Constellation Brands Company offers a variety of branded and premium wines, thus meeting the needs of its diverse client base. Through the acquisition of other wineries, the company has increased its product portfolio while equally offering quality wines. Development of the brand involves the opinion and interest of different stakeholders, thus ensuring that there is a positive reception in the market (Constantinides, 420).
The move to higher margin products indicates that there is a failure to address pricing issues as most of the products are highly priced. Further, the trend creates the risk of consumers switching to other brands (Constantinides 407-438). During purchase decision processes, there is a tendency to compare one product with other brands. Other than focusing on the quality, customers are likely to determine the price differences. Lack of an elaborate price mechanism that fits the needs of customers is a significant drawback to Constellation Brands Company.
The Constellation Brands Company continues to acquire other ventures in different regions, thus improving its distribution networks. Currently, it has a significant presence in North America where its products are available in major stores. However, it is recommendable to adopt online marketing platforms where customers can order and pay for goods (Constantinides 407-438). It is critical to note that online platforms are cost-effective and ensures that customers have access to the services and products offered by the company without geographical or time restrictions.
There is the use of social media marketing, discounts, and other forms of promotions, thus increasing the sales level of products offered by Constellation Brands Company. The promotion initiatives are centered on the need to ensure that there is increased awareness of the brand to assist in raising the sales levels. Improved communication with customers can prove beneficial in the promotion processes. It would allow for the communication of features of the new products, and, thus, increasing the awareness levels of the existing brands. Additionally, it gives the management an ideal platform to respond to the issues raised by customers.
Over the past five years, Constellation Wines Company has experienced some volatility in its operations, thus lowering its profit levels (IBISWorld US). In 2019, it is expected that the revenue level of the organization will increase by 7.6% to reach the 1.8 billion mark (IBISWorld US). The improved financial performance will primarily be driven by the acquisition of other businesses which have seen expansion in the product portfolio. Likewise, there are ongoing efforts to improve distribution networks, hence ensuring that there is coverage of a larger market base (Constantinides, 420). On the other hand, the operating income is likely to have a 10% rise. The projections indicate that the acquisition of other ventures will prove profitable in the long run period (IBISWorld US).
One of the major setbacks affecting Constellation Wines Company concerns the pricing levels of the brand. Focusing on past marketing activities indicates that the product is over-priced as compared to other brands. There is thus the risk that customers may turn to other brands that come at lower prices (Constantinides, 419). One of the ways that the price can be reduced without affecting the profit margins levels is ensuring that there is a reduction in the operational costs. Adoption of better technologies and green operational processes can further assist in cutting operational expenses.
Constantinides, Efthymios. “The marketing mix revisited: towards the 21st-century marketing.” Journal of marketing management 22.3-4 (2006): 407-438.
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