Hlavní práce73429_cibv00.pdf, 2.2 MB Stáhnout

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Prague University of Economics and Business International Business

Brand Analysis of Barefoot Wine

Author: Valerie Cibulková Thesis instructor: Tomáš Sadílek Scholar year: 2020/2021

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Declaration:

I hereby declare that I am the sole author of the thesis entitled “Brand Analysis of Barefoot Wine“. I duly marked out all quotations. The used literature and sources are stated in the attached list of references.

In Prague on ... Signature

Valerie Cibulková

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Acknowledgement

I hereby wish to express my appreciation and gratitude to the supervisor of my thesis, Ing. Mgr.

Tomáš Sadílek, Ph.D. for his patience, recommendations, and overall guidance.

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Introduction

“Wine is sunlight, held together by water.” - Galileo Galilei

Galileo Galilei, the Italian astronomer, was right in saying that wine symbolizes a connection between the earth and the sky - but it is the winemakers who convert those and bring out the best in them.

Nowadays, wine is more than just a system of connections between nature and man. It is now bottled, designed, and sold as a product - a process that by some, has been optimized and made extremely profitable. An example of such a brand is Barefoot Wine, the most sold American wine brand there is.

The goal of this thesis is to pinpoint the successes of Barefoot Wine through the examination of Barefoot Wine’s branding and marketing communication concepts. If successful, ideally, this thesis could be used as a guide for local wine companies that are searching for suggestions when it comes to branding their products.

The thesis is separated into two segments - theoretical and practical. The theoretical segment is separated into three chapters.

The first chapter introduces what marketing, and the marketing communication mix is.

Each type of the marketing communication channels (e.g., advertising, PR etc.) will then be explained separately, supported by direct examples of Barefoot’s Wine marketing taken from their sources.

The second chapter presents what a brand is and contains the specifics of branding concepts, using the structure from Scott M. Davis’s book: Brand Asset Management. This chapter contains two sub-chapters of Brand Development and Brand Positioning. Brand Development includes the concepts of Brand Vision, Picture and Identity. Brand Positioning includes the concepts of Brand Value, Uniqueness, Credibility, Sustainability and Fit. As with the previous chapter, all of these concepts will first be individually explained and then connected to the practical examples of Barefoot Wine’s brand.

The third and final chapter of the theoretical segment presents the brand itself - their history, product portfolio, market position and their competition. This chapter also defines the US wine market.

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The practical segment is based on the results of a survey created and distributed by the author. The chapter first introduces the reader to the methodology used, then continues on to describe the structure of the sample and analyze the general survey results. The author then summarizes the survey results and gives appropriate recommendations for potential improvements.

1. Marketing Communication Mix

As defined by Philip Kotler and Kevin Lane Keller, marketing communications is “the means by which firms attempt to inform, persuade and remind their customers - directly and indirectly - of products and brands they sell.” (Philip Kotler and David Lane Keller, 2012, p. 476).

It can be assumed that a product that cannot be seen or heard, cannot be sold. This alone is the reason why a marketing communication mix is so crucial to firms. It is even more crucial that the communication mix is tailored to the company and created in such a way that it produces the desired impact on the customer.

As said by P.R. Smith and Ze Zook: “Communication is not a one-way flow of information (…) it only occurs when the receiver actually receives the message that the sender intended to send.” (Smith and Zook, 2021, p. 157).

In order for the customer/consumer to be affected, the communication of the chosen mode of marketing has to be narrow, insightful and well prepared. Not only that, it is also ideal when several of the modes of the communication mix are effectively used together - for example, using advertisement and PR cooperatively.

1.1. Above The Line Marketing

Above The Line Marketing focuses on untargeted, mass market communication. It is about engaging with a large audience of customers in order to create brand associations and visibility and informing the potential customers about a product that is available for them to buy. Most commonly, we can find Above The Line Marketing in the forms of TV advertisements, Print media (articles in magazines or newspapers, etc.) or Radio. (Furman, 2017)

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1.1.1 Advertisement

According to the Oxford dictionary, an advertisement is a “notice or announcement in a public medium promoting a product, service, or event or publicizing a job vacancy.” (Lexico Dictionaries, 2021) To take it a step further, Kotler and Keller describe the term as “any paid form of nonpersonal presentation and promotion of ideas, goods or services” (Kotler and Keller, 2021, p. 478). According to the two authors, this includes all types of media, including printed (magazines, newspapers), electronic (websites, video/audio tapes), network (telephone), and telecommunication media (television, radio) (Kotler and Keller, 2021, p. 478).

Advertising is mainly used to build the customers' awareness of the brand and a desire to buy their products. As mentioned by P.R. Smith and Ze Zook: “the original purpose of advertising is to inform, persuade and remind.” (Smith and Zook, 2021, p. 349) It is about bringing the attention of the customers to the brand and then feeding the interest of the customer by persistently reminding them of the brand to a point where they are trusting enough to purchase the product.

Figure 1: Mindy Kaling for Barefoot Wine

Source: (Deabler, 2019)

In the picture above we can see an example from a TV and YouTube advertisement of Barefoot Wine with the actress Mindy Kaling. Barefoot Wine has a tendency to use famous people (Mindy Kaling, Aubrey Plaza, Kenan Thompson, The Black Eyed Peas etc.) in their advertisements as can be seen on their YouTube channel and Instagram profile. The people they choose tend to be well known people who are perceived to be easy-going or funny (both Mindy

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Kaling and Aubrey Plaza played in two of the most famous US TV shows and both of their characters have many similarities).

The use of celebrities in advertisements, especially those that are well perceived by many, can be a great strategy to get customers/consumers to trust your product.

