EXECUTIVE SUMMARY

Cartagz.com is a privately owned for- profit company that was created to provide

consumers of California an alternative to conducting business with the California Department of

Motor Vehicle. The online vehicle registration company provides clients full service without

visiting a DMV office. The company provides online e-confirmation or next day delivery on all

of their services. The target market of Cartagz is limited to the California geographical area.

However, other variables in the target segment are not limited to demographics (race, income,

age, gender or education).

Cartagz.com is currently the number one online vehicle registration company in

California. It is experiencing a growth rate that exceeded 10,237.5 percent since the

commencement of the company. Cartagz mission and vision for the company is to provide

needed service to the citizens of California without overcharging for the services. Cartagz

primary focus is to provide the clients with an inexpensive alternative while maintaining

outstanding customer service and support. This can be accomplished in a professional manner

that is efficient and effective for the customers and the company. The company demonstrated

that it is very profitable; in 2011 revenue generated was $14.2 million. Cartagz.com should

generated revenues for 2012 in excess of $24 million.

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COMPANY DESCRIPTION

History

Cartagz is a privately owned online vehicle registration business for the state of

California. The company is in the consumer products and service industry. They have received a

rating of third in this industry. It was founded by Greg Sanders and Troy Greeson in 2008.

According to Sanders, the vision of Cartagz is to “design a new, online vehicle registration

system that provides options currently not available through conventional means (PR web,

2012).” The goal of the online vehicle registration business is to provide a convenience for the

people of California by taking the negative stigma from doing business with California

Department of Motor Vehicle (DMV). By providing a service for a nominal fee, Cartagz is able

to allow patrons the opportunity of bypassing the DMV office. Cartagz online service is user

friendly and accessible to clients that may have problems that preclude them from using the

California DMV’s website.

The company’s has developed an economy of scales that includes “excellent customer

experience with unparalleled customer support” (PR web, 2012). The company’s goal is to

ensure that experts in the online vehicle registration industry are available to assist the

consumers, this cultural is exhibit throughout the company.

The company operating environment consists of business to business selling (B2B) and

business to consumer (B2C) selling. Cartagz selling environment for B2B clients consist of the

DMV, insurance companies, and other companies desiring to operate in the Cartagz fleet. The

B2C clients are comprised of the patrons that use the service online.

Since the conception in 2008, Cartagz has become the number one online vehicle

registration provider for the state of California. Information obtained from Inc. 500 states that

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Cartagz has experience a growth rate of 10,237.5 percent. Revenues generated for 2011 were

$14.2 million in 2008 the revenues earned was $136,934 . The revenues forecasted for 2012 is

expected to exceed $24 million. Currently, Cartagz operates with a staff of eight employees;

however, plans are being implemented to increase the sales force by hiring a Spanish sales staff

that will accommodate the Hispanics population.

Products Offered

Cartagz.com offers the consumers more services than other online vehicles registration

providers. Consumers have the options to renew their vehicle registration, transfer vehicle titles,

payment of parking/toll violations, and the replacement of lost or stolen registration cards or

stickers. Cartagz also provides the consumers the alternative of receiving the documents the next

business day or instantaneous e-copies of valid registration cards and other documents.

Market Summary

Target Segment (see exhibit 1)

The target market of Cartagz consists of the State of California DMV clients that are too

busy to wait in long lines at a traditional brick and mortar building, primarily this market entails

clients that have a basic working knowledge of the computer, but not necessarily computer

savvy, and those willing to spend extra for convenience. Cartagz recognize that clients of the

California DMV express a desire or need to save time and avoid trips to the facility. Cartagz.com

observed that people in the targeted market are willing to pay a nominal fee to fulfill their needs

(cartagz.com, 2012).

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Dividing the target market in sub groups has allowed Cartagz.com to achieve a greater

share of the market. Variable for segmentations includes age, demographic, discretionary

income, geographic, and culture. Relating to age segmentation, Cartagz.com will concentrate on

the target market age group that is in the computer or technological age. According to Jayson,

from USA Today Magazine, Generation X, Y, and the Younger Boomer are likely to purchase a

product or pay bills online, the ages of the clients in this group ranges from 18 to 54 (Jayson,

2009). Geographically, the target market place is the state of California, Cartagz will focus on

people within the state of California and clients outside of the state that may have a California

vehicle. Demographically, the target market will consist of the population between the ages of

30-55. This group has the largest portion of discretionary income. This income is the amount of

money that is left after all of the basic bills, such as food, shelter, clothing has been paid.

Consumers in this group are usually individuals and households with annual incomes of $35,000

to $100,000 (Thadani, 2010). Culturally, Cartagz.com has the largest numbers of clients that

covers a vast numbers of different ethnic groups. These groups do not have an issue with trusting

the technology of today. However, Cartagz realized that the Hispanic culture is the fastest

growing group in California, and was not being served with the present system. The language

barrier prohibited potential clients from using the online service. The Hispanic culture is taught

from childhood not to trust “outsiders and that Europeans are outsiders” (Rivera, B. D., &

Rogers-Adkinson D 1997). Cartagz has expanded the sales force to include Spanish-speaking

employees that will focus on attracting them to the available online services.

