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Introduction to marketing:

1- What is marketing:
Marketing is a total system of business activities designed to plan, price, promote and distribute want-satisfying products to target markets to achieve organizational objectives. This definition has two significant implications: A- The entire system of business activities should be customer oriented: While marketers see themselves as selling products; customers see themselves as buying value or solutions to their problems. The customers are interested in the total costs of obtaining, using and disposing a certain product. In order to succeed, marketers must present a certain product or service by defining a solution to problems that a large group of customers do face.

B- Marketing should start with an idea about a want-satisfying product and should not end until the customers wants are completely satisfied which will result in an exchange between two parties as minimum (Company-Customer): In order to prepare for a successful negotiation; a marketer must understand the target markets needs, wants and demands. Needs are basic human requirements (The need for food, water, vehicle ). Those needs become wants when they are directed to specific objects that might satisfy the need (Ex: I need a vehicle and I want a Mitsubishi Montero). At this step, marketers have to orient the vision of customers to a certain product or service in order to capture his attention and make the product as the customers best choice. In the end comes the demand, it occurs when the customers is ready to buy a certain object. The main goal of marketing is to attract new customers by promising superior value and keeping and growing current customers by delivering satisfaction. Marketing today must be understood in the new sense of satisfying customer needs by understanding the customer so well, and make a certain product or service fits him and sells itself.

2- The marketing mix:

The marketing mix is a set of controllable tactical marketing toold that a firm can do to influence the demand for its products. The possibilities can be collected into four groups of variables known as the four Ps: Product Price Place Promotion. Figure 1 shows the particular marketing tools under each P Figure 1:
Price Place Channels Coverage Assortments Locations Inventory Transportation Logistics Target Customers Intended positioning List price Discounts Allowances Payment period Credit terms

Promotion Advertising Personal selling Sales promotion Public relations

Place Channels Coverage Assortments Locations Inventory Transportation Logistics

However, there is another concern that holds that the four Ps concept takes the sellers view of the market, not the buyers view. From the buyers view point; the four Ps might be better described as the four Cs: Customer solution Customer cost Convenience - Communication Table 1 shows the relation between the Four Ps and the Four Cs

Table 1: Buyers view point 4 Ps Product Price Place Promotion Customers view point 4 Cs Customer solution Customer cost Convenience Communication


Situational analysis:

1- The dynamic marketing environment:

Any organization must identify and then respond to numerous environmental forces. Some of those forces are external to the firm, while others come from within. Many of those forces influence what can and should be done in the area of marketing. Environmental monitoring also called environmental scanning and it is presented by the following process: a- Gathering information regarding a companys external environment. b- Analyzing the information found. c- Forecasting the impact of whatever trends the analysis suggests. Figure 2 shows the process of the environmental scanning. Figure 2:
Gathering information. Analyzing the information. Forecasting the impact of whatever trends the analysis suggests.

An organization operates within an external environment that cannot be controlled. The marketing environment consists of actors and forces outside marketing that affect the marketings management ability to build and maintain successful relationships with target customers. It offers both opportunities and threats to a certain company or establishment and is characterized by a rapid change.

The environment is made up of both microenvironment and macroenvironment.


A- The companys microenvironment:

The microenvironment consists of actors close to the company that affect its ability to serve its customers; these actors are: the company (market), suppliers, marketing intermediaries, customer markets, competitors and publics. Three important environmental forces are external to an organization and affect its marketing activities. These are the firms market, suppliers, and marketing intermediaries. And they represent the primary micro environmental forces for a company. Marketing success requires building relationships with other company departments, suppliers, and marketing intermediaries. We note other micro environmental forces, such as: customers, competitors and publics.

a- The market: The market is what marketing is all about, and the process of reaching and serving it profitably is not so easy. The market should be the focus of all marketing decisions in an organization. The market is defined as a place where buyers and sellers meet goods or services which are offered for sale, and transfers of ownership occur. But to precise more, a market is also defined as people or organizations with needs to satisfy, money to spend, and willingness to spend it. In marketing, three specific factors need to be considered: People or organizations with needs. Their purchasing power, and Their buying behavior.

b- Suppliers: A firms suppliers are a vital part of its marketing environment. A business cannot sell a product without being able to make it or buy it. The suppliers provide the resources needed by the company to produce its goods or services. Marketing managers must always watch supply availability, supply shortages or delays, and everything that is related to the suppliers and that might present a problem in the market. Most marketers today treat their suppliers as partners in creating and delivering customer value because the suppliers role is essential in many industries and companies, and it can be a factor that helps a company to reach its specified objectives; for ex: improving a certain product quality is related to improving or gathering high quality resources from suppliers.

