New Zealand wine ‘at top of on-trade ladder’

After a brief blip last decade created by a glut of cheap, poor quality Kiwi Sauvignon Blanc flooding the UK market, New Zealand wine appears to have firmly reclaimed its place at the top of the on-trade wine ladder from the prospective of premium price positioning, writes Mark Newton of CGA Strategy.

New Zealand

Raising the baa – New Zealand wine is at the top of the on-trade ladder

The average price per glass of New Zealand wine at UK restaurants and bars is above its nearest Old World competitors, having edged over the £5 barrier earlier this year.

The precious price differential guarded for so long seems here to stay, but what are the factors that have helped to revive the Kiwi position?

Firstly, the well established, better-known brands have had plenty of time to reposition themselves back to their rightful position in the wine menu hierarchy.

Even in large pub groups, where value for money and big brands are still among the key consumer drivers, New Zealand wine is often the main reassuring focus for a trade up opportunity.

Secondly, and perhaps more importantly over the last couple of years, the varieties and styles of New Zealand wine available in the UK has mushroomed.

Aware that the insatiable appetite for Kiwi Sauvignon Blanc (up 14.8% volume and 29% value MAT) may not last forever, a number of key New Zealand brands have made efforts to refocus consumer interest towards more fashionable varieties like Pinot Gris and Riesling while underlining the consistent quality and approachable style of their popular Pinot Noir.

Even evergreen Italian performer Pinot Grigio has seen some significant growth over the last 12 months, with volume sales up 17.9%.

This illustrates that the consumer trend for experimentation is working well for Kiwi brands where price positioning as a trade up opportunity adds to their continuing popularity.

Looking to the future, it’s likely that New Zealand will offer even more in the way of popular but non-traditional varietal wines like Shiraz and Cabernet Sauvignon along with a continuing move towards pushing their sparkling wines as competition for the now ubiquitous Prosecco – whether via traditional Chardonnay-based blends or new innovations like sparkling Sauvignon Blanc.

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