Wine makes up just over one-third of all off-premise (aka off-trade) alcohol sales in the U.K., contributing more value than any other alcohol category. With over 500 brands dominating aisles across stores, we know the wine category is fragmented and can sometimes be daunting to shop.
Over the last few years, Malbec and Sauvignon Blanc have been growing in popularity and remain the two fastest-growing varietals (+£86.9 million and +£71.6 million, respectively), driving volume growth in an otherwise declining category.
With Malbec and Sauvignon Blanc firmly established, let’s take a look to the next generation of varietals that are set for growth. The Provence varietal sits further down the rankings, but sales have nearly doubled over the last three years (+£22 million from two years ago), and the varietal now generates £49 million in sales. It’s also posting year-over-year volume growth, which signals organic growth. Provence is drawing new wine shoppers into the category while encouraging existing rosé drinkers to expand their repertoire to include Provence, driving increased frequency of purchase, all of which is driving growth.
The Provence varietal engages with the more affluent, more mature households, and these households account for just over 80% of all wine spend in the off-trade market. These households are also increasing their overall household spend, and this varietal will work well to capitalise on this trend in the next few years.
As one would imagine, summer is a key time for this rose varietal; however, Christmas is also a popular time for Provence purchasing. This varietal is showing signs as an all year round product for retail shelves, especially as it is attracts a different type of rosé shopper.
The Cabernet Sauvignon/Merlot blend is growing not far behind Provence. Although it’s not a single varietal, it is the fifth-fastest growing varietal (+£17.8 million), and is now accounts for £50 million in sales. In terms of volume growth, it comes in third, behind Malbec and Sauvignon Blanc. The numbers for the blend do not deny that this is helping to keep the wine category afloat.
Similar to Provence, the Cabernet Sauvignon/Merlot blend is attracting a different type of shopper; Cabernet Sauvignon/Merlot is hugely popular among consumers who are 65 and older. It also appeals to working class households, which is different from a Cabernet Sauvignon household. the Cabernet Sauvignon/Merlot blend is less expensive than the single varietal Cabernet Sauvignon (around 70p cheaper), which could be driving the attraction.
There is still a place on the shelf for both the Cabernet Sauvignon and Cabernet Sauvignon/Merlot varietals, but education is key for shoppers. So, stores that stock this new varietal need to ensure that there is sufficient support and information on shelf to help shoppers make informed decisions.
Stores should still feature Malbec, Sauvignon Blanc and the core varietals, but as we look for ways to drive organic growth in the wine category, Provence and Cabernet Sauvignon/Merlot should be featured as well, as they’re posting promising growth for the wine category in the off trade sector.
This article was originally published in Drinks Retailing News.