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Still, Sparkling and Fortified Wine - UK - October 2018

OVERVIEW
What you need to know
Products covered in this report
Still wines
Sparkling wines
Fortified wines
Excluded from the Report
EXECUTIVE SUMMARY
The market
Strong year for wine sales in 2017
Slowdown in growth in 2018
Figure 1: Forecast of total UK value sales of wine, 2013-23
Off-trade continues to outperform on-trade
Better harvests expected in 2018 after weather-hit 2017
Companies and brands
Most top brands in still wine see sales growth
Figure 2: UK retail value sales of the top 10 still wine brands, 2017/18*
Freixenet benefits from move into prosecco
Buckfast drives growth in fortified wines
More formats targeting out-of-home occasions
Smaller bottles target mid-week drinking
New lighter, drier rosé and fruit-flavoured wines added
The consumer
Two thirds of adults buy wine
Figure 3: Purchase of wines by type, August 2018
In-store purchases dwarf on-trade wine buying
Grape type biggest factor influencing choice
Figure 4: Most important factors influencing choice of still wine, August 2018
Special offers/promotions have a big influence
Room to encourage more experimentation
Figure 5: Behaviours related to buying wine, August 2018
A third of wine buyers interested in ‘natural’ wines
Interest in more fruit-infused and sparkling wines
Figure 6: Interest in buying different wine products, August 2018
On balance more people are drinking less wine than more
Figure 7: Attitudes towards wine, August 2018
What we think
ISSUES AND INSIGHTS
Room for samplings and suggestions to encourage more wine buying
The facts
The implications
Packaging development can help add value to wine market
The facts
The implications
Alcohol moderation offers opportunity for wines with less alcohol
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Strong year for wine sales in 2017
Slowdown in growth in 2018
Still wine sales grow strongly
Slowdown in growth of sparkling wines
Buckfast boosts fortified wines
Off-trade continues to outperform on-trade
Freeze on wine duty in November 2017 Budget
Weakening of Pound ups wine prices
Better harvests expected in 2018 after weather-hit 2017
MARKET SIZE AND FORECAST
Strong year for wine in 2017
Higher prices boost value sales
Still wine a big driver of growth
Slowdown in growth in 2018
Prices still increasing
Brexit uncertainty continues
Figure 8: Total value and volume sales of wine, at current and constant prices, 2013-23
Figure 9: Forecast of total UK value sales of wine, 2013-23
Figure 10: Forecast of total UK volume sales of wine, 2013-23
Forecast methodology
MARKET SEGMENTATION
Strong growth seen in still wine sales
Figure 11: Total value and volume sales of still wines, at current and constant prices, 2013-23
Figure 12: Forecast of UK value sales of still wines, 2013-23
Slowdown in growth of sparkling wines
Figure 13: Total value and volume sales of sparkling wines (including Champagne), at current and constant prices, 2013-23
Figure 14: Forecast of UK value sales of sparkling wine (including Champagne), 2012-23
Buckfast reverses decline in fortified wines
Figure 15: Total value and volume sales of fortified wines, at current and constant prices, 2013-23
Figure 16: Forecast of UK value sales of fortified wines, 2012-23
CHANNELS TO MARKET
Off-trade continues to outperform on-trade
Rising costs push up on-trade wine prices
Figure 17: UK value and volume sales of wine in the on- and off-trade, by type, 2016-18
MARKET DRIVERS
Freeze on wine duty in November 2017 Budget
Figure 18: UK excise duty rates for wines, 2008-17
Weakening of Pound against leading currencies ups wine prices
Figure 19: Average Annual exchange rates for Sterling, 2013-18
Weather impacts on wine harvests in Europe in 2017
Moderation in alcohol puts pressure also on wine
Cost and health are key reasons for drinking less wine
Rising costs in the on-trade
Population growth will help wine sales
Figure 20: Trends in the age structure of the UK population, 2013-23
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Most top brands in still wine see sales growth
Freixenet benefits from move into prosecco
Buckfast drives growth in fortified wines
More formats targeting out-of-home occasions
Smaller bottles target mid-week drinking
Lighter and premium variants look to boost rosé wines
Low- and no-alcohol offerings tap interest in alcohol moderation
