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Still, Sparkling and Fortified Wine - UK - October 2014

Published By :

Mintel

Published Date : Nov 2014

Category :

Alcoholic Beverages

No. of Pages : 94 Pages


The scope to increase value sales is limited by the heavy promotional activity that is both accepted and expected by shoppers. Therefore, other avenues such as clearer information about the differences between more and less expensive wines and the opportunity to sample wines before buying may be better placed to help limit the perception of risk and drive uptake.
Table of Content

Introduction
Definition
Excluded
Abbreviations

Executive Summary
The market
Figure 1: Forecast of UK value retail sales of wines, 2009-19
Figure 2: Forecast of UK volume retail sales of wines, 2009-19
Market factors
Inflation keeps wine prices high even as tax escalator is scrapped
Demographic changes present challenges and opportunities
Consumer confidence is starting to recover
Companies, brands and innovation
Figure 3: Value sales of top-selling still wine brands in the off-trade, 2013/14*
Wine packaging continues to evolve
Adspend declines, as big four grocers and leading brands reduce spend
The consumer
Fewer adults are buying wine than in 2013
Sparkling wine continues to appeal in a post-recessionary landscape
Figure 4: Attitudes towards Champagne and sparkling wine, July 2014
Less than a third find wine easy to choose
Figure 5: Perception of own-brand and branded still wines, July 2014
Interest in smaller servings, product sampling and fruit-infused wine
Alcohol content limits intake but interest in low-alcohol wines is low
Figure 6: Further attitudes towards still wine, July 2014
What we think

Issues in the Market
Brands and retailers need to give people the confidence to trade up
The facts
The implications
Engaging consumers who are conscious about alcohol content
The facts
The implications
How can operators help consumers navigate the wine aisle?
The facts
The implications

Trend Application
Extend my Brand
Guiding Choice
Mintel Futures: Brand Intervention

Market Drivers
Key points
Inflation keeps wine prices high even as tax escalator is scrapped
Figure 7: UK excise duty rates for wines, 2004-14
Figure 8: HM Treasury estimated changes in volume consumption of alcohol over 2014-19 following changes to alcohol duty in Budget 2014, April 2014
Wine prices are growing more quickly than the price of beer
Figure 9: Annual price index (RPI) of beer and wines and spirits, in the on-trade and off-trade, 2009-13
Figure 10: Taxation on 75cl bottle of table wine from retail outlet, 2003-12
Ban on below-cost selling replaces minimum pricing plans
The Portman Group Code of Practice on Alcohol Sponsorship
Influence of exchange rates
Figure 11: Annual average exchange rates for Sterling, 2008-14
Consumer confidence is rising
Figure 12: Consumers’ financial health index, January 2009-July 2014
Number of 18-24s set to fall
Figure 13: Trends in the age structure of the UK population, 2009-14 and 2014-19
Accelerating growth predicted for over-55s
Slower growth on the cards for 25-34s

Strengths and Weaknesses
Strengths
Weaknesses

Who’s Innovating?
Key points
Packaging revamps and special editions boost fortified wine’s share of launches
Figure 14: New product launches within the UK still/sparkling/fortified wine market, by category, 2009-14
Branded NPD continues to lead the UK wine market, in line with the dominance of brands in sales
Figure 15: Share of branded and own-label new product launches within the UK still/sparkling/fortified wine market, 2009-14
Wine packaging continues to evolve
More operators launch smaller-format wines
Eco-friendly packaging continues to attract attention
Low-calorie wines remain niche
Appealing to younger wine drinkers – Fruit-flavoured wines
Tesco goes premium with bag-in-box wine
Wine producers get creative with helping consumers navigate the wine aisle
Social commerce for the empowered customer
Refillable wine

Market Size and Segment Performance
Key points
Wine’s value growth masks a decline in volumes
Figure 16: UK value and volume sales of wines, at current and constant prices, 2009-19
Figure 17: Forecast of UK value sales of wines, 2009-19
Figure 18: Forecast of UK volume sales of wines, 2009-19
Segment performance: Still wine
Figure 19: UK value and volume sales of still wines, at current and constant prices, 2009-19
Figure 20: Forecast of UK value sales of still wines, 2009-19
Segment performance: Champagne and sparkling wine
Figure 21: UK value and volume sales of Champagne, at current and constant prices, 2009-19
Figure 22: Forecast of UK value sales of Champagne, 2009-19
Sparkling wine remains popular in a post-recessionary landscape
Figure 23: UK value and volume sales of sparkling wines, at current and constant prices, 2009-19
Figure 24: Forecast of UK value sales of sparkling wines, 2009-19
Segment performance: Fortified wine
Figure 25: UK value and volume sales of fortified wines, at current and constant prices, 2009-19
Figure 26: Forecast of UK value sales of fortified wines, 2009-19
The on-trade again outperforms the off-trade
Figure 27: UK value sales of wines in the on- and off-trade, 2012-2014
Sparkling wine sales increase by a fifth in just two years
Forecast methodology

