The Auswine Forum

Craig(NZ) wrote:

Well yes, except there's no evidence that's happening. Here's my guess: the large majority of people who buy Penfold's bins are fundamentally wine ignorant and do so because they are premium products where "you can't go wrong". These are the people who will pay $70 a bottle. Next are loyalists/completists who might not like the headline price and might seek the best available discount, but will buy anyway. Next come people who will only buy when they see a really good discount and believe it's a really good wine this year. Finally come the people who say the whole thing is too expensive and don't buy at all.

The trick for a business is to maximise the price the non-discriminatory audience will pay without losing too many of the lesser categories and being able to clear stock at the highest mean price. That's why they discount for very early or very late buyers. Now this may shock you but I have an economics degree (well actually philosophy, politics and economic but what's triple honours between internet insults?), so I can exclusively reveal that this is called "price discrimination". It's what airlines do, for instance. Do you look up the cost of a flight from Auckland to Sydney leaving tomorrow and claim Air New Zealand have "lost the plot" because it's twice what you paid last time? No, you call yourself an idiot for not booking earlier. You know Penfold's bins are going to be discounted, yet you still complain about a headline price you are never going to pay.

Plenty of evidence it happens I can assure you but I don't want to argue about it. I can only imagine how much pressure it would be to win an argument as a triple honours student. You could lose sleep with all the counter arguments running through your head. Personally I have had only seven years experience leading price rise processes it myself and analysing its results another similar corporate. But that is only the real world, nothing quite as good as the classroom. Ok theres the jab but nothing personal ok...im ducking for cover. Now for my diplomatic side....

Wine does however have the advantage (or disadvantage) that supply is limited and really if you sell out a vintage before the next one is released you could argue you are too cheap? It also has a reasonably long shelf life so lots of time to assess and react.

I like your discounting on the way in and out comments. Makes a lot of sense. And yes a good comparison made to airlines. Headline price is also used for other purposes to do with Trade Marketing especially to supermarkets. Dear Mr woolies, yes price has gone up to $70 but I tell you what we will promote with you and fund you down to $50, you will be heros". We will pay you $20k also to put a big 1 page glossy ad in your mailer too. Then we will just write you out a rebate cheque for $20* bottles scanned over 2 weeks from launch. Again it wont impress mr and mrs corner wine shop owner but "makes sense"

However, back to the essense of forums, it is fair enough for us to rant about not getting our favourite wines as cheaply as we once did. As you have noted, happens every year and will continue to. Can't let these shareholders get too fat and make it too comfy for them Or maybe I should just buy shares?

Michael McNally wrote:Surprise, surprise. The Bin 389 is availble for $50p/b in any six. The Bins 28, 128 and 138 at $25.

Now to see what they taste like!

Cheers

Michael

I've also worked in the City of London and written for/edited financial markets publications for 12 years so, yeah, not all classroom you know. Anyway, I hate arguing with people on the internet for innumerable reasons and you're a much better contributor to this forum than I am so let's 'shake' on this and move on, yeah?

Polymer wrote:You haven't even considered internationally where the 389 does NOT have the same reputation. Its floundering in the US, even at $35. This used to be a 20 or sub 20 dollar wine..why would people pay 35? Or 50 in some cases? they don't. Will they pay 5 dollars more now? Hardly...

Or countries like Canada where the price is hard set by the government..or states in the US where the bottle shops are state owned..those prices are all set and not discountable... Or consider Europe where they have far more general knowledge about wine. At 30 EUR are they going to buy a 389? What for? The answer to that is simply no. Or the people in the UK who aren't buying it anymore either..and certainly won't with a price increase. None of these markets have rich people or loyalists that will pay for a premium for a 389 because for them, it's cheap wine from Australia.

TiggerK wrote:Heard the same comment from the DM lady about their allocations.... And I can't help but be cynical and think that the limited numbers of 407 released to Oz markets are just to create a sense of 'quick, buy now before it's all gone, yep sorry it's a bit pricey, but look, isn't it rare!'

Feeling a bit of overall brand 'meh' after this whole new release episode, wonder if others are now feeling more negative towards our famous Oz brand.

Sean wrote:
I am wondering if the RRP’s this year are a payback by TWE for the heavy discounting done by the big chain stores last year. TWE want to protect the brand (especially now perhaps) and have effectively forced the retailers to lift their prices. Might work or might not.

I am wondering if the RRP’s this year are a payback by TWE for the heavy discounting done by the big chain stores last year. TWE want to protect the brand (especially now perhaps) and have effectively forced the retailers to lift their prices. Might work or might not.

Rossco wrote:

Sean wrote:
I am wondering if the RRP’s this year are a payback by TWE for the heavy discounting done by the big chain stores last year. TWE want to protect the brand (especially now perhaps) and have effectively forced the retailers to lift their prices. Might work or might not.

or just a method to recover their substantial de-merger costs.

While i dont feel sorry for the big retailers, its the little retailers & independents who will be the hardest hit out this mess.