c- Marketing intermediaries: The marketing intermediaries are the firms that help the company to promote, sell and distribute its goods to final buyers; they include resellers, physical distribution firms, marketing service agencies, and financial intermediaries. These firms operate between a company and its markets, and between a company and its suppliers; they are part of the channels of distribution. In some cases, it may be more efficient for a company not to use marketing intermediaries. A producer can deal directly with its suppliers or sell directly to its customers. Marketing intermediaries are specialists in their respective fields. They often do a better job at a lower cost than the marketing organization can do by itself due to their specialization and wide experience in the marketing and distribution domains.

B- The companys macro environment:

The macro environment consists of the larger societal forces that affect the microenvironment. These forces are: demographic, economic, natural, technological, political and cultural forces. There are six major forces in a companys macro environment that could have an influence on any organizations marketing opportunities and activities. These forces are: a- Demographics b- Economic Environment c- Competition d- Social and cultural forces e- Political legal forces f- Technology

These forces are largely uncontrollable by a companys management, but a company may be able to influence its external environment to some extent.

a- Demographics: Demographics refer to the study of human populations in terms of size, density, location, age, gender, race, occupation and other statistics. The demography environment is of major interest to markets, because it involves people and people make up markets. And we note also that a company could take demographic factors into consideration while segmenting the market.

b- Economic environment: The economic environment is a significant force that affects the marketing activities of just about any organization. A market requires a purchasing power as well as people. A marketing program is affected especially by such economic factors as the current and anticipated stage of the business cycle, as well as inflation and interest rates.

c- Competition: To be successful, a company must provide greater customer value and satisfaction than its competitors do. Marketers must gain strategic advantage by positioning their offerings strongly against competitors offerings in the mind of consumers.

d- Social and cultural forces: The cultural environment is made up of institutions and other forces that affect a societys values, perceptions, preferences, and behaviors. People grow up in a particular society that shapes their basic beliefs and values. Those values and beliefs cannot be broken, and they affect the marketing decision making.

e- Political legal forces: Marketing decisions are strongly affected by developments in the political environment. The political environment consists of laws, government agencies, and pressure groups that influence or limit various organizations and individuals in a given society. f- Technology: The technological environment consists of forces that create new technologies, creating new product and market opportunities. It is the most dramatic force that has released many technological products like laptops, airplanes, and electronic machinesThe technological environment changes rapidly and such technological improvements may present opportunities to some companies, and threats to the others.

2- SWOT Analysis:
SWOT analysis is the activity by which a company identifies and evaluates its most significant strengths, weaknesses, opportunities and threats. It provides a good overview of whether a companys overall situation is healthy or unhealthy. Resource Strength: is something that a company is good at doing or an attribute that enhances its competitiveness. Resource Weakness: is something a company lacks or does poorly or a condition that puts it at a disadvantage in the marketplace. Market Opportunity: is a big factor in shaping a companys strategy External Threat: is a factor that comes from outside environment of a company, and has a negative influence.

An organization, and in order to fulfill its mission successfully; it should: Capitalize on its key strength. Overcome its major weaknesses. Avoid significant threats. Take advantage of the most promising opportunities.

Strengths and weaknesses often originate from inside the organization while the opportunities and threats originate from the outside environment.


Marketing Warfare:

Marketing warfare is an attempt to apply successful military strategy to marketing situation. According to Al Ries and Jack Trout, marketing is war and the marketing concepts customer-oriented philosophy is inadequate and should be replaced by the competitor oriented concept. Marketing was compared to a football game in which a team should focus its efforts on outwitting, outflanking, and over-powering the other side in order to win the game, or else they would be blocked. Successful companies today are competitor-oriented. This orientation makes them capable of meeting customers demands better than any other company in their field. By adapting military strategies to their operations, companies can gain and press home strong competitive advantages over all the other companies in their industry. Strategic planning will become more and more important. Companies will have to learn how to attack and to flank their competition, how to defend their positions, and how and when to wage guerrilla warfare. They will need better intelligence on how to anticipate competitive moves.

