I was recently invited to write a feature article for National Liquor News. An incredibly exciting opportunity because the topic was on my absolute favourite pastime - Champagne and sparkling wine! During my interviews with major brands, the key theme that stood out was that Champagne and sparkling wine were fizzy flutes of indulgence and enjoyment for Australian consumers, even in a year plagued with pandemic-induced challenges and economic uncertainty.

EXTRAORDINARY SALES GROWTH FOR SPARKLING WINE IN AUSTRALIA

The pandemic may have put a pin in the fun and festivities of Australian consumers over the past year, but it certainly hasn’t flattened their love of fizz. The sparkling wine category including Champagne has posted extraordinary sales growth over the past year.

Total sparkling wine generated an additional $160 million in sales (+16.9%) for the 12 months ending August 2021 and now represents almost 60% of total wine growth in Australia according to IRI figures.

Emma Baldwin, Head of Wine Delivery for Pernod Ricard Winemakers, said: “Gone are the days when sparkling used to be confined to a celebratory moment. Australians love sparkling wine, no matter what the occasion. The large selection of sparkling available in Australia - Champagne, sparkling wine, organic, lower alcohol, and lower sugar wine, mean there is something to pop no matter what the budget or event.”

“During the lockdown and restrictions, consumers opted for sparkling as a self-reward or ‘treat yourself’ moment with sparkling wines across all price points performing well. Prosecco has been, and still is, a growing category, as is sparkling rosé.”

AUSTRALIA DEFIES GLOBAL CHAMPAGNE TRENDS

Champagne, however, has been the standout performer this year. IRI data revealed that Champagne was the biggest contributor to total wine growth with sales up 30.6% versus a year ago; with strong gains for bottles priced over $50 highlighting consumers’ willingness to spend on Champagne despite yo-yo lockdowns.

Australians’ obsession with French fizz has defied global trends. The Comité Champagne, the trade association which represents the houses and grape growers of Champagne, referred to Australia as a ‘regional pocket of resistance’, being the only country in the top ten export markets to record growth in 2020 (+11.2%), compared to the double-digit declines experienced by leading export markets (U.S., U.K., Japan, Germany and Italy) which were all severely impacted by bar and restaurant closures.

Australia Laurent Valy, Brand Development Manager - Oceania, Maisons de Champagne Lanson, said: “The demand for quality Champagne is high here when you consider consumption per capita. To put this into perspective, China, with a population of 1.4 billion people, represents a market of just 3 million bottles of Champagne, while Australia imported more than 8 million bottles in the last year.”

This year’s Champagne harvest kicked off in September, but severe weather conditions including frost, mildew and hail are expected to slash the yield by up to 60%, stirring speculation that exports to Australia could be challenged due to low supply.

The Comité Champagne, however, has counteracted these suggestions saying that despite the low harvest, the quality of the 2021 vintage remains high and there are still large amounts of wine in stock to offset any supply issues.

*Winemaking facilities at Maison de Champagne Lanson; Source: lanson.com*

LOVING LOCAL

The escalating appeal of Champagne in Australia indicates a strong premium market and an opportunity for Australians to embrace local sparkling options, Natalie Burch, General Manager and Marketing Director for Western Australian winery, Burch Family Wines, explains.

“Support local. And we don’t just mean the local wine region. Support Australian sparkling as a whole. Our Methode Traditionelle sparklings are award-winning, as are many other well-known houses. Stocks dwindling due to the global export market could lead to an encouraging trend in Australian sparkling,” she said.

Johnathon Watson, National Sales Manager for Ferngrove Wines - another Western Australian winery, said: “The ‘support local movement’ is now part of the consumer psyche, people want to support local business, support their local community and home state. Consumers are keenly supporting their local wine producers and are increasingly impressed by home-grown sparkling wines. The quality and value that local sparkling wines offer are definitely being engaged and appreciated.”

Jen Doyle, winemaker at Jansz Tasmania, says there is also growing energy and enthusiasm for the quality of the sparkling wine coming out of Tasmania.

“Our consumers are clearly discerning and are recognising the significance of this special little part of the world. The interest isn’t only coming from the Australian domestic market. In the last 18 months, I have facilitated a steady stream of Zoom tastings for trade and consumers, particularly in the U.S. – they love our sparkling Rosés,” she said.

This growing consumer interest in exploring local premium options has resulted in 82% of sparkling wine growth coming from bottles priced over $20, according to data provided by Pernod Ricard.

“Sparkling wine shoppers don’t mind paying more for quality or something different and there is an opportunity to drive a premium trade up here. They’re also quite willing to spend more on new and different; so investing in inspiration, new ideas and NPD are likely to be well-received,” said Ming Lianto, Senior Insights Manager from Shopper Intelligence.

*Jansz Tasmania single vineyard Chardonnay 2014; Source: Jansz Tasmania*

BOOZE-FREE BUBBLES EXPLODE

The last year has also expedited the ‘conscious consumption’ movement which has spawned a new wave of low or zero alcohol wines, spirits and beer to appeal to the rapidly growing number of sober-curious consumers.

