Ch. 4 - The Marketing Environment

     
    Understanding the market environment can be one of the most integral parts of advertising and selling a product. Luxury brands are no exception, and Dom Perignon has done a very consistent job of of using their target audience and demographic to create a brand name that is synonymous with prestige and wealth. Indeed, their target audience consists of those who are 21+ and are, or are looking to be perceived as wealthy or high-class. Because Dom Perignon has such a high price point, their demography consists of only those who can afford it. For instance, Dom Perignons print advertisements  appear more like fashion lay-outs than advertisements for alcohol. Because of this, marketers for Dom Perignon place ads in high-end fashion magazines like Vogue and Harpers Bazarre instead of on subways and billboards. They know that the average consumer is not in the market for luxury champagne at any given time, making large advertisements seemingly pointless, considering their target market.
      Recently, Dom Perignon has made small steps to expand their target market while maintaing the integrity of their brand. Currently, Dom Perignon has collaborated with film director David Lynch on a series of bottles designed by the artist. In the past, Dom Perignon has targeted mostly baby boomers and Generation Xers in part because they were the demographics who had the most money and could afford luxury brand champagne. However, with Generation Y increasing in age and wealth, collaborations with notable avant garde directors like David Lynch have the tendency to intrigue a younger crowd without compromising  the brands identity. A Gen Yer who may never have thought twice about buying Dom Perignon could easily be swayed by the idea that their favorite director is in collaboration with the company. Dom Perignon has done an excellent job of understanding who their target market is. Simply put, if you can afford it, they will sell it to you.

     A notable example of misunderstanding your target market comes from one of Dom Perignons former largest competitors, Cristal champagne. In the early 2000's Cristal was one of the largest and most popular luxury champagnes on the market, due in large part to endless endorsements by the hip-hop community. Many rappers and hip-hop artists bought cases of Cristal, wrote about it in songs and even drank it onstage at concerts and appearances. The sales and notability of Cristal went through the roof in a way that advertising could only hope to accomplish. The controversy came when managing director Frederic Rouzaud spoke out against the hip-hop communities affection for Cristal and even went on to say "We can't forbid people from buying it. I'm sure Dom Perignon or Krug would be delighted to have their business." These statements sparked a backlash from rappers like Kanye West and Jay-Z who openly made statements condemning and boycotting Cristal. Whether or not Cristal meant to target the hip-hop community initially, they made a grave mistake by alienating and shaming a very loyal and essential part of their demographic. However, this misstep meant good news for Dom Perignon whose sales increased dramatically within the hip-hop community in subsequent years. The controversy also virtually eliminated a major competitor for Dom Perignon, a controversy Cristal was never fully able to bounce back from.   

Ch. 3 - Ethics & Social Responsibility

         As with any company focused on the sale of alcohol, the issue of morals and ethics in regards to selling the product to minors will always be at the for-front of discussion. Not only is it unlawful to market and sell alcohol to people under the age of 21, but it is also unethical and immoral by many peoples standards. Dom Perignon is no exception to these laws or ethical codes, however, their luxury image and subsequent luxury price tag has allowed the company to reach a postconventional morality that many of their competitors may have more difficulty achieving. Dom Perignon has a very specific image and method of wine production that they have rarely deviated from in the centuries that they have been manufacturing wine. Because of this, Dom Perignon is never trying to sell, advertise of promote a brand new product. This means that they do not run the risk of developing a new product that is potentially sweeter, cheaper, or more appealing to minors. Additionally, minors looking to buy or drink alcohol are very rarely going to purchase or obtain a $200+ bottle of champagne, leaving the ethical worry of underage drinking to alcohol manufacturers whose products are significantly less expensive. That being said, Dom Perignon does attempt to protect themselves from organizations like CAMY (Center on Alcohol Marketing and Youth) by insisting that any visitors to their website confirm that they are 21 or over before being allowed to browse the site, proving that they are indeed attempting to cover their bases in regards to social responsibility.    
         Dom Perignons online manifesto greatly details their methods of wine production and boasts many claims about the "perfection" of their wine. In addition to every bottle being a vintage wine, Dom Perignon insists that they "require the best grapes in Champagne". These are very lofty claims that the consumer can only assume to be factual. Centuries of wine making and a notably iconic image can put the consumer at ease that what the company claims is in fact true. However, if it were discovered that one of their wines was not vintage or that the grapes came from somewhere other than Champagne, this would be considered immoral and unethical on the part of Dom Perignon. Luckily for them, no such claims have ever been made against the purity of their wine.

