That is the opening line of the Executive Summary of Accolade Wines Wine Nation for 2017. This exclusive project charts the drinking habits of the UK’s regular wine drinkers – that is those that drink wine at least twice a month. The project has been running since 2006.
The in-depth report follows a survey of 8,000 regular wine drinkers in the UK and the results are good news for New Zealand wine.
“French wine continued to dominate on-trade values but the origin on the rise was New Zealand which gained 13.3 percent, while France fell by 4 percent,” the report states. And it was not only in the on-trade that New Zealand shone. In the off-trade, “again New Zealand was the star performer increasing value by 12.2 percent.”
In terms of styles of wine being drunk in the on-trade, it is still wine that leads the way, with 87.4 percent of all those surveyed saying they drank still wine, although that is down by 7.1 percent compared with 2016. Breaking that down further, 53.3 percent of all still wine sold in the on-trade was white, 37.5 was red and 9.2 was Rosé.
Sparkling wine (namely Prosecco) makes up 9.5 percent of the on-trade share, up 23.3 percent and Champagne makes up just 2.4 percent, down 11.7.
In terms of the off-trade, the figures from 2017 show that the volume of wine sales has fallen (with the exception of Prosecco which is still undergoing massive popularity), but the value is up. The report states; “as consumers drink less frequently, they are nevertheless spending more, choosing brands of known quality.”
It is interesting to note that New Zealand led the way in terms of value increases – up 13.3 percent.
The next closest was Argentina which saw values rise by 6 percent, while Italy’s value rose by 0.2 percent.
As mentioned earlier some of the rise in value has to do with taxes; but Wine Nation’s summary on the UK Drinks Landscape is worthy reading.
2017 began with the average price of a 750ml bottle of wine rising above the £5.50 mark for the first time in UK history.
The effect of Brexit – pushing down the value of the pound and driving up the cost of imports – was to send wine prices up by 3 percent in the 12 weeks to the end of 2016, compared to 1 percent over the previous two years. Then in March the Chancellor added another 8p in duty with the biggest tax increase since 2013.
Duty on wine has risen by 50 percent in the last 10 years from £1.46 on a 750ml bottle in 2008 to £2.16 in 2017. While the wine industry has tried to absorb the rising costs as much as possible in its pricing, the effect is inevitably being seen in the shops, bars and restaurants.
The rising prices have hit sales volumes but values have held, and indeed risen in the off-trade.
This is to be expected as prices inflate but there is evidence that wine drinkers are looking upmarket in their choice.
By looking at value share per price brand we can see that value has actually fallen in the bottom three price brands, including the most popular £4 - £4.99 and £5 - £5.99 bands, but risen in the next three bands, with a 23.7 percent value increase in the £7 - £9.99 band.
This trend is echoed somewhat in the on-trade performance of New Zealand wines.
In 2017, New Zealand overtook Spain as the highest priced origin in the on-trade, at an average £4.90 for a 175ml glass, yet sold 6.7 percent more volume while also achieving the best gain of 13.3 percent. Evidently price is not dissuading customers from buying quality when the product is right.
Alongside the 8,000 regular wine drinkers whose survey results have been collated, Wine Nation also drew on other research that logged information from a more general sample of adults, including non-wine drinkers, to gain a better understanding of potential markets.
The report breaks UK drinkers down into eight separate groups; Newbies, Strong Prospects, Occasionals, Economisers, Confident Enthusiasts, Routiners, Engaged Explorers and Experts.
Newbies are described as just beginning to take an interest in wine. Strong prospects are still relatively new but have developed a strong interest.
Occasionals are infrequent drinkers saving their wine for special occasions. Economisers base their choice mainly on price, past experience and recommendation. Confident enthusiasts – interest and knowledge is high and growing.
Routiners – wine is a staple, though they don’t regard it with any great reverence. Engaged explorers – regular wine drinkers with an interest in expanding their knowledge. And Experts are those that are very knowledgeable about wine.
The largest of these groups is the Newbies – which make up 24 percent of the regular wine drinkers. Second is Strong Prospects with 18 percent, with Experts coming in at 8th with just 4 percent.
But that graph is turned on its head when it comes to off-trade value, with the Experts making up 23 percent of purchases and the Newbies just 5 percent.
Again things are different when it comes to the on-trade.T
