There has certainly been a lot of talk around town about how Champagne has been performing globally, with its success in the USA and Japan compensating for the losses experienced in traditional markets such as France and Germany.
Australia has also contributed to this success. In the June 2018 Shanken’s Impact Newsletter, Australia was reported as the sixth largest market by volume for Champagne imports in 2017, up 15.5 per cent on the previous year. But what has led to Champagne’s success in these markets and in Australia?
It is quite evident that Champagne marketers have not rested on their laurels over the years and it appears that this has paid off, particularly in more non-traditional markets.
Changing format for different audiences
While Champagne houses continue to expand at the premium luxury end, new formats have been introduced to entice new consumers – especially the millennial demographic. These range from a single-serve bottle, Champagnes made specifically to be drunk with ice or in a cocktail, vending machines at high-profile events like the Golden Globes or educating consumers to consider drinking Champagne in different situations. One such example is from the LVMH group, who launched Clos19, an online retail lifestyle brand that sells its Champagne, wine and spirits along with a range of exclusively curated experiences.
These innovations and recommendations are part of a separate shift towards celebrating every moment, anywhere. ‘Now the trend is to celebrate each moment, to celebrate when you get together with family and friends’. Maria Valez, a senior product manager with The Beverage Information Group. (Chicago Tribune, 3 April 2018).
In Australia, we certainly have a lot to celebrate. According to the OECD Better Life Index, Australia performs very well in many measures of well-being relative to most other countries. So much so that Wine Intelligence, in its Sparkling wine in the Australian market 2017 report, noted that more Australians are drinking sparkling wine at least once per month, with up to 5.7 million people drinking it at least once per week. More Australian consumers are drinking Champagne once a month or more, up from 13 per cent in August 2013 to 28 per cent in July 2017. But while Australians have been consuming more Champagne, they are also consuming more Australian sparkling wines, with frequency increasing from 43 per cent in August 2013 to 56 per cent in July 2017.
Figure 1: Frequency of sparkling wine consumption: Champagne and Australian sparkling wine
Source: Wine Intelligence, percentage of drinkers of sparkling wine in Australia
The impact of perception
When it comes to describing how sparkling wine drinkers feel about Champagne compared with Australian sparkling wine, respondents tended to feel that Champagne was high quality, traditionally made, fashionable and sophisticated. Australian sparkling wine however indexed higher as being a good drink for celebrations, good value for money, great taste, great for informal social occasions, refreshing and popular with friends. These statements reflect the already existing positioning of Australian sparkling wine as the drink for celebrating every moment.
Figure 2: Percentage of those who used the following imagery statements to describe Champagne and Australian sparkling wine.
Source: Wine Intelligence, percentage of drinkers of sparkling wine in Australia
But over the past five years, the number of drinkers of imported sparkling wine – including Champagne – has grown significantly according to Wine Intelligence, up from 71 per cent of respondents who are drinkers of sparkling wine in Australia during 2013 to 80 per cent in 2017.
Table 1: Sparkling wine types consumption reach
Source: Wine Intelligence, percentage of drinkers of sparkling wine in Australia
Presence across the price spectrum
The most common price range for Champagne sold off-premise according to IRI Market Edge MAT 27 May 18 was in the $50–99.99 segment (representing 76 per cent). Over the past twelve months there was growth in this price segment of 5 per cent in volume and 7 per cent in value. There was also considerable growth recorded from the $10–14.99 and $20–29.99 segments, but these were off much lower bases.
For Australian sparkling wine, recent growth has come from the $15–19.99, $20–29.99 and $30–49.99 bands in both volume and value and continue to provide opportunity price points for Australia.
What is the future for Australian sparkling wine?
Tyson Stelzer mentions in his Australian Sparkling Report 2018 that 2017 marked a turning point for Australian sparkling at a global stage when an Australian sparkling brand was announced as the Best Australian Producer at the International Wine and Spirit Competition. So, while Champagne is striving to attract new markets, Australian sparkling wine is starting to come of age and is building its reputation in international circles.