MARKET STRATEGY

Mission Statement

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Our mission was to take the negativity out renewing a vehicle registration and replace it with a

simple-to-use and efficient online alternative

Marketing Strategy

Brand Recognition is an element that has permitted Cartagz is rise above the

competitions. Other competitors in the industry offer similar service, but lack the unique

services that Cartagz.com provides. The company core values of professional experts, quick and

efficient services, excellent customer services, and support teams have allowed Cartagz to

established and maintain the competitive advantages. Cartagz.com products, pricing, promotion

and placement has supported the overall goal and vision for the company, which is to “design a

new, online vehicle registration system that provides options currently not available through

conventional means, and to create a highly efficient company compiled of experts in their

individual fields,” (Cartagz.com, 2012).

Product

Cartagz products offered to the business to consumer clients are similar to the products

offered by the other competitors. The service provided are services that are offered by the DMV,

such as vehicle registration, lost tag replacement, etc. However, Cartagz.com differentiate their

product by providing same day service for some issues that can be printed from the clients

computer, and next day services for all other services. This method aligns with the company’s

goal of designing a new system not currently available. Cartagz is expanding their product to

reach new markets by targeting the Hispanic communities.

The business to business products are unique because Cartagz.com provides fleet services

for various companies both locally and out of state. The companies have an opportunity to

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become an affiliate or an owner. Training and support is performed by the professional of

Cartagz. This relationship coincides with the company goal of “creating a highly efficient

company compiled of experts in their individual fields’.

Price (see exhibit 2)

The price for the services provided by Cartagz is very similar to the competition. The fees

charged are a nominal amount compared to the time saved from driving to the DMV office and

waiting in the long lines.

Promotion

The business’s promotion and advertising has been utilized in manners that exhibit a

strong growth succession for the company. Advertisement and promotional campaigns have been

very successful. The use of other companies’ intranet and website to get the information to

prospective clients have proven to be a worthy investment, Cartagz have develop a relationship

with these B2B clients that has been beneficial for both parties. Web banners, direct marketing,

press releases in industry publication, and promotional discounts to affiliates has provided

Cartagz.com with a strong promotional network.

Place

Distribution for Cartagz.com has been placed mostly with companies that utilize the

California DMV. Insurance companies are some of the firms that Cartagz.com place this

products with. The placement of the product provided by Cartagz is strategically placed in trade

magazines, web banners, and search engines that may be used when a consumer is looking for a

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particular service. With Cartagz launching into the Spanish communities, it may become

necessary for the company to place the products in Spanish speaking television shows, and

billboard in the community.

Sales Strategy

Currently, Cartagz sales force consists of eight to ten representatives. The staff has been

able to perform B2B sells and B2C sells functioning. With the anticipating move into the

Spanish market, Cartagz sales force will have to be expanded to include bi-lingual staff

members. Sale members will have to be trained or employed to meet the needs of business

clients (insurance agents, car salesperson) that will depend on Cartagz as the primary resource.

Direct sales have been used; this includes internet marketing, telemarketing and trade

magazines. Partnership with fleets affiliates working as a team as proven to be a great source of

indirect sales. Because, of the launching of a new product, Cartagz may have to use a

combination of direct, indirect, and telemarketing to reach the targeted segment. Developing and

implementing a market test of the Hispanic community will be a cost effective measurement in

determining the size of the new sales force. A combination of subjective and objective

measurement aspects should be considered before investing in new hires. The goal of the sales

force is to attract new clients to the company and to increase the company’s revenue. Since this

has been accomplished for four years, with a staff of less-than ten employees, the use of sales

forecasting measures are highly suggested.

loyal customers are extremely important because they will drive future sales and require

significantly lower promotion costs than new customers. Another challenges faced by Rusty Red

is the extensive legal regulations regarding the sale and distribution of alcohol. These complex

regulations vary by state, and must be fully understood before Rusty Red can establish a system

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of distribution for its product. Lastly, Rusty Red faces intense competition from established

wineries and cause related marketing efforts. To overcome this challenge, Rusty Red will need to

leverage its core competencies to gain market share from its competitors.

Product Market Classification (see Figure 3)

In the short-term, the best strategy for Rusty Red is a market penetration and market

expansion strategy. Resources should be invested in building brand awareness and on generating

repeat purchases. At the present time, investing resources into developing new products could

prove too risky, since Rusty Red still has many obstacles to face in developing a strategy for its

current product line. However, once Rusty Red develops brand loyalty and gains market share, it

can consider product development and diversification as a long-term strategy.

Industry Analysis

Never before has the U.S. culture been more concerned with health and the overall

betterment of society though philanthropic means. Moreover, cause marketing combines the

efforts of a non-profit organization with those of a for-profit organization in the efforts of

achieving a mutual benefit. A study taken in 2006 states that 89% of Americans (aged 13-25)

are more inclined to switch between comparable brands to the brand closer associated with a

“good cause”(Watson). This, in turn, has increased returns for many businesses that employ

cause-marketing campaigns. Spending for cause-marketing campaigns is projected to increase to

1.34 billion this year according to sponsorship consultancy IEG, Inc (Watson). This will mark

an increase of almost 20.5% in overall cause-marketing spending as compared with last year.

With that, cause-marketing is now the fastest growing segment of sponsorship, outpacing even

sport sponsorships.

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With the discovery of Resveratrol in red wines, the wine industry has also been able to

tap into this growing concern for health, boosting overall sales in both dollars and volume.