Barefoot Wine is also launching overseas TV advertisements. (Mileham, 2021) A new example would be the “Let’s get Barefoot” ad campaign launching in the UK, which is projected to reach more than 5 million viewers. Olga Senkina, Marketing Director of E&J Gallo Winery said the ad would be illustrating the brand as the “perfect choice” to enjoy relaxing moments with friends and family. “As we spend more time with friends and family over the coming weeks, we hope our advert will encourage consumers old and new to enjoy everyday moments with a glass of Barefoot,” she said. (Mileham, 2021)

1.2. Below The Line Marketing

Below The Line Marketing focuses on targeted, specific market communication. It is about engaging with a smaller, more specific audience of customers who are targeted through personalized advertisements with the goal of creating conversions (sales). Most commonly, we can find Below The Line Marketing in the forms of billboards, banners, direct marketing, sales promotions, sponsorships, PR and so on. (Furman, 2017)

1.2.1. Direct Marketing

Direct marketing is a form of marketing that, with the rapid expansion of the internet, has been progressively growing. This mode allows for the company to directly communicate with their customers and is ideally used in combination with other modes of the communication mix - for example, a newsletter that is combined with a code for a promotional sale on the company's website. Well known examples of direct marketing would also be automatic text messages or messenger bots.

Chatbots and messenger bots are increasingly popular, considering the amount of information they are able to receive from and pass onto the customer with very low effort. On Facebook for example, the chatbot can receive your name, profile picture, gender and e-mail - everything needed for the company to create a customer persona and personalize ads and content in the favor of the potential consumer.

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The use of automatic text messages is very popular nowadays as well. They are useful to keep check of the consumer - send promotional offers, automatic birthday messages, making it seem like the company cares for each and every customer.

Barefoot Wine also uses direct marketing as a source of communication with consumers.

In the picture below, we can see a screenshot taken from Barefoot Wine’s website showing it is possible for the customer to sign up for newsletters with promotional offers, information about new products etc.

Figure 2: Newsletter on Barefoot Wines

(Barefoot Wine, 2021)

In the second screenshot below, we can see an automatic chat box that pops up once a customer goes onto Barefoot Wine’s Facebook page - this is the aforementioned messenger bot that allows for direct and fast responses whilst taking your data to be used for other purposes (the use of the customers public information).

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Figure 3: Barefoot Wine Facebook Chatbot

(Barefoot Wine Facebook, 2021)

1.2.2. Sales promotions

Sales promotions is a mode of communication that is specifically focused on getting the customer to buy a product. The previously mentioned advertisements can be taken as an introduction and repetition of the brand, whilst the sales promotion can be the final incentive for the customer to buy the product. Unlike the other methods of communication though, if sales promotions are done too often or sales are too high (e. g. 70% sales) it can come across as untrustworthy and to some consumers it might decrease the interest in the brand. On the other hand, promotions in the sense of loyalty programs or giveaways may be a good initiative for longer-term consumers to repeat purchases, as it can give new customers a reason to buy from the brand.

An example of a widely popular loyalty-type sales promotion would be a loyalty card.

Looking at an example of a coffee shop - for each coffee you buy, you receive a stamp.... Now, the free coffee might not seem like much, but if the customer is to choose between two cafés - one that offers loyalty programs and one that does not - they would be more likely to choose the one that offers this sort of benefit.

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Figure 4 - Loyalty Card example

(Industrious coffee and condensed type at Yourstruly – Typedeck, 2011)

From what can be found on Barefoot Wine’s website and social media, the brand does not have any active loyalty programs. Although there are currently no active sales on drizzly.com (Barefoot Wine’s sale channel), it is possible that sales do happen. The only added value/incentive to buy that exists on their website is free delivery if a certain amount of wine is ordered.

1.2.3. Public relations

Unlike others, this communication mode is more often relevant to the whole company and its reputation rather than a single product or a part of the company. “Public relations integrates with public affairs, corporate affairs, community affairs, community relations, corporate relations and corporate communications.” (Smith, PR; Zook, Ze. Marketing Communications, p. 392).

Simply explained, PR is a development and sustenance of a good reputation and relationship with differing communities - both public and private.

Public relations of a company can be tough to maintain, considering the differing needs and wants of different groups. For example, stockholders and employees will have vastly contrasting interests and expectations of the company's actions.

Examples of PR can be: press releases, press kits, speeches, seminars (online and offline), brochures, newsletters, annual reports, charitable donations, community relations, and company magazines.(Marketing Strategy and Promotion, 2021)

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Barefoot Wine is very active in their PR communication. They try to maintain an image of an inclusive and accepting brand - made by everyone, to be enjoyed by everyone. They are openly supportive of LGBTQ+ societies (creation of Pride Parade limited edition wines), feminists and have supported the Black Lives Matter movement through financial donations. They have also supported COVID-19 relief nonprofit organizations such as Free Mom Hugs. We can find examples of this on their blog posts, their website or through their social media (Instagram and Facebook) - as can be seen on the pictures below.

Figure 5: Instagram Post about LGBTQ+ Figure 6: Instagram Post about Black Lives Matter

(Barefoot Wine Instagram, 2021) (Barefoot Wine Instagram, 2021)

Although not the same brand, it also might be beneficial to mention the corporate social responsibility of E. & J. Gallo Winery (the owners of Barefoot Wine). In the year 2014, E. & J.

Gallo Winery was awarded the Corporate Social Responsibility Award from the Procurement Leaders for progressing energy and water management practices. According to the Gallo website itself, apparently, they have reduced energy consumption by 10% whilst keeping their sales at the same or higher level. (E. & J. Gallo Winery, 2014)

Since Barefoot Wines is owned by E. & J. Gallo Winery, it could be assumed that they will even have a better CSR status than most wineries - especially considering the popularity of green movements in the USA.

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1.3. Through The Line Marketing

Through The Line Marketing is composed of both Above The Line Marketing and Below The Line tactics. It functions on the belief that the market is an interconnected space and communication with customers is important in every way possible. An example of Through The Line Marketing could be: a combination of a magazine article with the product attached, or typically Digital marketing. (Furman, 2017)

1.3.1 Digital marketing

At the moment, digital marketing may be considered the biggest and most evolved type of marketing available. It is widespread, allowing for extreme mass communication by almost anybody, considering the small costs involved in the use.

The main digital marketing concepts that will be talked about in this chapter are summaries made from Simon Kingsnorth’s “Digital Marketing”.

