Thursday, September 19, 2019

How to start a business

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to do business it is not a easy thing



COCA-COLA®



No. 1



Coca-Cola is the most popular and biggest-selling soft drink in history, as well as the best-known product in the world. Created in Atlanta, Georgia by Dr. John S. Pemberton, Coca-Cola was first offered as a fountain beverage by mixing Coca-Cola syrup with carbonated water.


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Coca-Cola was registered as a trademark in 1887 and by 185 Coca-Cola was being sold in every state and territory in the United States. In 18, the company began franchised bottling operations in the United States.


Today, you can find Coca-Cola in virtually every part of the world. The Coca-Cola Company has more than 00 beverages in its portfolio.


Coca-Cola touches the lives of millions of people each and every day. From special occasions to exceptional moments in everyday life, Coca-Cola is there. The brand has become a special part of peoples lives.


Over the years, hundreds of people have sent us stories about how Coca-Cola has affected their lives. Whether it is a childhood memory, a reminder of family gatherings, or a recollection of good times with friends, Coca-Cola has impacted the lives of people all over the world.


The following are just some of the stories people have told us about the special role Coca-Cola has played in their lives.


To read the stories, click one of the links below or select a category from the menu on the left and click go.


If you would like to submit your own Coca-Cola story, select the link to the left and follow the instructions. We look forward to hearing about how Coca-Cola has played a part in your life.


As I was growing up, my parents owned a mom and pop store. As one of my duties as a helpful employee, I would have to take all the empty bottles to a back room to put them in order for the Coca-Cola driver who delivered new cases of Coke®. He then would take the empties back to be recycled. Those wooden boxes got pretty heavy. Those were the Coca-Cola® days.


In 17, we moved to Florida from New York. We were building our home and, as we were clearing the lot, a large tree was felled; the tree was about 00 feet (a live oak). And in a piece of the top of the tree was a Coke bottle with a piece of the tree growing around it. In the early 10s, Im told, workers on the land must have left the bottle in a small tree. I still have it.


Coca-Cola was a great treat for my younger brother Charles and myself every Saturday. They cost 6 cents each at that time. Not only was the drink a special treat, it was fun saving the bottles. When I was 1 and my brother , we used his wagon and gathered 100 Coca-Cola bottles to buy hula hoops. They were the biggest thing since Coca-Cola at that time for us. What wonderful days. And now Im here at World of Coca-Cola enjoying this great drink with my oldest daughter Cecilia and my 11-year-old grandson Crosby. These are great days also and Coca-Cola classic® is still my favorite beverage. I am the proud owner of a Country Convenience store and sell lots of Coca-Cola products every day.


When my family went on long trips back in the early to mid-70s, we always had a special contest. Wed all go into the store and get a Coke, without looking at the bottom of it. After drinking them, we would all turn our bottles upside down to read the city name for the bottling company [on the bottom of the bottle]. The city nearest home to Americus, GA, would win. I could never win. One trip, to be fair, my father announced that the winner would be the one the farthest from home. You guessed it -- mine was finally Americus. I might not have won the games, but I won lots of great memories. Each bottle of Coke brings one or two back.


When I was approximately 1 years old, I would pick up bottles for deposits. I would save this money and my allowances to purchase a six-pack of Coke for mama for Mothers Day or her birthday. I would ride my bicycle (banana seat) to the local grocery store and buy the six-pack. I would hang the cardboard carton on the handle bars to get the gift home to mama. I would put the six-pack under the sink and instruct my brothers and sister that theyd get in trouble if they drank the Coke. There were four of us kids and we usually drank the Coke and mama didnt get any. This was her special gift.


At the office about five to six men and women would place a bet on who got the bottle of Coke from the farthest state. The state was stamped on the bottom of the bottle. The bottles were dispensed from a machine in our office. The winner received free Coke for five days. I might add that foreign countries were also included. The winner received Coke for two weeks.


My uncle is a supervisor for one of the Coca-Cola bottling companies. When I was about 10 years old, I lived with my aunt and uncle. I had a friend spend the night, and my uncle had a lot of Coke bottles and other bottles around his house. My friend and I wanted to cash in his bottles [for the deposit] to go to the store. Well, we took ALL of the bottles, and when he got home he was really upset because some of his bottles were VERY old and collectors items. Luckily we went back to the corner store and he knew us, so he gave us the bottles back. From that time on, I started to collect glasses and I now have over 100 Coca-Cola glasses, all styles.


When I was younger I collected Coke bottles. My children wondered why. I collected them for the cents and later 5 cents deposits. My brothers and I would go around the neighborhood collecting bottles so we could turn them in for the deposit. If I knew then what I know now, I would have collected them and saved them. My kids would have a ball with these old bottles!


After my parents divorced (17), mom and I were sitting at the table eating lunch one day. She bet a quarter that her Coke was bottled the farthest away from Dallas, Texas. I remember wondering, What could she possibly mean? She held up her Coke, we looked underneath and on the bottom was the city name where the Coke was bottled! I won! It took me a while, but I figured out she had probably set it up so I would win to make me feel better! Its a small thing, but a very nice memory of a quiet Sunday afternoon; just me and my mom, a tuna fish sandwich and a Coke!


When I was a little kid, about 8-10 years old, the movies on Saturdays were 5 cents for the matinee. My two cousins, my baby brother and I used to take our wagon and go looking for Coke bottles. They used to pay cents for small bottles and 5 cents for big bottles. This is how we used to get our 5 cents for the movies. Im in my 50s today and the picture is still so very clear in my head. It was a great time. Our families did not have a lot of money, and this was our only way to come up with 5 cents for the movies.


I have always been a Coca-Cola drinker for as long as I can remember. When I was a Brownie and later a Girl Scout, my mom and dad would each work overtime so I could go to summer camp. There wasnt enough money for spending at the camp store, so I would go to all my neighbors in the Brooklyn apartments and ask them for their empty bottles, so I could get the deposit. Luckily, there were a lot of Coca-Cola lovers in my neighborhood, and people were always willing to help me out so I could have a little extra to buy a few treats at the camp store. (That way, I could be like the other camp kids, and I wouldnt be reminded my family was poor.) So, my favorite drink also became my financial friend when I needed a little help (to go to the movies, buy an ice cream cone, a Coke, etc.). As a teacher and an environmentalist, I now recycle at home and at school. With the money I make, I take my 0 second graders on at least four trips a year.


As kids, my brother and I spent our summer weekends at our grandparents, whom we called Nonnie and Poppie. Their house was in a new development and there was much construction. To make money at ages 7 and 8 was a challenge. So my brother and I discovered that collecting the empty Coke bottles at the construction sites at the end of the day was a great source of revenue. One summer we cleared over $15 a piece by turning in bottles at the local supermarket.


Kelly Lake is a tiny little railroad town on Minnesotas iron range. In 15, I discovered a stash of old Coke bottles in the upstairs of our garage. I found out that when we brought them to the store, we could get money for them! I was 5 years old. I loaded up our wagon, and off to the little store I went. My pockets were loaded with pennies and nickels. I excitedly went back for another load, and then another, until the store keeper said, Thats enough. You didnt buy all this pop here, so I wont give you any more money. That was OK, though. My, oh my -- I had enough money to buy a lot more Coke, and a few Hershey bars, too! Life was grand!


Living quite some distance from town, we rarely participated in the Halloween ritual of trick-or-treating. We only went trick-or-treating three times, but we always remembered the most important house on our visiting list the Coca-Cola drivers house. He handed out icy cold cans of Coca-Cola®, and nothing beat that for a treat! No one soaped his windows or toilet papered his trees, because even the most mischievous revelers appreciated their can of Coca-Cola for Halloween.


I was born where Coca-Cola was born Atlanta, Georgia! When I was a little girl, about 0 long years ago, I used to look forward to the arrival of the Coca-Cola man. I was more anxious to see the Coca-Cola truck than the ice cream truck. Whenever I saw that Coca-Cola man driving down the road, I would wave him down. He would always stop and give me all the Coca-Cola goodies that he had. Today, I work for a Coca-Cola bottling company. My customers are always trying to wave me down so that they can get free goodies from me.


A few years back I was salmon fishing with a co-worker in the very north of Norway. At that time we were both employed by a different soft-drink company. We had been hiking, fishing and camping for four days. We were very tired and very thirsty. When we got back to our car we immediately drove to the nearest convenience store. We walked in the store and walked directly to the soft drink cooler. The store sold no products from the company we worked for. Without the slightest hesitation we both reached for a Coke®, popped the top and downed the drink. We then looked at each other and agreed that that was the best drink we had ever had.


In the very early 50s, I worked as a route salesman for Coca-Cola in Chicago, Illinois, for seven years. In 156 or 57, I won a speedboat as the top salesman in the Northeast Region. I still have the magazine presenting me the award. The president of Coca-Cola called to congratulate me.


I grew up in a small town in Central Alberta. My parents owned the local general store. Growing up each child did their stint working in the store. My favorite time was always when the Coke delivery truck came, because every once in a while -- on a hot summer day -- after he made the delivery, he would bring in a Coke for my dad and me. To this day, from a dedicated Coke drinker -- even my children know -- its Coke or nothing.