Fruit-flavoured wines tap interest in different flavours
Wine brands looking to stand-out packaging
Retailers dominate wine advertising
MARKET SHARE
Most top brands in still wine see sales growth
Mid-market brands lose out to premium rivals
TWE taps into demand for quality branded offerings
Figure 21: UK retail value and volume sales of the leading still wine brands, 2016/17-2017/18
Freixenet benefits from move into prosecco
Figure 22: UK retail value and volume sales of the leading sparkling wine brands, 2016/17-2017/18
Own-label makes gains in Champagne
Figure 23: UK retail value and volume sales of the leading Champagne brands, 2016/17-2017/18
Buckfast drives growth in fortified wines
Figure 24: UK retail value and volume sales of the leading fortified wine brands, 2016/17-2017/18
LAUNCH ACTIVITY AND INNOVATION
More formats targeting out-of-home occasions
New pouches and bag-in-box wines
More single-serve cans launched
Figure 25: Example of Most Wanted wine in cans, 2018
Smaller bottles target midweek drinking
Grocers explore smaller bottles
Accolade and Concha y Toro launch 50cl bottles
Lighter and premium variants look to boost rosé wines
Figure 26: Examples of pale rosé wine, 2018
More celebrity wines launched
Figure 27: Examples of celebrity wine ranges, 2018
Low- and no-alcohol offerings tap interest in alcohol moderation
Black Tower and McGuigan go as low as 0.5% ABV
Aldi launches ZeroPointZero wine alternatives
Low-calorie variants remain a rarity in wine market
Fruit-flavoured wines tap interest in different flavours
Kingsland Drinks pitches fruit fusion sparkling as a premium drink
Château Jacked goes for a younger crowd with ginger and lychee
More spritz activity from leading brands
Wine brands look to stand-out packaging
19 Crimes uses AR to bring labels to life
New colour-changing label for Harveys Bristol Cream
Pernod Ricard links with the artist community
Figure 28: Examples of wines with standout packaging, 2018
Organic wines growing from low base
More vegan wines being launched
ADVERTISING AND MARKETING ACTIVITY
Increase in 2017 wine advertising
Figure 29: Total above-the line, online display and direct mail advertising expenditure on wine, 2014-18
Retailers dominate wine advertising
Lidl looks to prove the quality of its wine
Most retailers push wine price promotions
Fragmented spend by brands
Figure 30: Total above-the line, online display and direct mail advertising expenditure on wine, by advertiser, 2014-18
Yellow Tail puts the focus on taste
Kumala wine looks to ‘Keep it Kolourful’
Echo Falls official wine of Love Island
Casillero del Diablo renews Sky TV sponsorship 
TV adverts for Blossom Hill and Wolf Blass
Hardys renew partnership with England Cricket
I Heart Wines launches digital and poster campaign
Eisberg and Campo Viejo focus on experience
JP Chenet campaign for single serve bottles
Nielsen Ad Intel coverage
THE CONSUMER – WHAT YOU NEED TO KNOW
Two thirds of adults buy wine
Still white and red remain most popular types
In-store purchases dwarf on-trade wine buying
Grape type biggest factor influencing choice
Alcohol content is a bigger factor for younger consumers
Special offers/promotions have a big influence
Room to encourage more experimentation
A third of wine buyers interested in ‘natural’ wines
Interest in more fruit-infused and new sparkling wines
On balance more people are drinking less wine
PURCHASE OF WINES
Two thirds of adults buy wine
Wine buying falls among over-65s and rises with income
Sparkling wine sees a younger skew
Figure 31: Profile of still and sparkling wine buyers, by age, August 2018
Still white and red remain most popular types
Figure 32: Purchase of wines by type, August 2018
Prosecco cements third place
Champagne shows a stronger young bias
Still rosé and fruit-flavoured wines are more popular with women and younger drinkers
LOCATIONS FOR BUYING WINE
In-store purchases dwarf on-trade wine buying
Figure 33: Channels used for buying wines, August 2018
Big supermarkets used by eight in ten buyers of wine
Aldi and Lidl over-trade in wine
Figure 34: Where wine has been bought in the last 6 months, August 2018
Specialist wine stores draw in more shoppers online than off
C-stores appeal most to under-45s
Three in ten wine buyers buy from pubs/bars
FACTORS INFLUENCING CHOICE OF STILL WINE
Grape type biggest factor influencing choice
Grape type has most sway among over-55s
Retailers can focus on grape over country