1- The Principle of force: The principle of force is better explained by Al Ries and Jack Trout when they affirmed that its easier to get in the top than to get there. Once at the top, a company can use the power of its leadership to stay there. All other things equal, an army with a larger number of troops has an advantage over smaller armies. When several companies enter a new market, the one with the larger sales force is likely to become the leader. The larger a company has the resources to outnumber smaller competitors, it can advertise more, perform more research and development, and open more sales outlets in order to focus on continuous improvements and wide availability of its products. Smaller companies must recognize the principle of force and attempt to win the battle by crafting and executing a superior strategy, not by using simple strategies that allows the company just to exist without trying to advance in the market. It is not necessary to win the battle by recruiting superior employees or developing a superior product, Ries and Trout argue that to win the battle, a firm must successfully execute a superior strategy.

2- Types of warfare: Ries and Trout discussed four strategies for fighting in a marketing war: abcdDefensive warfare. Offensive warfare. Flanking warfare. Guerrilla warfare.

As a general rule for an industry, the leader company in the market should be using defensive warfare strategies, the second 2 companies (nos. 2 & 3) should be using offensive warfare strategies, the next three companies should flank and the rest of the industry should use guerrilla warfare techniques.

a- Defensive warfare: A defensive strategy is appropriate for the market leader. Ries and Trout outline three basic principles of defensive marketing warfare: Defensive strategies should only be pursued by the market leader:

It is self-defeating for a firm to pretend that it is the market leader for the purpose strategy selection. The market leader is the firm who has attained that position in the mind of the consumer. Attacking yourself with new products or services that improve existing offerings :

Introducing new products that are better than the existing ones preempts similar moves by the competition. Even if the introduced product has fewer profit margins and may reduce short-term profits, it accomplishes the more important long-term goal of protecting the firms market share. Strong moves by competitors should never be ignored, but blocked:

Competitors moves should always be blocked in order to maintain in the same place as leader and with the same market share.


b- Offensive warfare: An offensive strategy is appropriate for a firm that is number 2 or possibly number 3 in the market. Ries and Trout outline three basic principles of offensive marketing warfare: Companies that rank no 2 & 3 must focus on the leaders strength:

To attack a competitor in an industry segment, a company must have to come up with what its strength and weak points are. Once it knows its strength, it comes easy to attack the competitors based on that main strength. And the main strength of the leader should be attacked by the 2 following companies. The challenger should find a weakness in the leaders strength and attack at that point alone:

Competitors must attack the leader at his weaknesses and strength and fight them in order to advance and take the leaders position in the market. The challenger should attack a point alone and not engage in a broad attack:

If a new entrant wants to compete a leader, it should first attack on the geographical areas where the leader hasnt entered or has a least penetration. This policy shows how it is comfortable to fight against a leader. But in response to that attack, the leader would strengthen those areas first where the least penetration has been done.

c- Flanking warfare: A flanking attack is not a direct attack on the leader, but rather an attack in an area where the leader has not established a strong position. The objective of any good flanking move is to bleed the leaders market share. Ries and Trout present the following three flanking principles: A flanking move is best made in an uncontested area:

A good flanking move means introducing a new product or service in an area which is uncontested by the market leader or any other major competitors. The move should be done in a new category where the direct competition with the leader or the major competitors does not exit, and the company should be the first to target the new segment.


A flanking move should have an element of surprise:

Surprise is important to prevent the leader from using its enormous resources to counter the move before it gains momentum. The pursuit is as critical as the attack itself:

The firm should follow-through and focus on solidifying its position once I is established before competitors launch competing products. Management should turn its attention to the products that are not performing well rather than strengthening the position of the winners. If the firm does not have the resources to strengthen its newly won position, then perhaps it should have used a guerrilla strategy instead of a flanking one. According to Ries and Trout, flanking attacks generally take one of several formats: 1- Lower Price: Price lowering is an important factor in attacking the market leader by winning a large market share. But usually leaders are better users of this element because they can employ economies of scale. 2- High Price: In almost every category there is a high priced product which represents the high quality. So making a high price flanking move is a good strategy because most people equate price with quality.

3- Small size: Many companies are introducing smaller, more compact, and usually more innovative product offerings. This flanking move has worked numerous times historically (Ex: Sony, Beetle ). 4- Larger than life size: A competitor can differentiate his products or services by making them larger than anybody elses. This flanking move has also been proved successfully in a number of situations (Ex: Prince Tennis rackets).