As an employee of Coca-Cola, my soon-to-be-wife and I decided to use an 8-ounce Coke toast instead of champagne at our wedding. We provided enough 8-ounce bottles of Coke for all 00 people who were there. When the best man raised his glass for a toast, everyone popped open their bottles at one time. It was a great sound to hear 00 bottles of Coke being opened at once.


While traveling through a highway construction area one steamy summer day, a real life Coke commercial took place in front of me. A semi-truck was stopped as on-coming traffic proceeded along the one open lane. As I passed, I couldnt help but chuckle as the truck driver opened his window and handed the sweaty, female road crew worker a Coke and a Smile. What better example of the generosity of our country and endorsement for Coca-Cola.


When I was a child, my grandmother worked at the bottling plant in Cincinnati, Ohio. Our family had less than moderate means. One of the Christmas decorations that I remember as a child was the cardboard stand-up Coca-Cola Santa. The kids in our family started getting excited about the holidays when Grandma put out the Santa.


In 148 my husband graduated from Rutgers University. His first job was as a Coca-Cola salesman. He had a Coca-Cola car and sold syrup dispensers and syrup to places that dispensed soda at a fountain or bar. He had to participate in a training program at headquarters in Atlanta before he started. All of the salesman he worked with in the New York City area were great guys. His starting salary was $50.00 a MONTH. Its hard to believe. We didnt have a telephone when we first moved into our house, and I couldnt drive the Coca-Cola car -- but then, I couldnt drive. As I look back now, life was very simple by comparison to todays young couples. We were years old. I still have the group picture of his training class.


In the winter of 180, I spent three very important months delivering Coca-Cola in West Tulsa, Oklahoma. Those were still the days of glass bottles, wooden crates and hand pricing. It was hard work. My most vivid memories were of stacking the crates and hand walking them into the stores. Many times I had to wheel the hand truck into the pit at the rear of the store, and throw the heavy wooden cases up onto the dock, re-stack them and wheel them into the store to price and then rotate the stock. Then it was the drivers responsibility to sort the empty bottles and carry them back to the truck. Hard work and low pay. I moved on to other things after a short time, but I will always remember this job, and the lessons it taught me about hard work, and delivering a product that was respected and enjoyed by so many.


In the winter of 180, I spent three very important months delivering Coca-Cola in West Tulsa, Oklahoma. Those were still the days of glass bottles, wooden crates and hand pricing. It was hard work. My most vivid memories were of stacking the crates and hand walking them into the stores. Many times I had to wheel the hand truck into the pit at the rear of the store, and throw the heavy wooden cases up onto the dock, re-stack them and wheel them into the store to price and then rotate the stock. Then it was the drivers responsibility to sort the empty bottles and carry them back to the truck. Hard work and low pay. I moved on to other things after a short time, but I will always remember this job, and the lessons it taught me about hard work, and delivering a product that was respected and enjoyed by so many.


My grandfather told me once about his mother, Emma Sanger, who worked at the family Coca-Cola Bottling Company in Longview, Texas. Emma had one of the most important and probably the highest-risk jobs at the plant. Emma walked down the Longview, Texas, wooden sidewalks wearing a gun and holster while she took the bags of nickels [from sales of Coca-Cola] to the Longview Bank twice a day. On the quiet days, my grandfather used to make the walk with her. It was the best job in town in those days.


Ive drunk Coke® all my life and have a Coke collection from a micro Coke car to four Coke machines. At work, people call me the Coca-Cola® Kid because I am never without a Coke in my hands and a spare in my lunch box. I am such an avid collector, I bought some stock so I can say I own a piece of Coke. No other sodas besides Coke products are allowed in my house. When friends come over and they have some other soda, it has to stay outside. I even have six VCRs going all day so I can record the commercials. I have over 0 hours of Coke commercials, including Id Like to buy the World a Coke, the Mean Joe Greene ad and some from foreign countries that I got when I was in the military. I play the commercials when I clean my house instead of listening to the radio. Friends, family, neighbors, and on a few occasions strangers come over just to see my Coke collection. Thanks for all the joy Coke has brought.


I used to have a beautiful German Shepherd that danced to a Coca-Cola commercial. He stepped on his two legs and began to back up. He only did that when he heard the Coca-Cola commercial.


Drop back to the early 170s when I was about 10 years old. I was an impressionable fun loving kid just running around, playing games and growing up with all my best friends. Pick-up games of baseball and football were more important than school or girls. You remember those days?


I was always looking up to older kids and how they acted and dressed -- sort of a hero worship and wanting to be "big" like them. One of the most engrained images I have of those times was the big brother of a friend of mine who had a pair of those the funky red and white checkerboard COKE pants. It seemed to make a big impression on me that he was soooooo coooool in those pants with a white T-shirt and disco hair. He was always nice to all of us and helped us get out of a lot of trouble we may have caused. Imagine that. Anyway, that impression was and still is important to me as to what an impact Coke had then with its cool commercials, songs, Mean Joe Greene, and the list goes on and on.


Still, those funky checkerboard pants!! I cant imagine wearing them now, but sure wish I had a pair. By the way, we can all skip going back to the disco hairstyles, right?


The commercials, especially around Christmas, from your company and marketing team have been fabulous. The spirit of Christmas is so carefully inscribed within the commercial that I have to stop and think as I watch your commercial -- as opposed to tune it out like so many others.


I am in marketing and realized that I wanted to be in this profession when I saw the Coca-Cola commercial from Christmas with Id Like to buy the World a Coke. I knew that I wanted to do this. Since then, I continue to be amazed at how wonderful and continuously creative Coca-Cola is with both its print ads and television commercials. I now collect Coca-Cola magazine ads and have a wall dedicated to years of great advertising. Thanks, Coke, for giving me the push I needed to go into a field that continues to keep my creative juices flowing!


My last year of high school was in 17. During that year I was a cheerleader and enjoyed cheering at football games. I recall watching the commercial of the football player and the child who offered him a Coke after the game. It brought tears to my eyes. I never knew how important commercials were, but as I was watching them [at World of Coca-Cola], they all brought back some kind of fond memory of the date in time.


As a teenager my friends and I would all gather on our porch singing the old Coke song, Coke adds life and everybody wants a little life ... Coca-Cola. We would laugh and sing drinking Coke. Every time we would see someone with a Coke we would break out singing. Everybody wanted to sing the last high-pitched Coca-Cola. That is one of my best childhood memories.


The day I discovered that I had a real love for Coca-Cola was when I was around 5 years old -- the 171 Coke commercial. The Coca-Cola song being sung in the hills of Italy brings happy reminders of when I was young and first started to sing. Whenever the old 71 commercial plays, reminders of my childhood abound, and thoughts and feelings of those good ole days bring me back to my youth. And I still know the song!


After a very devastating start to my life (I was 7 years old), my two brothers and I were released from an orphanage to my fathers care, and he promptly moved us to Chicago, Illinois. It was a new beginning and a time filled with hope and promise. That was when I first saw your commercial about teaching the world to sing in perfect harmony, and it seemed to personify what I felt in my heart, even at such a young age.


My favorite Coke commercial is the one where Coke teaches the world to sing. As a young girl, I always thought that was a wonderful symbol of my hopes and dreams for the future of the world -- everyone living together peacefully. Now, as a mother of two children, I still hope that someday this becomes a reality. Coke and my dreams will always be one. Our required diversity training for employees provides an overview of diversity management strategies in the workplace and ways to effectively implement them with an inclusive approach. We also offer supplier diversity training to help ensure that employees understand how to leverage the procurement power of the company by creating a pool of suppliers that include minority- and women-owned businesses.


Civil Treatment for Managers - This online course provides guidelines for appropriate workplace behavior as well as practical skills for effectively working with senior leaders, managers, co-workers and customers.


Leveraging the Power of People and Ideas (LPPI) - A workshop for managers and employees, this course helps build a broader understanding of diversity that extends beyond ethnicity and gender. It focuses on four approaches to diversity leveraging workforce diversity; strategic diversity management; understanding differences; and representation. Participants gain awareness and develop skills in managing diversity through experiential exercises and rich discussion that challenge their perspectives relative to real-time workplace issues.


Supplier Diversity As A Marketplace Advantage - This one-day session focuses on both procedural knowledge and behavioral skills that help create an inclusive vendor pool for contracting, purchasing and outsourcing, using various proactive strategies. Employees gain a thorough understanding of how purchasing decisions can be made to reflect a diverse pool of suppliers.


WORKPLACEAt The Coca-Cola Company, we are committed to cultivating a diverse, rewarding culture that encourages our people to develop to their fullest potential.


The heart and soul of our enterprise have always been our people. Over the past century, Coca-Cola people have led our successes by living and working with a consistent set of values. While the world and our business will continue to change rapidly, respecting these values will continue to be essential to our long-term success.


As we have expanded over the decades, our company has benefited from the various cultural insights and perspectives of the societies in which we do business. Much of our future success will depend on our ability to develop a worldwide team that is rich in its diversity of people, cultures and ideas.


We are determined to have a diverse culture, from top to bottom, that benefits from the perspectives of each individual.


Please use the drop-down menu on the left to find out more about our At Work programs.



CULTURE



With the same spirited investment as the worlds premier marketer and beverage industry leader for more than 116 years, we are focused on strategic workplace programs that help assure the success of our commitment to embracing the similarities and differences of people, cultures and ideas.


