Air Malta and Maltese Wine Industry Partnership

Maltese wine industry and Air Malta partnership are more of branding and promotion strategies embraced by the winery industries in the company. Though the Maltese wine industry uses the Air Malta to promote their products to their potential customers, the partnership is aimed at achieving relationship marketing. According to Cohen (2014), relationship marketing is a marketing strategy that focuses on long-term customer retention and engagement and at the same time achieving customer loyalty.  It aims at offering a platform for the creation of strong customer connections that would ensure that there is absolute loyalty between potential customers (Zhang et al., 2016 p.64). Therefore in contrast with the partnership of the two countries and the need to wade off stiff competition from the EU wines, Maltese wine industry aims at winning potential customers through the help of Air Malta.

Though the relationship is plagued by various shortcomings such as blatant isolation of other potential customers, it aims at ensuring that the wine industries identify potential customers from other ordinary travellers. Giving quality wine to first class or business class travellers is a strategy used to ensure that only potential customers are targeted by the fine products of the industry (Gbadmosi, 2013). On the other hand, the wind industry heavily relies on the airline to ensure that its products are promoted to countries abroad. Consequently, the customers abroad are targeted by offering them a taste of high-quality wine produced by the industries. The marketing strategy is aimed at exploiting a market niche that may be in existence as per the tastes and preference of the potential customers. Air Malta airlines travel to countries far beyond Europe. The airline sometimes operates in the Far East and Baltic states which hardly produce wine on their own like in Western European countries. Therefore, the relationship between the wine industry and the airline aims at ensuring that customers from these regions are introduced to the wines produced in Malta. Consequently, it helps in diversifying the markets for the Maltese wines to ease the market pressure placed on the wine industry from the wine imports in Europe.

Advantages of Air Malta and Maltese Wine Industry’s Partnership

The partnership between the Maltese wine industry and Air Malta have relatively varied advantages. First, the airline provides a perfect opportunity to promote the industry’s products. Air Malta is destined to various countries across the globe. The airline company operates within virtually all the continents in the world. Taking into account the partnership between the two entities, the airline offers an ample platform upon which the product is exposed to the outside world. Baker (2014) notes that giving customers high-quality Maltese wines during flights, the industry is exposed and various customers are cumulatively targeted. Promptly, the customer base would be significantly increased due to diverse customers from varied countries. However, this could only be achieved if the customers are given quality services and wine of high quality.

Similarly, the partnership helps in identifying potential customers who would be of higher value to the winery industry. In a bid to cut costs of operation, the airline with the partnership of the wine industry ensures that only potential customers are targeted with quality services and wine. Though the practice seems relatively discriminatory, it is essential in ensuring that it pinpoints and isolates customers who are too costly from the valued customers. Most of the local travellers have wide variety and choices of wine to choose from owing to the fact that in Malta, superior wines from Europe have flooded the market. However, by targeting customers abroad, the partnership aims at tapping at the curiosity and the adventurous nature of potential non-local customers (Hoban, 2015). The airline is of the assumption that potential local customers do not have any significant impact on the sales of the wines so it would be prudent to target customers who would be looking for diversity. To some extent, offering quality wines to people who are rather unprofitable for the company ensures that the customers deemed unprofitable are persuaded to change to be long-term customers. Through the partnership by air Malta and Maltese wine industries, customer value is achieved.

On the other hand, the partnership offers the wine industry instant feedback on their products. It is the tradition of all the airline companies to ask for customers’ feedback on the services and the products they offer. The feedback is aimed at ensuring efficiency and improving the quality of services they offer. In that regard, when customers aboard Air Malta offers a feedback, whether positive or negative review, the winery industries are offered an insight into their products. Zablocka (2015) notes that a positive review of the products would to a great extent translate to a potential customer who could purchase the products of the industry in the future. A positive review is a conduit for referrals and other strategies of marketing which could greatly spur the sales revenue and increase the marketing scope of the products. However, Beck et al. (2015) assert that negative feedback would offer the industry a platform for improving the products they offer for their potential customers. On the other hand, it would ensure that the winery industry offers products that are in line with the preference and taste of the potential customers. Consequently, this would give them an edge over various wines in the market.

The relationship maximizes the word-of-mouth strategy of marketing. The most effective way of marketing a product to potential customers is the use of word of mouth to highlight various aspects of the product (Byrd et al., 2016 p. 21). Word-of-mouth strategy ensures that products reach individuals who are seemingly difficult to persuade. In some cases, the consumers of the products require detailed information about the products offered and how they could be accessible. The existence of the airline workers who are readily available in explaining detailed information about the wine ensures that word-of-mouth strategy is effectively employed to the potential customers. In turn, the customers would tell other potential customers in that cycle hence increasing the market base of the products offered. In marketing, people trust the opinion of friends and trusted individuals than other marketing strategies. The partnership offers a correct platform upon which the wine is recommended to others. One potential customer acts as a marketer for the brand since he/she would tell his friends and others about the particular wine offered by the airline.