5- A new distribution channel: By marketing through sales channels, no one else has ever tried, you can establish a market segment and dominate it (Ex: Timex distributed its watches in drugstores). 6- A new product format: You can establish a market segment by introducing innovation to an existing product or service (Ex: Close-Up was the first gel toothpaste and Soft-soap was the first liquid soap).


d- Guerrilla warfare: Guerrilla marketing differs from a flanking campaign in that the guerrilla move is relatively small and differs significantly from the leaders position. Guerrilla marketing is appropriate for companies that, relative to the competition, are too small to launch offensive or flanking moves. Guerrilla warfare does not require huge amounts of money resources. Ries and Trout list the following three principles of guerrilla marketing warfare: Identify a segment that is small enough to defend:

A firm should identify a small segment in which it could become a leader. The scope can be limited geographically, demographically, by industry, or by price. Never start to act like a market leader:

No matter how successful a firm becomes, it should not act like a leader. Because some firms who got successful in using guerrilla marketing strategies began to act like a leader by building larger building, and many other decisions that has increased their overhead costs. Be prepared to move out of segment at any time:

If the market takes a negative turn, the firm using a guerrilla strategy should exist quickly in order to prevent wasting resources.



The Lebanese wine industry:

Lebanon is one of the oldest sites of wine production in the world, its wine industry may be small, but it is achieving global recognition. The wine industry is growing well in Lebanon. Although Lebanon doesnt produce a lot of wine, international experts hold that Lebanon is the regions best in high regard and rarity. The annual production amount is about 6 million bottles. Most of the vineyards and wineries are situated in the Bekaa valley, a valley that is capable of production and that runs 75 miles through mountains at an average of height of 914 meters above the sea level, where the grapes receive an abundance of sunshine in the summer and rain in the winter. Some medical researches made conclusions that red wine contains a substance that delivers great health benefits. Today two of the largest and most successful wineries in Lebanon that will be described and analyzed later on are Chateau Ksara and Chateau Kefraya; both are situated in the Bekaa valley and have met successful stories that are increasing in the Lebanese markets and abroad. Chateau Ksara is the oldest and the biggest wine industry that began life in 1857 when the Jesuit Brothers have inherited and began farming. And Chateau Kefraya was created by its founder, chairman and chief executive Michel de Bustros in 1951, and is considered as the second big wine company. Both Chateau Ksara and Chateau Kefraya produce more than 3 million bottles of wine each year and are seeking to boost sales abroad.


1- Chateau KSARA:
A- History: Chateau Ksara lies near Baalbeck in the heart of the Bekaa. It began life in 1857, when Jesuit brothers inherited and began farming a 25 ha plot of land to produce Lebanons first non-sweet red wine. In doing so, they laid the foundations of Lebanons modern wine industry. In particular, they pioneered the introduction of high-quality vines in Lebanon. KSARA's natural wine cellar was a grotto discovered by the Romans who created solid underground rooms and dug several narrow tunnels from the cave into the surrounding chalk. These tunnels were enlarged to their present size during World War I when the Jesuit Fathers sought to alleviate famine in Lebanon by creating employment. Over one hundred men toiled with picks and shovels for four years to complete an underground network of tunnels stretching for almost two kilometers. The temperature in the tunnels is ideal for wine, varying throughout the year from 11 to 13C. In 1972, the Vatican encouraged its monasteries and missions around the world to sell off any commercial activities. By then, Ksara was a profitable entity, producing over 1 million bottles annually and representing 85% of Lebanese production. When then order to sell came through, the winery was sold to be considered as a limited liability company for $3.2 million in 1973. At the end of World War I, France was mandated to govern Lebanon. Its military and administrative machine moved in, bringing with it thousands of French soldiers and civil servants, for whom wine was an integral part of their culture. Ksara was in a position to supply Lebanons new administrators and by the time the French left in 1946, Lebanon had embraced the Francophone experience with a passion that can still be felt today. During the next 30 years, Ksara maintained its position as Lebanons most popular wine as Lebanon grew into a cosmopolitan and convivial hub, where western tastes were eagerly adopted. When the guns fell silent in 1990 after the Israeli invasions took place, Ksara had lost a significant chunk of its local market share. But it was exporting over 15-20% of its production abroad, mainly to France. Zafer Chaoui, who was appointed chairman in 1991, had a vision and that same year the flamboyant businessman, backed by an aggressive board of directors, appointed a new Managing Director and made more funds available. He did not know it then but he had set in motion of one of the most remarkable corporate turnarounds in Lebanese business history. Today, KSARA produces wines with strong personalities, achieving a rare condition of dry fruitiness, delicacy and robustness. And it is in its 150th anniversary.


