Case study - SVEDKA Vodka (A)

Assignment Questions

1. What gave Cuvelier the idea that there was a market for $10.00 vodka?

2. Are there brands you can point to that have used strategies similar to those employed by SVEDKA?

3. What is the brand positioning statement that might guide integrated marketing communications? How has the positioning evolved over time? Where is it headed?

4. What advice would you give Cuvelier for SVEDKA's rollout strategy?

5. Which elements of his total marketing strategy is he relying on for success in this market?
Use the vodka industry data set to evaluate the effect of price and advertising on sales by answering the following:

6. Run a regression of the natural logarithm of change in sales on the natural logarithm of previous period's prices, and the natural log of marketing expenditures on print, outdoor, and broadcasting.

7. To understand the influence of vodka quality, run a regression by adding the tier 1 and tier 2 dummy variables (that indicate whether a vodka brand belongs to first- or second-quality tiers) to the set of independent variables in question 6.

8. To understand the influence of competition and brand power, run a regression by adding the sum of sales of all the competing brands in the previous year ("lagtotalminussales") to the independent variables in question 7.

9. To measure the sales growth of new brands compared with the existent ones, include the variable "firstintro" to the independent variable set in question 8. "Firstintro" is equal to one in the first three years after a brand is introduced and is zero elsewhere.

10. Why does the coefficient of price and advertising change in the above regressions?

11. Based on your analysis of the Vodka data, what recommendations do you have for Cuvelier regarding the marketing mix for SVEDKA?