Search Engine Optimization

SEO (Search Engine Optimization) is a tool well known to most who have at least minimal experience in digital marketing. If anything, it is undoubtedly the most valuable knowledge one can have if they rely on income through their website or social media. It is a discipline that is not only quite complicated to grasp, but also everchanging. Since SEO is dependent on search engines, when they evolve, so does the SEO.

According to Kingsnorth, SEO is best described as a triangle of three key factors: content (e.g., main text on websites, meta tags, length and density of website, title and heading tags etc.), technical (e.g., domain name, image optimization, etc.) and links (quality of links, internal link volume etc.). (Kingsnorth, 2019)

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Figure 7: SEO Triangle

(Kingsnorth, Simon, 2019)

“If your site has compelling, broad, relevant and timely content that is fast to download, easy to navigate, works across all platforms with no errors and a large number of reputable sites link to you because they also think your site is valuable, then your SEO strategy is likely to be on the path to success.” (Kingsnorth, 2019, p. 123) This means that as long as all three of the sides of the triangle are working together, your website is as close as it can get to being ideally optimized for search engines.

So how do we create the ideal SEO strategy? It is first important to understand who you are creating your strategy for. Creating customer segmentation profiles based on target customer groups is important in order to understand the next step - the use of proper keywords.

Keywords are extremely important in the line of digital marketing, considering they are practically all of the search terms that are used in search engines such as Google. (Kingsnorth, 2019) The personas (e.g., a middle-aged woman with two children living in the suburbs) will help us understand what keywords need to be highlighted. Such a woman might search for terms such as “babysitter, fast, new york suburbs” or anything of the sort. By creating a potential persona, it is easier to identify what kind of keywords your customer might be searching for.

This goes hand in hand with another useful tool - data mining. In order to understand who, the customer is, it is always great to have an analysis of the website in place. This can, for example, collect the age, location, most visited landing page, frequency of visits etc., of the brand’s customer. Some e-shop providers, such as Shoptet.cz even provide the most searched keywords

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Although this may seem as the only thing a person would need to create a customer profile, other factors should still be considered for future brainstorming and planning. The reason for this is simple - sometimes the people that travel to your website are not the people that are your target customers. Therefore, if you create keywords based on these visits, you will continue a cycle of inviting in people that would not necessarily be prosperous for your sales or building of your brand.

The last thing to do in order to create ideal keywords would be to recognize which keywords have the highest competitiveness and which keywords hold the largest commercial value. These two points are extremely important to understand and utilize.

Commercial value of a keyword is quite easily explained: “For example ‘pound/euro exchange rate’ has a large search volume, but if a bank were to rank number one for the term, how many current accounts would get opened on the back of it?” (Kingsnorth, 2019, p. 127)

Similarly, the competitiveness of a keyword is somewhat easily understandable - if you are a small website and compete with a keyword such as “translate”, the chance that the given keyword would drive the customer to you rather than to Google translate is minimal. Although neither are specifically countable per say, they are easily deductible with common sense. Therefore, they should be considered as a part of the keyword brainstorming.

Technical SEO

SEO is not only about keywords, but also about the technicalities of the website. One of the most important technical concepts is “Tags”. The two main tags being - title tags and meta description. (Kingsnorth, 2019)

Title tags are short descriptions of the actual page content to be found on the website. They can be found in the HTML of the website and are used by search engines such as Google to then find the website and show it on the search engine as the title tag that was written in. The key to a good title tag is using your brand name and a suitable keyword to go along with it. An example of a good title tag can be seen in the picture below.

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Figure 8: Technical SEO example

(Processed by author)

Meta description, as seen in the picture above, is a more descriptive explanation of what the website actually provides. These are important to catch the customers eye through the use of relevant, interesting and short sentences.

A couple of other important technical concepts could be things like: website hierarchies, providing alt text for images or for example the correct structure of URL (the address of a web page).(Kingsnorth, 2019)

Content SEO

Content SEO means the use of content in order to have your website search engine optimized. There are two main types of content - technical and engaging. (Kingsnorth, 2019) Technical content is the type of content that is functional and simply used for its purpose for being found by Google's algorithm. An example of such technical content could be blog posts that use certain keywords.

Engaging content on the other hand is what makes the customers click on your website. It is the relevance of the content which makes it become so engaging that it pushes the customer to re-share the content. This re-share, link etc., that leads back to your website is then seen by Google’s algorithm as something of worth, and therefore it moves the content higher up the search engine. An example of such content could be Buzzfeed’s (American entertainment company) cooking website. They publish recipes on their website, which are then re-shared on Facebook or can be commented on directly on their website. This creates large amounts of traction, which allows them to be shown at the top of certain recipes on Google.

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Paid and organic search interactions are self-explanatory. They both refer to the possible search methods used for example on websites such as google.com, bing.com, seznam.cz and so on. A person can either create more organic (unpaid, ranked by relevance) searches by using quality SEO on their own websites, or they can pay for advertisements which will show them at the top of the page results. An example of both versions can be seen in the picture below.

Figure 9: PPC and Organic search example

(Google Adwords Marketing - Baboon Software, 2021)

It is important to mention that for some customers a paid google ad may be discouraging.

Sometimes, although recognized, the top advertised websites are skipped. It is possible that people can be more trusting of organic searches that are based on actual human interaction rather than something that has been prepaid.

Social media

Social media is becoming an increasingly more important channel for businesses to grow in. In January 2021 there were 4.66 billion internet users worldwide which accounts for 59.5% of the global population. 92.6% (4.32 billion) of those users had accessed the internet via mobile devices. (Johnson, 2021).

In 2020, over 3.6 billion people were using social media worldwide - that is 77.3% of all internet users. The number of social media users is projected to increase to 4.41 billion in 2025.

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14 (Tankovska, 2021)

Technological development along with social media has completely changed the way people shop. Suddenly, we can all browse countless content through devices that we carry on ourselves and even buy products through social media apps such as Instagram.

