing projects in to assist Kentucky’s small farm wineries in the promotion of grape and wine products through advertising.

Eligible Expenditures: Internet, print radio and TV ads, promotional items and uniform apparel.

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Grant Programs for Kentucky Wineries

Wholesaler Reimbursement Program

Purpose: To assist licensed small farm wineries and licensed Kentucky wholesalers in the distribution of small products.

Eligible Expenditures:A licensed Kentucky wholesaler may be reimbursed up to $12 per case for distributing wine products of licensed small farm wineries which meet certain requirements.

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Question

If Kentucky is such a great place for growing grapes, why hasn’t the Kentucky Wine Industry achieved the same success as the Kentucky Bourbon Industry?

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Barriers to Wine Production in Kentucky

Though there is a rich history of wine production in Kentucky, many local wineries are relatively young

Kentucky is one of 16 states that prohibits wine from being sold in grocery stores

Survey’s indicate local grape growers regard viticulture as more expensive and labor intensive than tobacco cultivation

Over half Kentucky’s counties are dry which makes distributing wine difficult.

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Kentucky’s Promotion of the Local Wineries

Promoting wine tours and trails is one strategy the state is using to increase public awareness of local wineries.

For example …

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Kentucky Horseshoe Trail Broad Run Vineyards (5) Brooks Hill Winery (6) Springhill Winery (29) Horseshoe Bend Vineyards

(17) Wildside Vines Winery (34) Ashwood Cellars (2) Chrisman Mill Vineyards

(11) Elk Creek Vineyards (12) Stonebrook Winery (30) CCC Trail Vineyard (8) Jean Farris Winery (18) Wright-Meyer Vineyard (33) River Bend Winery (23

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Day 1 Day 2 Day 3

Four Roses Distillery

Buffalo Trace Distillery

Equus Run Vineyards &

Winery

Kentucky Gentleman Cigar

Co.

Liberty Hall Historic Site

Wildside Winery

Lovers Leap Vineyard &

Winery

Thomas D. Clark Center for

Kentucky History

Woodford Reserve Distillery

Wild Turkey Distillery

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Traditional Industry Marketing Channels

Television

Newspapers

Billboards

Websites

Events

Customers (word of mouth)

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Kentucky Vineyard Social Media Marketing Channels

Web 2.0 Facebook YouTube Twitter

Talon No Yes No No

Equus Run Yes No No No

Jean Farris No Yes Yes Yes

Elk Creek No Yes No No

Lovers Leap No Yes No No

Crisman Mills No Yes No No

Acres of Land Yes Yes No No

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Marketing strategies of three Central Kentucky wineries …

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Talon Winery

Website

Newsletter

Wine Clubs

Hosts a variety events and groups (i.e. Luna Fest, Bluegrass Literary Discussion Group)

Slogan: Think Wine Think Talon

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Chardonnay $14.95A dry white wine with light apple flavors, aged in Kentucky white oak barrels

Vintner’s Select Chardonnay 2004

$17.95 A perfectly balanced dry white with oak and almond flavors

Traminette $13.50A spicy, floral white in the style of dry, light Gewürztraminer. Great with asian foods!

Chambourcin 2005 $19.95A light to moderately tannic wine, oak aged with a nose of plum and licorice, finishing with hints of vanilla and chocolate.

Estate Cabernet Sauvignon 2005

$49.95Our premium dry red. Awarded medals over some of the top wineries in the world

Cabernet Sauvignon 2005 $21.95A rich, full bodied red featuring deep black currant flavors and black cherry aromas

Monarch 2005 $17.95A lively red featuring peppery flavors of estate-grown Cabernet Franc grapes

Coyote Red $12.95A semi-sweet soft red wine with refreshing light cherry and strawberry flavors

Sweet Evening Breeze $11.95An elegant Riesling style white wine, semi-sweet with tropical undertones

Moondance $12.50A soft white blend of Cayuga White and Vidal Blanc, with hints of pear and vanilla

Bluegrass Blush $10.95 A luscious semi-sweet blush with tropical fruit flavors

Afterglo       $9.50 A semi-sweet blend of estate Catawba and Concord with a robust grape flavor

Buffalo Red              $9.50 A sweet and spicy light red with hints of cherry.

Buffalo White $9.50A light version of our Buffalo Red, with a distinctive aroma of fresh grapes and peaches with hints of cedar.

Talon Wine Menu

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Equus Run Vinyard Website

Newsletter

Wine Clubs

Hosts a number of events including the Alltech Fortnight Festival and Concerts in the Vinyard Series

Slogan: Visit the Vineyard Taste the Experience

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Equus Run Vinyard

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Jean Farris Winery & Bistro Website

Newsletter

Wine Clubs

Commercials

Offers live music on Saturdays and a variety of holiday themed dinners and events

Slogan: Hand picked Kentucky proud

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Some wineries are also airing television ads to make consumers more aware of their products.

These ads typically focus on the history of wineries and

the unique experiences they offer to consumers.

http://www.jeanfarris.com/videos.html

Jean Farris Winery & Bistro

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Strategy Development

While examining the marketing channels of local wineries we discovered that many are not using social networking websites

Our group chose three Central Kentucky wineries and focused on creating a buzz about their products through social media websites

Our goal was to use social networking to expose consumers to wineries’ products through promo clips, pictures, discussions and weblinks

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Marketing Channels

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Target Market

Consumers over age 21 who appreciate drinking wines as well as Kentucky Bourbon drinkers who may not have tried wine before

Native Kentuckians and tourists who may not be aware

of Kentucky’s fine wines and related products

All ethnicities who appreciate drinking wine and other alcoholic beverages

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Goals

Increase awareness of Talon Winery, Equus Run Vinyard and Jean Farris Winery & Bistro by utilizing Facebook, YouTube and Twitter

Promote the Kentucky wine experience and make consumers aware of all the Kentucky wind industry has to offer

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Strategies and Tactics

Setup a Web 2.0 presence on Facebook and Twitter

Establish relationships with local Central Kentucky wineries

Create promotional videos featuring local wineries

Initiated conversations and invited others to join

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Budget

$25 dollars (gas)

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Work Product and Results …

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Facebook

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Facebook

Video: Members can post videos, write captions, or comments.

Events: Events can be posted with all the need information to attend. E-vite option also available

Messaging: Administrators can send a message to group members

Links: All links that are posted on the wall are filed in the links page and can be retrieved at anytime

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Facebook

Wall: The main avenue of communication. Member can posting thoughts, links, experiences, suggestions, etc…

Information: Provides group background information.

Discussion Board: A medium were anyone can hold group conservations

Photos: Areas where member scan post photos, write captions or comments.

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Facebook

Members List: Updated list of all current members

Open Group: An open group where any of facebook member can join.

Promotion: If desire there is paid advertising that can be used to promote the group

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YouTube

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YouTube

Videos: It is the main uploading video source for the whole Kentucky Wines promotion. Any video can be uploaded as long as it is of a certain format and is less than 10 minutes long.

Cross promotion: After all videos are up loaded, a link will appear on Kentucky Wines Twitter and Facebook pages.

Viewership: Any member on Youtube can watch the videos

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Twitter

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Twitter

What are you doing: Constant messaging can be sent out to whoever is following. These messages can be from event updates, special deals, to random announcements.

Following: Updates can be received from anyone you might be interested in. We are following: Kentucky Ale, The Wine Diary, KY Wine Lovers, and more.

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Questions?