Sales of wine depends on the culture of the market

Joel Payne is known in the wine industry as a leading expert and critic of the wines of Germany, as well as editor in chief Meininger’s Wine Business International – the only magazine for professionals vinotorgovogo market with global reach.

Eleonora Scholes met with him to discuss the role of supermarkets in sales of wine, their current problems and the latest world trends.

How great is the power of supermarkets in the global sales of wine?


For each of the market share in sales will be different, but today there are very few countries where supermarkets have not had a large share of sales. In Germany, for example, the network sales account for 82-87% by volume. In Britain the figures at approximately the same level, except that slightly lower. However, you must first define the concept of supermarkets, which are classified by size and pricing policies. These include and discounters, which in different markets play different roles. In Germany, their position is very strong: every second bottle of wine sold through a discounter. In the Netherlands the figure is not as high. In Britain, until recently, such a phenomenon did not exist: sales network operators such as Aldi were negligible. This means that the leading supermarkets, particularly Tesco and Marks & Spencer, have the opportunity to include in the range of premium wines. Likewise, in the U.S., where on the shelves of supermarkets, there are even good bottles of Chateau Latour or Romanee-Conti.

It turns out that supermarkets are good not only in order to move large quantities of wine in the low and middle-price categories – they are sold and expensive wine?

Yes, they have a place for expensive wines, but often it depends on the country’s culture. If you look at traditional markets in Europe, people always buy good wine in specialized locations. Now, these shops have less, but there is another trend. Some, like Oddbins in Britain, Nicolas in France and Jacques Weindepot in Germany, grew into a network, repeating the phenomenon, once created supermarkets. If you recall, they started with a successful family store, which then adds a second point, and subsequently evolved into a regional or national network. Now many supermarkets are working on an international scale.

In the culture of the market in large networks can sell premium wines. This applies particularly to the U.S., because people do not have alternatives. They do not go to the butcher for meat or to the bakery for bread, they do not have farmers’ markets on Tuesdays and Saturdays, as in many European cities. If all products are purchased in the supermarket, why not wine? This is a new reality. Earlier in America, people who regularly drank wine, made only a very small part of the total consumer market of drinks. Today the situation has changed, and new buyers of expensive wine, may not have a clue about that before bottles were purchased in a small specialty store. But go to a good U.S. supermarket – there special lighting, and granite floors, and hallways, reproducing the atmosphere of the farm market with the collapse of the grocery and bakery. Supermarkets thus create a special experience for the buyer.

If it is such a powerful sales channel, whether it influenced the structure of modern vinoindustrii?

Certainly. If you link this with the previous question, the reason why some wine shops still have a special value, not only in the fact that there may be to sell high quality brand of wine, and that many of the brands are limited in scope. Look for Burgundy, Piedmont or Rheingau – where producers are not able to produce wine in bulk to “saturate” supermarkets. They need some retail channels.

Now switch to the next level. Due to the increasing power of supermarkets to them are any special brands or existing brand gaining momentum along with the networks. Keep in mind that buyers can purchase and drink only a certain amount of wine. More and more products on the shelves is a major brand, whether it is brand independent producer or the network itself. I think that in the future will increase the influence of companies, producing such brands exclusively. They will control a significant market share. And since the overall quality will be improved further, it can survive outside of this market will vinoproizvoditeli, with emphasis on individuality and quality.

Now we are seeing two trends of market development. If we turn to Piedmont, then, when I wrote my first article on the region 25 years ago, there could come a couple of days, visiting a dozen manufacturers and see all that noteworthy. Now I’m at Piedmont for a week, meeting with 50 producers and I know that there are still 30, which ought to talk to, but not enough time. On the one hand, it’s a great situation, giving you a variety of proposals. On the other – there is no distribution system, which would be able to cover all growers. I think that even the well-known, but small-sized farms will have to increase the volume. Soon we will not see that so far there is to be in the Moselle: reputable manufacturer, owns 3 hectares of vineyard and produces 18 thousand bottles per year. Even Petrus in a good year produces 40-50 thousand bottles. Now for the recognition of the brand must have a certain minimum amount – unfortunately, I can not say which.

Which countries have succeeded in building brands?

If you talk about the creation of new brands, it is customary to assume that successful countries in the New World. In fact there are a number of reasons. This is largely due to the discretion of producers who do not have the narrow regulatory restrictions. They also think in the plane of the brands. And now look at the traditional markets – and France, Italy and Spain. Their products have historically sold by local demand, so few manufacturers approach to doing business globally, although the situation is slowly changing. Even when producers are ready to create a great brand, their work is complicated by the legislation. If we take such a category, vin de pays as in France or indicazione geografica tipica in Italy, the area of production is gradually being consolidated, and we have, in fact, talking about the legal possibility of issuing high-quality wines of France, Italy or Spain, without giving a specific geographical origin. However, even with this possibility remains the problem of fragmentation of vineyards, most of which are small areas of plantings. In these circumstances it is very difficult to achieve production efficiency, as in Argentina or Australia. The situation must change, but this change will be slow and probably painful. The tradition of small-scale viticulture in Italy, France and Spain has a long history. The current generation of winemakers do not always understand what is the work of their fathers, grandfathers and great grandfathers, can no longer make money, but on their side a huge force, especially when they are protesting in the streets. While there is a buffer in the form of European funds, to motivate people to further progress more difficult than in the New World.

Could you list the major trends in supermarket sales of wine, as well as give predictions for the near future?

It is always difficult to discuss trends, but I can think of several obvious. Sales rose wines are growing at unprecedented pace, the truth, starting with a small amount. I think this growth will continue in the near future. Here we talk about everyday wines, where consumers prefer them to be enjoyable and not burdensome. The pink drink more treatment than most red wines – at least for not too knowledgeable people. Previously it was believed that only red wine can be a serious drink, but finally this stereotype is broken.

Also there is a tendency to consume wine with less alcohol and less pronounced colors in barrels aging. While old-style wines continue to receive high marks from critics, but more people – from influential experts to ordinary consumers – are beginning to abandon him.

Also, I think that with the further development of the market will increase the influence of another trend, which is only now gaining momentum. It refers to wines with the best quality / price ratio. Consumers will invest in this concept a different meaning, rather than one that is popular in the UK. There are “value” refers to a bottle for 3.99 pounds or promotions, “Buy one bottle, get second for free. Soon people will increasingly ask: “What wine offers the highest quality for 6.99 pounds?” or “Recommend the best wine that costs less than 10 euros.” Then offer for buyers become more diverse.