Resveratrol is a naturally occurring compound found in grapes, mulberries, peanuts and other

plants, especially red wine, which may protect against cancer and cardiovascular disease by

acting as an antioxidant, antimutagen, and anti-imflammatory. With 40% of the overall market

located in grocery stores, the wine industry marked a 13 week growth spurt in dollar and unit

sales during the third quarter of 2007. Dollar sales increased by 8.6% with a unit growth of 5.1%

(MacPherson). White wines are growing as well but at a slower pace than reds (this may be

attributed to the lack of resveratrol in white wines). The decline in the U.S. economy and the

weakness of the U.S. dollar has caused many importers of wine to leverage their prices against

their high import prices. However, this may be offset by the fact that when selecting wines

priced above $10, location (where the grapes are from) is the most important factor considered

by a consumer (Ramey). Pricing points do not seem to present much deterrence in growth either,

seeing sales growth of 18.4% for wines between $12 and $15, and sales growth of 17% for wines

greater than $15 (MacPherson). A business coupling the growth factors of both cause-marketing

and wine are sure to realize future positive returns if positioned correctly within the market

place.

Competitors (see Figure 4)

Competitor 1: Clarendon Hills

Clarendon Hills’ primary strengths lay in its high quality wine recognized by many wine

critics. Positive ratings from these popular wine experts provide a credible source of information

for consumers who seek to purchase wine based primarily on quality. Although Clarendon Hills’

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wine is highly rated, the company lacks the charitable aspect of Rusty Red and other

competitors. Additionally, Clarendon Hills is located in Australia, a weakness when targeting US

consumers, especially considering the company’s limited advertising strategy.

Competitor 2: Big Tattoo Wines

Big Tattoo Wines was founded in 2002 by two brothers, Alex and Erik, whose father

founded Billington Wines in 1985. Big Tattoo’s goal is to donate money to cancer research and

hospice care. Big Tattoo Wines offers wines from many geographic areas, including Chile,

Spain, and California. According to the Billington Wines website, Big Tattoo Wines donates

$.50 for every bottle sold, which generated $1,105,000 in donations as of January 1, 2008

(Billington Wines). The company has established customer loyalty which has helped them

expand. Additionally, the company has begun donating money to local charities in communities

where the wine is sold, and have even started a new “2 Brothers” line with more elegant

packaging to appeal to more traditional, upscale wine drinkers.

Big Tattoo’s weaknesses in comparison with Rusty Red include the lack of a social

network, a smaller portion of profits contributed to charity, and a less prestigious image. Unlike

Rusty Red, Big Tattoo Wines lacks a cohesive network of people who come from a similar

background. Additionally, Big Tattoo donates a smaller portion of their sales (only $.50 per

bottle) compared to Rusty Red’s more generous contributions. Also, their wine is significantly

less expensive, selling on average, at $10 per bottle, compared with Rusty Red which can be sold

at $10 per glass. Compared to Rusty Red, Big Tattoo Wines has less of a prestigious image,

attracting less of a high-income customer base whom tend to make larger contributions.

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Competitor 3: Humanitas Wine

Humanitas Wines differs from Big Tattoo and Rusty Red in the causes it supports. The

business donates its profits to issues of hunger, affordable housing, and literacy, some of the

more basic needs for humanity. It gives funds to regional chapters of the charities where the wine

is sold. Humanitas’ primary belief is giving back to ones’ community. The business is also

weaker than Rusty Red in terms of quality; however, this weakness is offset by heavily

concentrating on cause-related marketing (Humanitas Wines).

Rusty Red

Compared with these competitors, Rusty Red faces a lower market share and lack of

brand loyalty. Rusty Red also lacks the established selling and distribution systems that these

companies likely have in place. Additionally, Rusty Red’s target market may value the causes

supported by Big Tattoo and Humanitas more than those supported by Rusty Red. Rusty Red can

compete with Big Tattoo and Humanitas in terms of quality; however, it will be more difficult to

compete with the quality of critic-acclaimed Clarendon Hills. To successfully compete with

these companies, Rusty Red will need to leverage its core competencies, primarily its image and

affiliation with Cornell.

MARKETING PLAN OBJECTIVE

Strengths

Rusty Red’s major strengths include Joe Lizzio’s dedication to the company’s success,

his extensive social network, and the uniqueness of Rusty Red’s product. Mr. Lizzio is

personally dedicated to Rusty Red’s success, and is willing to invest considerable resources into

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the company until it begins earning enough profits to sustain its growth. Additionally, Rusty Red

offers a unique product in that its wine supports a charitable cause. Although other wine

companies such as Big Tattoo and Humanitas support philanthropic efforts, Rusty Red’s focus

on student athletic programs sets it apart from other wine companies.

Opportunities

Athletic banquets following major Cornell athletic events create a substantial marketing

opportunity for Rusty Red to profit from its connection with both Cornell and athletics. These

banquets occur after sporting events in which Cornell teams travel out of state. In addition to

student athletes, between 75 and 300 alumni usually attend the events. During the banquets,

various snacks and drinks are served, creating an opportunity for Rusty Red to initiate a trial of

its product among alumni. Given their involvement with athletics, the alumni at these events

should be particularly receptive to Rusty Red’s mission, perhaps more-so than other alumni. For

this reason, athletic banquets could provide a profitable marketing opportunity for Rusty Red.

An additional opportunity exists for Rusty Red to seek distribution of its wine through

upscale restaurants in Ithaca and New York City, which would allow the company to capitalize

on the perceived prestige of its product, the growth in popularity of premium and imported

wines, and the increase in restaurant visits by consumers (Wine Mintel). To act on this

opportunity, Rusty Red would need to expand its target market. In Ithaca, Rusty Red’s target

market consists of Ithaca residents and Cornell-affiliates interested in supporting athletics. In

New York City, the target market consists of the large percentage of Cornell alumni residing in

the Metropolitan New York City area, and also of upscale wine-drinkers interested in supporting

Rusty Red’s mission.