Cultural Sensations - This employee awareness program takes diversity beyond representation and provides employees an opportunity to learn about different cultures and regions of the world in which we do business. Our Cultural Sensations program is designed to foster dialogue about the similarities and differences of people, cultures and ideas through the use of art, music, dance, food and special events.


Diversity Advisory Council - The companys corporate Diversity Advisory Council consists of a representative group of employees from all levels, functions and business units of the organization. The Council develops recommendations for senior management on advancing the companys efforts towards achieving our diversity objectives.


Employee Forums - We believe that a sense of community enhances our ability to attract, retain, and develop diverse talent and ideas as a source of competitive business advantage.


In the United States, through employee forums, employees can connect with colleagues who share similar interests and backgrounds. In those forums and elsewhere, employees support each others personal and professional growth and enhance their individual and collective ability to contribute to the company. Forums that are currently active include


Across more than 00 countries ... more than 100 languages ... a multitude of cultures and geographies, The Coca-Cola Company strives to be a special part of peoples lives. This privilege comes with a responsibility. We have chosen to take a leadership role, knowing that our differences make us stronger in our business and in our communities - each and every day.


We embrace our commitment to diversity in all its forms at The Coca-Cola Company as a core value. Diversity - of race, gender, sexual orientation, ideas, ways of living, cultures and business practices - provides the creativity and innovation essential to our economic well-being. Equally important is a highly motivated, healthy and productive workforce that achieves business success through superior execution and superb customer satisfaction.


In todays volatile economic environment, this kind of performance requires unprecedented commitment to the principles of integrity and leadership. We are intent on keeping that commitment.


Visit The World of Coca-Cola Atlanta and trace the history of the worlds most popular soft drink. Youll journey more than 100 years into the past and explore the future of the magical story of Coca-Cola®.


The excitement begins the moment you walk through the door. Pass under our landmark neon spectacular Coca-Cola sign and find yourself standing in a three-story atrium hung with flags representing over 00 nations & territories where Coca-Cola is available. From there, move at your own pace through the fascinating galleries showcasing the rich heritage and global reach of Coca-Cola.


With exhibits that appeal to both young and old, the attraction boasts approximately 1,00 Coca-Cola artifacts, in addition to interactive exhibits and video presentations. Youll be taken on a virtual journey from the invention of Coca-Cola by Dr. John Pemberton in 1886, to its present popularity throughout the world, where an average of 1,000 of The Coca-Cola Companys beverages are consumed every second of every day.


Experience the nostalgia of the 10s replica Barnes Soda Fountain, where an old-fashioned soda jerk demonstrates how an early Coca-Cola was prepared, while you listen to songs about Coca-Cola playing from the authentic 10s jukebox.


View vintage television commercials, watch the evolution of product packaging and vending, including the first soft-drink dispenser in space, and taste exotic beverages made by The Coca-Cola Company around the world (but not available in the U.S.), one of the most popular parts of the attraction. Tour the attraction.


Before leaving, stop by the Everything Coca-Cola gift store and pick up the perfect memento of your visit. There is something here for the entire family. Enjoy!


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Holocaust

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I was told a story about a Jewish women who was sent to one of the worse death camps, Auschwitz. She had just had a little infant baby that was no more than 4 months old. Oblivious to what was going on and frightened by the loud noises of the shouting Nazi soldiers, she began to cry loud and uncontrollably. The woman fearful of her child's death tried to calm her daughter down but couldn't get her quiet. A Nazi soldier impatiently grabbed the baby from her mother's arms and angrily, without guilt, threw the baby against the brick wall. The walls were dripping red each day from the blood of innocent little children who were never given a change to live. The ground was filled with skeleton bodies who died of starvation and disease. No human being deserved to be treated like this. Jews were constantly tortured and killed simply because of their background and what they believed. Little Jewish children weren't given a chance to live a normal childhood, but instead they spent most of their lives hiding or working in unventilated factories. The lives of millions were ruined because of one selfish man.


The dead Jews from the Holocaust numbered more than 5 million about million in killing centers and other camps, 1.4 million in shooting operations, and more than 600,000 in ghettos. (Traditional estimates are closer to 6 million.) How can one single person do so much damage? Jews were treated very poorly and with no respect what so ever. They were killed, starved, tortured, and even murder because of the simple fact of what they believed in. Some Nazi soldiers found it humorous to make the Jews dig there own grave and lie there to die. The cruel and unjust act should never be forgiven and forgotten until this day but many Jewish survivors are trying to put their past behind them. The Holocaust was a very difficult experience for the Jew and the many harsh things they went through still haunt them till this day and will for the rest of their lives.


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Tuesday, September 17, 2019

PEST analysis Advertising Industry India

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Most of us are consciously trying to ignore the industry that determines the way we live. The industry silently persuades us into something or the other without we ever realizing it. But this industry gets less respect and many harsh words are spoken about it. Yet, its impact is profound on the very fabric of our lives. Thinkers dub it as the 'spark' that runs the 'economy engine' and critics call it as the 'evil thing' that constantly creates wants! Yes, it's the advertising industry.


Advertising is one of the oldest industries. Traditionally, agencies that sell media space at a commission have given birth to present day's advertising agency. Then, their sole purpose is to act like media space selling agents and thrive on 15 percent commission. Gradually, they started to offer whole range of allied services like, providing creative ideas, media planning and coordinating in so- called below the line activities. Thus, media space selling agencies evolved to become modern day's full service advertising agency. When industry attractiveness grew, new players started flocking in, eventually to combat competition; consolidation and diversification became the order of the day. No one can completely visualize the direction towards which the industry is moving. The pace of transformation seems very high when one is about to gather and share a view, the industry is no longer the same!


The Political and legal, Economic, Social and Technological environment, in which the industry operates is subject to constant change and has an immense impact on the advertising industry itself. Here, each of these factors has been analysed in detail.


Political and Legal Environment


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Governments all over the world have always craved control over their media, either directly or indirectly. The several laws and regulations that regulate the advertising industry are given as under


1. MINISTRY OF INFORMATION & BROADCASTING FOREIGN INVESTMENT


POLICY


(Ministry of Information and Broadcasting is the nodal Ministry for formulation of policies on


foreign investment in broadcasting, film, print and advertising sector. It invites foreign investment


and frames laws keeping an eye on the widest national interest.)


ADVERTISING SECTOR


Following guidelines for foreign direct investment in advertising sector is being pursued


There should not be any cap on the percentage of foreign investment in a new project. Where the proposal is for a new joint venture or enhancing foreign direct investment in an existing joint venture, foreign direct investment should be limited to 74%. In exceptional cases, the 74% limit could be relaxed to go up to 100% with the consent of the Indian partner/partners and subject to the justification being established to the satisfaction of the Government.


Where a foreign company/investor already has a joint venture in this sector, a new wholly owned subsidiary shall normally not be permitted, unless there are strong reasons to make such an exception.


Foreign Direct Investment would include all repatriable investment, irrespective of who or what the investor is. Such investment would be permitted through the automatic approval route.


ELECTRONIC SECTOR


Foreign investment proposals directly linked to Broadcasting will be kept pending till Broadcasting Law comes into effect. Presently, companies with 80% Indian equity may be allowed to uplink for satellite channels. The proposals related to production of software and marketing of TV rights, airtime, advertisements, etc. may be recommended with the condition that


a). All future laws on Broadcasting will be applicable to them and they will not claim any privilege or protection by virtue of this approval;


b). They will not undertake any broadcasting from Indian soil unless specially permitted to do so;


c). Companies desiring to market TV software in India will in addition to conditions mentioned at (a) and (b) above will observe the Programme Law and Advertisement Codes of Doordarshan. Proposals having an Indian equity of atleast 5% will be encouraged, however, in genuine cases, even 100% foreign equity can be allowed. There is no foreign equity allowed in private FM broadcasting (to be introduced).


PRINT MEDIA


Foreign ownership of newspapers and periodicals in India and publication of their Indian editions is guided by the Cabinet decision of 1th Sept., 155. The relevant extracts of the decision are


•No foreign owned newspapers and periodicals should, in future, be permitted to be published in India. Foreign newspapers and periodicals which deal mainly with news and current affairs should not be allowed to bring out Indian editions.


•Above decision was taken on recommendation of the First Press Commission, which inter-alia had observed that proprietorial interest in the daily and weekly newspapers should predominantly vest in Indian hands. It also considered Indianisation of both capital and staff desirable, especially at the higher level. It was felt that newspapers should not be viewed similar to an industry since their true function was to influence working of democracy by shaping public opinion. Foreign participation in ownership or control of newspapers could be used for purpose of influencing Indian opinion in support of foreign interest and in some cases such participation could be at the instance of a foreign Government as well.


•In pursuance of the above decision, this Ministry has since 155, consistently denied permission for any foreign equity holding in print media or publication of Indian editions of foreign newspapers and periodicals. Due to many developments taken since then in the overall media scenario in the country and grant of Open General Licence to foreign newspapers and magazines, which resulted in their easy availability in the market, efforts are being made to review the 155 Cabinet decision.


FOREIGN OWNERSHIP OF NEWS AGENCIES


The existing policy of foreign ownership of news agencies in India is governed by the Cabinet decision of 156 which was also based on the recommendation of the first Press Commission. The relevant extracts of the decision is reproduced below


•Communication facilities should be granted to foreign news agencies only where the distribution of news within the country is to be effected through an Indian news agency owned and managed by Indians, which would have full and final authority in the selection of foreign news for distribution and which would also be in a position to supply Indian news in a reasonable volume to the foreign news agency with whom they have a working arrangement.


