By Andrew Catchpole
Published: November 28, 2018
While the 2018 global harvests have rebalanced the global wine supply, the market is evolving to allow greater fluidity of supply, to the benefit of high-end bulk players and smaller volume buyers, with different formats cited as critical to future consumer engagement and sales. .
These are some of the key takeaways from the 10th edition of the World Bulk Wine Show in Amsterdam this week, where bargain pricing was back on the table after 2017’s supply shortages at a trade show which welcomed a record 6,500 visitors and 250 exhibitors.
Speaking at a seminar on different packaging formats, Catherine Mendoza, who oversees the Scandinavian market for broker Ciatti, highlighted the need for a step change in the approach to packaging and delivery wine if the industry is to prosper in the future.
“This exhibition started as a place for large volumes, but now it is not only for large producers and large buyers, but for everyone, whether it is a buyer from a group restaurant or specialty buyer,” Mendoza said, suggesting that the bulk wine market has evolved. to meet niche and premium purchases.
In turn, she added, this now allows for greater flexibility throughout the bulk supply chain, which coupled with the overall improvement in bulk wine quality and ever-increasing focus greater focus on wines of regional origin, plays into the hands of buyers who seek to create original and more niche offerings and formats.
“Different formats are key to increasing engagement, sales and helping to drive mid-market and higher-end sales,” Mendoza said.
She cited younger consumers in both the UK and US seeking more premium wines but in more flexible and smaller formats, as well as the growing trend in China among women to drink a glass of wine a day, for apparent health benefits.
The importance of offering wine in formats that allow it to retain its freshness, youth and vibrant taste for a younger generation seeking freshness and lighter styles, as well as greater acceptance of innovation by the entire wine trade, was also highlighted.
Bag-in-box, Tetra Pak, cans and kegs were also cited as key growth areas in the US market by Cyril Penn, guest speaker and editor of Wine Business, during a seminar on American market trends.
Reminding the audience of suppliers and wholesale buyers that young people “have less money and more debt,” Penn said that as baby boomers “age out” of the market, innovation has become increasingly important in an era where impulse buying reigns.
“Where are the opportunities? Bag-in-box is a huge concept, with everything happening with younger consumers who are looking for convenience and wouldn’t think of a traditional 75cl bottle,” Penn said.
“If I want to enter the US market right now, I would think about Bag-in-box, Tetra, cans – cans are huge, growing 38% last year. There is room for more players, thanks to innovation.
Penn also reported that wine on tap is “taking off quickly,” with double-digit growth, allowing restaurants to put a wide range of finer wines in the glass without the damage associated with opening and storing wine. an expensive bottle.
It is against this backdrop that Constellation is launching a US$30 BIB in the US market, seeking to replicate some of the success Mendoza had described earlier in the Scandinavian monopoly markets.
In this context, government pressure on environmental issues and growing consumer demand for sustainable packaging have allowed bag-in-box to take over half the wine market, including more premium styles. And sustainability will undoubtedly become an increasingly important factor in the future, as consumers and industry look to reduce carbon footprints and waste.
When it comes to new business opportunities for bulk wine and, indeed, global trade as a whole, Jean Luc Faveral, director of research and development at major player Pera-Pellenc, summed it up best. message.
“We must adapt wines to the demands of the consumer of today and tomorrow,” said Faveral, referring both to the liquid contained in the “bottle” and to the shape that the packaging should take.
Anyone who suspects that the bulk wine sector is lagging should think again. As this show demonstrates, this is an increasingly ambitious sector in terms of innovation, superior quality and engaging new consumers.
