Established in 1975 after the merger between Pernod SA and Ricard SA, Pernod-Ricard has 18,226 collaborators throughout 70 countries. Pernod-Ricard is the world leader on the market of premium and prestige spirits, and the co-leader on the wine and spirits market. The company is the leader on the Asian markets, which are the most dynamics. Pernod-Ricard has a large portfolio of premium wines and spirits in whiskies, anis-based spirits, liqueurs, cognacs and brandies, white spirits and rums, bitters, wines. Pernod-Ricard puts emphasis on 14 flagship brands that are 14 strategic spirits and champagne brands. The company also puts emphasis on 4 wine brands.
Pernod-Ricard's strategy is built around 4 main axes:
-Invest heavily on strategic brands with a worldwide vocation
-Turn the portfolio into a premium portfolio in order to accelerate growth and profit
-Continue development on emerging markets which are offering stronger growth perspectives
-Continue external growth after reducing debt in order to stay a dynamic actor of the consolidation of the Wine & Spirits sector
[...] Communication plan to make the current products of the group known by the potential customers Why? To reach the maximum of customers and then to increase their sales and their brands awareness How? Through advertisement in the big cities to reach the most of prospects Who? The marketing and the scientific council of the group When? Starting now and during one year How much? (around 5 millions??) Middle term What? Promotional and sales events around the different brands Why? How? [...]
[...] Pernod-Ricard is so large that he has very significant economies of scale benefiting to the whole value chain. It operates in all continents, as a global company, with a global portfolio. Compared to his competitor “constellation Brands” it doesn't outsource or off shore. It rather wishes to increase profits by increasing profit margins (by increasing its prestige), than reducing costs through increased efficiency in the Global Value Chain. Having being through the external analysis of Pernod-Ricard, it is interesting to see how the company is positioned in the several markets where it evolves. [...]
[...] Smaller competitors: Brown Forman (US Fortune Brands Campari (Italie),Rémi Cointreau (France) Other Competitors on different segments: Spirits: Diageo Bacardi Martini, Beam, Brown Forman; Wine: Constellation Brands (1st ),Foster's, E&J Gallo Winery, Concha Y Toro, Diageo; Champaign: LVMH Vranken-Pommery, BCC,Laurent-Perrier,Rémy Cointreau; Cognac: LVMH (1st of the activity in value in 2009),Rémy Cointreau, Fortune Group name Millions of boxes sold Spirits market Diageo 104 Pernod - Ricard 93 Bacardi Martini 35 Beam 30 Brown Forman 30 Wine market Constellation Brands 58 Foster's 37 E&J Gallo Winery 34 Pernod-Ricard 22 Concha Y Toro 16 Diageo 12 Champagne market LVMH 4 Vranken-Pommery Monopole 1.6 BCC 1.4 Pernod-Ricard 0.8 Laurent Perrier 0.7 Bowman Strategic clocks If we refer to Bowman‘s strategic clock, Pernod Ricard position itself with a strategy of “focused differentiation” (high prices and differentiation), which is a successful strategy, allowing them to yield higher margin owing to their prestige and their high quality product. [...]
[...] market is characterized by a high degree of industry concentration, as well as a high degree of competitive rivalry. It is also characterized by high profitability levels thanks to fairly pressure on margin. Rivalry remains below average owing to strong differentiation between products and the fact that despite a declining consumption trend, consumers are increasingly demanding. However, independent producers with a strong specialization still take a significant share of the market value, mostly in countries having a strong local production tradition (wine in European countries, Spirits in Eastern Europe). [...]
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