GIOVANNI BUTON:

International Marketing Strategy

Case Study (MRKTG201-A)

Submitted by:
Azcarraga, Maria Lilia O.
Espiritu, Christian R.
Formilleza, Pearly Dawn L.
Hamsani, Saddamar Amil
Sahiron, Ahmad Al-Khudri

Submitted to
Mr. Francis H. Arroyo
Instructor

July 23, 2015

I. Statement of the problem
Given that there are major changes in marketplace, what should
Giovanni Butons strategy be for improving its position in Europe?

II. Objectives

To be able to come up with a strategy for improving Giovanni

Butons position in Europe

To develop the company into a worldwide known brand

III. Brief Description of the case

This case describes the situation confronting Giovanni Buton, an Italian
distiller and beverage distributor in 1989. The market for distilled spirits was
declining and the spirits industry was consolidating via merges and
acquisitions on a worldwide basis. Global Brands such as Dewars Scotch
were gaining share at the expense of local products. The process of market
integration in the European Community was scheduled to be completed by
the end of 1992.
IV. Areas for consideration
SWOT Analysis
A. Strengths
A1. Giovanni Buton Is the largest spirit producer in Italy, among the
highest distributor of any liquor in Italy and its principal product is the
leading brand in Italy.
A2. Giovanni already captured 30% of brandys market share.
A3. Persons who are in charge in managing Giovanni Buton are well
experienced on their specific task.
A4. Giovanni is more focus in marketing their product through intensive
advertising and promotion.
B. Weaknesses
B1. Poor connections outside Italy were they can expand their market.
B2. Lacked of proper information that will use to identify their market
outside Italy
C. Opportunities

C1. To have a subsidiary distributor or a joint venture with other

company outside Italy.
C2. To develop Giovanni Butons company internationally.
C3. To increase Giovanni Butons sales turnover outside Italy or
expands its sale in Europe.
C4. To position and market their product outside Italy.
D. Threats
D1. Foreign products entering Europe especially in Italy.
D2. Growth of major supermarket, affecting the retailing stores to
decline. This decline changes the preference of their captured market. It is a
threat for Giovanni Buton that foreign company changes the preference of
their captured market. Since the entry of these large supermarket even the
hypermarket,

Giovanni

Buton

captured

market

have

changed

their

preference because of new offerings.

D3. Possibility of Giovanni Butons market share drops. On the
utilization of both the market place with the market space, the company has
not fully caught the grasp of the reality of the advantages of them. Since
their competitors foreign and domestic have been to acquisitions and joint
ventures one and not the other and are now growing they fail to catch up on
the modernization that they need to be fully aware of in order to have that
edge from the other businesses.
D4. Possibilities of declining more of their sales when they fail to
market well their product.
SWOT Grid/Matrix
Giovanni Buton

Strengths

Weaknesses

Solutions

A1,A2,A3,A4,

B1,B2

Opportunities

Opportunity-Strength

Opportunity

C1,C2,C3,C4

OS

Weakness OW

(Strengths
advantage

takes (Overcomes
weaknesses by taking

opportunities)

advantage

of

-Giovanni Buton should opportunities)

look

for

company -Giovanni

Buton

outside Italy for them to should acquire more

tie

up

with

this distribution

channel

company.

inside

outside

Threats

Threat-Strength TS

Italy.
Threat-Weakness TW

D1,D2,D3,D4

(Strengths

to

avoid (Minimize

threats)
-Giovanni
produce

and

weaknesses to avoid
Buton

must threats)

another -Giovanni Buton must

product that suits not gather

more

only Italian people but Information

about

also

other

people

in their market outside

Europe.

Italy

through

some

reliable people.
V. Alternative course of action
I.

Create

Joint

Venture

Partnerships

with

Other

Brand-Producing

Companies Outside Italy

Butons main joint venture opportunities seemed to be with
companies that had a strong domestic brand that they wished to
develop internationally. The agreement could take the form of a
II.

cross-shareholding in the distribution companies.

Acquisition of Distribution Channels
The trend toward companies acquiring their own distributors
made purchasing a distributor of anything above net asset value
an

increasingly

risky

move.

The

situation

was

further

complicated by the fact that when a change of ownership took

place any previous any previous agreements with the brandowning principals were almost always invalidated.

III.

Launch New Brands

In the past, Buton had already successfully developed new
products for the Italian market and they could still use this
strategy that will help them improve its position in Europe.
Criteria for developing new products include:
a. First in category
b. Sustainable long-term competitive advantage
c. Fit with existing production capabilities

IV.

and

distribution channels
d. Potential growth category
Market Segment Selection
Because of the increased polarization between the large volume
market and the specialty market, a strategic choice needed to be
made as to where to market Butons Brands. The choice was
whether to go into direct competition with the major domestic
products in the volume market, or whether to limit distribution of
the brand to traditional Italian channels Italian restaurants
and specialty food outlets. This choice would influence the choice
of a distributor, the investment levels required, and the long-

V.

term production volume expectations.

Recommendation
We recommend that Giovanni Buton should choose the first
alternative which is to create joint venture partnerships with
other brand-producing companies outside Italy.

VII. Action plan

Activity
Look
for

Time Frame
other 1st week

Person Involved
Nigel Brown

brand-producing
company
Conduct a meeting 2nd week

Nigel Brown with the

to

introduce

the

Administrative

and

suggested plan
Make agreements to 3rd week

Marketing staff
Nigel Brown and

the

the selected brand-

brand-producing

producing company
Presenting
the End of the month

company
Nigel Brown

information to the

Giovanni

Giovanni

management

Butons

management

and

the

Butons