The latest CGA on-trade report, published in association with The Buyer, goes to parts of the world wine industry that individual businesses cannot reach. For as well as you might be looking at your own sales data, and that of your customers, it only tells you your side of the story. CGA’s new ‘Global Origins and Price Polarisation’ report is a deep dive into which countries are the most popular – with the Old World still coming out top over the New World – and the fact consumers are now growing in confidence enough to spend more on wines they know are going to be of better quality.
New CGA report highlights the dominance of France and Italy and a host of important shifts in consumer taste preferences and spending patterns.
Keeping on top of what are the best selling wine producing countries and grape varieties in the UK on-trade is like mapping the movers and shakers, climbers and losers in the good old music charts. Who and what was in the Top 10 last week, last month and last year is constantly changing.
OK the wine market is slightly more predictable with the powerhouses of the Old World, France, Italy and Spain, battling it out with the New World stalwarts of California, Australia, New Zealand, Argentina, Chile and South Africa.
It’s what regions and what grape varieties within those countries that are selling the most that are of most interest to UK wine buyers. Whether you are looking to source wines to then distribute and push out to your restaurant, pub and bar customers, or you are a restaurant group, or sommelier, looking to buy direct.
This it was the latest CGA Wine Insight Report is all about. The chance to take a deep dive into exactly what is selling and moving off wine lists and back bars across the country.
The ‘Global Origins’ Wine Insight’ report reveals that Old World countries continue to dominate the UK’s wine market, but consumers are increasingly open to new sources and varietals, and if they like the wines they taste then they are also willing to spend more for higher quality. Based on recent CGA on-trade data the value of GB total wine and Champagne sales remains in decline, down2.4% year-on-year, but it over indexes significantly against volume, which is down 7.4% year-on-year, which suggests spend is greater in relation to consumption.
The report, which is the latest in a four part series being produced in association with The Buyer, shows how traditional the wine market still is. Wines from Old World countries account for nearly two thirds (63.4%) of volume sales in the last year, with France and Italy the two most popular countries.
The report reveals important nuances in the market—including an increase in New World countries’ share of still wine sales in the last year, with New Zealand and Australia the most preferred countries of origin. It shows growth in sales of wines from countries including England, Hungary and Romania, and increasing interest in more premium, niche European varietals including Cortese and Albarino.
Pay for quality
When it comes to price and impact the cost of a particular bottle of a wine is having on what countries and regions are most in demand, then the overall trend continues to be very encouraging. For whilst overall volume sales of wine might be in slight decline, what operators can charge for them is going up. Particularly for wines by the glass and more unusual, off-beat varieties.
Yes, the consumer as a whole is looking to cut back on their drinking and how much they are spending, but when they go out they are still looking to treat themselves, and trade up. This report sifts through the numbers to pick out what the key price trends are and where it is worth freeing up more space on your lists.
CGA’s data indicates that in the managed sector sales of still wines priced at £35 a bottle and above have significantly increased their market share in the last few years—and more than half (52%) of wine consumers say they are willing to upgrade their choices when drinking out of home.
This report goes to parts of the world wine industry that individual businesses cannot reach. For as well as you might be looking at your own sales data, and that of your customers, it only tells you your side of the story. This report can help you see what the on-trade sector is doing as a whole.
It also identifies the main reasons that are now dictating what wines consumers are choosing to buy and why it is important for operators at all levels of the on-trade to look not just at country of origin as your main buying priority. For that is not what your customers are doing.
Growing in confidence
The report is also a boost for the wine industry as a whole as it clearly demonstrates a growing confidence amongst consumers about the style and type of wine they like. Grape variety has long been the major driving force behind how the major supermarkets now sell their wine, particularly with their private label ranges. This, in turn, has helped consumers understand the styles of wine they like which is now very much dictating the wines they want to buy when eating and drinking out in the on-trade.
Mark Newton, senior wine category development manager at CGA, said: “For the majority of wine drinkers, the Old World still very much rules the New, and the continued popularity of Prosecco makes Italy the global leader in overall sales terms. But that dominance may not last, and all operators and suppliers should be aware of the subtle shifts in the market lately. Understanding changing preferences and drinking occasions is going to be crucial to success in a very competitive market.”
He added: “The value end of the wine market is still hugely important, with one in four drinkers typically opting for the cheapest or second cheapest option on the list. But as consumers extend their knowledge of wine we see that more and more of them are willing to pay extra for it—so long as the quality is right. Educating drinkers about countries of origin and the differences between Old and New World could help to unlock extra spending.”
The new report, Global Origins and Price Polarisation, is the latest in the exclusive subscriber-only Wine Insight series, and is based on CGA’s BrandTrack survey and On Premise Measurement service. It contains many more insights into consumers’ wine preferences and spending behaviour, and helps operators and suppliers to identify areas of focus and opportunities for growth.
Richard Siddle, editor in chief of The Buyer, said: “This new series of category reports from CGA is a great way to understand the key questions and changes currently facing the wine industry in the UK on-trade. Through a combination of industry leading data and expert insight they will help you to recognise opportunity, unlock potential and increase sales.”
The other reports in the series are:
Casual Dining – Changes in the High Street. Available now.
The headline figures from this report make both encouraging and startling reading. For on the one hand the value of wine sales in casual dining restaurants has jumped by close to 7% in the last year, with nearly half of guests choosing to drink wine when dining out, but only a quarter of those guests actually rate the win choice as very good.
Data from this report highlights just how big this sector has become for wine. The 46% of consumers who regularly choose to drink wine in casual dining outlets is not only up on 2017, but is significantly higher than all other drinks categories, including lager (31%) and cocktails (21%). The report also looks at which type of casual dining restaurant is most tuned into wine, and picks out the Italian-focused brands such as Carluccio’s, Prezzo, Jamie’s Italian, Zizzi, Bella Italia and PizzaExpress as leading the way.
Wine Threats: Competitive Categories. To be published later in the year
CGA and The Buyer will look at what are the key challenges facing wine and hospitality in the ‘Wine Threats: Competitive Categories’ report. This will examine just how much competition wine is now facing from all other drinks categories and what it is about them that is making them such attractive and dangerous competitors. With a particular focus on trends in premium spirits, cocktails, craft beer and fruit cider. It will also look to see where have got with Brexit by then.
The Future of Wine. To be published later in the year.
The final report in the series will look at ‘The Future for Wine’ and assess how the wine category will change over the next decade, be it through natural forces, changes in production, wine innovation, packaging, dispensing technology, product diversification and education.
The reports are both individually priced, but offer a £900 saving when bought as a subscription package of four.
Individual report: £850 all excluding VAT
Two reports: £1,550
Three reports: £2,250
Four reports: £2,500
Reports are delivered in both PDF and Powerpoint formats.
- You can subscribe to the full Wine Insight report series or buy individual reports. For more information, please contact Mark Newton at firstname.lastname@example.org.
- About CGA: CGA is a data and research consultancy covering the out-of-home food and drinks market, specialising in market measurement, consumer research and location planning. It is focused on analysing three key types of data – supply, demand and consumer – and then triangulates this data to provide an accurate picture of the overall out-of-home sector. Find out more at: www.cga.co.uk.