In social media, it is important to align with what the company’s strategies are in their

“classical marketing”. Meaning, the personality the company chooses to portray through their PR, websites etc., should be parallel to the personality they portray on their social media.

There are also many different types of social media that companies should bear in mind.

Not only the basic Instagram, Facebook, Twitter, and YouTube. The importance of blogging, networking sites, forums and even review/rating sites should not be neglected.

When it comes to Barefoot Wine, they seem to have it all. They have an Instagram with vivid images that scream exactly the personality they strive to be - bubbly, inclusive, American.

Their twitter seems to mirror the same exact content posted onto their Instagram.

Figure 10: Barefoot Wine Instagram Figure 11: Barefoot Wine Instagram

(Barefoot Wine Instagram, 2021)

They have a YouTube channel which has a combination of advertisements and regular content that reinforces their PR (LGBTQ vlogs, “We Stan For Her” - support for black businesses videos etc.).

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Figure 12: Barefoot Wine YouTube

(Barefoot Wine YouTube, 2021)

Figure 13: Barefoot Wine YouTube

(Barefoot Wine YouTube, 2021)

Likewise, their website blog about cooking uses the same colorful pictures with interesting recipes for desserts, entrées, and snacks that customers can make using their products.

Figure 14: Barefoot Wine website recipes

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2. Branding 2.1. What is a brand?

As is written in the book Marketing Management, the American Marketing Association defines a brand as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.” (Kotler and Keller, 2021, p. 241)

Another definition, this time by Giep Franzen, says that a brand is “a network of associations in the mind of the consumer.” (Průša, 2020)

Last, but not least a definition made by Scott Davis - “A brand is an intangible but critical component of what a company stands for...In part, a brand is a set of promises. It implies trust, consistency and a defined set of expectations.” (Davis, 2002, p.155)

All of these definitions joint together give us a rather clear perception of what a brand supposedly is. For the companies, it is a chance to create a perception and differentiation of their product or service through different means and for consumers it is the way they actually perceive that product or service and why.

2.2. Brand development

Brand development is an overall evolution of a branding strategy. It is a multi-stage process that is undertaken in order to create a functional brand that is clearly defined, differentiated from competitors and is aligned with the primary business objectives. These primary business objectives are then supported through secondary activities such as marketing, communicating with the target market and updating the brand accordingly.

Parts of the Brand Development process are described further below through factors such as: Brand Vision, Brand Picture, Brand Identity and Brand Positioning.

2.2.1. Brand Vision

A brand vision is undoubtedly one of the most important factors to consider when creating a brand for a product/service. It focuses and defines what the actual role of the brand is. It helps companies define a picture (qualities, associations, and values) that they want to set and make sure

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it complies with both company values and their financial and marketing strategies.

According to Scott Davis - “A Brand Vision should help to define how the company plans to leverage its brand or brands in order to reach its corporate vision, uphold its corporate values, and achieve its stated corporate mission.” (Davis, 2002, p. 467)

If we take a look at Barefoot Wine’s website, social media and take parts of their book into consideration, we can find specific qualities, associations and values that Barefoot Wine wants to represent. These are further discussed in the Brand Picture and the Brand Identity.

2.2.2. Brand Picture

A brand picture, or image, is an external view of the company's brand - meaning the way the consumer/customer truly perceives the brand. Ideally, a brand picture/image should be a reflection of the brand vision and the overall positioning. If the two are aligned, then it means that the company is correctly focusing its efforts and that the consumers perceive the brand the way the company wants it to be perceived.

There are two main elements that help define the brand picture - associations and persona.

A brand persona is a set of human qualities that the customers can relate and associate with.

Associations on the other hand are company characteristics which help customers differentiate, self-express, or maybe even gain status due to the status of the company.

When it comes to the external view of the company’s brand, we can only assume how customers of Barefoot Wine perceive the brand. This type of information tends to be internal information that is kept inside the company or achieved through external surveys that ask customers about their opinions. Such factors will be later on considered through the survey analysis.

2.2.3. Brand Identity

Brand identity is based on the values of the brand. It is the picture of the brand that the company sets through certain associations. We can find a couple different versions of definitions of the brand identity, yet most actually have much in common. (Průša, 2020)

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David Aaker separates Brand Identity into three sections:

1. Brand as a product

2. Brand personality - brand as an organization, person, or symbol

3. Value proposal - functional values, emotional values, and values of self- expression

Keller brought about the so-called Brand Mantra, which is built by three parts:

1. Functional 2. Descriptive 3. Emotional

Last but not least, Franzen splits the Brand Identity into four categories:

1. Functional 2. Impressive 3. Expressive 4. Social

Considering that all of the above-mentioned theories about Brand Identity are almost identical, the author will look at Barefoot Wine’s Brand Identity in general.

In the book, “The Barefoot Spirit'' there are two paragraphs that describe what the brand itself stands for and what it brings for the consumer.

In one of the paragraphs the author describes: “Wine seemed exclusive, unwelcoming, almost foreboding. Barefoot’s success brought fun and energy and lightheartedness to wine, and it led the way for animals and art, for bikes, for silly pictures, for embracing everyone. It helped make wine into something that was approachable and egalitarian and thoroughly American.”

(Houlihan, Harvey and Kushman, 2013, p. 14)

Therefore, the company thinks of itself as something that had revolutionized the wine industry by making the branding of wine less serious and much more acceptable by regular day- to-day consumers who were intimidated by the elitist environment surrounding the wine industry.

It actively tries to associate the brand to what is written in the second paragraph mentioned:

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“The Barefoot Spirit is a close-up of the American entrepreneurial spirit with a West Coast smile, an ode to originality and perseverance.” (Houlihan, Harvey and Kushman, 2013, p. 14) A brand that is original, energetic, lighthearted, and inclusive towards everyone in a truly american style.

This resonates in a slogan that can be found on their website which says: “Smile with us.