Disadvantages of the Partnership

One of the notable disadvantages is that the relationship between Air Malta and Maltese wine industry segregates other potential customers. Though the airline company focuses on maximizing the profit margins and reduction of the operation costs, having preferential treatment on various customers is inappropriate. According to Gbadmosi (2013), passengers who travel in economy class and locally are treated with substandard quality wines. The wine provided is either under chilled or not fully mature thus lowering the quality. The segregation of the customers would translate to customers giving a negative review of the products of the industry rendering them highly ineffective and less competitive in the market. Similarly, the segregationist approach could make the company miss out on potential local customers and those with moderate earnings. Therefore, the company should adopt a strategy that would ensure that all customers are targeted regardless of the social class in society.

On the other hand, the marketing strategy is prone to negative reviews. Taking to account the segregationist approach employed by the partnership between the two entities, the product is bound to massively suffer the negative feedback from the customers. Relationship approach of marketing hugely depends on positive reviews received to expand the market potential of the products. Lewis et al (2015) warn that any negative review damages the reputation of the product and renders it impossible to change the perception of the individuals regarding the wine. Therefore, in as much as the partnership opens up the products to the overseas markets, there is a need to ensure that the services and the wine offered to the customers are of high standard. Instances, where wine is served in plastic utensils, should be hugely discouraged and avoided at all costs.

   The costs of the promotion and time consumption could be relatively high. The approach emphasizes on direct marketing which is time-consuming as it depends on the higher level of personalization (Beck et al, 2015). The potential customers are attended to a personal level which could, in turn, prove to be time-consuming and relatively expensive. The airline could be prompted to employ more attendants to promote the winery products and give a detailed explanation of the products. Consequently, it would negatively impact the operations of the airline which could translate to massive losses and inefficiency in productivity, rendering the services offered highly ineffective.

On the other hand, the full realization of the goals of this strategy takes a relatively long time. Building a strong relationship with the potential customers could take a relatively long period of time. There is no guarantee that the time taken would have value on the products as some potential customers are generally hostile and assumes a conservative approach. Persuading them to embrace new products could be less successful and this could plunge the partnership into a deep crisis as the essential time that would rather be channelled for productivity is used in marketing the product. 

Lastly, the success of the relationship is dependent on the success of the airline. When Air Malta registers a loss, there are high chances that the partnership between the two entities would be stalled. Based on the case study, it is reported that in a bid to be competitive, Air Malta initiated approaches where local travellers were served with substandard wine. In that regard, it is evident that the airline would do anything to cut costs of operation even the move has detrimental consequences on the winery industry. It translates that if the success of the wine industry is directly pegged on the airline progress. Consequently, it leads to non-proportionate interdependence which could hamper the marketing of the Maltese wines.

 Marketing Plan

Taking into account the competitiveness the Maltese wine industry faces, the following market plan should be employed to ensure that well-formulated goals of the industry are achieved. Through the expansion of markets and coming up with well formulated and realistic objectives, it would be important for the formulated market plan to have an edge over existing wine imported from Europe. Target markets could be achieved through extensive branding, promotions and effective use of mainstream and social media platforms.

Business Summary

Maltese wines industry is made of various winery factories which have been in operation since 1907. Though the wine producing entities are categorized under SMEs, notable companies such as Emmanuel Delicata records a substantial progress in both longevity and quality of the products. Other notable companies include Marsovin, Meridiana, Montecristo, and Camilleri which were founded in 1919, 1985, 1995, and 2000 respectively (Gbadamosi, 2013). The companies under this industry have their headquarters in various towns within Malta. Based on the varied goals, the wine manufacturing entities does not have any binding mission but they are of the general opinion that there is a need to expand their market base.

SWOT Analysis

Strength

The Maltese winery industry has various strengths amidst the stiff competition they face from the imported wines. Aparacio et al. (2019) note that one of the notable strength is that they depend on local farmers who have embraced an organic expansion of production. The presence of local farmers ensures that there is a constant supply of grapes to the companies. Similarly, Gbadamosi (2013 highlight that Marsovin and Delicata possess vineyards where they have embraced enhanced production mechanisms aimed at increasing productivity. Lastly, through a partnership with Air Malta, the industry has benefitted immensely from the exposure by the airline company. The formation of certification of origin also distinguishes the wine from others giving it a much-required identity.

Weaknesses

Maltese wines are relatively known to individuals in various companies. Initially, due to lack of exposure, the Maltese wine remained unknown to many people thus confining it within Malta. On the other hand, the production was obscured with uncertainties since the farmers were not confident whether the companies would purchase the grapes. Lastly, the imported wines from EU countries have suppressed the growth of the market for the winery products.

