E-Marketing

By analysing the current state of Wines of Uruguay, our group proposes that the next strategy which should be implemented along with the main strategy is improving customer base through E-Marketing

Part of our E-Marketing Strategy is to design a Facebook application. The idea is for the user to have a wine farm which he would develop continuously. He would be able to grow wine grapes, develop the actual wine and finally sell it to other users. A template of the user interface could be seen above. The whole process and the structure of the wine farm would be customisable and interactive (such as simple game when the wine bottles are labelled and corked).

Through the application, it would be possible to advertise Uruguay and tannat wine and hopefully when customers buy wine (online or otherwise), they would consider Uruguayan products.

Budgeting Experience

It was a great experience to budget for the firm, even though it was something nobody in our team had done. It was quite clear considering we were all wondering what the different prices would be (e.g. operational costs, costs for hardware/software). For some things such as printer costs, it was more manageable and easier to decide on due to previous experience. Eg for Alazar and Fotis it was easier to predict Web Server costs, while for Aleks it was easier think about what would be the cost for a warehouse, VAT related calculations. Winnie on other hand bought some things which we did not consider, leading to changes in numbers.
Yet by doing first the Marketing Part and then the Whole firm, some problems arose. For example we included Labour costs in the Marketing budget, leading us to wonder what we should put to the overall budget. If we did it again, it may be a good idea to know what’s included in each budget, so that we would not consider wages for the same worker 2 times.

The experience showed why so much money is given for budgeting firms, and the complexity that comes with budgeting. Yet such division as the exercise would be used by large companies. In Busy Corporation (my parents’), it’s me and my mom who do this work, as the company is small and on top by having the managers do the work, it’s possible to learn more about the business and see how things are going.

IT and the supply chain

The diagram above, by DSC consulting, illustrates how information can be gathered and used in the decision making process.As shown in the diagram, Retailer could make use of arrayed stock, arrayed flow of sales and also delay in delivery when deciding orders and this information would be a good input for the factory along with production stock and production rate which in turn is determined by raw material consumption.


IT can help the supply chain in the following ways:


IT helps to keep track of stock level information at retailer's shelves so that producers are able to forecast retailer's' inventories. In addition, accurate information can be delivered on the point of sales demand.


One of the examples of IT solutions that help supply chain's optimisation is Skillweb, a mobile solution provider that helps to achieve significant cost savings and a reduction in carbon emissions. "Utilising a transport management solution developed and supported by Skillweb. BT has been able to restructure its operational infrastructure over the past 6 months to reduce its transport fleet operation used to supply 27,000 service engineers with parts by over 25 % and remove six sites from its depot network. This technology, known as BT TraX are mobile computers that help to manage and track the goods as they move from the warehouse or collection point through the trunk network for onward delivery to each engineer. It better controls the movement of parts per day to ensure that each engineer is supplied with the right parts at the right time." (Warehousenews, 2009)


Another example of how IT can help supply chain is RLS Logistics, a leading temperature-controlled logistics provider offered to food industry. RLS software helps clients to view their data in real time on a web-based system. Their service is so extensive that it covers a lot of aspect of performance improvement such as accuracy in shipment, quick and effective processing of orders and receipts and reduced transportation costs, backup power and computerized temperature monitors. (Suppl chain Digital, 2009)


The above mentioned examples are both applicable to WOU in order to improve their performance in terms of temperature control of wines as well as keep track of their goods to and from their warehouse and collection point, in line with the transparency mission and vision.


Reference list

BT uses Skillweb [Internet ] Available at: http://warehousenews.co.uk/?p=6132
[Accessed 22 Nov 2009]
Supply chain digital [Internet] Available at:
http://www.supplychaindigital.com/Magazine.aspx?id=1797 [Accessed 22 Nov 2009]

The Beer Game (Supply chain)

(Figure courtesy of DSC consulting)

Our team was playing the Retailer role. As communication between us, the wholesalers, distributors and the factory was not allowed we had to rely on the pattern of flow of orders from the customer side and delivery of beers from the wholesaler, which were unpredictable especially given the unfamiliarity of the market we were put in, and were forced to make decisions based on mere guesses rather than justifiable assumptions, to say the least. what was interesting about this game is the similarity in the resulting consequence between over/under stocking of beers in an organization warehouse and over flow of beer in the human system, especially while driving under the influence of alcohol, both situations maybe characterized by lacking clear sense of direction, being at the mercy of the external environment, and eventually leading to a deadly accident. Hence, at the end of this experience, the question left on our minds was how deadly such a phenomenon may turn out to be for WOU, if it was to be placed in such an unfortunate position.

We believe that the use of IT in the supply chain would help avoid such adverse effects by better facilitating communication, tracking and storing of relevant information and even by predicting consequences for different scenarios.