Sparkle and shine with us. Just be YOU with us! No matter who you are, you’re always welcome with us.” Even their official hashtag is #BarefootWithUs. (Barefoot Wine, 2021)

2.3. Brand Positioning

Brand positioning is an “offer which captivates an exclusive and valuable position in consumers’ minds. It identifies an optimal position of a brand and its competitors.” (Sadílek, 2020)

There are four main components of a successful Brand Positioning:

1. Definition of target market - includes geographic, demographic, socioeconomic and psychographic criteria.

2. Definition of the industry you compete in - identifies the industry along with competition.

3. Points of differences - benefits associated with the brand that the customer could not find elsewhere.

4. Point of parity - associations that are shared with other brands. (Davis, 2002) These three components are accompanied by the following five principles:

1. Positioning should be updated every three to five years, or as often as needed.

2. Positioning should help drive all other company strategies, along with profitability and revenue.

3. Senior management must lead the charge in implementing a brand's positioning.

4. Employees bring the brand positioning to life.

5. A strong brand positioning is customer driven and fits with customer perceptions of the brand. (Davis, 2002)

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Finally we have the five principles of effective positioning which are explained further below:

1. Brand Value 2. Brand Uniqueness 3. Brand Credibility 4. Brand Sustainability 5. Brand Fit (Davis, 2002)

These five principles should ideally be used as questions with the target market in order to determine which kind of positioning the company should use.

2.3.1. Brand value

The value in this context is the “perceived benefits that customers value”. Meaning how much value you hold as a company for the consumers/customers.

We can find the answer to these questions by asking ourselves:

● Does our position motivate customers to choose us over other brands?

● Does it speak to the key needs of our customers?

● Will it win the loyalty of customers and keep them for life? (Davis, 2002) This factor was considered earlier under the Brand Picture section.

2.3.2. Brand uniqueness

The brand uniqueness means we should focus on the areas where other competitors are not present. What only the company can give to the customers, how different it is from other competitive brands and so on.

For Barefoot Wine, as was already mentioned, the unique position was the fact that they brought about a more accessible and more relaxed wine into a stiff wine industry. This position is still held by them, considering they are the most sold wine on the US market.

What has not been mentioned yet was the unique marketing strategy called the “Worthy Cause Marketing” that Barefoot Wine had used to get their company recognized from the start.

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They managed to distribute their wines using charity events as a way of gaining early customer recognition. This helped build their customer base and gave them a good reputation as a philanthropist brand.

Bonnie, one of the co-founders of Barefoot Wine explained: “We believed if we could get Barefoot to our customers, they would like it. We asked ourselves where we can find people who would drink Barefoot, and we thought of fundraisers.” (Houlihan, Harvey and Kushman, 2013, p.

116)

Michael, also a co-founder, continued on to say: “We were already supporting non-profits, so we started thinking, what can we ask from them in return that would help us both? That was the key, it wasn’t just charitable giving, we were asking the non-profit members to become Barefoot fans...people down the street are having a fundraiser and we’re donating the wine. And we’re going to tell them they can thank us by coming in here and buying this product from you.” (Houlihan, Harvey and Kushman, 2013, p. 116)

2.3.2. Brand credibility

The question we are asking ourselves here is whether or not our brand comes off as trust-worthy, believable and convincing.

● What must be done to make our positioning credible?

● Is the company keeping its promises and being true to their brand?

● How stable is the brand?

● Are other competitive brands as credible as we are? And if yes, what else can we offer in order to make us even more valuable than them? (Davis, 2002)

When it comes to credibility, the author could not find any additional information about credibility when it came to Barefoot Wine customers. On the other hand, in the book “Barefoot Spirit” the two co-founders describe the way they made sure to keep the trust of vendors of their wine - by communicating payments and making sure that any issues got settled in time and with full responsibility taken.

“To build their trust, Bonnie never let vendors doubt they’d get paid—even if it was late.

She would often tell them, long before a bill was due, that Barefoot would come up short for that payment, but she’d also give them a payment schedule and tell them precisely which incoming

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check to Barefoot was earmarked for them.” (Houlihan, Harvey and Kushman, 2013, p. 135) Michael (the second co-founder) talked about the responsibility when it came to the actual production of the wine: “Michael told Brown he understood how mistakes like this create problems, and he wanted Brown and Lucky to know Barefoot would never hide something it messed up.” (Houlihan, Harvey and Kushman, 2013, p. 240)

2.3.3. Brand sustainability

Sustainability of a brand is whether or not we are able to maintain ourselves at a certain level. We must attempt to maximize the time we can stay positioned in the competitive environment. The questions that we ask ourselves here is:

● How long will our position stay valid?

● Do we truly have a unique and valued position?

● What other brands do customers associate us with?

● Can we clearly communicate our positioning? (Davis, 2002)

Barefoot Wine seems to be holding a stable position, considering they were among the first winemakers in the USA to create inviting and affordable wines for everyone. Not to mention, their marketing strategy of using charities as an entrance to potential consumers was something that was not used at all and to this day is a rather rare form of marketing.

2.3.4. Brand fit

Last but not least, we have Brand fit. The fit refers to the brand positioning fitting in with the organization itself (the company). The questions we must consider when talking about the Brand fit are:

● Does the positioning support our corporate objectives?

● Will it increase our value and profitability?

● Does it help our planning and day-to-day actions?

● Does it help drive momentum?

● Will our employees support it?

● Can we measure success in a consistent and meaningful way? (Davis, 2002)

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The Brand fit is something that the company must deal with internally and therefore the author cannot fully evaluate the Brand fit of Barefoot Wine.

3. Barefoot Wine 3.1. Who is Barefoot Wine?

Barefoot Wine is an American wine brand based in Modesto, California, established in the year 1965 by a man named Davis Bynum, a former newspaper reporter and editor. He had named the brand Barefoot based on “the free-spirited method of crushing grapes barefoot.”

Later on, in 1986, Michael Houlihan and Bonnie Harvey, at the time two wine amateurs, took over, and with the help of a wine buyer for the Lucky supermarket chain called Dan Brown, renamed the brand Barefoot Cellars and designed the iconic Barefoot logo.