Opportunities

Despite all the challenges faced by the Maltese wine industry, the industry has a limited opportunity which it can exploit and expand its market. The industry could use the local market and potential customers to increase its sale. The industry could brand its products to align with the patriotic ideologies and instil the sense that the product of the country comes first. Similarly, through the production of high-quality wines, the industry could take advantage of the accolades it won during the Grand Cavalier Chardonnay to expand its market in EU countries (Gbadamosi, 2013). The partnership with Air Malta has offered the industry an exposure to the outside world. Therefore, the industry could exploit market niche existing in Asia, Africa or Baltic and Arctic nations which does not readily produce their own wine.

Threat

The existing threat the industry faces is the flooding of the imported EU wines which are of relatively high quality in the local market. EU countries produce a wine of high quality and since they are more advanced in wine production, local winery industries have found it hard to navigate the local market.

Target Market

Wine consumption markets are numerous and also dependent on various factors.  However, the Maltese wine industry should strive to target local markets in Malta, EU markets and any potential market abroad. The local market in Malta is quite limited and competitive based on imported wines from foreign countries. However, targeting the market would ensure that the industry cements its influence on the local market which would give it a desirable launching pad. The local market is made up of potentially 1.5 million customers where the target would be mainly on the tourists (Hoban, 2015). Tourists are considered to be main targets due to their adventurous nature and desire to try new products in a foreign country.

Though it is difficult to navigate the EU winery markets. The focus should be placed on following up on the customers acquired due to the partnership with Air Malta. On the other hand, in Africa, very few countries produce their wines. The huge population depends on the imported wine. Their desire and taste for imported wines would be exploited to ensure that Maltese wins exploit the existing market niche. Though there is competition from EU countries for the market, high quality and desire to diversify should give the industry an edge over others.

In Asia, precisely in Japan, the citizens have an astounding love for red wine. It is estimated that over 80% of wine consumers in the country prefer imported wine which they use during meal times and special occasions. Japan boasts of huge population and high working power. Therefore, the high population and the existing purchase power would provide the wine industry with the required market. The Maltese wine industry, therefore, should strive at ensuring they achieve the highest quality of wine based on the preference and demands of the customers (Beck et al, 2015). Precisely, in Japan, the industry aims to benefit from the high population and high purchase power to expand its market and sale.

Market Strategies

Product

Maltese wine industry mainly focuses on producing different varieties of wine fermented from the organic grapes grown by various farmers and leading companies within Malta. The notable types of wine produced include Gellewza (red) and Ghirgentina (white). Other varieties such as Cassar de Malte and La Valette wines are also produced in Malta by the Maltese wine industries.

Promotion

Though the industry depends on partnership with Air Malta to promote various wines it produces, there is a need to ensure that the products have a global outreach. Therefore, the use of social media, television adverts and partnership with other global entities should be used to ensure that the maximum number of potential customers are reached. Since Air Malta does not reach various nations, these initiatives would prove pivotal in marketing and promoting the wines.

Placement

The products would be made available and through local distributors in the target regions. It would be costly to set up distribution in every country but through a partnership with various outlets, the goal could be achieved. In the partnerships, the outlets would further act as marketers of the products.

People

There are individuals who would be tasked with promotion, distribution, and general marketing of the wines in various destinations. Through a partnership with Air Malta and potential distributors in various countries, the products would be branded and distributed to reach a maximum number of potential customers available.

Process

To widen the market base, the industry should offer incentives through warranties and discounts to the distributors. Armstrong et al. (2014) counsel that the incentives would boost the confidence of the suppliers and potential customers. Though the major winery companies offer incentives such as wine tasting initiatives, there is a need for such incentives to be expanded in targeted markets to ensure the win has an edge in the market over other wines.

Packaging

The wines would be packaged in bottles and chilled. The packaging in the bottle would render them very fragile hence there would need to ensure that safety measures are put in place to prevent any form losses emanating from the fragility of the packages. Transport mechanisms should be cost effective but also take into account the nature of the products to cut on the losses.

Budget

Taking into account the varied and distant markets targeted, the budgeting for the whole marketing process would be relatively high. However, the industry would prioritize on the most effective approach and one which does not strain the financial well-being of the industry. Cumulatively, $2 million could be used for commercial attaché and television advertisements for one month. There is a limited budget required to facilitate social media advertisements.

Market Channels

The Maltese wine industries would employ varied mechanisms to ensure their products are exposed to the market. The industry would exploit the ease of accessibility made by social media to reach a relatively high number of global audience. Through sponsored advertisements, the industry would showcase all their products to the global market and potentially reach a huge number of potential customers (Fiore et al., 2016 p270). Secondly, the industry would be in partnership with various reputable entities and sport television channels. Most potential customers are sports lovers.  Partnering with sports television stations would reach a good number of probable customers on a global scale.

Lastly, the industry would employ the use of commercial attaché to ensure its products are marketed and people within the targeted market scope are sensitized on the same. Though the expenses associated with commercial attaché is relatively high, it should be done for a short period of time mainly to expose the products to the outside world. The practice would give the Maltese wins required advantage to navigate the overseas markets.

                           References

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(Bachelor’s thesis, University of Malta).

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