E-procurement

There are seven main ways of implementing IT in the procurement process:

• Web-based ERP (Enterprise Resource Planning): Creating and approving purchasing requisitions, placing purchase orders and receiving goods and services by using a software system based on Internet technology.
• e-MRO (Maintenance, Repair and Overhaul): The same as web-based ERP except that the goods and services ordered are non-product related MRO supplies.
• e-sourcing: Identifying new suppliers for a specific category of purchasing requirements using Internet technology.
• e-tendering: Sending requests for information and prices to suppliers and receiving the responses of suppliers using Internet technology.
• e-reverse auctioning: Using Internet technology to buy goods and services from a number of known or unknown suppliers.
• e-informing: Gathering and distributing purchasing information both from and to internal and external parties using Internet technology.
• e-marketsites: Expands on Web-based ERP to open up value chains. Buying communities can access preferred suppliers' products and services, add to shopping carts, create requisition, seek approval, receipt purchase orders and process electronic invoices with integration to suppliers' supply chains and buyers' financial systems.

WoU could use e-sourcing to identify new suppliers for wines, thus hopefully increase choice offered to customers. E-sourcing would also be beneficial to potential suppliers due to providing exposure to their wine products to the UK market ie would be a win – win situation.

A study by Aberdeen group (Aberdeen group) has concluded some of the steps for successfully utilising E-sourcing. Some of their strategies include:

• Adopt and validate best-in-class strategic sourcing procedures before investing in e-sourcing technologies.
• Ensure proper executive and stakeholder support for sourcing and dedicate a manager to champion the program.
• Develop systems and competencies to make total spending analysis an efficient and repeatable process.

Another solution for the Wines of Uruguay would be to have a rapid ERP deployment. The advantages earned by this implementation would be:

• Quick integration in the whole process.
• Less time needed to fulfil the implementation.
• No disruption in the procurement process
• Lower cost during the deployment of the system

But there are also some disadvantages in choosing this kind of ERP deployment:

• Difficulty to customize completely the system to match with the needs of the company
• The procurement process must be understood in order for the implementation to be effective.
• Might be a preparation cost.
• The time frame for an ERP could be limited as new needs for the company arise.

Such procedures may be out of scope for Wines Of Uruguay due to high cost, however by understanding them from an early stage, the company can be structured in a way that would help its expansion and growth in the future.

Taken from Wikipedia and

Ravi Kalakota, Marcia Robinson (2000) e-Business: Roadmap to Success Massachusetts: Addison Wesley

http://www.aberdeen.com/summary/report/other/bp-esourcing.asp

The New E Process

The Redesigned Vinification Method:

One the left side is the generalised old method of how wine was produced by the WoU's partners.
The grapes need to be collected and then crushed. After that Fermentation begins (how the alcohol is created). After a specific period the liquid is checked, filtered and bottled. Or it can be further stored (in oak barrels) for giving a specific aroma to the wine. Next it would be bottled and labelled and prepered for selling.

Generally the grapes are grown where the wine is produced, minimising labour and transport costs. However our group thinks we can bring further value to the wine producers.

The proposed E process will add transparency to vinification. By adding a system to store information about the winemaking process such as:
When the grapes were picked,
how long the wine was stored

Hopefully by displaying the extra information on the label, it will give customers higher reason to trust the company and purchase the wine rather than an offering by other competitors.

Furthermore the proposed E Process compliments our long term strategy of producers to produce Fair Trade wines.

More information would come on future posts.

Social Impact of Fairtrade

Behind the concept of fairtrade, we need to understand how fairtrade is helping the rest of the developing countries, what changes can we make by doing something locally to have an impact globally. It's time to change the rules of trade!

Hope the following clip will change your view too.

Promoting WOU through Fairtrade

We have seen the market of fair-trade is increasing by 25% per year, and from this statistics, we have projected that the revenue of WOU in 5 years will be £164794. Through long-term strategy, we are going to suggest WOU to join Fairtrade. We need to consider the process of application, audit and evaluation via Fairtrade Labelling Organization (FLO) in order to obtain Fairtrade Certificate from the certification authority FLO-CERT. In this way, we are investing our cost to boost the revenue of WOU in a cost efficient way.

Picture of Tannat Man

Prices, Premium and Procedures for Fairtrade

A quick overview about Fairtrade in relations to Wine Grapes:
-There are 2 categories of organizations that WOU needs to define themselves:
a. Small Producers Organizations
b.Hired Labour
-There are 2 types of Wine grapes that Fairtrade will need to know:
a. Organic
b. Conventional

Certification Body: FLO-CERT
WOU needs to pay premium in order to start getting involved in Fairtrade.

