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Wednesday 1 July 2015

UK consumers trading up on Chilean wine

16th September, 2013 by Lucy Shaw

Having placed their trust in the wines at entry level, UK consumers are now trading up on Chilean wine, according to the latest figures from market analysts Nielsen.

Sara Matthews Photography, Brooklyn New York, USA, www.saramatthews.com

Nielsen puts off-trade sales of Chilean wine over £10 in the UK up 38.8% on last year, while sales of Chilean wine in the £3-£4 bracket are down 40.8% on 2012.

The £7-£8 bracket has grown by 27.6%, proving that UK consumers now have the confidence to invest a little more in wines from Chile.

Toby Morrhall, Chilean buyer for The Wine Society, believes £7-£12 is the “sweet spot” in the market that Chilean producers should be seeking to corner in the UK.

“This is where the Chileans excel in producing wines with real personality and expression that tease, excite and leave you yearning for another glass,” he told db.

Concha y Toro is targeting China with its Three Decades of Don Melchor gift case

While volume sales of Chilean wine have dipped slightly in the UK on-trade – down 5.9% on a year ago – the country has outperformed in value, boasting the second-highest increase in bottle price of the UK’s top 10 imported nations.

Proof of how Chile is edging up the quality ladder is Concha y Toro’s successful price increase of its flagship Casillero del Diablo brand in the UK from £4.99 less than five years ago, to the average price of £7.99 that it holds today.

The gradual price increase over the past few years hasn’t deterred consumers from buying it – one million cases of Casillero were sold in Britain last year.

“We were over-delivering at the £4.99 price point, so £7.99 is more in line with where it should be, as the quality of the wine is increasing every year,” Concha y Toro’s marketing director, Isabel Guilisasti, told db.

Casillero del Diablo has successfully increased from £4.99 to £7.99 in the UK

Casillero del Diablo has successfully increased from £4.99 to £7.99 in the UK

“Luckily for us, our consumers have become fans and are willing to pay a little extra for a brand they trust,” she added.

Couple the encouraging trend of higher bottle prices in the UK with the weakening of the peso against the dollar, the softening of grape prices and a superlative-inducing 2013 vintage, and Chile’s outlook appears to be sunny.

César Morales, viticulturist at Emiliana, says he has “never seen” a year like 2013 in Chile before.

“This year has been a lot cooler than previous years, meaning that we picked our Sauvignon Blanc three weeks later than usual. We also picked our reds 10 days late, so the wines will have lower alcohol levels, higher acidity, softer tannins and good phenolic ripeness and that means we should be in for a treat,” he told db.

Outside the UK, Brazil and China are proving to be an El Dorado for Chile’s pricey “icon” wines.

“The beauty of Brazil is that its people view Chile as a fine wine-producing country; there are no cheap and cheerful preconceptions to shake off,” Alvaro Arriagada, Europe area manager for Wines of Chile, told the drinks business.

Concha y Toro is taking advantage of the thirst for fine wine in China, allocating 20 of its 50 Three Decades signed wooden gift cases, which house six vintages of its icon wine Don Melchor spanning from 1988 to 2007, to the Asian market for sale in 2014.

An in-depth analysis of Chilean wine in the UK market appears in the September issue of The Drinks Business.

One Response to “UK consumers trading up on Chilean wine”

  1. Brian Bonomi says:

    I like Chilean wine!!!

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