Expansion of Canada's Wine Market

The Product

Ca’Tullio, Patriarca, Refosco dal Peduncolo Rosso, Is a great and rare Italian wine, not very well known as it’s made with an autochthon grape from Friuli Venezia Giulia, small region located in the north of Italy (Ian D’Agata, 2014). The DOC wine is available at the LCBO and through Signature Wines and Spirits agency for licence.

The Ca’Tullio winery was established at the end of the nineteenth century and was to experience an astounding development in farming and winemaking in 1928, with the Tullio family (Catullio.it). The winery offers tours and tastings in order to welcome anyone in their home and educate on what they do in the heart of the DOC Friuli Aquileia area, story which could be told during the service of the wine in order to bring the customers to a next step experience being told about the charming origins of the wine.

Canada and Italy’s Association in Wine Industry

With a 4.6% of increase in the sales of wine from the previous year (2018), Canada is the fifth largest importer for Italian wines and almost 14% of the wines on the shelves are dominated by the Italian reds and whites. Vinitaly, an event organized by the ICE (Italian Trade agency) focused on the Canadian monopolies for the upsell of Italian wines across all the liquor control boards in Canada. While studying the Canadian market it was found out that Ontario and Quebec are the largest consumers of Italian wines by volume in Canada. Therefore there is a huge market share for Italian wines in the industry here. (Canada bound: for the first time six Canadian trade monopolies met Italian producers at Vinitaly, 2019)

Business Market

The business market for this wine would be restaurants looking to offer something new and different and able to provide the best pairing to enhance this wine: Italian restaurants or upscaled steak houses or barbeque places. The reason is that the wine perfectly pairs with pasta, but also beef, lamb, and game, thank to its medium to high tannins, dried cherries, fresh herbs, almonds, and lavender intense flavours and aromas but with a short finish (Refosco dal Puduncolo Rosso.com).

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Being sold at $15.79 and considering a x3 average markup for those kinds of establishments, the selling price would be around $50, price which would appeal to a certain kind of clientele, looking for affordable wines, but not catching the attention of customers looking for a great, bold wine towards the end of the wine list.

The process of business buying for this wine would assume the general manager, owner, or sommelier of the restaurant to decide to add the wine to the wine list. In order to do so they will have to contact the agency, meet and establish payment method and deadlines, provide business liquor licence, and proceed with the first purchase of the wine.

Consumer Market

The potential consumer market in fact for such a particular wine, would be passionate and knowledgeable about wine willing to discover new grapes and have a new experience, but also consumers attracted from the affordable price.

This wine has a lot to offer; is one of the only 6 Refosco dal Peduncolo Rosso wine available at the LCBO; it’s a rare and unknown product to many people; pairs with food easy to prepare and to find; only comes from a specific area in the north of Italy making it rare.

The Ca’Tullio Patriarca is the second less expensive Refosco dal Peduncolo Rosso wine available at the LCBO, which could be the right way to enter this new world of an unknown grape.

As previously stated, this wine perfectly pairs with pasta, beef, lamb and game, which are dishes easy to prepare and to elaborate according to the restaurant concept.

Government versus Consumer buyers

In Canada, each province has there own, independent, liquor control boards that decide the import, distribution and the sale. Taking an example of the Liquor Control Board of Ontario (LCBO) they have five phases that goes into the selection of wine:

1. Product needs
2. Presubmission
3. Initial Decision
4. Product Evaluation
5. Final decision and launch in the market

Also, each wine or vintage must be represented by an agent like as mentioned before the assigned wine comes from Signature Wines and Spirit Agency.

However, the consumer buying behaviour in Canada does not vary according to the province. Survey statistics state that approximately 20.3% Canadians only drink wines on special occasions and events whereas 24.2% prefer reds over whites or sparkling. Also 54.2% mentioned that price is the one of the biggest factors that influence the wine buying decision. According to the seven P’s of Marketing, product and price are inter-related as it was found that the lack of knowledge on the consumer’s behalf made them prefer wines within a moderate-low price range ($10 – $17). Although exporting wines from Italy are expensive, Ruenza Santandrea (Wine coordinator at ACA) presumed that with the abolition of monopolies that are present in Canada, will cause a slight decrease in the price of wine and have an indirect positive effect on the consumer demands. (Bedford, 2018)

E-Marketing

Wine E-commerce has opened since a decade and is a way of media marketing strategy. Mostly E-Marketing benefits both the consumer and the producers by reducing the marketing effort and price by providing the information online, however it doesn’t reduce any travel or shipping costs which still remain the same. Another disadvantage to consider is the negative reviews which impact in the sale of the wine.

Mostly E-marketing is focused on the millennials as they are the proper target market who respond to this. Online advertising, email advertising or social media campaigns are just certain platforms for consideration.

Most of the wineries according to the survey carried out said that there was an increase in direct sale by up to 30%.

With the assigned wine we can open up a social media campaign, describing the wine while providing a virtual tour online of the place it comes from and the history behind the place and the grape. It will help diffuse the product in the market through LCBO sites as well as provide direct product placement in the market for consumers and business buyers as an increase in the knowledge about the product helps the sales. (Stricker, Susanne; Mueller, Rolf A.E.; Sumner, Daniel A., 2007) (Andrade Viana, 2016)

References

• Andrade Viana, N. (2016). Digital wine marketing: Social media marketing for the wine industry. 39th World Congress of Vine and Wine, 1-5.
• Bedford, E. (2018, August 3). Retrieved from Statista: https://www.statista.com/topics/2996/wine-market-in-canada/
• Canada bound: for the first time six Canadian trade monopolies met Italian producers at Vinitaly. (2019). Retrieved from Vinitaly: https://www.vinitalyinternational.com/what-makes-a-wine-influencer-2-2-3-2-2-2-2-2-2-3/
• Stricker, Susanne; Mueller, Rolf A.E.; Sumner, Daniel A. (2007). Marketing on Web. Choices Magazine, 31-34.
• D’Agata Ian, Native Wine Grapes of Italy, 2014.
• Refosco dal Peduncolo Rosso, retrieved from http://refoscodalpeduncolorosso.com/it/vitigno/
• Ca’Tullio winery, retrieved from https://catullio.it/the-winery/
• LCBO- Refosco dal Peduncolo Rosso, retrieved from, https://www.lcbo.com/webapp/wcs/stores/servlet/SearchDisplay?categoryId=&storeId=10203&catalogId=10051&langId=-1&sType=SimpleSearch&resultCatEntryType=2&showResultsPage=true&searchSource=Q&pageView=&beginIndex=0&pageSize=12&searchTerm=Refosco+dal+Peduncolo+Rosso&authToken=-1002%252CetYHJunN2fPHnqWYb6iXk2V4thGGKMCP7yRvypmsoac%253D
• Bacche di Bacco, Refosco dal Peduncolo Rosso, retrieved from  https://www.bacchedibacco.com/refosco/