Please see below for more detailed terms via the links:

Here's the Fairtrade Standards for Small Producers Organizations:

Some of the terms need to refer to the second link:
http://www.fairtrade.net/fileadmin/user_upload/content/02-09_Wine_Grapes_SPO_EN.pdf

http://www.fairtrade.net/fileadmin/user_upload/content/SOP_Public_Development_of_Fairtrade_Standards.pdf


Here's the Fairtrade Standards for Hired Labour:
http://www.fairtrade.net/fileadmin/user_upload/content/Wine_Grapes_HL_Feb09EN.pdf


The Certification body is called FLO-CERT:
http://www.flo-cert.net/flo-cert/main.php?lv=3&p=1&p3=6



Examples of Price for Fairtrade Wine grapes:
http://www.fairtrade.net/fileadmin/user_upload/content/051009_EN_Price_and_Premium_table.pdf


If we look at Wine grapes from Argentina, here's what WOU can take as a reference:

Product:Wine grapes
Quality:Conventional
Country:Argentina
Small Producers Organization/Hired Labour:SPO / HL
Price Level:Farm Gate
Unit:kg
Quantity:1
Currenty:EUR
Fairtrade minium price:0.25
Fairtrade Premium:0.05

UK government invests £12 million in Fairtrade

In UK, customers can choose from more than 4,500 Fairtrade products. A research of 25,000 households showed that they prefer to spend more on a Fairtrade product than on any other. This led to an increase of purchasing Fairtrade products by 5.5% in the last twelve months.

Now UK Government decided to invest £12 million in order to help Fairtrade to expand and achieve its’ following goals:

• 100% increase of the farmers involved in the Fairtrade system.
• Help farmers in lowest income countries to access the Faitrade markets.
• Give money back to the producers in order to invest in their own community projects.
• Three-fold increase of the sales of Fairtrade products globally.

Reference: www.fairtrade.org.uk

Fairtrade - Buy-side social factor recommendation for WOU

Consumers in the UK are increasingly demanding transparency and would like to know
more about the product making/acquiring process, especially if it is imported from a developing country like Uruguay, so that they can be sure that the money they spend on an item reaches the root of the supply chain. But they don't have the time, resource and energy to do all the hard work required for such behaviors in order to ensure that their money is spent ethically, Fairtrade does it for them. That is why we recommend WOU and/or its suppliers to join Fairtrade and be an active player in the UK wine market.

The chart below illustrates the ever increasing demand for Fairtrade certified wines.

Summary of presentation

This presentation tries to look at the social factors that we should consider while planning a strategy for WOU. It tries to address the social factors from the buy side and continues to the sell side.

The buy side social factors mainly focus on transparency. This is because consumers are becoming increasingly cautious about the products they buy. They would like to be sure that the money they spend reaches the root of the supply chain. As a solution this presentation suggests WOU and/or its suppliers to join Fairtrade to gain consumer’s trust.

The sell side social factors include age (34-69), main stream media and national holidays as shown by the customer journey. Furthermore, as the findings of our research show, the last two months of the year are a good chance for WOU to boost its sales, by setting up events where the main customers reside in.

Web market Research

These are the findings of our research in the web market of wines using "Google Trends". The phrase "online wines" is used in a quiet stable rate along the year. But in the last two months the rate goes surprisingly up. This is when we should put all our effort to attract new customers.

In the second chart we can see the cities of UK that search the most for wines online. We can use this findings in order to localize our efforts (organize the wine taste events in these cities).

UK's Popular Social Networking Sites

In addition to Aleks' post, this is the pie chart that I made based on the below

Reference:Clickz.com Top Ten UK Social Networking Sites, May 2009

http://www.clickz.com/3634585

"Eighty percent of the total U.K. online population visited a social networking site in May, with Facebook and Bebo attracting the most unique visitors over the course of the month, according to data from comScore's World Metrix audience measurement service."

Customer Journey Chart

Hey,
This is the chart that I made.The following graph shows the customer journey.

Firstly we are concerned for the UK market exclusively. We need to consider the fact that many customers would not be able to use the internet effectively, thus making the website simple and easy to use would be beneficial. (I think the new site is really well designed)

Potential customers may be using Search Engines such as Google and Yahoo to find the wine they want to drink. This is case it is essential that the website is Google Friendly so that its on top of the search list. Some of the web technologies which could be used are: Cascade Style Sheets, and Google Webmaster Tools.

Customers may use Mainstream media or search online using a search intermediary.
Our research shows that the main group of wine drinkers are 33-60 years old(77million). By looking up their online habits, it seems like a good idea for the company to establish a network using Facebook. This way it would be possible to connect Wines of Uruguay with their main customers.