When Michael Houlihan came up to Dan Brown to sell him thousands of gallons of unbottled wine, he asked him what label the wine should have and Brown told him: “Don’t make it a hill or a leap or a run or a valley or a creek. I got enough of those. I can’t sell more. Don’t put a flower on it. And for chrissakes, don’t make it a chateau. Make the logo the same as the name.

It has to be something familiar, something people will recognize and remember. And whatever you do, do it in plain English.” (Houlihan, Harvey and Kushman, 2013, p. 29)

And that is exactly what Michael Houlihan and Bonnie Harvey did as can be seen on the picture of the logo below.

Figure 15: Barefoot Wine logo

After Michael Houlihan and Bonnie Harvey formed Barefoot Wine into a sizable, successful, and unique business, it became an inviting target for potential buyers, and Michael and Bonnie wanted to sell it under the condition that Barefoot Wine would stay the same fun, approachable and inclusive brand it was. That is when Gallo, the largest family-owned winery that

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Currently, Barefoot Wine still belongs to E & J Gallo Winery, by whom it was bought in 2005. Their wines are currently sold and distributed in the USA, UK, Canada, Europe, and Asia.

Barefoot Wine is currently maintaining their position as one of the most popular global wine brands and as the most popular wine brand in the USA. In 2020 Barefoot Wine had sold more than any other wine brand, amounting to 673 million USD worth of table wines as can be seen on the graph below.

Table 1: US wine market: dollar sales of leading table wine brands in 2020

(Wine market in the U.S., 2020, p.31)

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3.2 Product portfolio

Figure 16: Barefoot Wine Product Portfolio

(Processed by author)

Barefoot Wine has a large variety of products under their brand name. To begin with, they create the classic bottled wines which they then further separate into several categories. The obvious separation would be red, white, rosé wines. These are then segmented even more into simple varietals (such as Cabernet Sauvignon), blends (e.g., mix of red wines and fruity mixtures), spritzers (sparkling wine) and last but not least, champagnes and prosecco (both of which are again either made from classic varietals or from blended mixtures).

Figure 17: Example of Barefoot Wine bottled wines.

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Another classic that most consumers will be used to, especially in the USA, is wine on tap.

Others may know this as boxed wine. In this category, Barefoot Wine also has both classic varietals, blended mixes (e.g., “Sunset Red Blend”) and even Sangrias.

Figure 18: Example of Barefoot Wine boxed wine.

This box-like packaging can then be found as well in their other type of product called

“wine-to-go”, which consists of a 500ml box of wine with a screw top, ideal for travelling.

Continuing, Barefoot Wine produces two types of canned wine - Spritzers and Hard Seltzers. Both of which are in 250ml cans. Although they sound similar, they vary in their substances.

Figure 19: Example of Barefoot Wine canned wine.

Hard Seltzers are made from sparkling water and wine and tend to be low-calorie, low sugar (less than 5 grams) and low on alcohol (6% or less). According to Barefoot Wine they are ideal refreshing beverages that “will go the distance with you”.

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Spritzers, on the other hand, are more wine based, meaning they tend to have higher levels of alcohol. They also tend to be fruitier (caused by flavoring or added sirups) and therefore have a higher amount of sugars and hence calories.

Last but not least, it would be good to mention that Barefoot Wine also creates limited edition wines - specifically for certain events, such as the Pride events for the LGBTQ+

communities. Although these are filled with the same wines as their classic products, considering the special packaging, it should be mentioned as a different product.

Figure 20: Example of Barefoot Wine limited editions.

3.3. US wine market and consumers

To start off we must consider just how big the US wine market is in the larger scale of the overall alcohol industry. On the graph below, we can clearly see that wine is sold the least, with beer being sold the most, and spirits following behind. We can also see that the structure of the alcohol does not change much during the years. On average, wine takes up from 15-17% of the overall alcohol industry.

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Table 2: Market share of the U.S. alcohol industry by beverage 2000 - 2020

Although 15-17% of the alcohol industry does not seem like much, comparing it to the other two drinks, we can see on the graph below from Statista that the total retail value of the sales of wine in the United States amounted to 68.1 billion USD in the year 2018, which in terms of 9- liter cases would be about 405 million 9-liter cases of wine. That is not at all bad. It is also predicted that the US wine industry will keep growing, reaching an estimated 72,557 million USD in the year 2025.

Table 3: Projected revenue in the Wine market

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(Wine market in the U.S., 2020)

For statistics to be kept relevant, it is also important to consider how the structure of the wine market had changed during the time of COVID-19. For example, on the graph below, we can see that the sales of premium wineries (wineries with an average bottle price of 28 USD) had gone drastically down from +5.6% in 2019 to -7.1% in 2020. This shows that consumers had turned to buying cheaper wines because of the crisis of COVID-19.

Table 4: U.S. premium wineries sales growth 2002 - 2020

When it comes to consumption, it is increasing as well. On the graph below we can see that wine consumption in the USA had gone up by 40% since 2005 (the year in which Barefoot Wine was sold to Gallo). In 2018 wine consumption was at 966 million gallons.

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Table 5: Total wine consumption of the US 2005 - 2018

We can also look at the structure of the consumers who buy this wine. On the graph below we can see that the people who buy wine the most are in the age category of 21-34. The consumers that buy wine the least are those of ages 55 and over.

Table 6: Share of total wine spending in the United States in 2019, by age

We can combine this information with the graph below, where we can see the consumption based on the price of the wine.

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Based on Barefoot Wines advertisements, social media, and websites, we can probably assume that their target market is for Gen Zers (21-23) and Millennials (24-39). Barefoot Wine sells wine in the 0-19 dollars category, with most of their wines being around 15 USD. Here we can see that Gen Zers and Millennials combined form 29%. If we consider that Gen Xers (40-55), who also buy most of their wines at 0-19 dollars at 24%, we could assume that some part of them consume Barefoot Wines even if they are not directly marketed to. Those three combined make up a large part of the market and therefore create plenty of potential consumers for Barefoot Wine.