This decision has been the yardstick for examining requests of foreign news agencies to operate in India. Direct distribution of financial news by foreign news agencies is not violative of the 156 Cabinet decision. Subsequent to this decision, this Ministry conveyed to its no objection to the permission accorded by RBI to M/s Reutors, subject to the condition that their financial services would be only for selected Indian non-media clients for their own use and not for reproduction and public distribution.


. DOORDARSHANS ADVERTISING CODE


General rules for conduct in advertising


1. Advertising shall be so designed as to conform to the laws of the country and shall not offend the morality, decency and the religious susceptibilities of the people.


. No advertisement shall be permitted which


derides any race,caste,colour,creed and nationality;


is against any of the directive principles, or any other provision in the Constitution of India;


tends to incite people to crime or glorifies violence or obscenity in any way;


adversely affects friendly relations with foreign countries;


exploits the National emblem or any part of the constitution or the person or personality of a national leader or state dignitary.


relates to or promotes ciggarettes and tobacco products,liqour,wines and other intoxicants;


in its depiction of women violates the Constitutional gaurantees given to all citizens such as equality of status & oppurtunity and dignity of the individual Women must not be potrayed in derogatory light and in a manner that emphasizes passive, submissivequalities and encourages them to play a subordinate and secondary role in family and in society. The potrayal of the female form shall be aesthetic and within the well established norms of good taste and decency.


. No advertisement shall in any way be presented as News.


4. Advertisements must not be directed towards any religious or political ends or have any relation to any industrial dispute.


5. Advertisements for services concerned with the following services shall not be accepted


money lenders


chit funds


savings schemes and lotteries other than those conducted by the Central & state Government organisations, Nationalised or recognised banks and public sector undertakings;


unlicenced employment services


betting tips &guide books relating to horse racing or other games of chance.


6. No advertisement shall make claims to the effect that the product advertised posesses any miraculous or supernatural property or quality which is difficult of being proved, eg cure for baldness, skin whitener.


7. Scientific or statistical excerpts from technical literature etc. may be used only with a proper sense of responsibility to the ordinary viewer.


8. Advertisers or their agents must be ready to furnish evidence to substantiate any claims or illustrations since the Director General of DD has the right to demand the same.


. Advertisements shall not contain disparaging or derogatory references to another produt or service.


10. Testimonials must be genuine and used in a manner not to mislead viewers.


11. No advertisement shall be accepted which violates AIR and TV Broadcast code which is reproduced below


Criticism of friendly countries;


Attack on religions or communities;


Anything obscene or defamatory;


Incitement to violence or anything against maintenance of law & order;


Anything amounting to contempt of court;


As persons against the integrity of the President and the Judiciary;


Anything affecting the integrity of the Nation; and


Criticism by name of any person.


1. Information given to consumers in relation to the price quality & weight of products shall be accurate.


1. Any pretence in advertising copy must be avioded. The simulation of appearance or voice of a personality in connection with the advertisements for commercial products requires a permission from the personality to that effect.


14. Advertisements for a product or a service shall not be accepted if it suggests that if children do not buy it they shall be lacking in thir duty or loyalty to any person. Also if it is suggested in the advertisement that the children shalln be condemned,ridiculed if they do not buy the product. The advertisements shall also not create in the children an interest to do something which can prove to be dangerous to the children.


15. No advertisement shall try to take advantage of the superstition or ignorance of the public.


16. Advertisements should be truthful,avoid distorting facts and misleading the public by means of implications and ommissions.


17. Testimonials of any kind from experts etc.other than Government recognised standardisation agencies shall not be permitted.


18. Imitations likely to mislead the viewers shall be avoided.


1. Advertisements shall not be obscene, vulgar and offensive in their theme or treatment. This also applies to such advertisements which advertise objectionable books or photographs.


0. For advertising for medicines the general principles have laid down the following guidelines


No advertisement shall contain a claim to cure any ailment or symptoms of ill health.


There should be no exaggerated claims regarding the composition, character, action and suitability of the purpose for which it is recommended.


Appeals to fear shall not be made.


Advertisements for diagnosis or treatment by correspondence are strictly prohibited.


When words such as college, clinic, institute, laboratory are used in advertisements, such references can be made only when the said establishment does actually exist.


Advertisements for products specifically offered to women shall not be advertised as products that are effective in inducing miscarriage.


Advertisements relating to claims about curing of sexual weakness, premature ageing, loss of virility, sexual excesses etc. shall not be accepted.


No advertisements should offer any medical product that is for the purposes of slimming, weight reduction or figure control.


No advertisement shall contain any offer to diagnose or treat complaints or conditions by hypnosis.


. GUIDELINES FOR UPLINKING FROM INDIA


The Union Government has taken a decision on 5th July, 000 to further liberalise its Uplinking Policy and permit the Indian private companies to set up uplinking hub/teleports for licensing/hiring out to other broadcasters. The new policy also permits uplinking of any television channel from India. It also allows the Indian news agencies to have their own uplinking facilities for purposes of newsgathering and its further distribution. The salient features of eligibility criteria, basic conditions/obligations and procedure for obtaining the necessary permission for these services are briefly described below. For details, reference should be made to the relevant terms and conditions of Licences/Permission/Approval.


1. LICENCE FOR SETTING UP OF UPLINK HUB/TELEPORTS


(i) Eligibility Criteria


Company to be incorporated in India.


Foreign equity holding including NRI/OCB/PIO not to exceed 4% .


(ii) Period Of Licence 10 years.


(iii) Basic Conditions/Obligations


To uplink only those TV channels which are specifically approved or permitted by the Ministry of I&B for uplinking from India.


To stop uplinking of TV channels whenever permission/approval to such a channel is withdrawn by the Ministry of I&B.


Can uplink both to Indian as well as foreign satellites. However, proposals envisaging use of Indian satellite will be accorded preferential treatment.


To keep record of materials uplinked for a period of 0 days and to produce the same before any agency of the Government as and when required.


To permit the Government agencies to inspect the facilities as and when required.


To furnish such information as may be required by the Ministry of I&B from time to time.


To provide the necessary monitoring facility at its own cost for monitoring of programme or content by the representative of the Ministry of I&B or any other Government agency as and when required.


To comply with the terms and conditions of the licensing Agreement to be signed between the Applicant and the Ministry of I&B.


To comply with the terms and conditions of the Wireless Operational licence to be issued by WPC.


To uplink in C-Band only. • The satellite to which uplinking is proposed should have been co-ordinated with Insat system.


Failure to comply with the terms and conditions of above licences would result in termination/cancellation of the licences.


. PERMISSION/APPROVAL FOR UPLINKING A TV CHANNEL FROM INDIA


(In case a TV channel proposes to set up its own uplinking facility/earth station, it has to apply separately for the same after following the procedure as in case of 1 above.)


i) Eligibility Criteria Any TV channel irrespective of its ownership, equity structure or management control which is aimed at Indian viewership.


ii) Period Of Approval/Permission 10 years.


iii) Basic Conditions/Obligations To undertake to comply with the Broadcasting (Programme & Advertising) Codes laid down by Ministry of Information & Broadcasting.


To keep record of materials uplinked for a period of 0 days and to produce the same before any agency of the Government as and when required.


To furnish such information as may be required by the Ministry of I&B from time to time.


To provide the necessary monitoring facility at its own cost for monitoring of programme or content by the representative of the Ministry of I&B or any other Government agency as and when required.


 If the applicant hires its own transponder on a satellite, the same should be in C-Band and should have been coordinated with INSAT system.


To comply with the terms and condition of the permission/approval of the Ministry of I&B.


Failure to comply with the terms and conditions of the permission/approval would result in withdrawal of such permission approval.


. LICENCE FOR UPLINKING TO INDIAN NEWS AGENCIES


i) Eligibility Criteria


The Company/Agency to be incorporated in India


Accredited by Press Information Bureau (PIB).


 100% owned by Indian with Indian Management Control.


ii) Period Of Licence As per WPC licence.


iii) Basic Conditions/Obligations


To use uplinking for news-gathering and its further distribution to other news agencies/broadcasters only.


Not to uplink TV programmes/channels for direct reception by public.


To keep record of materials uplinked for a period of 0 days and to produce the same before any agency of the Government as and when required.


To furnish such information as may be required by the Ministry of I&B from time to time.


To provide the necessary monitoring facility at its own cost for monitoring of programme or content by the representative of the Ministry of I&B or any other Government agency as and when required.


Conformity with the provisions of inter-system coordination agreement between INSAT & the satellite to be used.


To comply with the terms and conditions of the No Objection Certificate to be issued by the Ministry of Information & Broadcasting.


To comply with the terms and conditions of Wireless Operational Licence to be issued by the WPC.


Failure to comply with the terms and conditions of the No Objection Certificate or the Wireless Operational Licence would result in withdrawal or cancellation of such certificate or licence.