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Distribution through restaurants would provide a broad customer base and substantial

revenues for Rusty Red to use in its charitable efforts; however, without significant promotional

efforts on behalf of the restaurants, Rusty Red would not be able to communicate its mission to

customers. This inability greatly detracts from the company’s cause-related marketing aspect,

and would prohibit customers from making future donations to the foundation. Therefore, in

order to maximize the potential of this opportunity, Rusty Red would need to offer incentives to

restaurant owners in order to gain distribution in their restaurants and enlist their help in

promoting its product.

The creation of an aesthetically-pleasing, user-friendly website provides an opportunity

for Rusty Red to benefit from the trend toward web-based retail (Rampell). It also creates an

efficient way for the company to market and distribute its product to customers. Such a website

would communicate Rusty Red’s mission to customers and allow them to order wine and make

donations online. Additionally, users would be able to register with the site to receive news and

updates, making them feel as though they were part of an interactive club, rather than just

customers of a wine-selling company. This additional feature would also help Rusty Red to track

sales and build brand loyalty. The website itself could be promoted through various Cornell-

affiliated events and by word-of-mouth marketing through Mr. Lizzio’s social network. Overall,

the website would stream-line the ordering/donation process for customers and for Rusty Red,

and would provide an efficient way to communicate with customers.

Weaknesses

Rusty Red does not currently have an ordering or delivery process, making it difficult for

customers to purchase its product and make donations. This is a serious weakness for the

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company, and could result in a major loss in sales revenue. To correct this weakness, the

company must devise a stream-lined ordering and distribution system that makes it easy for

customers to order its product and make donations to the foundation.

Another serious weakness is Rusty Red’s lack of brand awareness. To build brand

awareness, the company must create an aggressive marketing strategy to inform potential

customers about Rusty Red’s product and mission. There are a number of ways the company

could do this, including the strategies described earlier in the “Opportunities” section.

An additional weakness is Rusty Red’s lack of employees. Currently, Mr. Lizzio is the

company’s sole employee, and although he exhibits impressive dedication, there is only so much

one person can accomplish. Therefore, to improve upon this weakness, Rusty Red must take on

additional employees. By hiring even a few additional employees Rusty Red should be able to

function more efficiently, ultimately resulting in increased revenue for the company.

Threats

Competition is a major threat to Rusty Red’s business. This competition comes not only

from other wine companies, but also from other charities. Wine companies with a cause-related

marketing aspect, like Big Tattoo Wines and Humanitas Wines, pose a particular threat to Rusty

Red, as they compete for customers in both of these markets. In order to defend against such

strong competition, Rusty Red must differentiate itself in the minds of its target market. It can do

this by focusing attention on the company’s mission, the premium quality of its product, and the

prestige associated with the Cornell network.

Rusty Red also faces the threat of laws and regulations regarding the sale and distribution

of alcohol across state lines. To defend against this threat, Rusty Red can limit its target market

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to residents of New York state, where a large population of Cornell alumni reside. This way, it

will not be necessary to transport the product across state lines. Although this strategy will limit

Rusty Red’s customer base, it will save the company from becoming involved in potential legal

struggles.

Objective

Generate $100,000 in profit by May, 2009, driven by the establishment of a well-

structured website through which customers can effectively understand Rusty Red’s mission,

purchase its product, make donations, and stay involved with the foundation.

Measure of Success

One measure of success of Rusty Red’s objective is whether the target level of $100,000

in profit is reached by May 2009. An additional measure of success will be a short survey which

will be completed by customers when they order wine or make a donation through Rusty Red’s

website. This survey is outlined in Figure 5.

The data will be stored in a computer database which will collect responses and organize

the data. Once organized, the data will be reviewed by Rusty Red personnel and used to make

decisions regarding the success of the objective. Averages of the level of satisfaction and ease in

navigation of the website can be used to quantitatively measure success in both these areas.

Questions regarding product trial and past experiences can be used to evaluate the effectiveness

of various marketing strategies. For example, if many customers indicate that they have heard of

Rusty Red through Cornell-affiliated events, this would indicate that Rusty Red has been

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successful at marketing its product through these events. Rusty Red could respond to this

information by altering its marketing strategy accordingly.

Points of Difference

Rusty Red’s primary points of difference within the market place lie in its association

with such an esteemed university, the sense of community provided to its customers, and its

mission to give back. According to a poll, Cornell University is within the top 1% of Colleges

and Universities worldwide, making it a symbol of prestige (U.S. News). With that, Cornell

provides a strong alumni base within the Northeastern region of the US. Additionally, the

foundation plans to provide substantial funding for Cornell’s student athletes in hopes of

promoting its strong traditions through outstanding athletics.

Through the development of a more functional website, Rusty Red will become more

efficient with regard to its business operations while providing a medium through which

customers can foster a sense of community. Customers will find it easier to place orders and

make donations though the website. They will also be able to track where their donations are

going through a yearly post of profiles of players receiving scholarships. Lastly, the website will

have an open platform for communication between other customers and the company. With this,

Rusty Red should realize immense growth within its first few years and a strong body of return

customers.