Figure 35: Most important factors influencing choice of still wine, August 2018
Country of production lags some way behind grape type in wine choice
Focus on country of production need not be about familiar origin
Alcohol content is a bigger factor for younger consumers
Brand name and look of bottle can help increase appeal
BEHAVIOURS RELATED TO BUYING WINE
Special offers/promotions have a big influence
Savvy shopping is part of wine buying for most
Wine events offer some scope to boost volume sales
Most buyers report trading up in wine
Figure 36: Behaviours related to buying wine, August 2018
Room to encourage more experimentation in wine buying
Sampling offers a way to expand wine repertoires
Wine buyers are open to more suggestions
Supermarkets should benefit from making wine choice easier
Half of buyers will ask staff to help with wine choice
INTEREST IN BUYING PRODUCTS
A third of wine buyers interested in ‘natural’ wines
All-natural claims are rare in wine
Promoting natural credentials should appeal
Figure 37: Interest in buying different wine products, August 2018
Emphasising ‘craft’ credentials can also win favour
Spotlighting small volume should benefit retailers/on-trade venues
Interest in more fruit-infused wines
New types of sparkling wines appeal widely
Interest in more choice in different packaging formats
Single serve wines interest 35-44s and c-store shoppers the most
Gift packs appeal to a fifth of buyers
WINE DRINKING BEHAVIOUR
On balance more people are drinking less wine
Figure 38: Change in amount of wine drunk compared to a year ago, August 2018
Saving money and health are main reasons for drinking less wine
Risk of squeezed buyers taking wine off the shopping list
Figure 39: Reasons for drinking less wine compared with a year ago, August 2018
Low-calorie wines can steal a march with those moderating wine to manage weight
ATTITUDES TOWARDS WINE
Taste is key for increasing the appeal of low-alcohol wine
Strong interest in below 10% ABV wines
Lower-alcohol wines chime in particular with Millennials
Figure 40: Attitudes towards wine, August 2018
Wine spritzers also seen as good for alcohol moderation
Women and youngsters are most positive about spritzers
Interest in low-calorie wines overlaps with positivity about spritzers
Smaller bottles can help encourage more wine drinking
Smaller sized bottles have most sway among 18-34s
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology
APPENDIX – MARKET SEGMENTATION
Figure 41: Best- and worst-case forecast of total UK retail value sales of wine, 2018-23
Figure 42: Best- and worst-case forecast of total UK retail volume sales of wine, 2018-23
Figure 43: Forecast of UK volume sales of still wines, 2013-23
Figure 44: Best- and worst-case forecast of UK retail value sales of still wine, 2018-23
Figure 45: Best- and worst-case forecast of UK retail volume sales of still wine, 2018-23
Figure 46: Forecast of UK volume sales of sparkling wines (including Champagne), 2013-23
Figure 47: Best- and worst-case forecast of  UK retail value sales of sparkling wine (including Champagne), 2018-23
Figure 48: Best- and worst-case forecast of UK retail volume sales of sparkling wine (including Champagne), 2018-23
Figure 49: Forecast of UK volume sales of fortified wine, 2013-23
Figure 50: Best- and worst-case forecast of  UK retail value sales of fortified wine, 2018-23
Figure 51: Best- and worst-case forecast of UK retail volume sales of fortified wine, 2018-23
Figure 52: Total value and volume sales of fortified wines through the off-trade, by type, at current prices, 2016-18
Figure 53: Total value and volume sales of still wine through the off-trade, by types, at current prices, 2016-18
Figure 54: Total value and volume sales of sparkling wine (excluding Champagne) through the off-trade, by types, at current prices, 2016-18
APPENDIX – MARKET SHARE
Figure 55: UK retail value and volume sales of the leading still wine manufacturers, 2016/17-2017/18
Figure 56: UK retail value and volume sales of the leading sparkling wine manufacturers, 2016/17-2017/18
Figure 57: UK retail value and volume sales of the leading Champagne manufacturers, 2016/17-2017/18
Figure 58: UK retail value and volume sales of the leading fortified wine manufacturers, 2016/17-2017/18
APPENDIX – LAUNCH ACTIVITY AND INNOVATION
Figure 59: New product launches in the UK wine market*, by claim (sorted by 2017), 2014-18

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