The government is now contemplating on a media regulator as it feels that it is the government's responsibility to have a free and fair media. Regulation is, perhaps, needed due to the great divide among the stakeholders MSOs (multi-system operators), cable operators, broadcasters. The question is, how will they work together? Will the relationship between the stakeholders be there? As of now, there is a Convergence Bill which talks of a common regulator for TV, telephone and airwaves, also, content and carriage. But regulation has three aspects one is a very bad advertisement, other is a very bad programme (content) and the third is the rate part of it (carriage rate). The existing Convergence Bill envisages one regulator for both content and carriage. However, it is to be decided whether to go for a separate regulator for broadcasting.


But the question remains how can a regulator make things better? The FIPB (Foreign Investment Promotion Board) or the I & B ministry has not clarified some issues like, is the 6 percent cap of foreign investment in print and TV news applicable only to FDI and not portfolio investment? And why is investment by foreign institutional investors (FIIs) allowed in radio when FDI is not? Again, there is little that a regulator can do about technology issues other than laying the ground rules. Where Cross media restrictions are being dismantled around the world what sense would it make in India? Some experts feel that as long as equity caps are enforced and 51percent Indian control is in place, there is no need for any other regulation. That leaves pricing and content. Pricing, in any country, is left for the industry to decide. It is a business decision and hence it is for the broadcasters to decide whether the pay channels should carry ads or not. Then there is content. India has a fairly well defined programming and advertising code which no foreign or Indian broadcaster or publisher is allowed to violate. In case there is any odd obscene ad or show, usually the I & B ministry steps in. Even though the press in India is very independent, a few instances show that the government is not averse from using its stick from time to time. Moreover, the concept of an independent regulator appointed by the government is an oxymoron. Thus, with the rising change in the political and legal scenario in which this industry is operating will lead to many more changes in the way it operate.


Economic environment


The major trend is the changing revenue model of agencies. Traditionally, all agencies used to get a commission from the media groups. Thus 15 percent commission was in vogue. When we observe remuneration patterns across the world, fee- based remuneration models have increased from 5 percent to 5 percent in comparison with the decline of commission based model from 61 percent to 5 percent, as per the study conducted by Association of National Advertisers of United States. The scenario in Asia, Hong Kong and Singapore is at about 0 percent working on a fee or commission hybrid model. The real issue seems to be accountability and transparency in dealings. Analysts opine that there are three reasons for the increased popularity of fees. Primarily, to overcome hyperinflationary trends in media costs so as to maintain comparable levels of media impressions and share of voice. Secondly, to offset media expenses, advertisers reduced commissions from 15 to 10 percent. Thirdly, when commissions were eroded, agencies demanded labour based fees. The confluence of all these factors led to the shift and had an effect on profits. Unlike in the past, advertising is now short term. Nearly 70 percent of the expenditure goes towards sales promotion and a flimsy 0 percent towards branding. The number of promotional campaigns has also increased in the recent times. The possible reasons for this shift could be, consumer inclination towards freebies, impulse buying behaviour or the sheer attractiveness of the promotion itself. However, a notable change behind the change could be the stock market pressure exerted on advertisers. Whether this shift dilutes the role of creativity in the industry as a whole or are the agencies forced to adopt more lateral thinking techniques in designing promotional campaigns, are questions that have no answers at the moment. If at all there are any, they are inconclusive.


Adding on to this, much against the convention, clients have started preferring one stop shops for all their communication requirements. Unable to survive with low commissions, many players are wiped from the business or have become prey for major giants touting around to increment size and consolidation. Industry as a whole has seen many mergers and acquitions. M & As though consolidated the industry; yet they have redefined the client agency relationship. To counter the heavy toll, many agencies spun off their own sister concerns and started claiming, as independent arms without any link with the parent company or accounts. In addition to this, the ever changing market dynamics also increment problems. In 00, 57 percent of the agencies admit that existing clients knew that they grew, whereas 76 percent of the agencies now say new business wins will push growth in 00. Experts however, say that growth will be tied to maintaining the same level of spending from existing clients and a little extra business and this extra won't be for many.


The biggest trend is the explosion of media, which has an all round effect on the way the industry operates. Traditional media vehicles lost their lustre, as advertisers felt that they no longer have the desired reach or efficacy to lure the customer base. Print media in particular witnessed slump in advertising revenue worldwide. Advertisers preferred more of local media vehicles than those which have nation wide presence. Magazines were a hard hit than dailies. Competition has further intensified with more and more players entering into the fray and all of them choose to fight the pricing model as the differentiation plank. This is further eroding the advertising revenues. Although, radio and television with varied sounds and images continue to lure customers, now they are on the verge of losing their efficacy due to clutter.


Social Environment


The industry perceived the consumer as a naïve 'object' and bombarded him with commercials. Traditional media vehicles, both broadcast and non broadcast, intrusively persuaded him. Commercials accomplished their objectives through cajoling and kindling consumer desire. Suddenly, a host of new technological devices started empowering consumer. The industry finds itself in a vulnerable situation. Industry can no longer take consumer for granted as the new technological gadgets hardly allow the advertiser to reach them. Now, it is the consumer who decides which advertisement to watch and through which medium. Advertisers are finding it hard to reach their prospective consumers at right place, right time, through right medium and get noticed which they hope will get transformed into sales. Michael Goldhaber rightly says, "The scarcest resource in the new economy is consumer attention".


Technological Environment


New technologies like TiVo enables viewers to both record programmes and to take the commercials out of them has become a marketing executive's nightmare as it affects television as a medium. But now TiVo has adorned a new role of a friend to advertisers by providing them with statistics of advertisements, which are being skipped by the viewers. This helps the advertisers to ascertain which type of ads are generally not liked by the viewers and therefore helps them in preparing better ads. The recorder sends the data back to the headquarters without revealing the user. Driven by regulations and a desire for transparency and accountability consumers are preferring to obey Conditional Access System (CAS) through set-top boxes, a powerful device to empower consumer. In post CAS era, advertisers' reach by default gets limited and at the same time tailor- made communications to specific customer segments may increase. On the whole, the days of intrusive advertisements seems to be over, communicating at 'mass' gradually getting replaced by one to one communication sowing the seed for interactive advertising. With the change in consumer viewing habits, outdoor advertising is no longer a reminder media. In some markets indeed, it is turning out to be the main media. Several new brands are built using outdoor advertising. With the development of sci fi technology it is now possible to identify a passerby on the road and interact with him as well as display individualized communications. The real onslaught on these conventional media was due to the advent of World Wide Web. Search engines gained more prominence. Their speed and ability to crawl through, determined page exposures. Advertisers tried several methods to reach net savvy modern consumer. Otherwise ignored, contextuality of banner ads helped to increase involvement of consumers and was felt suitable for small business enterprises. Intrusive forms, pop ups and pop under were vehemently opposed. New and innovative forms like advergraming, streaming videos are still under nascent stage due to technological, financial as well as compatibility constraints. The most significant development of this new form of media Web, is the shift in power from advertiser to consumer. New media empowered all the consumers as they use their discretion whether to get exposed to an ad or skip it. Intrusive marketing tactics were replaced by permission based concepts. Spams were treated as illegal and offenders penalized. Thus reaching customers has become the toughest task for marketers in the Web age. This is where media planners' role becomes significant. Traditionally they were back room boys, now they lead the bandwagon. Increasingly, traditional media planning approaches were taken over by modern, sophisticated methods. Conventional cost led media planning strategies were replaced by brand strategy led consumer psychographics. On the whole, broadcasting techniques lost their relevance and increasingly narrow, casting methods are gaining prominence.


Another interesting trend across the globe that shall have a greater role to empower consumer is also taking place. Consumers have started using more of mobile devices to get information. Now an advertiser has to reach consumers on the move mobile advertising and the tool is through SMS or MMS. New versions of mobile devices and the technological compatibility barriers are slowly phasing out. SMS advertising is increasingly becoming popular as a most effective, low cost, personalized advertising technique. Ring tones also help to build brands based on sounds (sonic branding). Hence, the potential is endless.


It was SMS, now it is wi fi (wireless fidelity), popularly termed as "Hot Spot" or wireless Web. The possibilities thrown open are endless. Now it is a challenge for advertisers and agency people to own the upside of the inflection curve rather than get subdued at the downside. With every twist and turn, the industry jolts. Ti Vos, CAS, In film advertising and ever explosive media with no proportionate increment of audience attention are all the hurdles that the optimistic marketer has to surpass. Change is imminent and the ideal way is to embrace it!


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Monday, September 16, 2019

Lucille Ball: The World's Greatest Actress

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Just mention Lucy, and everyone knows who youre talking about. Lucille Ball is without a doubt the worlds greatest actress and the most famous redhead. She is remembered most for her famous TV character, Lucy Ricardo, but there was more to her than just the famous character she portrayed on I Love Lucy. Lucille could play all types of roles, including drama, comedy, and musical. There was much more to her than what people thought.


Her film career began with bit parts in the early 10s. Lucille was frequently cast in comedies because she was so good at physical comedy. She would do anything to get a laugh, and she didnt care if she looked different or did something out of the ordinary. The only thing Lucille cared about was actually being comical and making people laugh.


Even though she was a successful comedienne, Lucille wanted very much to be recognized as a dramatic actress. She wasnt offered many dramatic roles during her career, but Lucille did have a few opportunities to prove her talent as a dramatic actress. In 14, she starred in The Big Street, and her performance was highly successful and received rave reviews.