Perceptual Map (see Figure 6)

Two of the most important qualities of Rusty Red wine have been constructed into a

perceptual map. Rusty Red stands as a high quality wine with very high charitable efforts. It is

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weaker than Clarendon Hills Wines because Clarendon Hills has established a high quality

among many critics and wine lovers. However, Clarendon Hills does not have any philanthropic

association with its business. Because Rusty Red will contribute all sales to helping athletic

causes, it ranks more charitable than Big Tattoo Wines which only contributes $.50 per bottle

and Humanitas which only contributes 20% of its sales to a cause. Rusty Red’s favorable

acceptance in high end restaurants like Wolfgang Puck’s has credited its quality, an advantage

that Humanitas lacks.

DESCRIPTION OF NEW PRODUCT

Product

Rusty Red will develop a well-structured website where current and potential customers and

donors can find more information about the company and its product. Many features will be

created for the website. The homepage will display the logo and a brief history of Rusty Red.

There will be a panel of links that include About Rusty Red, News, Place an Order, Make a

Donation, Contact Info, and Member Log-In.

Each link will allow the customer to easily navigate the site. The link to About Rusty Red will

provide the viewer with a more detailed story of the founding of Rusty Red, describe the

philanthropic aspect of the business, display the mission statement and state the long term goals

of the business. News will include the latest updates on the progression of the business such as

new locations serving Rusty Red wine, money raised for the foundation, and events sponsored by

Rusty Red. Place an Order will allow a customer to make an order online with payment options

of credit cards, such as MasterCard and Visa, billing by check, money orders and PayPal. Before

the customer checks out, he/she will be connected to a survey of a few brief questions that will

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allow Rusty Red to make improvements to the website. Those interested in just making a

donation can visit the link, Make a Donation, where they can donate with the same payment

methods. Contact Info will list the different ways of contacting Rusty Red. For general questions

and comments, there will be a message box that will direct these concerns to the general mailbox

of the Rusty Red website. There will be an address for Rusty Red’s office, and a phone number

will also be included for specific inquiries.

Member Log-In will be an exclusive page for those who sign up to be members, usually

previous customers and donors. One can become a member by signing up through Rusty Red’s

website. Members will be placed on a list-serve where to receive news updates, notifications

regarding Rusty Red-sponsored charity events, and quarterly reports regarding the business’s

performance. These updates will keep members involved and constantly in touch with Rusty

Red. The log-in for the site will create more customized navigation through the site based on

previous orders. Members who have made previous orders can also track their orders and other

activities.

The newly established website, planned to be completed by August 2008, will enhance Rusty

Red by creating a more effective channel for order placement and information flow. The site

allows Rusty Red to keep customers and those who are interested, mostly Cornell alumni,

informed about the foundation. Through site membership, Rusty Red hopes to create more

loyalty to the product and cause. The website can also attract new and potential contributors who

request more information about the business. Furthermore, the site will be useful for keeping

track of quality control through the survey from the purchases. To make the website more

compatible with its product and target market, it would need a sophisticated, professional-

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looking design that portrays the image of prestige. For practicality, the site should also be easy to

navigate, making it a smooth experience for its users.

PROMOTIONAL TACTICS

Promotion

We have selected two promotional tactics for the Rusty Red Foundation:

Tactic 1: Rusty Red-Sponsored Event during Cornell Lacrosse Alumni Weekend

Tactic 2: Long-term Advertising Strategy through Various Mediums

Tactic 1—Rusty Red-Sponsored Event during Cornell Lacrosse Alumni Weekend: Our first

promotional tactic targets the lacrosse based segment of Rusty Red’s market. This will be

accomplished by establishing Rusty Red’s presence through the distribution of wine and

promotional materials during the Alumni Weekend banquet to be held in September of 2008.

The Lacrosse Alumni Weekend is an annual event when Cornell lacrosse players return to

campus to participate in numerous activities. Saturday of the alumni weekend is the optimal day

to distribute wine samples and information about RustyRed.com. Three bottles will be provided

to each table at the banquet, accompanied by a brief informative speech outlining Rusty Red’s

mission and promoting its newly developed website. Utilization of the golf outing prior to the

evening banquet should provide Rusty Red with additional exposure to potential customers.

Rusty Red will be present at this outing for those who wish to sample the wine and receive

additional information about RustyRed.com.

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Tactic 1 Budget: The golf outing and the banquet during Alumni Weekend are annually

scheduled events which means that the main cost associated with this weekend is the cost of

supplying the wine. An estimated 200 people participate in the afternoon golf outing while

approximately 350 are in attendance at the banquet. With a cost of $20 per bottle, estimated total

costs for the day would range from $5,500 to $7,360. These estimates are based on ½ bottle per

person (275 bottles) and ⅔ bottle per person (368 bottles).

Tactic 2- Long-term Advertising Strategy through Various Mediums: The Rusty Red

Foundation is currently in the introductory stage of its product life cycle. This stage of a product

is directly associated with high cost, low sales, and the need to create demand for the product by

directly prompting the customers within the target market to try the product. The first tactic was

targeted toward the immediate lacrosse community consisting of past and current players and

their family members. However; for this company to succeed the target market must be

expanded to include people outside of this immediate lacrosse community and capture the

market of general Cornell alumni interested in good wine, athletics, and giving back. This will

be accomplished in two phases: establishing a web presence outside of RustyRed.com, and

advertising through printed news media.