According to the ISO international certification; Chateau Ksara is certified ISO 9001:2000 for its wine and arak production, viticulture, national and export sales.

B- Mission and vision: Chateau Ksara focuses on continuous improvements of the wines; and is developing new brands as soon as they are discovered and tested, to satisfy the needs of different types of consumers in many geographical areas. By that; Ksara is seeking to strengthen its position in the local and overseas markets.

C- Products: Chateau KSARA produces different types of wines, under 6 wine, arak and brandy categories; we note: 1- Red Wine: Le Souverain - Prieur Ksara - Rserve du Couvent - Chteau Ksara Red Cabernet-Sauvignon - Cuve du Troisime Millnaire - Cuve de Printemps 2- White Wine: Blanc de l'Observatoire - Chteau Blanc de Blancs - Chardonnay 3- Rose Wine: Ros de Ksara Sunset - Gris de Gris 4- Sweet and Fortified Wines: Moscatel Late Harvest Fortified Wine 5- Arak: Ksarak Arak 6- Brandy: Vieille Eau de Vie


D- Management and Sales: Four known families are the owners of Chateau Ksara. Kassar and Chaoui are the major shareholders owning 37% of shares each. Mr Zaher Chaoui is the current general president of Ksara. According to an interview made with Rania Chammas (responsible of public relations) and Bernard Beyrouthy (Junior Oenologist) on 5 May 2005, it has been mentioned the following: Chateau Ksara cultivated 300 ha of vines, it used to export wine firstly for over 311 Lebanese restaurants situated in France, and then it has exported a part of its production to Syria, Europe, USA and some Arabic countries. Today Ksara is present in Africa, Australia, Austria, Bahrain, Belgium, Brazil, Cambodia, Canada, Cyprus, Czech republic, Denmark, Dominican republic, Finland, France, Germany, Greece, Hong Kong, Ireland, Italy, Japan, Jordan, Malta, Poland, Spain, Sweden, Switzerland, Syria, The Netherlands, UAE, United Kingdom, USA and of course in its country of origin, Lebanon. In 2003, Ksara has received over 70.000 visitors, produced more than 1.6 million bottles of wine, and had over 75 permanent employees. In 2004, Ksara has increased its production to 2 million bottles of wine, and has also increased the number of employees to be 85. It has been mentioned also that Ksara has used the services of many seasonal workers in different years, who where engages in collecting the grapes. And that its wine production is increasing of over 10 to 15 % every year. Ksara remains one of the major and biggest wineries in lebanon, producing over 70% of all the countrys production. Chart 1 Illustrates Ksaras wine bottle production for the years 2003 and 2004. Chart1:

Ksara's wine bottle production (Millions)

3 2 1 0 2003 2004 Production (Millions)


2- Chateau Kefraya:
A- History: Chateau Kefraya is situated in the heart of the Bekaa Valley where the climate includes 300 days of sunshine and some 1200 mm of average annual rainfall. The areas components make it ideal for grapes cultivation. Chateau Kefraya has extended its land of 300 acres on the foothills of Mount Barouk. And it was first created by its founder, chairmen, and chief executive Michel de Bustros in 1951. It continued to grow vines and produce wine despite being under siege and bombardment throughout the civil war that occurred between 1075 and 1990. De Bustros had to accompany the wine containers by boat from the south of the country to Beirut, a 24 hour journey, because the roads were impassable. Since then, Chateau Kefraya has established itself as a key winemaker in Lebanon and abroad, becoming available nationwide in Lebanon and exported to 35 countries worldwide. Although 70% of Chateau Kefraya's wines are red, the estate has been producing white, ros, sweet wines and Arack for many years now. The red wines, created from five varieties of grapes, provide a unique taste and a complex aromatic bouquet that is ever-changing with the aging of the respective labels and vintages. Since its establishment as a premier wine producer in Lebanon, Chateau Kefraya has gained international praise from Europe, North America, and Asia. To create the most perfect blend of flavors and tastes, Chateau Kefraya's founder, President and Chairman, Mr. Michel de Bustros, has brought to Kefraya the classical and noble French vines Cabernet-Sauvignon, Grenache and Syrah. According to the ISO international certification; Chateau Kefraya is certified ISO 9002:1994 and ISO 9001:2000 for its wine and arak production, viticulture, national and export sales.