Lucille wanted to be cast in more dramas, but she didnt have much luck. The public loved her most when she was doing comedy, and it became quite clear that people didnt want to see Lucille Ball as a drama queen. They wanted to see her as the Queen of Comedy and nothing else.


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She also wanted to do musicals, but


Lucille was only given two opportunities. In 160, she appeared in the Broadway show Wildcat. Then, she starred in the film version of Mame in 17.


Mame was thought to be her last film, but it wasnt. Lucille shocked everyone when she appeared as a bag lady in the 185 TV movie Stone Pillow. Once again, she proved she could play dramatic roles.


There has never been nor will there ever be another actress like Lucille Ball. She had so many talents to offer the world, and she gave her best in everything she ever did. She will always be the worlds greatest actress. Lucille Ball may be gone, but her spirit lives on through her movies and television shows. She was someone who was and always will be a true star.


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Thursday, September 12, 2019

Wine Industry

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Executive Summary


The American wine industry is a stable and present market in the United States with room to grow. The wine industry began with the first settlers and has persevered for centuries. There are three classifications of wine Red, White, and Blush, and table wine (a wine containing 7% to14% alcohol traditionally consumed with food) is the most popular and fastest-growing type of wine consumed. Even though wine is produced virtually everywhere in the U.S. the wine producers in California have the largest economic impact of $0 billion. Wine sales have risen in the last ten years from 11.7 billion dollars to 1 billion dollars. The Alcohol, Tobacco, and Firearms division of the Internal Revenue Service, at 8%, which is around $1.07 per gallon, heavily taxes these sales. Technological impacts have allowed winemakers to help control the quality of the wine from the vine to the liquor store.


The wine industry contains high barriers to entry due to high costs of land and building manufacturing facilities. Product differentiation is quite vast, being able to make several different types of wine varieties. The value of the wine varies year to year and is often set by the opinions of a few wine experts. The economies of scale in the wine industry have the greatest impact on the cost of land for grape growing. This because the type of land needed to produce quality wine is limited in the United States. This provides an advantage to existing wine producers already having ownership of farmland. Access to distribution channels is through commercial trucking for small distributors, and leased trucking or privately owned trucking for medium to large wine producers. The bargaining power of suppliers is lower today because there is an excess amount of grapes making the supply of wine and grapes exceed demand. The bargaining power of buyers drive up the price of some wines, and drives down the price of others. The wine industry's threats of substitutes are mainly form alcoholic competitors such as the micro brews and non-alcoholic competitors such as the premium coffee shops. The wine industry relies on each other for grapes needed for blended wines and low production years. Rivalry between companies has increased in recent years because of increased competition for shelf space.


There are three top wine producers in the U.S. E&J Gallo Winery, Constellation Brands, and The Wine Group. Their success has comes from recent acquisitions, and their ability to change with the needs of consumers. Three key issues the wine industry is facing today are upholding advertising standards, the threat of corporate buyouts, and increasing a market for wine.


Introduction


Humankind has enjoyed wine for many centuries. The first settlers of the United States of America found the new world to be filled with thousands of beautiful grape vines. Much to the dismay of the settlers the wine produced from native grapes was undrinkable, tasting "overly musky" (Lukacs, 000, p.17). This did not deter early American Settlers from trying; Thomas Jefferson was one of the earliest advocates in making American wine. Thomas Jefferson once stated, "Good wine, is a daily necessity (Lukacs, 000 p. )." He chose the wines that George Washington drank, and kept the White House well stocked. Much to Jefferson's dismay he was unable to see any quality wine come from America in his lifetime. It would be 150 years before America was able to produce quality wine (Lukacs, 000, p). Rarely turning a profit, wine making in the 1800 was a profession for the rich. The first successful entrepreneur was Nicholas Longworth, who came to Cincinnati Ohio in 180. His fortune was made from real estate, but his love was of wine. Longworth was the first American to successfully make wine on American soil, using imported European Vinifera Grapes (Lukacs, 000, p. 1). His success was short lived. The Vinifera Grapes could not survive for very long in American soil, due to lack of immunity from disease and insects (Lukacs, 000, p.18).


Americans continued to develop a grape that would flourish, and taste good. It was fifty years before hybridization became an accepted practice to produce a grape vine that could resist disease and insects. Today wine is made in nearly every state with the largest producer being California. The most crucial moment in Americans' wine history came in 176 when wines from America went up against French wines in a blind taste test. The judges were Frances' most esteemed wine professionals. Twenty wines were entered twelve from northern California. The two wines picked as the winners of the taste test were both American wines from Napa Valley, California (Lukacs, 000, p. 4). This was a definite turning point in American wine industry. American wine was, for the first time, thought to be of good quality.


This Industrial Analysis will evaluate the Wine Industry in three different ways, first by a macro level, which will look at the Social and Cultural Impacts, Political and Legal Impacts, Economic Impacts, and technological impacts that the industry has encountered in recent years. Then, through Porter Five forces of industry standards, the Analysis will discuss major barriers to entry Threat of Substitutes, Product Differentiation, and Firm Rivalry. Then the analysis will look at the wine industry through a competitive analysis of the industries top three competitors. The evaluation will end with short discussions of three issues the wine industry is facing today.


Description of Industry


Wine differs by what kinds of grapes are used and what type of flavoring is added. The flavor often comes from the type of barrel used in the wine making process (usually oak). There are three main classifications of wine Red, White and Blush. White wines are made from light-colored grapes and are generally lighter in taste than red and blush wines. Red wines are typically produced with darker grapes, and often their stems are included in the crushing process. Today, the industry categorizes wines into six different categories see figure 1.1.


Table Wines Comprising about 84% of U.S. production.


Sparkling wine Comprising about 6% of U.S. production


Special naturalComprising about 5% of U.S. production


Dessert wineComprising about 4% of U.S. production


VermouthComprising about 1% of U.S. production


SpecialtyComprising about less than 1% of U.S. production



Fig. 1.1



Table wines are the most popular and fastest-growing type of wine in the United States. Table wine contains 7% to 14% alcohol by volume and is traditionally consumed with food (Standard & Poor, 001). Table wines that retail at less than $.00 a bottle are considered to be generic or "jug wines", those retailing for $.00 to $7.00 per bottle are considered to be premium wines, $7.00 to $14.00 super premium, and ultra premium wines retail at more than $14.00 per bottle (Standard & Poor, 001).


The United States is the fourth largest wine producer in the world, averaging 465,400 gallons of wine a year. The top three countries are France, Italy, and Spain. (www.wineinstitute, 00). Wine is produced in every state. The total of Bonded Winery Premises (licenses issued by the Bureau of Alcohol, Tobacco and Firearms for tax purposes) in the United States currently is ,44; Half (1,10) of the licenses are in California, making California the number one factor when discussing American wine production.


Social and Cultural Impacts


Wine drinking and knowledge of wine is regarded as part of the wealthy and educated community. Wine is an alcoholic product however, wine producers continually try to advertise wine as part of everyday dining, to be enjoyed by people who can afford the finer things in life. According to Standards and Poor, the number of consumers buying premium wine should increase because of the increase in customers over the age of 55 who tend to consume more wine, especially premium (Standards and Poor, 001). This increase is however very small, only about a one percents increase in sales. Wine is specifically not marketed to younger children, or advertised in a way that emphasizes the effects the alcohol will have if consumed in excess. There are voluntary standards that the wine industry published to facilitate this type of market (www.wineinstitute, 00). This emphasis on wine drinking for the mature and sophisticated has created a general stereotype that wine is connected with a higher standard of living, because it can enhance one's meal enjoyment.


Political & Legal Impacts


Wine, which is an alcoholic product, is regulated by the Alcohol, Tobacco, and Firearms division (ATFD) of the internal Revenue Service. This makes it subjected to high levels of tax. The Federal Excise tax on these products was last increased in January 11, which increased the tax on wine by eight percent making the tax $1.07 per gallon (Standards & Poors, 001).


Economic impacts


California carries the most economic importance of any wine producers in the United States. Wine is the number one finished agricultural product in retail value from the state. The industry has a total annual economic activity, according to a comprehensive new report commissioned by the wine institute and the California Association of wine grape growers, of nearly $0 billion (www.wineinstitue.org, 00). This research shows that California's wine industry and affiliated businesses provide 145,000 full-time equivalent jobs in the state, with a total of $4. billion in gross wages. California receives an average of one-billion dollars in taxes and other business licenses and fees, the federal government and other states and local municipalities collect an additional $.1 billion a year. The tourism generated by the vineyards brings in expenditures of $1. billion annually (www.wineinstitute.org, 00). California also employs around ,16,000,000 employees working in the winery and vineyards.


See figure . for more detailed descriptions of the economic impact California's wine industry brings.