Market Share
Key points
Hardys revamp helps it to retain top spot
Figure 28: Value and volume sales of top-selling still wine brands in the off-trade, 2012/13 and 2013/14
Mixed performances for other leading brands
Own-label drives the bulk of the growth in sparkling
Figure 29: Value and volume sales of top-selling sparkling wine/Champagne brands in the off-trade, 2012/13 and 2013/14
Figure 30: Value and volume sales of top-selling fortified wine brands in the off-trade, 2012/13 and 2013/14

Companies and Products
Accolade Wines
Overview
Product range
Recent activity
Product innovation
Brand communication and promotion
E&J Gallo
Overview
Product range
Recent activity and product innovation
Brand communication and promotion
Freixenet
Overview
Product range
Recent activity and innovation
Brand communication and promotion
Moët Hennessy (Moët Hennessy Diageo)
Overview
Product range
Recent activity and innovation
Brand communication and promotion
Percy Fox (Diageo)
Overview
Product range
Product innovation
Brand communication and promotion
Pernod Ricard
Overview
Product range
Recent activity and innovation
Brand communication and promotion
Symington Family Estates
Overview
Product range
Recent activity and innovation
Treasury Wine Estates (TWE)
Overview
Product range
Recent activity
Product innovation
Brand communication and promotion

Brand Communication and Promotion
Key points
Adspend declines, as big four grocers and leading brands reduce spend
Figure 31: Topline advertising spend in the still, sparkling and fortified wines market, 2010-14
Adspend for sparkling wine/Champagne grows in 2013
Figure 32: Adspend for still, sparkling and fortified wines, by product category, 2010-14
Red wine adspend matches previously leading white in 2013
Figure 33: Adspend for still, sparkling and fortified wines, by product category, by individual and multi-product still wines, 2010-13
Direct Wines is still the biggest advertiser of still wines
Figure 34: Leading advertisers in the still wines market, 2010-14
Previously flat Champagne/sparkling wine advertising gets a boost
Figure 35: Leading advertisers in the Champagne and sparkling wine market, 2010-14

The Consumer – Usage of Wine, Sparkling Wine and Fortified Wine
Key points
Fewer adults are buying wine than in 2013
Figure 36: Purchase of still wines in the last six months, July 2014
White and red wine are bought by more than two in five
Figure 37: Purchase of red, white and rosé wine, by gender and age, July 2014
Boxed wine purchases remain low but the segment has growth potential
Prosecco takes top spot in sparkling at cava’s expense
Figure 38: Purchase of sparkling wines in the last six months, July 2014
Purchases of fortified and low-alcohol wines remain niche
Figure 39: Purchase of fortified and lower-alcohol wines, July 2014
Purchases of lower-alcohol wines fall
Purchase of branded and retailer-exclusive wines
Figure 40: Purchase of wines for in-home drinking, by brand type, July 2014
One in five have bought retailer-exclusive wines
Figure 41: Purchases of retailer-exclusive wines, July 2014

The Consumer – Attitudes towards Champagne, Sparkling Wine and Fortified Wine
Key points
Sweet flavour and lack of sophistication hold back fortified wines
Figure 42: Attitudes towards fortified wines, July 2014
Smaller formats can combat boredom
Fortified wines lag behind dark spirits on perceived sophistication…
and are seen as “old-fashioned” by one in four
Sparkling wine enjoys a strong image as savvy choice
Figure 43: Attitudes towards Champagne and sparkling wine, July 2014
Sparkling wine isn’t just for recessions
Champagne has more of a draw among younger people

The Consumer – Perceptions of Branded and Own-brand Wines
Key points
Branded wine enjoys a strong image for consistent quality and gifting
Figure 44: Perceptions of own-brand and branded still wines, July 2014
Consistent quality is a key benefit in a sometimes confusing category
54% think standard own-labels offer value for money
Less than a third find wine easy to choose

The Consumer – Attitudes towards Still Wine
Key points
Familiar brands have scope to appeal in bag in box
Figure 45: Attitudes towards still wine, July 2014
Familiar brands can combat doubts over quality of bag in box
Smaller boxed formats should appeal to variety seekers
Price-marked packs spark limited interest – or disinterest
More scope to explore smaller formats

The Consumer – Further Attitudes towards Still Wine
Key points
Keen interest in product trial
Figure 46: Further attitudes towards still wine, July 2014
Alcohol content limits intake but interest in low-alcohol wines is low
More scope to explore fruit-infused wines

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