Table 7: Consumption by cohort based on winery's average bottle price (in %)

(McMillan, 2021, p.39)

Last but not least, to also bring relevance into the consumption statistics, it is important to look at how the consumption pattern has changed due to COVID-19. The most important detail to mention here can be seen on the graph below - the explosive growth of e-commerce due to measures taken against COVID-19.

This factor is very important to take into consideration, because of COVID-19 companies had to restructure their sales from wine clubs, wine tastings to e-commerce. Brands such as Barefoot Wine, who already had an established website, social media, and e-commerce in general, definitely had the upper hand during the pandemic.

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Table 8: E-commerce trends in alcohol

(McMillan, 2021, p.23)

3.4 Competition and market position

When it comes to the market position, Barefoot Wine was the biggest selling wine brand of 2019. They sold an estimated 22.5 million cases globally in 2019 according to industry estimates. The Barefoot brand had also grown by 19.2% in value over 12 months in 2019.

We can also consider the size of E&J Gallo Winery, the owners of the brand Barefoot Wine. They produce more than 40% of all wine production in California and its volume is valued at 15 million USD. (Top 10 biggest selling wine brands, 2021)

On the graph below we can see just how much importance California holds. 70% of all US wine consumers prefer California - USA as their preferred region for wine. So, if we consider that in 2019, 53,615 million USD was made in revenue from wine sales and out of that 70% is California, that would make the region of California worth 37 530 500 USD.

The only two foreign countries that come close to being some sort of competition in the USA are Italy and France, with other USA states following closely behind. A specific wine that is imported and could be considered a competition is the Yellow Tail brand from Australia which is the 3rd most sold global wine brand in 2019 and which became the number 1 imported wine into the USA in 2011. (Top 10 biggest selling wine brands, 2021)

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Table 9: Consumer preference for wine country of origin in the United States in 2008 and 2019

(Statista - Consumer preference for wine country of origin in the United States in 2008 and 2019, 2021)

If we are talking about in-country competition, we should consider a few factors. The competition of E&J Gallo, the competition of the brand itself and indirect competitors. The competitors of E&J Gallo Winery could be: Suttor Home Winery (another family-owned winery which holds second place in top sold table wines in the USA), The Wine Group (owns Franzia, the third most sold table wine in the USA) and Constellation Brands (sells both wine and other alcoholic drinks).

The competition of Barefoot Wine as a brand is vast. There are many wineries pushing similar products to Barefoot Wine. For example, House Wine, with their iconic canned wine and similar Instagram. The US wine competition is also ever evolving, with new brands coming about all the time, considering that most of the wineries forming the US wine market are limited production (5000 cases and less) and there is always somebody trying to chase the American dream. (Wine market in the U.S., 2020, p. 13)

When considering indirect competition, it is similar to the competition of the brand. There are many indirect competitors to Barefoot Wine, especially companies creating beer. Beer directly hits Barefoot Wine’s unique selling point of low-alcohol, bubbly wine in a can and bag. Beer tends to generally be cheaper than wine and socially still more inviting if we consider America.

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4. Research Methodology

For the purpose of this thesis, the author had decided to use a survey as the form of a research method. The survey was planned beforehand, beginning from the creation of a Bachelor Thesis Project, where it was first introduced. It was also consulted several times with potential survey respondents, who contributed their opinions in order to make sure the survey was well created and logical.

After the author had discussed all issues, the final version of the survey was created on Google Forms and then distributed to potential survey respondents through several channels - university groups, private wine-oriented groups, survey exchange platforms and social media such as Instagram and Reddit.

Thanks to much help and effort of close friends, the survey got 200 respondents in the span of 3 days. After the survey was completed by the respondents, the author did a final review of the data to make sure nothing is missing. Once it was clear that the survey is without any bigger issues, the author downloaded all necessary data, formatted the data on Microsoft Excel and created graphs and tables belonging to each question. The data was then presented through a combination of bar charts, contingency tables, etc. along with commentary from the author.

The questions in the survey are focused on finding out whether or not Barefoot Wine marketing and branding is in line with what the consumers deem to be important.

The survey consisted of 21 questions. The survey respondents answered questions that were: multiple choice, yes/no and open-ended as well. Some questions could’ve had more than one answer, some only one single answer.

4.1. Research goal

The research goal is not formulated through a hypothesis but rather through a set of questions that the author hoped to have answered. Although the author had some questions prepared, throughout writing the thesis these questions became slightly altered.

The previous main question for practical findings should have been “What are the important aspects of Barefoot wine that allowed for the building of such a successful brand?” but this question was answered more through theoretical parts rather than theory. In fact, the practical part of this survey has come up with a couple of interesting and rather surprising conclusions which

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would indicate the opposite when it comes to branding itself. Nevertheless, it is still included. The current main question can be seen below.

The main questions the author was asking during the creation of the survey were:

● Which branding and marketing factors are most important for wine consumers?

● What are the important aspects of Barefoot wine that allowed for the building of such a successful brand?

The survey also focuses on other sub-questions, which attempt to define which target group would enjoy or buy Barefoot Wine and whether their digital and real-life marketing tactics are working the way they should. These sub-questions can be seen below.

Sub-questions:

● What is Barefoot Wine’s ideal target group?

● What are typical features of Barefoot Wine digital marketing?

4.2. Sample structure

The survey was answered by 200 respondents. The structure of these 200 respondents is written in the paragraphs below.

The first couple of questions were aimed at the demographics of the survey respondents.

We can see that the majority of the survey respondents were aged between 18-24 (73.5%). The least represented group was 65+ (0.5%).

The most represented region is Central & Eastern Europe (69%). Second most represented region is Western Europe (14%). All together then Europeans formed 83% of the whole survey.

Gender-wise, most of the survey respondents were females (60.5%) with males making up the rest (39.5%). One person preferred to not disclose their gender (0.5%)

When it comes to education, it was quite close, with 42% having a Bachelor's degree and 40% having a high school diploma. The rest were a mix of Masters (13%), Doctorate (3%) and some that preferred to not disclose their information (2%).