TOTAL ECONOMIC IMPACT


RevenueCalifornia Economic Impact


Winery Sales $7,00,000,000


Retailers and Restaurant Wine Sales (in California) 4,45,000,000


Distributors Sales (in California) ,000,000,000


Retailers and Restaurant Wine Sales (in California) 4,45,000,000


Wine Grapes (excluding Thompson Seedless) 1,600,000,000


Tourism1,00,000,000


Glass1,150,000,000


Tax Revenues 1,00,000,000


Financing Revenues Debt886,000,000


Vineyard Development Independent Grower Overhead/Financing/Prop Tax 64,000,000


Vineyard Development Materials (excluding vines) 7,000,000


Corks/Capsules/Screwtops175,000,000


Boxes and Bag-in-a-Box170,000,000


Wine Labels 106,000,000


Grapevines81,000,000


Trucking6,000,000


Charitable Contributions6,000,000


Cooperage 56,000,000


Financing Revenues Equity 0,000,000


Stainless Steel Tanks11,000,000


Wine Labs 4,000,000


Grapevine Assessments,000,000


Winery Research ,000,000


Wine Industry Indirect - IMPLAN from Appendix 4.,65,000,000


Other Industry Induced - IMPLAN from Appendix 4. 1,55,000,000


Other Industry Indirect - IMPLAN from Appendix 4.1,481,000,000


Wine Industry Induced - IMPLAN from Appendix 4.161,000,000


Total Revenue $8,40,000,000


Fig. . www.wineinstitute.org


California wineries weathered last year's economic slowdown and the September 11 attacks, which were especially hurtful to wineries. Shipments from California wineries have grown steadily during the past five years. The wine institute estimates the retail value of California wines sold in the US to be $1.4 billion in 001 compared with $1 billion in 000 (Theodore, 00). This slow growth fits in with the small but steady increase in sales over the last ten years, which have risen from $11.7 billion dollars to $1 billion dollars (www.wineinstitute, 000)


Technological Impacts


Recent Technological advances allow wine-makers to control the winemaking process more carefully than ever before. The use of stainless steel containers and careful temperature control during fermentation has revolutionized the making of white wines. Quality control during the harvest and juicing has improved also, with such innovations as night harvesting to avoid high grape temperatures and field crushing to more quickly separate juice from grapes. Improved techniques have been developed for sulfur dioxide fermentation, for monitoring sugar levels during fermentation, for stabilizing wines, and for controlling malic-lactic fermentation (a secondary process in which malic acid in the new wine is converted into lactic acid). Various chromatographic methods have been developed for determining, in detail, the composition of grapes and wines, though they have not yet replaced human tasting and sensory evaluation (Peters, 17). The increase in use of technology has enabled the Wine makers to deliver a more consistent quality product.


Porter Five Force Model


Major Barriers to Entry


According to Standards and Poors, the wine industry has high barriers of entry. Such as the level of sales needed to justify the enormous legal costs associated with producing industries. The capital needed to build manufacturing facilities, together with the high costs of advertising and distribution, are other substantial barriers to entry in these industries. Small wine makers may achieve local success. However such firms often have difficulty attaining profitability with such a level of operations and may find it virtually impossible to go national (standards and Poors, 001). There is also a very high cost of ferial farmland.


Product Differentiation and Switching Costs.


In a Fortune magazine an article was published in September 001 entitled Making Wine is easy. Making Money doing it is not states that the numbers of distributors is shrinking, making it harder for the average person to get into the wine market. "Brand building in this market is a daunting challenge, but anonymity is death," states Walter Channing, author. Luckily for the new wine producer consumers typically enjoy trying new and different wine all the time. Wine drinkers look for the experience of tasting new wines. The determining factor in their selections is usually due to word of mouth, by taking a recommendation from a wine expert. Robert Parker, a wine mega critic, in May of 00 declared the Bordeaux of 000 to be one of the greatest vintages of the century, proclaiming it "something that comes once every thousand years"(Forbes, p.8). This drove the value of the wine per bottle to $0 solely due to Parker's critique. This type of name recognition is necessary to achieve sales, according to Market Experience, Consumer Attention and Price-quality relationships for new word wines in the U.S. Market, Therefore, the price of wine increases with the increase in the producers' reputation. This vastness in the market also makes switching costs for the consumers low. It generally will not cost them any extra money to change the type of wine they enjoy drinking.


Economies of Scale And Cost Disadvantages Independent of Scale


The largest factor in the wine industries Economies of scale is the cost of land for grape growing. Grapes being an agricultural product will flourish where the soil contains the right nutrients and the climate has an extended summer, which gives the grapes time to grow. Even though different types of grapes will grow virtually in any soil, the different nutrients in the soil will change the taste of the wine. In the United States California is one of the only states with both needed agriculture components to make good quality wine. Land is a limited resource, making it the highest start up cost in a vineyard. On the other hand, this gives an advantage to the wine producer who has ownership of prime properties who no longer has the cost of the land as a financial burden.


Access to Distribution Channels


The final step in wine production is getting the product to the customer. If the distribution channels are overlooked there can be a significant impact on a wine company efficiency, product quality, cost of operation and on the perception it holds in the minds of distributors and consumers (Beverage industry, Nov 001). Most distribution from the vineyards is done with private, leased, or hired trucking companies.


Most wine producers hire a trucking company to distribute their product. Kendall-Jackson, the 10th largest winery in the United States is located in Sonoma County of Northern California. Seeing a problem with hiring a trucking company, they saw a need for better transportation cost accounting, flexibility to expand with growth, and improving customer service. In wine production timing is key, whether it is transporting juice from the vineyards, moving finished product or hauling cases of bottled product to distributors, a well-run winery relies on precise timing (Kendall-Jackson Smart Transportation Route to Continue Growth, Beverage Industry, Nov 001, p. 46). Kendall-Jackson discovered having its own trucking fleets was not cost effective so they incorporated a leased trucking fleet for high priority transportation needs, and used a hired trucking fleet for outside carriers. Therefore there are several avenues that wine producers can use to transport their wine. The cost in any of the three distribution channels is high, limiting the distribution power of the smaller vineyards that typically rely on local sales.


Bargaining Power of Suppliers


There are two different suppliers in the winemaking industry, those who produce the grapes, and those who produce the wine. Most wine producers are their own main suppliers, because of the great timing needed from harvest to production. To ensure the quality of the juice most vineyards make and bottle their wine at their vineyards. Many vineyards will sell their grapes to each other to compensate for a bad year, or for use in blended wines. Several factors contribute to the power the suppliers have on price. If there is a shortage of a certain type of grape, due to poor production the vineyards with the products have the most power. On the other hand when there is excess in product like in the present production, the excess inventory will bring the prices down. (Time, 11, 00). Currently the bargaining power of the suppliers is very low in the wine industry due to excess grapes, which will be later discussed as one of the key issues facing the American wine industry later in this analysis. The same is true with the wine product. The wine that has a supply lower than demand can fetch a higher price than the wine that exceeds supply.


Bargaining Power of Buyers


The fate of American's wine industry lies primarily in the hands of wine consumers. Patterns of wine consumption are key (Peters, 17). The major buyers of wine from the vineyards are liquor stores and restaurants. Competition between these buyers can either force down the price of the wine, or increase the price of the wine. Certain wines are naturally (due to the lack of needed farm land) scarce. Competition between buyers can drive up the price of the wine per bottle because the demand is greater than the supply. On the other hand if there is excess in the production of wine the competition can force the prices down.


Threat of Substitute products and services Threat of Substitutes


There are wineries in more than forty states; most people live within driving distance of some version of wine country. Wineries are welcome by residents and communities because winemaking is a clean industry, and a good neighbor. Also, the associated tourism brings in a source of income (Peters, 17). Even though vineyards are virtually everywhere the amount of threat of these vineyards is minimal. These small vineyards generally also have small markets, generally only a few hundred miles from the vineyard and other larger producers are still present in the stores and restaurants, which works to the larger producers' benefit.


On the other hand the large producers don't benefit from the same type of branding that large beverage companies like Coke and Pepsi do. This is due generally because of the vastness of product differentiation in the market. Generally a consumer shows more favor to one cola than to another, either preferring Coke or Pepsi, then usually just drinks the one type of cola. Wine is thought to enhance food; therefore different types of wine enhance different types of food (Peters, 17). The consumer may prefer a Chardonnay with fish, and a Merlot with a Steak. When choosing the brand of wine, customers look most for price and value. During periods of both recession and prosperity the consumption of wine tends to stay the same, however the quality of the products produced changes. This is related directly to disposable income. A decline in disposable income puts downward pressure on the prices of consumer products, as people shift away from buying premium-priced brand name products in favor of lower-priced brands and private-label goods (Standards and poors).


There are several substitutes in products that may take some of the market away from even drinking wine at all; there are competitors from other beverages (Peters, 17). Winescapes author suggest two competitors that are making a claim to the time and money of the growing number of people there is the micro brewing industry and its related brewpubs. The other, however less threatening is the growth in premium coffee shops, led by Starbucks (Peters, 17).


Firm Rivalry


Rivalry Amongst Existing Competitors


The buying and drinking of wine is luxury item than a needed commodity. The tastes and preferences of the consumer continue to evolve with time, and experience. Chardonnay is still the leader in wine sales in the US, but American consumers are increasingly showing a preference for red (Seeing Red, 00). During the past decade, volume share of red wines has grown 118 percent, according to the Wine Institute; reds held 17 percent of the market in 11, 5 percent between 15 and last year jumped to 7 percent market share. During the same ten years white wines dropped from 4 percent market share to 40 percent, an 18 percent drop. Blush wines held their own for the first half of the decade, with 4 percent market share, but dropped to percent between 15 and 001, a percent decline. The California wines priced at more than $5 a bottle are a hot category, selling around three million cases per year. These premium California wines were almost non-existent in the mid 180s, but are currently growing at a rate of 0 percent per year.


