Hampshire-based wine producers Hattingley Valley has just secured a deal with the multiple grocery retailer Wholefoods, making it the first English sparkling wine to be available nationwide in the US, as one of only nine wines selected to be part of its Holiday Wine Programme. Helen Arnold caught up with commercial director, Gareth Maxwell, to talk about his plans for building up the Hattingley brand at a time when its production has almost tripled in only 12 months, from 180,000 bottles in 2017 to 500,000 this year.
English sparkling wine producers Hattingley Valley in Hampshire has just harvested its best ever vintage and is well on track to achieving its target of producing one million bottles a year within five years.
Is this your first collaboration with Wholefoods?
Yes, this is the first time that we are working with them in the US, we used to work with them here, but that changed when we changed distributor. While we were already shipping to the States, we were only in about 20 states, and the Wholefooods deal means we will be in closer to 40.
What are you hoping to get out of the partnership?
It’s a big step for Hattingley and for English wine in general. We hope that it will raise the profile and create much more awareness about the category and us. There should be a large amount of consumer press coverage stateside which will filter into people’s homes and make them aware that the UK is a place for premium fizz. I’d guess that only a few percent of people in the US know that we make wine and this partnership should raise that number by a significant amount. We’re very proud that we have been so well received in the US market, especially with the country now accounting for 13% of our overall sales. The team has worked hard to raise brand awareness and fly the flag for the English wine category in the States and we see this new relationship with Whole Foods Market as a milestone achievement.
How did you start exporting to the US? What volumes do you ship?
By exhibiting at Prowein, when we met our importer, Valkyrie Selections and that began our conversation. Then we had stock on the water six months later. We have done pretty well since the stock landed in January 2017 and have shipped a few containers’ worth since then.
What are the particular challenges of shipping to the US?
It can be a tricky market to get started in with FDA registration, COLA approvals etc, it’s not that straightforward. This is something that we are working on at the WineGB Export Committee and will have a step-by-step guide to help new producers ship to America. Further to that, we still seem to struggle with shippers exporting out of the UK to the US, there always seems to be delays and a general lack of knowledge – even from the logistics providers.
What about pricing – how much does your wine sell for in the US market?
We start at around $45 and go up from there, we have been aggressive in our pricing for the Classic as the under $50 is a key price point – if our wine started at $60 then I don’t think we’d be having this conversation, we stick to sensible pricing and don’t buy into the game of insisting that our wines are expensive, we want people to drink them, not for them to sit on a shelf with an expensive price tag doing nothing.
Where else do you ship to? What percentage of your production is for export?
Around 35% of our production is shipped overseas, with the US being our biggest marketing, accounting for around 15% of total exports. Scandinavia is probably our second biggest market, and we are also focusing on Australia where we are now listed nationwide in Vintage Cellars. At first I had to badger the Aussies for over a year, and their initial reaction was: ‘do the actually English make wine?’ but now they are doing really well. We are also shipping to Germany, where we are listed in 100 Jacques Wine Stores as part of its rarities tastings until he end of the year. Japan, Germany Sri Lanka and even Kazakhstan are other markets we are selling into. Exports are increasing, but really being driven by the US at present though other markets are creeping up too.
Is China a market you are considering breaking into?
I don’t think China is going to be significant for us – I mean, we could sell there because of the sheer volume of people there, and we have the advantage of being regarded as a very premium, prestigious country, but the Chinese palate is not attuned to cold and sparkling drinks – the market there is heavily skewed in favour of red wine.
What is the size of the 2018 vintage, and how does this compare to 2017?
It was our biggest and best harvest yet, we processed around 670 tonnes this year compared with 200 tonnes last year! What about quality this year? Exceptional.
What do you think is the widely held perception of English wine overseas?
It is still a tiny part of the wine world, but our reputation is growing steadily in the wine trade and it will take some time for it to trickle down to consumers. However, we have done well at pitching ourselves at the premium end of the market and most people see us in that light. Also, very few people overseas talk about English wine, they talk about British wine but that’s probably a discussion for another day. The perception is very positive, certainly in the US where I’ve been about seven times in the last two years and the response has been fantastic. They are clearly fans of Britain and see us as slightly quirky and eccentric, but also very much in a premium light so it’s great that we have a premium product to match.
Why has Hattingley put so much effort in building its exports when the domestic market is still relatively untapped?
It was always part of Simon’s [proprietor] strategy from the beginning to grow the company into an international brand. And with a lot of wine coming on stream, having a number of different markets is a way of spreading the risk.
What about the UK domestic market – how much potential is there for increased sales?
It’s huge, there’s so many places that don’t yet list English sparkling and so many consumers are yet to experience the wines. I think the market will continue to grow and grow for years to come, probably at the expense of Champagne as I think overall consumption of wine will remain flat or fall over the years. In any other wine producing country in the world, it would be very unusual for the domestic market not to swallow up most of the production, but that’s currently the case in the UK. In the UK we’re listed in Waitrose and Majestic in Hampshire, as well as Ocado nationwide, with our distributor Enotria.
How are you going to drive sales in the UK
It’s all about changing perceptions, with older customers who have been drinking their favourite Champagne for 40 years and are very reluctant to change. But when you get them to taste English sparkling they are pleasantly surprised. Younger consumers, however, are more provenance driven, it’s all about the story for them, and about being tangible – they love the novelty of being able to physically visit a vineyard in England, and they like seeking out different and unusual wines.
Who do you regard as your main competitors?
Some producers seem to tire when we talk about Champagne but they really are the competition, I see no escaping it for another decade or so. We never focus on trying to oust another English sparkling wine in the on-trade, our focus is to bring more of the trade into English sparkling to widen the market for domestic producers.
What do you think the future for English wine holds?
It’s a seriously bright future; climatically we are in a very strong position with room for sales growth both domestically and overseas. We have already seen an uplift of international visitors which I think will continue to grow as well. And for Hattingley in particular from the very beginning we focused on making the best wines that we could, we then focused on setting up a distribution network which we now have in most key markets but now we have to create some pull. Therefore, we have just started with some marketing campaigns showing our true character, which I think, will resonate here and abroad. These will show our Britishness a lot more coupled with our sense of humour, we are talking about wine after all, not world peace.
What are your plans for the future at Hattingley?
Our focus is now on strengthening Hattingley’s brand and creating more market awareness and to drive our visitor numbers too. I envisage that in five years we will be producing up to a million bottles a year.