Through Facebook it would be possible to promote new events and wine. Furthermore Facebook is able to connect the customers to the company. Twitter could also be added as the firm expands for further establishing a name for Wines of Uruguay.

Wines of Uruguay, has an advantage over other wine importers/sellers as it has exclusive connection to Uruguay and it’s able to supply more diverse products. However customers have a diverse range of sites which sell wine online such as major UK superstores, virgin wines and Majestic Wine Warehouse.

References:

Google 54 of all search engines done by Google
http://www.pcmag.com/article2/0,2817,2126193,00.asp

Alexa.com

Winnie References.

Breaking News!!!

WOU has a new website now! Check it out @ http://www.winesofuruguay.co.uk.

Articles about UK's wine market & social networking websites

Facebook being crowned as UK's most popular social networking site
http://www.theregister.co.uk/2009/03/09/social_networking_and_blogs_more_popular_than_email/
Interestingly, the fastest growing demographic of Facebook users are those aged 35 to 49 years old (more than 24.1 million users). The site also has almost twice as many visitors between 50 to 64 years old (+13.6 million) compared to those under 18 years old (+7.3 million).

Buyer trust is needed to begin any purchasing relationshipThe core group of wine purchasers is made up of individuals who fall into the 34-60 age (Mintel, 2007)http://www.google.com/search?q=uk+online+wine+buyers+age+group&rls=com.microsoft:zh-tw:IE-SearchBox&ie=UTF-8&oe=UTF-8&sourceid=ie7&rlz=1I7GPEA_zh-twGB301

Mintel report about UK wine market 2008
http://www.giichinese.com.tw/report/mt90805-wine-uk.html

Wine drinkers segmentation in the UK 2009
http://www.wineintelligence.com/documents/WineIntelligenceUKPortraitsnewsletter.pdf

List of all social networking sites
http://en.wikipedia.org/wiki/List_of_social_networking_websites

Are social class and online social network related?

Just come across this new article on CNN.

http://www.cnn.com/2009/TECH/science/10/13/social.networking.class/index.html

Our Suggestion part 1

This is the chart showing how we believe the “Wines of Uruguay” company should be reorganized. Also, it is showing the technologies that should be used in order to add value to the brand.

From the buy side point of view, we recommend an intranet specially designed to fulfill the needs of the producers and the company itself. We should use a database keeping track of the suppliers and their wine’s quality. Additionally the company will know each moment its stock availability so to be in position to fulfill online orders. Suppliers will have the ability to register in order to acquire an e-mail account to receive newsletters and have a more immediate communication with the company.To those who are registered a blog will be available to facilitate this communication.

From the sell side point of view, we believe that the best way to promote the brand is by improving the already existing website. First of all, we could have a database to keep track of our customers. Gathering information for all the customers will help the company to create profiles of them in order to make them suggestions about the company’s products (personalization). These suggestions as long as wine taste parties and other events invitations can be sent to the customers by newsletters or mobile text messages. Another technology that we should include is online ordering, giving the opportunity to the customer with some simple steps to order the wines of his choice from his home. We believe that it is also essential for the company to add a blog to the website. Nowadays it has become very difficult for the companies to keep their customers because of the internet and the many alternatives given. Adding a blog makes the website more interactive for the customer and gives him the opportunity to express his opinion and thus it is more possible to keep him with us. Finally, some marketing policies should be adopted like creating a Facebook group and organizing wine taste parties in order to attract new customers and keep the already ones interested.

This was our first draft view of how this company could be reorganized in order to gain more important role in the new marketplace that it is trying to be part of.

Initial State of Wines of Uruguay

Hey,

The chart above shows how we see Wines of Uruguay at the moment.

Wines of Uruguay (WoU) is a small business importing wines from Uruguay and selling them in the UK market. Its a small business managed by 2 -3 people, including Carla Bertelloti as the owner.

On the buy side (the wine producers), there are 4 main companies being represented by WoU at the moment. All of the imported products are stored in a warehouse in Isle Of White before being sold and shipped to the customer. There is no link between the warehouse and the website, thus customers may not be able to see if there are any new wines available or others which have run out of stock.

On the sell side(customers), there is a basic website which is used as an intermediary between WoU and its customers. As it is, the website gives basic overview what the company is about, available wines and some of the producers. There is no description of how wines taste or some insight of the wine producers such as a brief history/philosophy. Finally a customer can order wines by calling/emailing using the contact details.

Overall, this is how we see the company at the moment. At least to us, it seems that the used technology is not used to its potential and further improvements can make the company more profitable and efficient. A future view of how we would like WoU to evolve to can be seen on the next article.

Welcome !

This blog is created by Alazar, Aleksander, Fotis and Winnie (2009-10 BIS post graduate students in Royal Holloway, University of London ) to support their project for the course Networked organisations.