Table wines are by far the biggest-selling category of wine in the US. With 504 million of the 56 million gallons sold last year, reports the wine institute. Table wines had 4 million gallons in sales in 000, and have grown steadily from 461 gallons in 17. Desert wines came in with 4 million gallons in 001, and increase of million gallons over 000, and up from 0 million gallons in 17. Sparkling wines sold 5 million gallons last year, down from a peak of 7 million gallons in 1, when millennium celebrations caused consumers to stock up on the bubbly.


Competition was higher in the wine industry last year than it has been in a decade, according to The Wine Institute. Wineries had to compete harder for retail shelf space and restaurant wine listings, and the dollar compared to other currencies also contributed to competition for California vintners, making foreign-made wines more affordable to U.S. consumers (Seeing Red, 00).


Competition between US states and Colorado wines are not soon going to drive either California or French wines off the shelves of wine shops in Denver, Colorado Springs, or Aspen, they may however develop sufficient local interest to allow the state's emerging wine industry to survive. Elsewhere, in Arizona and New Mexico, or in Missouri and Arkansas the same is true. Survival is likely to be tied primarily, if not exclusively to regional loyalty. New York and Virginia are producing wines that are becoming important competitors on the national wine scene. Texas seems somewhere in between. The western wine regions along the pacific Rim of California, Oregon and Washington will continue to produce the lion's signs of trouble in paradise, especially in the vineyards of the northern state, which can at least be partly alleviated by better weather and higher yields and by new plantings of popular cultivars (mainly Chardonnay, Merlot, and Cabernet Sauvignon) a grapevine pest and a disease have become significant nuisances.


Competitive Analysis


There are three top wine producers in the United States (see figure .). The top producers are E&J Gallo Winery, Constellation Brands, and The Wine Group. The key to top production is size of these three. The only producer who produce solely wine is E&J Gallo. One determining factor in all three of these producers that has contributed to their success is their recent acquisitions and partnerships. Constellation Brands Inc. have just acquired Ravenswood (Wall street Journal, June, 0 001); The Wine Group's partnership of Southern Wine & Spirits of America Inc (Beverage Industry, March 00), and E&J Gallo recent acquisition of California's oldest wineries Mirassou Vineyards in San Jose (Beverage Industry, October 00). This growth has enabled these three to become the leading producers in America.


The main competitive advantages that these three have are their size, branding and connection with distribution channels. Because they are so large they are able to produce several different products varying in cost and quality. For instance although The Wine Group produces both Franzia, and MD (Mad Dog) 0/0, the quality between these two products is quite different. Franzia can be found at many medium to high quality restaurants, while MD 0/0 is considered to be more of a "wino" drink, only being consumed for the sole purpose of becoming intoxicated (Lucas, 47). Constellation Brands and The Wine Group also do not win many awards for their wines, because where production of wine is concerned quantity often hurts the quality of the wine.


Top Wine producersTheir Brands


E&J Gallo WineryCarlo Rossi; Gallo Livingston Cellars, the wine Cellars of Ernest & Julio Gallo


Constellation BrandsAlmaden' Abor Mist; Inglenook; Paul Masson; Richards Wild Irish Rose; Ravenswook' Taylor California Cellars; Simi; Franciscan Oakville Estates; Estancia


The Wine GroupFranzia; MD 0/0


Fig . Standard and Poors


E&J Gallo has grown and expanded for three generations because of its ability to change. E&J Gallo is a name synonymous with American wine. In recent years the family owned company has gone through some changes. One of the granddaughters has taken over the company and is striving to put quality in the wine produced, in reaction to customer demand for higher quality wines. One factor that American wine producers have faced is the lack of daily wine drinking among the American public. While in other countries wine is served with each meal, Americans don't incorporate wine with meals on a daily basis. After Prohibition when the accepted alcohol content in wine went from 1% to 0%, wine was looked at as a way to become intoxicated and the wines that sold were inexpensive with high alcohol content. E&J Gallo saw this market and produced what Americans wanted. This has made the company extremely successful, but also the company is known for having lower quality products (Lukacs, 18). Just like after prohibition now the public is demanding higher quality wines and E&J Gallo is shifting to meet the demands of the public. Over the last few years E&J Gallo have won several awards for their wines. Figure 4.4 lists the top 0 wine brands and the company that produces them in America today, according to Standard and Poors. E&J Gallo hold 5 of the top 0 spots for the best American wine brands, it is E&J Gallo's ability to make both high quality wines and less expensive wines, along with their distribution ability and branding, that gives E&J Gallo the largest competitive advantage from other smaller and less known competitors in the wine industry.


BrandsCompany


1. FranziaThe wine Group


. Carlo RossiE&J Gallo Winery


. Livingston Cellar E&J Gallo Winery


4. AlmadanCanadaigua Wine


5. E&J WineyardsE&J Gallo Winery


6. Sutter HomeTrinchero Family Estates


7. WoodbridgeRobert Mondavi


8. BeringerBeringer Wine Estates


. InglenookCanandaigua Wine


10. VendageTurner Road Wintners


11. Arbor MistCanandaigua Wine


1. Turning LeafE&J Gallo Winery


1. Turing leaf E&J Gallo Winery


14. Peter VellaE&J Gallo Winery


15. Corbett Canyon The Wine Group


16. Glenn Ellen UDV Wines


17. FetzerBrown-Forman Beverages


18. Boone'sE&J Gallo Wines


1. Gossamer BayE&J Gallo Wines


0. Concha y ToroBanfi Vintners


Fig 4.4 Standards and Poors




Key issues



Advertising Standards


There are several wine producers who want to make America into a quality wine producer that can compete with the rest of the worlds wine producers in quality. One of the main stumbling blocks for this initiative is the general wine consumption habit of the American people. Paul Luckas, author of the book American Vintage The Rise of American Wine talks extensively about American wine consumption in America. Even before Prohibition wine was not thought of in the same context as other liquors. Other types of liquor were thought of as having the sole purpose of intoxication, while wine was regarded as an experience, and an enhancement to food and general living (Luckas, p65). There has also been a general consensus between premium wine producers that it is the job of the wine producers to ensure that wine keeps a positive reputation. The Wine Institute last year published a Code of advertising Standards that they feel is a good addition to the informal principles of good advertising practice for the winegrowing industry that was first adopted in 148. (www.wineinstitute.com). These voluntary standards use such rules to encourage the proper use of wine. The code states that there should be no references are made to the effect of what the alcohol content may produce, or how one would act under the influence of alcohol, and any advertising should only be of people of legal age through a media where over 0% of the viewer are of legal age. One of the most import aspects of the code is for says A distinguishing and unique feature of wine is that it is traditionally served with meals or immediately before or following a meal, Therefore, when subscribers to this code use wine advertising which visually depicts a scene or setting where wine is to be served, such advertising where appropriate shall include foods and show that they are available and are being used or are intended to be used (www.wineinstitue.com)." These codes are helpful to facilitate the proper use of wine, but also instill the purpose of everyday use with the use of food that the wine industry would like to see as a common practice.


Corporate buyouts


The second issue that the wine industry faces is the threat of large corporate buyouts. One of the most interesting aspects of most wine producers is that they are small, usually family owned businesses that are able to produce quality wines. Sixty percent of all U.S. wine today is produced by five companies (Time, November4 001). Times are tough for most in the wine industry today, which has created an opportunity for larger companies to buy out smaller. As vineyards expand in the U.S. there has become an oversupply of grapes, which has depressed prices for growers but has offered a boom to companies like Canandaigua, which buys % of the grapes (Time, November 4 001).


Companies are snapping up wineries that are struggling, and everyone is trying to improve quality so that the wines can command higher prices. For the consumer, this is a good thing. New winemaking technology, new foreign producers and intense competition are resulting in higher quality bottles at all price levels (Time, November 4 001).


Increase Support For Table Wine in the U.S.


The last issue this analysis will discuss is the lack of support for quality table wines in the U.S. An article published in American Demographics magazine's February 00 issue discusses the hope that after the September 11 attacks there will be an increase in wine buying. New advertising campaigns are targeting the middle class (over forty) age group who now turn more to family and enriching home lives after September 11.


The above Article commercials about wine generally show wealthy people enjoying a perfect dinner that is enhanced by the particular type of wine they are consuming. The new commercials show the more middle class typical families coming together to enjoy a bottle of wine with dinner. With new advertising such as these the wine industry hopes to increase a feeling that all social classes with dinners should enjoy wine.


Conclusion and Recommendations


The wine industry has existed since the beginning of the U.S. The wine industry throughout history has continued to grow making a large economic impact in California. Technology has improved the production and quality of wine in the U.S. By looking at the wine industry through Porter five-industry forces model revels high barriers to entry and even higher barriers to widespread success, however there is easy access to distribution channels. Both buyers and suppliers hold bargaining power, which equally control the price. The wine industry's largest threat of substitutes comes from micro-brew, and specialty coffee shops. Firm rivalry is strong between the competitors, because of the large number of grapes, easy access to distribution channels and the technological improvements enabling wine makers to control the quality of their product.


The trend today in the wine industry is moving toward large corporations. For this reason and the high entry barriers I would not recommend anyone to join this industry. Successful competitors have been making wine for generations, who have perfected their wines, and have created a brand for themselves. There is also and excess amount of grapes that drives the price of wine down, and increases the competition. After my research I think making wine will have to stay a hobby.


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