B- Mission and vision: Chateau Kefraya and since 1979, the founder, president, and chairman Michel De Bustros has oriented his vision to make a production of quality. In order to reach the strategy of producing wines of quality, De Bustros has recruited a French oenologist who was specialized in supervising the wine production process and making some technological researches to ameliorate the production process and the wine quality.

C- Products: Chateau Kefraya produces different types of wines under 5 wine and arak categories; we note: 1- White Wine: a- Vins de plaisir: La dame blanche du chateau kefraya 2008 La dame blannche du chateau kefaya 2007. b- Vins de fetes : Le blanc de blancs du chteau kefraya 2007 Le blanc de blancs du chteau kefraya 2007 c- Vins de prestinge : Casta Diva 2004 Vissi Darte 2006 2- Rose Wine a- Vins de plaisir : La rosee du chteau kefraya 2008 La rosee du chteau kefraya 2007 b- Vins de fetes : Myst de chteau kefryaya 2008 Myst de chteau kefraya 2007 3- Red Wine a- Vins de plaisir : Les breteches du chteau kefraya 2006 Lea breteches du chteau kefraya 2007 b- Vins de fetes : Le chteau kefraya 2002 Le chteau kefraya 2003 Le chteau kefraya 2004 c- Vins de prestige : Le comte de M 2003 Le comte de M 2004 d- Vin primeur : Le kefraya nouveau 2008 4- Sweet Wines : a- Vins de charme : Lacrima Doro Le nectar de kefraya 5- Arak : a- Lanis en folie : Larak de chteau kefraya.


D- Management and Sales : Chteau Kefraya is a Lebanese society that is owned by three partners, the Lebanese durze leader Walid Junblat, Michel de Bustros, and the rest of shares are owned by Fatahl family that is well known in the Lebanese commerce domain. Mr Michel de Bustros is the current general president of Kefraya. According to an interview made with Dalia Younes (Oenologist) on 28 April 2005, it has been mentioned the following: The vines that Kefraya used to collect are of over 300 ha. Due to their increasing production, they also used to buy vines from people who used to cultivate them in kefraya. In 2000, Kefraya has produced over 1.5 million bottle of wine. And as a result of exporting 40 % of this production, Kefraya has generated over 8250 millions of LL. In 2004, Kefraya kept producing 1.5 million bottles of wine, and the number of its permanent employees is over 75. We note that 40 % of Kefrayas production is exported abroad to many Arabic, European and American countries. And it is also meeting success in the Lebanese market. Kefraya considered as the second big wine producer in Lebanon. Chart 2 Illustrates Kefrayas wine bottle production for the years 2000 and 2004 Chart 2:

Kefraya's wine bottle production (Millions)

2 1.5 1 0.5 0 2000 2004 Production (Millions)



Companies situational analysis:

1- Companies SWOT analysis: By analyzing and evaluating the most significant strengths, weaknesses, opportunities and threats for the both companies Ksara and Kefraya, we can report the following: A- Chateau Ksara: a- Strengths: Strong brand name, image and company reputation:

Ksara is a strong brand name that has a well known image and a good reputation in the Lebanese market and abroad, because it is the oldest high quality wine industry created in Lebanon in 1858 and the most popular. Wide geographic coverage:

Ksara started to export wine firstly for over 311 Lebanese restaurants situated in France, and then it has exported a part of its production to Syria, Europe, USA and some Arabic countries. Today Ksara is present in more than 32 countries like France, Italy, UAE, Denmark, and USA Diversification:

Ksara focuses on research and development in order to create new types of wines to satisfy the needs and wants of the majority of customers and present them total satisfaction. It offers currently 17 different types of wines, and it has entered into brandy and arack productions. High demand on Ksaras wine products:

Ksara has increased its wine production from 1.6 million bottles to 2 million bottles between the years 2003 and 2004 due to the increasing demand on its products that is increasing for over 15 % per year.


b- Weaknesses: Lacks in advertisement:

Ksaras main weakness is that it does not invest much in advertisements in order to keep reminding the consumers about its existence. It has its own old image and does not have many advertisements on TVs, billboards, magazines

Behind rivals in E-commerce capabilities:

Due to the technological advances, many companies offer now internet shopping from their own website. Ksara has developed its online shopping in UK and USA, but should develop the same step in Lebanon, because more and more Lebanese prefer to shop from the internet.

