Pernod Ricard UK announces initiative to drive premium wine sales

Pernod Ricard UK has unveiled an initiative titled ‘Building Premium Wine Brands’, to bring growth back to the UK light wine sector.

PRUK, which claims to be the UK’s leading premium wine brand company, says it has researched 2,500 shoppers and wine consumers in the off trade sector and discovered that 58% of those polled said that they would be prepared to pay more for wine but only 11% actually did.

Lee James, PRUK channel director for wine, said PRUK is looking for “bespoke solutions with its retail partners” including cross merchandising with supermarket delicatessen/fresh food counters, interactive shelf barkers and linking wine with occasions such as Christmas, Valentine's Day and Mother's Day.

The background to this is that after years of growth, the light wine category in the UK is down 2.3% by volume and 2.1% by household penetration, according to Nielsen.

Having segmented wine into: budget (<£4), lower mass market (£4-£5), upper mass (£5-£6.50), premium (£6.50-£8.50) and fine wine (£8.50+), Chris Shead, category development controller, found that the difference between upper mass and premium was, on average, only £2.74

With brands such as New Zealand’s Brancott Estate, Spain’s Campo Viejo and Australia’s Jacob’s Creek, PRUK has committed to try to move wine consumers up to paying more for better quality wines.

PRUK deputy managing director, Simon Thomas, said: “Light wine is in marginal decline – a new and accessible source of value sales growth is required. One of the strongest opportunities lies in accelerating the existing trends of premium wine – we know that consumers are ready and willing to trade up and so tapping into this opportunity is key.”

He said premium spirits represent 25% of the spirits category and premium beer 25% of beer. If they could match that in wine, £87 million could be added to the value of the wine category.

The four levers have been identified as:

-        Make it available;

-        Make it easy to find;

-        Make it compelling

-        And make it an occasion

Shead defined premium wines as having a sense of place – being made somewhere by someone; looking artisan and being hand crafted rather than manufactured; an established brand and price – premium wines cost more. He said wine consumers split 50:50 between aspirers, explorers and connoisseurs who would buy premium wines and families, retirees, practicals and young socialisers who are less likely to trade up.

James said the key drivers they would be looking to with their brands were the wine’s provenance, grape variety, its story/the winemaker and any awards it may have won. The cross merchandising and establishing associations with occasions such as Christmas were ways to encourage consumers in-store to trade up.