Username:    Password:
Thanks for stopping by...
























Ripe Flavour Rewards from High Country
























Annals of Marketing
The Deadly and Effective Comparative Marketing of Woolworths
Wednesday, 24th November, 2010  - David Farmer

For a number of years both of the large retailers, Woolworths and Coles have used a method of selling liquor called ‘bundles’. They offer two items, or a bundle, for say $50.00 rather than singly at a higher combined price. Less frequently one of the paired products is either a brand they control as the importer or a brand they own. There are many variants of this simple theme.

When you pair your product with say a well known international brand you begin to mix selling and marketing.

The consumer gets confused and with time associates the lesser known brand with the better brand which might be for example Johnnie Walker. Use of this technique also allows the retailer to bring together two similar products which have a considerable difference in their cost price. Thus two for $50 may bring together spirits that cost $26.00 and $20.00 for a profit of $4.00. The consumer is attracted because they know that at least one of the products is worth far more than half the price which lowers the risk.

With this method the retailer has achieved three things: the customer equates over time the two products as equal and as the retailers product costs less than the established brand this increases the margin. The third benefit is that the retailers product cannot be attacked on price by other retailers. In this way the retailer can manipulate the profit margin and more importantly begin to further control the customer and move them away from brands which they do not control. As you can imagine this makes conventional wholesalers rather nervous.

Of the three liquor categories you can make the greatest use of this method with wine as the selling prices are far more variable than spirits while beer is controlled in Australia by just two companies and it is thus harder to get supply.

The Dan Murphy advertisement shows an advanced use of this method. In sequence Oyster Bay, Taylors and Grandin are used to sell three brands controlled by Woolworths. Coles do similar things. Recently it was mentioned to me that wine suppliers to Woolworths were told they will use their brands to sell and develop their own.

I know this is an effective, indeed deadly marketing technique as I have been using it for 16 years. I do not use the bundle idea but have periodically promoted exclusive retailer brands with a comparable supplier brand. In this way customers see the enormous price discrepancy and readily make the leap that the cheaper wine is of the same quality, and you can reinforce this in the body copy.

The Oyster Bay product in the Dan Murphy advertisement has not been done correctly as it really says two Tangaroa are only worth one Oyster Bay. This is not comparative marketing and is a different proposition entirely. It does though remove customer doubt about the unknown brand as they will rightly say; there is not much risk in this deal.

Big retailers though should be cautious with this method and show far more subtlety than they currently do as it is not in their long term interests to destroy brands.

R
E
C
E
N
T
2
0
1
3
2
0
1
2
2
0
1
1
2
0
1
0
2
0
0
9
RECENT ANNALS OF MARKETING ARCHIVE
Rosemount Reaches the End of the Road

Monday, 15th June, 2015

Winery Names and Naming Wine Labels

Sunday, 6th April, 2014

Trademarks, Crittendens, Koppumurra, Wrattonbully and Legal Follies - Part 1

Tuesday, 18th February, 2014

ANNALS OF MARKETING ARCHIVE 2013
Hamburgers Under the Golden Arches

Wednesday, 3rd July, 2013

The Founder of the German Retail Colossus Metro Dies, Age 89

Friday, 15th March, 2013

Cheez Doodles, Cheetos, Fast Foods and Wine

Wednesday, 27th February, 2013

ANNALS OF MARKETING ARCHIVE 2012
When Marketing is Not Needed

Monday, 19th November, 2012

Marketing Bogus Items - Assets on Balance Sheets

Thursday, 4th October, 2012

In Recognition of Eugene Ferkauf - Retail Pioneer

Thursday, 20th September, 2012

How Do You Tell Customers You are Changing the Recipe?

Monday, 13th August, 2012

The Price Tension of Supply and Demand

Thursday, 28th June, 2012

Are Heritage Wine Brands Worth Anything?

Sunday, 22nd April, 2012

Marketing a Business

Friday, 2nd March, 2012

Using Negatives and Telling the Truth - Can it Work?

Sunday, 15th January, 2012

ANNALS OF MARKETING ARCHIVE 2011
The Dream of Sales and Marketing - Making Consumers Spend

Sunday, 13th November, 2011

Turning Disaster into Triumph

Sunday, 21st August, 2011

A Question of Balance

Friday, 1st July, 2011

Marketing a Colour Change in Fish

Monday, 9th May, 2011

Marketing the Aldi Way - A Note on Theo Albrecht

Monday, 7th March, 2011

The Art of Marketing the Arts

Friday, 14th January, 2011

ANNALS OF MARKETING ARCHIVE 2010
The Deadly and Effective Comparative Marketing of Woolworths

Wednesday, 24th November, 2010

Just Being Yourself Is Good Marketing

Saturday, 9th October, 2010

Studies Show Wine Consumers Fall Into Unique Segments

Friday, 20th August, 2010

Advertising Guru Sir John Hegarty Says Wine Market is Impenetrable

Sunday, 1st August, 2010

Reclaiming Your Brand

Sunday, 4th July, 2010

Writing Job Applications

Wednesday, 19th May, 2010

Marketing - The Rules of Success

Friday, 30th April 2010

We Pay Tribute to a Marketing Legend

Tuesday, 6th April 2010

The Art of Marketing Fragrances

Wednesday, 24th March 2010

The Andre Rieu Phenomenon

Monday, 1st March, 2010

Riding the Organic Wave

Sunday, 21st February, 2010

Keeping Supply Lower Than Demand

Wednesday, 13th January, 2010

ANNALS OF MARKETING ARCHIVE 2009
Facts About Marlboro Man and Marlborough

Wednesday, 18th November, 2009

Be Very Clear About What You are Selling

Monday, 5th October, 2009

Diamonds are a Girl's Best Friend

Saturday, 12th September, 2009

Ah yes, the Art of Marketing Yourself

Thursday, 16th July, 2009

Do You Understand the Creative?

Sunday, 5th July, 2009

First Cat's Pee and Now the Taste of Cigarettes

Wednesday, 17th June, 2009

Finding the Flavour that Works

Wednesday, 10th June, 2009

Not so Easy at Fresh and Easy

Sunday, 7th June, 2009

Twittering - Where Will it Lead

Sunday, 31st May, 2009

Is This Shooting Yourself?

Sunday, 24th May, 2009

What's in the Name

Saturday, 16th May, 2009



©2016 Glug  |  Contact Us  |  Privacy Policy  |   RSS Feed
Liquor Licensing Act 1997: It is an offence to sell or supply liquor to a person under the age of 18 years, or to obtain liquor on behalf of a person under the age of 18 years.
All transactions in $AUD. This web site is operated by Glug Management Company Pty Ltd ABN: 64 116 647 780 Licence No: 51401128