c- Opportunities: Expand the companys product line to meet a broader range of customer needs:

Ksara has the opportunity to profit from entering into the production of other products that are produced from vines, in order to create a wide range of products that generates from the vines field and appear to meet a broader range of customer needs. By that, Ksara would be the customers first choice when he needs any of the vines high quality products. Expanding into new geographic markets:

Ksara could benefit from introducing wine products to countries where people havent heard about it; by that it could gain a high market share and profits in order to strengthen its position in different countries that are known as major wine producers like France. Online sales:

Ksara could benefit from investing more in online sales, because due to technological advances, more customers prefer the internet shopping to buy online from the company itself. It should develop online sales in more countries like France and many other European and Arabic countries.


Create a channel of distribution in many countries abroad:

Ksara should start investing in being physically available in different countries abroad that has a large demand on its products and then create its own distribution channel.

d- Threats: Low governmental support:

One of the main forces that affect the industry is the low support provided by the government. The government should decrease the taxes from important industries like the wines industry in order to encourage it to reach global markets and to invest the taxes cash in improving its position abroad. Increasing competition that may squeeze profit margins:

Ksara has too much competitors in Lebanon and abroad. So it shares the wine market share among its rivals (Kefraya, Musar, Fakra). Ksara should pay an important attention to prevent its rivals to squeeze its profit margins.

B- Chateau Kefraya: a- Strengths: Strong advertising and promotions:

Kefrayas major strength is the use of advertisements and different types of promotions to build a good image in the mind of consumers and to encourage customers to purchase its products Wine festival:

Kefraya possess a restaurant in which a wine festival is organized every year, and wine products are introduced to the public.

Wide geographic coverage:

Kefraya is working hardly on its geographic coverage, and is now present in different countries across the world.

b- Weaknesses: Loss in the market share:

As the production numbers shows, Kefrayas yearly wine production remained stabilized. It kept 1.5 million bottles in the years 2000 and 2004 while other competitors are growing their market share.

c- Opportunities: Expand the companys product line to meet a broader range of customer needs:

As the case of Ksara, Kefraya could also benefit from expanding its product line to meet more consumer segments and different needs. Online sales:

Kefraya could also benefit from investing more in online sales, because due to technological advances, more customers prefer the internet shopping to buy online from the company itself. Create a channel of distribution in many countries abroad :

Kefraya should create a strong self owned channel of distribution to serve many customers in Lebanon and abroad.

d- Threats: Low governmental support:

It is a factor that affects many companies in different industries. Low governmental supports could influence the company negatively and could result in high prices, and loss of the market share and the company may meet later bankruptcy, because it will not be able to compete abroad with high prices. Increasing competition that may squeeze profit margins:

Also like the case of Ksara, Kefraya should pay attention to prevent its profit margins from decreasing due to the strong competition in the wine field.



By taking into consideration Ksaras production, size, number of employees, brand name, wide geographic coverage and diversification, it appears that it dominates the Lebanese market and should be considered as a market Leader. And by taking into consideration also Kefrayas same factors, we note that it ranks the second Place after Ksara. In being considered as a market Leader, Ksara should use a defensive warfare marketing strategy. It should create more differentiated products, even if the introduced product has fewer profit margins and may reduce short-term profits, because this step accomplishes the more important long-term goal of protecting the firms market share. Also Ksara currently must block strong competitors moves, it must compete Kefraya by creating successful strong advertisements and promotions that boosts its sales and image positively. According to the situation of Kefraya, and as being considered as a follower, it should use an offensive warfare marketing strategy. Kefraya should reply to the leader Ksara by searching for some points of weakness in its strength and attack them and it should try not to engage in a broad attack, because the use of a broad attack is risky.

After all, we would like to note that both companies are somehow similar, few are the characteristics differentiate them from each other and that decide the rankings. But in the end, those companies have to work hardly to Capitalize on their key strength, overcome their major weaknesses, avoid significant threats, and take advantage to the most promising opportunities that allow them to improve their situation in the market by gaining market shares.




Authors: Mr. Philip Kotler and Mr. Kevin Lane Keller. Book title: Marketing Management (Twelfth Edition). Mr. Michael J. Etzel, Mr. Bruce J. Walker, and Mr. William J. Stanton. Book title: Marketing (International Edition). Mr. Philip Kotler, and Mr. Gary Armstrong. Book title: Principles of Marketing (Eleventh Edition).


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