In the early part of this decade, the USA overtook Germany, Italy and France to become the world’s largest consumers of wine[1]. As the market continues to grow and evolve, Wine Australia has invested in research to understand how Australian wine can grow its share of the market.
The overarching aim of Wine Australia’s marketing strategy in the USA is to create positive sentiment around premium Australian wine to drive demand. To inform this strategy, several pieces of research have been conducted, including a five-year research project with Wine Opinions. This program was developed specifically to identify the opportunities for further market share expansion of Australia’s regional and premium price segment wines in the USA market. Findings have helped inform the activities funded by the $50 million Export and Regional Wine Package, such as Aussie Wine Month in September 2019.
Through analysis of trade and consumer surveys and online sales results, the first three years of the program identified the pre-existing bias and low awareness of Australian wine. It also highlighted opportunities for certain varieties and blends, like Grenache Shiraz Mourvedre (GSM) blends, Riesling and red blends, and at certain price points, at $15 and above per bottle for Australian wine. The key findings were reported in Market Bulletin Issue 85 in November 2017.
The goal of the fourth year of research is to validate the approaches adopted in Wine Australia’s marketing strategy and to test a series of potential marketing and promotional scenarios designed to ‘unlock’ opportunities for Australian wine.
Through online discussion groups and face-to-face interviews with retailers, distributors and other trade, specific promotional concepts and programs were assessed. These included the Costco promotional program, mock ups of four different advertisements and Wine Australia’s promotional plan to promote specific wine/region pairs in the over $15 per bottle price category. The specific pairings were:
- Shiraz – Barossa and McLaren Vale
- Cabernet Sauvignon – Margaret River and Coonawarra
- Chardonnay – Margaret River, Yarra Valley and Adelaide Hills
- Pinot Noir – Yarra Valley and Adelaide Hills
- Sparkling – Tasmania and Adelaide Hills, and
- Red blends – focus on blends, rather than regions: Shiraz Cabernet, Cabernet Shiraz, GSM, Cabernet Merlot, Shiraz Viognier, and Cabernet Malbec.
Costco promotional image tested
Year 4 Qualitative Trade Report
‘If you are going to put the time and energy into revitalizing the Australian wine industry in the United States…you want a campaign that will make the category a “classic” instead of a trend. The promotion needs to be authentic and real, focusing on real people and wines that speak of where they are grown. The flash in the pan “Critter Wines” were never destined to be a classic. They were certainly a huge and monumental trend, but that trend is gone. Now you need to focus on becoming a classic for every occasion and every meal.’
– TX grocery
Key findings
|
Lead with wine type/region |
Respondents were enthusiastic about the idea of leading with wine type/regional promotions as it was felt that this would dispel the image of Australia as a single region and convince gatekeepers to think about Australia in a similar way to European countries where individual regions are at the forefront of trade (and often consumer) thinking. |
|
Certain pairings present most potential |
Pairings considered to have the most potential (or the least controversy or competition) are Chardonnay from Margaret River, Adelaide Hills and Yarra Valley, and Cabernet Sauvignon from Margaret River and Coonawarra. |
|
Including maps and food suggestions worked well in the Costco promotion |
Showing where each region is located using a map icon and including food suggestions were identified as important aspects of the Costco campaign, and respondents were split on which was more important. |
|
Trade trips are effective |
Trade trips are the best way to make an impact among the trade, followed by master class-type seminars. It should be noted that the New York trade is overwhelmed with tastings. |
|
Availability limited for higher quality and higher prices wines |
Participants who would like to expand their Australian portfolio are frustrated by the lack of availability of some of the higher quality, higher priced Australian wines in the market. |
|
Better quality at a lower price |
A key opportunity for Australian wine is providing better quality than its competitors at a lower price. |
|
Challenges still need to be addressed |
Among the challenges for Wine Australia are availability, dispelling negative bias against Australian wine, and engaging younger wine drinkers who are less interested in Australian wine than older wine drinkers. |
|
Winemaker interactions are key when approaching the trade |
Having a winemaker at an event, or another person behind the bottle determines attendance. Makes for a personal touch and allows trade to ask questions. |
About the study
Wine Opinions conducted two online discussion groups, one among New York retailers and distributors, and a second among retailers and distributors in key markets. In addition, six one-on-one interviews were conducted among members of the USA wine trade who had participated in the Australia Decanted event in 2018.
The full suite of reports produced by Wine Opinions (WOP 1401) as part of this five-year research program are available in the Research section of the Wine Australia website. Other research conducted on the USA market for Wine Australia are Barriers in United States trade for developing premium Australian wine sales, and Advance Australia Fair? Determining the country of origin associations for Australian wine in emerging and established markets – USA summary.
Next steps
We are now preparing for the last year of the research program with Wine Opinions. This final study allows for both consumer and trade research to be conducted to not only track progress made since the first surveys were undertaken, but to also test certain findings. In particular, the intent is for price/choice models including selected regional/variety pairs of Australian wines to be tested on consumers to yield further insights on the prospects of success in the market for the newly adopted Wine Australia strategy.
[1] International Wine and Spirit Record (IWSR)