Last but not least, the ethnic structure of the survey respondents is: 80.5% White, 10%

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Asian, 5.5% other, 2.5% Black, 0.5% Hispanic. 1% of the respondents preferred not to disclose their ethnicity.

Table 10: Sociodemographic structure of survey respondents

AGE PERCENTAGE GENDER PERCENTAGE

18-24 73.5% Female 60.5%

25-44 20.5% Male 39%

45-65 5.5% Prefer not to say 0.5%

65+ 0.5%

HIGHEST EDUCATION ACHIEVED PERCENTAGE REGION PERCENTAGE

Bachelor's degree 42% Central & Eastern Europe 69%

Highschool diploma 40% Western Europe 14%

Master’s degree 13% Americas 9.5%

Doctorate (PhD) 3% Asia 5.5%

Prefer not to say 2% Mediterranean & Middle East 1.5%

Americas 0.5%

ETHNIC BACKGROUND PERCENTAGE

White 81%

Asian 10%

Other 5.5%

Black 2.5%

Prefer not to say 1%

Hispanic 0.5%

(Sourced from survey created by author)

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5. Survey results and analysis

The first two questions (after the sample defining ones) are focused on generally defining what kind of consumer the respondents believe they are through the Brand Personality types and what communication channel affects their buying habits.

Q.1 - What kind of consumer are you?

The highest amount of 63% of people believe that they are consumers that buy products because they function how they should (functional belief). In the second place we can find 53.5%

buying products because of their good reputation. In third place at 51% buying products because they love them and will not switch to another brand (love brand). In fourth place we have buying products because of their price (43.5%). Fifth place - buying products due to associations (29.5%). Sixth place - buying products because of nostalgia (18.5%). Last but not least we have buying products because they give status (15.5%).

In the author's opinion, the only two that would not be too applicable to Barefoot Wine as a brand are nostalgia and status consumers. As we can see, functionality as a factor is, understandably, placed highly, seeing as most people want their products to work the way they were promised. When it comes to wine, this is something that can rarely go wrong, and in the cases it does, we already saw Barefoot Wine is very willing to take responsibility and fix issues immediately.

For Barefoot Wine, the second highest factor, good reputation, is quite important, considering their brand works based on the principle of “Worthy Cause Marketing” that was explained earlier on.

The other factors are not insignificant either though, considering we already saw that Barefoot Wine is a cheaper wine (hence price being an important factor) and that they also want their customers to create associations with Barefoot Wine products (as was seen in the Brand Picture).

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Table 11: What kind of consumer are you?

Q.2 - Which communication channels affect your buying decisions the most?

The highest amount of 51% have their buying decisions affected by Social Media. This is an extremely important factor, as we can see that Barefoot Wine has been pushing for their social media accounts to be more visually attractive and regularly post their products along with other content (e.g., wine recipes) to be seen.

Next in line are Websites, at 61%. Similarly, to social media, Barefoot Wines’ website could be considered one of their strong points.

Other has been answered by 42.5% of respondents answered without further specifications. “Other” in this case could mean different communication channels that were not mentioned, such as radio, events, emails and so on.

After that we have TV advertisements with 34% and finally, we have the remaining three communication channels, all with similar values - Internet Banners (11%) and Billboards (10%) and Sponsorships (7%).

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Table 12: What communication channel affects your buying decision the most?

The next set of questions refers directly to the consumption of wine.

Q.3 - How often do you buy wine?

The results of this question were somewhat unsurprising. In the first place, 45.5% of respondents said they buy wine monthly, then 26.6% respondents said weekly, 19% yearly, 6.5% never and 2.5% daily. It is probable that most consumers buy their wine in bulk and that it lasts them for a whole month, or that they just do not drink it daily. Wine is not a product that would (and should) be used on a daily basis.

Table 13: Contingency table on "How often do you buy wine?"

Count of:

How often do you buy wine?

Daily Monthly Never Weekly Yearly Total

Female 0.5% 27.5% 3.0% 17.5% 12.0% 60.5%

18-24 0.5% 22.5% 2.5% 12.5% 9.0% 47.0%

25-44 0.0% 4.5% 0.5% 3.5% 2.0% 10.5%

45-65 0.0% 0.5% 0.0% 1.5% 1.0% 3.0%

Male 2.0% 18.0% 3.5% 9.0% 6.5% 39.0%

18-24 0.0% 13.0% 2.5% 6.5% 4.0% 26.0%

25-44 1.0% 4.5% 0.5% 2.0% 2.0% 10.0%

45-65 1.0% 0.5% 0.0% 0.5% 0.5% 2.5%

65+ 0.0% 0.0% 0.5% 0.0% 0.0% 0.5%

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Prefer not to say 0.0% 0.0% 0.0% 0.0% 0.5% 0.5%

18-24 0.0% 0.0% 0.0% 0.0% 0.5% 0.5%

Total 2.5% 45.5% 6.5% 26.5% 19.0% 100.0%

Q.3 - How do you buy wine?

Most people (75%) buy their wine the traditional way - in stores. 17% of people buy their wines both in store and online. 8% buy their wine in other ways (e.g., wholesaler, tasting rooms, wine clubs, subscriptions). It is slightly surprising that nobody buys their wine strictly online.

After COVID-19, one would assume that the number of people who buy their alcohol online increased dramatically.

Table 14: Contingency table on "How do you buy wine?"

Count of:

How do you buy wine?

Both In store Other Total

Female 9.50% 47.00% 4.00% 60.50%

18-24 5.50% 38.50% 3.00% 47.00%

25-44 2.50% 7.00% 1.00% 10.50%

45-65 1.50% 1.50% 0.00% 3.00%

Male 7.50% 27.50% 4.00% 39.00%

18-24 3.00% 20.50% 2.50% 26.00%

25-44 3.50% 5.50% 1.00% 10.00%

45-65 1.00% 1.50% 0.00% 2.50%

65+ 0.00% 0.00% 0.50% 0.50%

Prefer not to say 0.00% 0.50% 0.00% 0.50%

18-24 0.00% 0.50% 0.00% 0.50%

Total 17.00% 75.00% 8.00% 100.00%