Ch. 2 - Strategic Planning for Competitive Advantage

       
        Because Dom Perignon is a luxury brand item, its strategic marketing can differ greatly from more traditional approaches to marketing. Dom Perignon does not rely on a cost competitive advantage in order to sell its product unlike many of its sparkling wine competitors. Instead, the company relies on their prestigious image and uses a product differentiation competitive advantage in order to sell their highly priced champagne to consumers. A good example is in the 1950's, much of Europe was drinking an inexpensive champagne called Krug. When Moet Chandon, Dom Perignons mother company, discovered they could produce a comparable wine and price it three times higher than their competitor, they took that opportunity to release Dom Perignon onto the market. In order to expedite their "symbolic acceptance" they sent cases of Dom Perignon to the Queen of England and even had the fine champagne appear in the first James Bond movie as his signature drink. This strategy worked, skyrocketing Dom Perignons sales and even causing their initial competitor, Krug, to raise the price of their champagne from $19- $100 over the course of only ten years. High price, high prestige, and high quality are all factors that have resulted from an extensive and historic market plan.
        Dom Perignon is not aiming to lower its prices anytime soon. Instead the company uses an experience curve in order to create the exact opposite effect, that is to demand more money for their product. Technology and wine production have increased and improved greatly since Dom Perignons inception over two centuries ago. Therefore, with these technological advances and increased knowledge, Dom Perignon is not only able to produce far greater quantities of champagne than it once did, but it is also able to truly perfect its craft, thereby making it more desirable by consumers. Beyond having a highly sought after and prestigious product, Dom Perignon also boasts a niche competitive advantage by simply having the name "champagne" affixed to its label. A sparkling wine cannot be called "champagne" unless it is produced in the small wine region of Champagne, France. Therefore, any wine produced in this region already has a competitive advantage over other retailers who are trying to sell luxury sparkling wines. A consumer looking to purchase a high end sparkling wine is far more likely to pay $200 for a bottle of authentic champagne than they are to pay the same price for a bottle of Cava or Prosecco. That one word alone can make all the difference when it comes to purchasing sparkling wine. Additionally, Dom Perignon is a vintage wine, meaning that they will only produce bottles in years where the grapes are perfect. If it is a weak year, no wine will be produced by the company. The word vintage also refers to the fact that each bottle boasts grapes from the same harvest and, of course, the same year. Vintage wines are very rare and can also be very costly to produce. However, the rarity of these wines make them more valuable, with some vintages collecting $1000 or more per bottle. These are only some of the many competitive advantages that have put Dom Perignon a head above the rest for so many years.      

Ch. 1- Overview of Marketing (Brief History and Mission Statement)

            Regardless of ones familiarity or penchant for drinking sparkling wines and champagnes, one name is easily recognizable among many: Dom Pierre Perignon. Known for its superior taste and notably high prices, Dom Perignon is easily one of the finest crafted champagnes on the market. Since its inception in 1668, Dom Perignon champagne has easily grown to be one of the most prominent household names in luxury sparkling wine. Created by French monk Pierre Perignon in Champagne France over two centuries ago, this elegant and highly sought after sparkling wine has maintained its integrity and prestige to astounding degrees. Father Perignon prided himself on creating the perfect wine until his death in 1715 and "acquired a reputation for excellence". To this day, Dom Perignon is largely touted as one of the most highly sought after and reputable champagnes in the world, proving that this unique and finely crafted champagne has truly stood the test of time.

            Indeed, Dom Perignons mission statement is a simple yet lofty one: "To create the best wine in the world". Said by Father Perignon himself on September 29, 1694, the companies ultimate goal has  remained relevant and stead fast. The current Chef De Cave, Richard Geoffrey, strives to maintain the integrity and "destiny of this legendary wine". Centuries later, Dom Perignon is a champagne that specializes in the same taste and elegance that it symbolized so many years ago. Each bottle is emblazoned with an ever-prominent shield, the likes of which have been re-worked by such notable artists as Andy Warhol and David Lynch. Each vintage is chosen by Chef De Cave Richard Geoffrey to ensure the quality and integrity it prides itself on. Without a doubt, it is safe to say that Dom Perignon is one of the most highly praised staples of excellence in champagne production.