Data provided by Pernod Ricard revealed that the ‘no and low alcohol’ wine segment has accelerated over the last three years with sales up +46% in the past 12 months. The segment has doubled in the last year alone with more than 30 new products hitting the shelves in both liquor stores and grocery outlets.

The rise in popularity of no-and-low alcohol alternatives is particularly popular among younger consumers as they look for a healthier lifestyle and ways to help moderate, explains Ben Turner, Global Marketing Director for Australian Vintage Limited (AVL) Wines.

“AVL Wines is an industry leader in the no and low alcohol space. McGuigan Zero is the number one zero-alcohol brand in the UK and Australia. Sparkling with 0.0% alcohol provides an alternative for those with health concerns or those who are simply wanting the wine moments without the alcohol.”

Guillaume Bladocha, Asia Pacific Export Director for French winemaker and distributor, Barton & Guestier, said: “During the last few years we have seen new product developments in the sparkling category focusing on eco-friendly (organic, sustainable agriculture) or zero per cent alcohol options.”

“At the beginning of 2020, we released Barton & Guestier 0% sparkling wine which is performing very well in the market. We have actually never seen such strong growth for any item in the range in such a short period of time.”

Ben Culligan, Category and Marketing Director for Treasury Premium Brands, Asia Pacific, said: “There is so much potential for non-alcoholic wines as they fulfill needs across several life stages and can help facilitate social participation, give consumers additional non-alcoholic options and allow them to be more inclusive hosts,” he said.

Lianto stressed that healthy choices are very important to sparkling wine and Champagne shoppers.

“Although the industry has delivered better on this compared to last year, there is still an opportunity gap in delivering better and more low sugar, low carb and low cal options,” she said.

French winemaker, Barton & Guestier, has its 0% sparkling wine at the centre of its range; Source: barton-guestier.com — French winemaker, Barton & Guestier, has its 0% sparkling wine at the centre of its range;
Source: barton-guestier.com

SIPPING ON SINGLES

The rising trend in moderating alcohol consumption has been complemented by the expanding range of small format options within sparkling wine.

Watson explained that innovation in the small format and rosé styles has played a key role in charming consumers into the sparkling wine category.

“Our small format grants both wishes: enjoying a local glass of bubbles while ticking the health and wellbeing box. Moderation is key. Consumers want to enjoy a glass or two of their favourite sparkling without overindulging,” he said.

Baldwin said that smaller format spritz wines are perfect for the summer months ahead, particularly as outdoor dining and picnics will become commonplace as restrictions start to ease in NSW and VIC.

*Western Australia winery, Ferngrove, has recently launched its Petite Sparkling Rosé; Source: Ferngrove*

FANCY UP YOUR FIZZ DISPLAYS

With vaccination rates soaring across the country, the idea of a ‘normal’ summer and silly season is within arms reach. And what better way to celebrate than with a festive flute of fizz?

When preparing for the biggest time of year, John O’Loughlin, Head of Client Development for newly launched transactional data and consumer research firm, Fonto, said it’s important to note that sparkling wine shoppers are more likely to shop around to find what they are looking for.

“Sparkling buyers purchased from an average of three different brand stores in the last month, compared to the overall alcohol average of 2.1 stores,” he said.

Lianto added that brands and retailers should keep in mind that one-in-three sparkling and Champagne shoppers are ‘expandable’ i.e. they will consume more than they buy, and they are quite open to trading up in volume if they are tempted with multibuys and case specials. These shoppers are also not too price aware - they are more focused on value for money than price.

“Use information to highlight value for money and help them navigate the shelf; direct them to higher-margin products, or premium brands, as they’re not too brand loyal. Displays on the floor near the main shelf are a high trigger to purchase. A display of promoted items near the entrance and gondola ends are also likely to drive new penetration into the category,” Lianto added.

Burch said: “Get creative. Make the display look beautiful - give the customers a reason to go back to retailers by injecting some joy into the shop space. And stock up. With an increase in sales across the board, our sparkling wines will sell through.”

Bladocha added: “Gift boxes are always welcome during the festive season. Window displays as well as gondola end displays are the best way to showcase key items and drive volumes during this crucial period of sales for your business.”

While unique bottle designs and compelling gifting options play a key role in this category and drive point of purchase, Culligan said it’s critical that stock is also available online during this key selling period.

“Online sales continue to rise with shoppers shifting to this space for convenience, so it’s important to ensure an online sparkling and champagne presence to capture this audience,” said Culligan.

Baldwin said: “With more outdoor gatherings rather than at home, having a refreshing sparkling drink that people can pick up on their way to a picnic in the park will see great opportunities for retailers. In terms of placement, being in the fridge is a priority for peak season traction. And not forgetting gifting – sparkling is a perfect gift for anyone.”

A BUBBLY GOOD TIME: AUSSIES TURN TO SPARKLING WINE IN THE PANDEMIC