“Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or a different service.”
According to the Power 100 Report, [yellow tail] has emerged to be ranked as the most powerful Australian wine brand in the world and it also fetched the 37th position on the chart of top 100 wine and spirit brands globally (Yellowtailwine, 2011).
But this tremendous success for [yellow tail] did not come easily. The company adopted some innovative business ideas and strategies to compete and enter into a bloody red-ocean American wine industry comprising 1600 wineries characterizing intense competition, increasing bargaining power on the part of the retail and distribution channels, flat demand and mounting pressure (ChicagoTribune, 2010).
[Yellow tail], a fun and nontraditional wine, is a dramatic example of a Blue Ocean Strategy. Its success can be attributed to the Four Actions Frame work and differentiation not based on traditional factors of low cost or offering premium quality and strategic logic benchmarking. It assessed the alternatives to bring easy to drink a fun and non-traditional wine in the U.S wine market (TheAustralian, 2011).
Casella Wines with the help of this Framework created a new and different Value Curve which was entirely in contrast with the strategic profiles of both budget and premium wines in the U.S market. This new Value Curve enabled Casella Wines to create a winning strategy for a brighter future and success of [yellow tail] brand (Kim & Muabogne, 2005, p.29).
Here are the key success factors of [yellow tail]:
One of the success factors for [yellow tail] was the elimination of the industry factors that have long been followed by the wine industry players to compete against each other. For instance, it eliminated the three factors that were above the line marketing, aging & tannin qualities and enological terminology and distinctions. Casella Wines assessed that these two factors of aging quality and enological terminology intimidated customers. Thus it decided to choose different factors to compete (BlueOceanDiscovery, 2011)
Casella Wines reduced the factors that were well below the industry standards such as wine complexity, its wider range and vineyard prestige. It offered [yellow tail] in two variants; white wine and red wine in order to avoid customer confusion and at the same time mistake of over to win the competitive battle in wine industry of the U.S (ChicagoTribune, 2010).
Casella Wines raised the factors that were above the industry’s standards such as price vs budget wines and retail store involvement by giving retail employees Australian outback clothing. This strategy enabled the company to create loyal customer for [yellow tail] who don’t make compromises (TheAustralian, 2011).
Casella Wines created some new sources of values for its brand [yellow tail] such as easy drinking, ease of selection and sense of fun & adventure, which the industry has never ever offered. This created new customer experiences for wine drinking and led to the success and acceptance of [yellow tail] in American wine industry (Kim & Muabogne, 2005, p.29).
The following lessons can be applied to ventures and opportunities to make them successful in the long run:
Go untapped markets and applying unconventional approach:
Entrepreneurs can learn from Casella Wines how it realized that yellow tail would not be sold in Australia and totally targeted an unsatisfied segment of the US market with unconventional and new blend, lighter on expensive oak and aging time. Thus they should see the untapped markets that are still uncultured by big industry players (Kimbrell, 2009)
When entrepreneur are going to launch new products or services, they must keep in mind that, these must hold a distinctive position in the minds of consumers. As [yellow tail] clearly adopted a focused positioning that is clearly differentiated from the competitors such as the distinctive name and label, the accessible wine, affordable price point etc. to beat the competition and create a new place for its growth (ChicagoTribune, 2010).
Applying Four Action Strategy :
Casella Wines with the help of the Four Actions Framework created a new, uncontested, highly-successful Blue Ocean amid the highly competitive bloody Red Ocean Industry. The opportunities in the competition can also be grabbed with a different strategic framework that is matchless with any competitor in the industry (Kim & Muabogne, 2005, p.31).
Never Compromise on Quality:
Entrepreneurs can tap the potential opportunities by staying true to their core principles as [yellow tail] did it by never compromising on quality since its launch and never selling a bottle of wine that they are not proud of (TheAustralian, 2011).
Going for Alternatives:
The entrepreneurs can learn from the success story of [yellow tail] the lessons for adopting non-traditional ways and alternatives rather than becoming part of traditional factors. Thus the company redrew the Strategy Canvas of the U.S wine industry after thoroughly assessing the alternatives of beer and ready-to-drink cocktails in terms of non-customers (Kimbrell, 2009).
Innovation does not mean inventing, it could be a new way of doing traditional business as Casella Wines adopted Blue Ocean Strategy-Four Actions road map to build a durable brand of [yellow tail] and beat the intense competition in the U.S wine industry. And the company is quite optimist to keep delivering the same brand promise in the years ahead without drifting and compromising on its key success factors.
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Kim, W.C & Muabogne, R, 2005, Blue Ocean Strategy: How to Create Uncontested Market Space and make the competition irrelevant, Harvard Business Publishing: Boston.
Kimbrell W, 2009, “Creating value on the vine: a [yellow tail] case study”, ProcessExcellencNetwork, Viewed 16 October, 2011
BlueOceanDiscovery, 2011, “ The Yellow Tail Wine Story”, BlueOceanDiscovery, Viewed 17 October, 2011,
Yellowtailwine, 2011, “Media Reports”, Yellowtailwine, viewed 16 October, 2011,
ChicagoTribune, 2010, “The Tale of Yellow Tail Brand”, Chicagotribune, viewed 16 October, 2011,
TheAustralian, 2011, “ Casella’s Yellow tail wags the wine corporation” The Australian, viewed 18 October, 2011,