Web: Rusty Red’s web presence is currently limited to its official website, RustyRed.com,

however; through sites like LaxPower.com and wikipedia.org, Rusty Red can increase its

product recognition among its target market. LaxPower.com averages over 15 million views per

month. Of the website’s 54,000 registered members, approximately 60% are of legal

consumption age. This number is quite promising for Rusty Red. In addition to this, 59% of the

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members shop online (ActiveNetwork.com). Rusty Red could benefit greatly from taking

advantage of this opportunity. Rusty Red should aim to begin advertising on the site no later

than February 2009 to capitalize on the amount of traffic LaxPower.com will receive due to the

beginning of the NCAA Lacrosse season in mid-February. Active Marketing Group allows

customers to select a daily or monthly budget for their advertisement. Active will help design a

banner that will promote the foundation. In order to advertise with the Active Marketing Group,

the ad cannot contain material advertising for any alcoholic beverages. This means that Rusty

Red must strictly promote the foundation which is the best way to attract the lacrosse

community.

Moreover, developing a page on wikipedia.org provides Rusty Red with a cost-free way

of expanding its internet presence. Wikipedia is one of the top ten most visited websites

worldwide and one in every three internet users is said to consult Wikipedia (Alexa & Rainie).

The webpage should include the company’s history, mission, contact number and links to the

direct website. Once these internet-based promotions have been established, more opportunities

like these should be pursued in the future.

Print: The second phase of the long-term promotional tactic is to advertise via the Village Voice

and through press releases in popular New York newspapers. This phase will begin by placing

four 2/3 page advertisements in the Village Voice promoting RustyRed.com. The

advertisements will go out for 4 weeks, every second Wednesday in the months of September

through December of 2008 (Figure 8). The ads will incorporate Rusty Red’s logo, a short slogan,

web address, and contact information.

21

Next press releases regarding Rusty Reds philanthropic efforts and the launch of its

website will be sent out to a number of popular news papers in the New York City and Ithaca

areas. The papers that will be targeted are Crain’s New York Business, The Gotham Gazette,

The New York Daily News, The New York Observer, The New York Post, The New York

Times, The Chief Leader, The Village Voice, The Wall Street Journal, The Ithaca Journal, and

the Ithaca Times (Figure 9). These efforts will combine with Rusty Red’s internet presence to

increase product recognition, fostering knowledge of and interest in the product.

Tactic 2 Budget: Advertisements on LaxPower.com costs an average of $36 per display

(Columbia.edu). Rusty Red can multiply their ideal number of views by this price to establish an

appropriate advertising budget. Fifty to one hundred views would be a reasonable amount for

Rusty Red to hope to accomplish per month which creates a budget of approximately $1,800 to

$3,600 in advertising costs each month. The Wikipedia page and press releases are of no charge.

The total cost of advertising in the Village Voice will be approximately $7,500 (Figure 10).

Place

Once the wine is produced and imported from Italy, the primary means of distribution for

Rusty Red wine is personally via Mr. Lizzio. Consumers may also purchase Rusty Red wine at

select restaurants, including Wolfgang Puck in New York City and Ruloffs in Ithaca, NY. The

current distribution system is illustrated in Figure 11.

The proposed website for Rusty Red would require the implementation of a new

distribution system. As a part of this new system, the wine would no longer be personally

delivered to customers by Mr. Lizzio. Instead, customers would be able to order wine directly

22

from the Rusty Red website. Once a customer places an order through the website, the wine

would be delivered to them via a shipping service such as FedEx or UPS. However, as a part of

this new system, customers would still be able to purchase Rusty Red wine in select restaurants.

CONCLUSION

The implementation of this marketing plan will provide the Rusty Red Foundation with

an effective way to raise awareness of its product and mission. The promotional tactics of our

plan advertise our objective to the people who are most closely related to the cause of Rusty Red.

By advertising directly to Cornell alumni and lacrosse communities, Rusty Red will be able to

reach those who are likely to be touched by our cause. This strong relationship with the target

market along with the user-friendly website will allow all those who wish to help our cause do so

easily. With this plan, RustyRed.com will develop into a network of people connected by their

love of sports and care for young athletes across the country.

23

WORKS CITED

"Active Network Media Kit." Active Network. 26 Mar 2008. <http://mediakit.activenetwork.com/Our_Markets/Team_Sports.htm>.

Alexa, comp. "Traffic Rankings "Top 500 Sites"" Alexa the Web Information Company. 28 Mar. 2008. 28 Mar. 2008. <http://www.alexa.com/site/ds/top_sites?ts_mode=global&lang=none>.

"America's Best Colleges 2008." USNews.Com. 13 Mar. 2008. U.S. News Education. 25 Feb. 2008 <http://colleges.usnews.rankingsandreviews.com/usnews/edu/college/rankings/brief/t1natudoc_brief.php>.

Big Tattoo Wines. 25 February 2008. <http://www.bigtattoored.com/>.

Billington Wines: Big Tattoo Wines. 25 February 2008. <http://www.billingtonwines.com/vina.asp?indexid=131>.

Cause Marketing. Mintel Group, 2007. 11 Feb. 2008<http://academic.mintel.com.proxy.library.cornell.edu/sinatra/oxygen_academic/search_results/show&/display/id=267071/display/id=294100?select_section=267071>.

Clarendon Hills. 2003. 21 February 2008.<http://www.clarendonhills.com.au/indexFlash.html>.

