News Analysis: Wine's Glass Half-Full

Marketing, September 1, 2005 | Go to article overview

News Analysis: Wine's Glass Half-Full


Wine producers have every reason to be optimistic following a sharp rise in consumption. Samuel Solley reports.

Wine is now more popular than beer. A decade ago, such a statement might have seemed ludicrous for a nation known for its capacity to knock back pints, but times are changing.

Last week, Marketing's Biggest Brands survey reported a dramatic shift in at-home alcohol consumption. Wine is now a bigger brand category than beer, and is second only to soft drinks in terms of grocery sales.

Indeed, supermarket sales of wine rose 14.6% in the year to 19 June 2005, while those for beer fell nearly 1%, according to TNS Superpanel.

There are several caveats behind the statistics: one-off events that capture the national interest can drive beer sales, and 2005 lacked a World Cup or Olympics. But ultimately, a steady increasing interest in wine has been seeping into the British psyche.

British wine drinkers increased their consumption by 5% between 1999 and 2004, breaking the 8bn litre barrier, according to Mintel. This is in marked contrast to both France and Germany, where consumption fell by 6% and 8% respectively.

Marketing undoubtedly contributed to the UK shift. The first to adopt it with enthusiasm were the New World manufacturers, which currently rule the top 10 wine list. Blossom Hill, Jacob's Creek and Kumala have all secured places with their promotional efforts.

But the move away from beer did not happen overnight. In some cases, the brewers, a number of which once controlled wine sales, have no one to blame but themselves for the lost opportunity.

Naive thinking

Pete Brown, author of Man walks into a pub: a sociable history of beer drinking, and founder of drinks marketing consultancy Storm Lantern, traces the roots of the shift back decades. 'The brewers underestimated the wine industry 20 years ago,' he says. 'Companies such as Whitbread and Wolverhampton & Dudley used to own wine businesses, but they divested them, believing that it would never be a direct competitor to beer in the future. They were not big brands, but brewers were naive in thinking there was no future for them.'

It took some Australian and US wine companies to spot a potential opening in the UK. They have been taking a more brand-led approach to marketing, distribution and catering to consumers' differing tastes than Old World wines.

While French manufacturers cling longingly to their country's appellation d'origine controlee system, which classifies wine according to the location of their vineyard and does not allow the blending of grape varieties or vintage, the New World producers concentrate on taste above all - something consumers can relate to. …

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