"Constellation Brands, Inc—Company Profile." Datamonitor 25 May 2007.12 Feb 2008. <http://www.blackboard.cornell.edu/webapps/portal/frameset.jsp?tab=courses&url=/bin/common/course.pl?course_id=_9374_1>

Cornell Career Services. “Class of 2006 Postgraduate Report.” 26 Feb 2008. <http://www.career.cornell.edu/downloads/PostGradSurveys/CCSPstGrad_Rept06_1.pdf>

Cornell Career Services. “Preliminary Class of 2007 Postgraduate Report.” 26 Feb 2008. <http://www.career.cornell.edu/downloads/PostGradSurveys/PreliminaryClassOf2007.pdf>

Humanitas Wines- Drink Charitably. 25 February 2008. <http://www.humanitaswines.com/humanitas/index.jsp>.

"Internet Advertising." 09 Jan 2008. Columbia University. 29 Mar 2008. <http://www.cs.columbia.edu/~hgs/internet/advertising.html>.

MacPherson, Theresa . "The Wine Market Keeps Powering Along." D.A. Davidson and Co. 19 Oct 2007:

24

Rainie, Lee, and Bill Tancer, eds. PEW/ Internet and American Life Project. Apr. 2007. Global Research At Hitwise. 28 Mar. 2008 <http://www.pewinternet.org/pdfs/PIP_Wikipedia07.pdf>.

Ramey, Timothy. "State of the Wine Industry – Super and Ultra-Premium Wines – Let the Good." D.A. Davidson & Co. 09 Apr 2007:

Rampell, Catherine. "Web Retail's Higher-Fliers." Washington Post 28 Oct 2007: F01.

Red Wine. Wine.com. 2008. 21 February 2008.<http://www.wine.com/wineshop/product_list.asp?N=7155+124&Ns=p_Rating|1>.

Watson, Tom. "Consumer Philanthropy: Nonprofits Spend Billions to Reach Consumers." On Philanthropy 13 Dec 2006 18 Feb 2008 <http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=6863>.

Wine. Mintel Group, Feb. 2007. 12 Feb. 2008<http://academic.mintel.com.proxy.library.cornell.edu/sinatra/oxygen_academic/search_results/show&/display/id=226430>.

25

APPENDIXFigure 1: BCG Matrix

Relative Market ShareRelative Market Share

Mar

ket G

row

th R

ate

Mar

ket G

row

th R

ate

High Low

Hig

hL

ow

STARS

CASH COWS

QUESTION MARKS

?Rusty Red

DOGS

26

Figure 2: SWOT Analysis

INTERNAL FACTORSINTERNAL FACTORS STRENGTHSSTRENGTHS WEAKNESSESWEAKNESSESManagement Joe’s dedication to the

company’s successLack of additional management staff

Product mix Unique product—wine with a cause

Only one product line

Marketing Strategy Joe’s extensive social network, which can contribute to a successful marketing strategy

Current lack of a cohesive strategyLack product awareness among target marketLack of pricing strategy

Quality High quality wine Not currently recognized by wine critics

Distribution Joe’s dedication to personally delivering wine to customers

Lack of a means of ordering and delivery and extensive regulations

Facilities A single wine-making facility provides control over the production process

No current selling or warehousing facilities

Location Current Northeastern location convenient for target market

Limited in terms of customer base

EXTERNAL FACTORSEXTERNAL FACTORS OPPORTUNITIESOPPORTUNITIES THREATSTHREATSCurrent Customers Establishing brand loyalty and

generating repeat salesPossibility of losing customers to other wines or other charities

Prospective Customers Wine markets and CRM markets growing steadilyFavorable responses to CRM

Extreme competition from other alcoholic beverage companies and other CRM initiatives

Economic Environment Growth of the market for gourmet winesPopularity of CRM

Significant regulations on sale and distribution of alcohol

27

Figure 3: Product Market Classification

ProductProduct

Mar

ket

Mar

ket

Existing New

Exi

stin

gN

ew

MARKET PENETRATIONGenerate repeat purchases of Rusty Red wine amongst Cornell alumni through intensive follow-up and promotion

MARKET EXPANSIONMarket Rusty Red wine to new customers, including non-Cornell affiliates through word-of-mouth marketing

PRODUCT DEVELOPMENTDevelop new products such as boxed wines or other gourmet products and market them to Cornell alumni

DIVERSIFICATIONDevelop new products such as boxed wines or other gourmet products and market them to new customers, including non-Cornell affiliates

28

Figure 4: Competitors

FACTORFACTOR COMPETITOR 1COMPETITOR 1 (Clarendon Hills) (Clarendon Hills)

COMPETITOR 2 COMPETITOR 2 (Big Tattoo Wines)(Big Tattoo Wines)

COMPETITOR 3COMPETITOR 3(Humanitas Wines)(Humanitas Wines)

Price At par~ $100-$400/ bottle

~$10 per bottle($7- $13/ bottle)

~$15-$25 per bottle

Quality BetterHigh, age of wine; hand picked grapesAdvocated by Robert Parker (wine specialist)

On ParTheir wines have been rated with 96 and 97 points.

WorseHumanitas stresses its main selling point charity which offsets the quality.

Product Line More diverse product line

It’s original line of Big Tattoo Wines has red and white wines and Syrah, and the new line has Cabernet Sauvignon, a Syrah and a Riesling

Red and white wines with a variety of fruity hints of flavor such as raspberry, apple, peach, and pumpkin pie.

Service BetterRusty Red does not have an established distribution system of their wine, even though Clarendon is in Australia.

BetterBig Tattoo Wines has imported wines based off of Billington Wines.

BetterHumanitas offers direct online purchasing of its wines. There are even gift baskets.

Location WorseOnly one location, Australia, potentially less appealing than Italian wine

BetterBillington has wines from many locations: Chile, Argentina, Spain, Germany, and California.

UnsureThe business is very local and only active in some states in the U.S. Although situated in a smaller location, this may mean heavier focus on the local market.

Advertising BetterAdvocates and rating

BetterThrough word of

BetterPeople heard about

29

of the wines make them very popular. Extracted from Clarendon Hills’ homepage, “In August 2003, Robert Parker (Wine Advocate) names Clarendon Hills as one of Australia and the world's greatest wineries.”

mouth from those who support the cause. Big Tattoos have already established firm support from its >$1 Million donation (from $.50 per bottle).

Humanitas Wines from emails that commented on how great it would be to drink wine and be able to help charity at the same time. People began forwarding emails and this long chain of recipients started asking for wine.Also, it has a wine club where customers subscribe and pay a set amount of money, depending on the package, so that wine will be sent four times a year.

Reputation Better Rated by well known wine advocates and experts and received excellent reviews from critics.

BetterMore people know of the wine and the quality and its cause for fighting cancer and helping local charities.

On ParHumanitas wines do not have the reputation for high quality, but the business is recognized for their strong philanthropic efforts.

Business Strategy WorseOn its homepage, Roman Bratasiuk, the owner, was described to have a simple business strategy. “His aim is quite simply to make wines equal to anything in the world.”

On ParDifferent from Rusty Red, Big Tattoo only takes $.50 per bottle it sells for charity. Big Tattoo’s story for the cause is personal and Rusty Red’s story pertains to a larger group of people. They are similar because of their businesses are for good causes.

On ParAccording to the Humanitas webpage, “'Humanitas' is the Latin word for 'philanthropy', 'human nature', and 'character'.” They promote these different points to consumers to join the efforts to fight poverty.

30

Figure 5: RustyRed.com Survey

How did you hear about Rusty Red? (check as many as apply)FriendCornell alumni

Family memberCornell-affiliated event (please describe)Other (please describe)Have you tried Rusty Red wine in the past?Yes (please indicate where)

RestaurantCornell-affiliated eventOther

NoIf you have tried Rusty Red wine, how satisfied are you with its product?1 (very dissatisfied)2345 (very satisfied)

How easy was it for you to navigate through this site?1 (very difficult)2345 (very easy)Do you have any suggestions for improving Rusty Red’s product, website, etc.

31

Figure 6: Perceptual Map

High Quality

Low Quality

High Charitable Efforts

Big Tattoo Wines

Rusty Red

Clarendon Hills Wines

Humanitas Wines

32

High Quality

Low Quality

High Charitable Efforts

Big Tattoo Wines

Rusty Red

Clarendon Hills Wines

Humanitas Wines

Low Charitable Efforts

Figure 7: Comprehensive List of Resources Used

Tactic Resources UsedTactic 1 Evening Alumni Banquet

Supply the banquet with a minimum of 175 bottles of Rusty Red. Give a brief informative speech about the wine, foundation and

how they can help.Alumni Golf Outing

Minimum of 100 Rusty Red bottles to supply for the afternoon.

Use outing to promote the wine by allowing participants to taste the wine.

Tactic 2 LaxPower.com Advertisement Active Marketing Group creates and displays the advertisement

on LaxPower.com that gives viewers a direct link to RustyRed.com.

Advertisement will inform viewers of the opportunity to help future lacrosse players.

Wikipedia Detailed history of the wine and the mission of Rusty Red to give

back to the athletes of the Cornell Community. Link to Rusty Red’s direct website

Village Voice Advertisement 2/3 page in size Runs for 4 consecutive Sundays starting in May Finished Design of the Rusty Red Logo A slogan highlighting rusty reds mission. Link to the direct Website

Press Release Release to a number of NYC and Ithaca newspapers Highlight Rusty Red’s mission and inform about RustyRed.com

33

Figure 8: General Advertisement

34

Figure 9: Press Release

35

Contact: Joe LizzioEmail: joe@rustyred.com

FOR IMMEDIATE RELEASE

As cause-related marketing efforts have grown in recent years, many major companies have begun to link their core business with a charitable cause. In 2008, entrepreneur and former Cornell University lacrosse player Joe Lizzio founded one such company: Rusty Red. Lizzio founded the company this year when he began importing wine made from grapes at his personal vineyard in Predappio, Italy. Because of his passion for lacrosse and his desire to give back to the athletic community, Lizzio founded the Rusty Red Foundation, where the proceeds from the sale of Rusty Red wine are used to fund community athletic projects and scholarships for student athletes. Rusty Red wine, an Italian blend made from Sangiovese grapes, has already made its way into several restaurants in Ithaca, NY and into Wolfgang Puck in New York City.

For more information regarding the Rusty Red Foundation, or any of the information in this article, please visit www.rustyred.com, or email Joe Lizzio at joe@rustyred.com.

Figure 10: Village Voice Budget

Cost Per 1/3 of Page Color # of AdsTotal Cost

(1/3 pg cost + color) x # of Ads

$1,180 +$695 4 $7,500

NOTE: (rate acquired though (212) 475-3300)

Figure 11: Current Distribution System

36

Figure 12: Proposed Distribution System

Wine produced in Italy

Wine shipped to Mr. Lizzio

Wine delivered directly to customers by Mr. Lizzio Wine delivered to restaurants

Wine purchased by customers

Wine produced in Italy

Wine shipped Mr. Lizzio

Orders placed by consumers via rustyred.com

Wine delivered to restaurants

Wine delivered to consumers via third party delivery service

Wine purchased by consumers

37