Champagne discounting at low level despite fear of price rises

Champagne Ayala MD Hadrien Mouflard expressed concerns about pricing in the lead-up to Christmas, when he spoke with db.

As economic pressures build and the cost-of-living crisis deepens in the UK and other important export markets for Champagne, Ayala managing director Hadrien Mouflard is concerned that sales in key export markets like the UK may be hit if the recent round of retail price increases meet with consumer resistance.

Speaking to the drinks business at the Female Chef of the Year awards held at Angela Hartnett’s Café Murano, in London’s Covent Garden, Mouflard questioned whether the Champenois are in danger of increasing prices too steeply in response to  the cost pressures they have been under during the past year or so.

The latest figures for Champagne shipments in the year to the end of September do suggest the downward trend, already evident in the first eight months of the year, accelerated last month.

While in the year to date (Jan-Sept 2023) total shipments were down 8.3% to 195.6m bottles, shipments in September 2023 vs September 2022 were down in general by 21.2% to 23.4m bottles (while the monthly decline in August was 13.8%).

The monthly decline was very similar in the French domestic market – down 22.6% to 8.7m bottles – and to all export destinations that fell 20.3% to 14.4m bottles in the month.

The major houses won’t want to see this monthly trend continue as we enter the final quarter of the year, the period when the vast majority of annual sales are still made.

And while they will take some comfort from the fact that the MAT total in the 12 months to the end of September is still showing a figure of more than 300m bottles, at 307.9m that is already 8.8% less than the total shipped in the calendar year 2022.

In the UK market, in an effort to make Champagne and table wines more affordably in the run-up to Christmas, several grocers including Tesco, Sainsbury’s and ASDA, are employing their recently favoured 25% off deal, on purchases of six bottles or more. All of which have such offers running until the end of October.

Individual price reductions on Champagnes, prior to taking account of the 25% reduction, are thinner on the ground than they have been in recent years, but there are still some decent deals to be had.

Tesco, where you need a Clubcard to access the individual offers, only has reductions on Moët & Chandon Rosé, which is down from £49 to £43 before the 25% reduction if you buy six bottles, and Taittinger Brut Réserve, which is down from £43 to £36 before the 25% deal.

At Sainsbury’s, Nicholas Feuillatte Brut is down from £28 to £25 a bottle, while Pommery Brut Royal is down £9 from £43 to £34; both before the 25% for six offer applies.

The best deal at Sainsbury’s is for Lanson 2012 vintage, a very fine year, down £3 to £45 a bottle and therefore £33.75 under the 25% off deal.

At ASDA, the ‘25% off’ deal has just ended, but when in the Roehampton branch last week, Heidsieck Monopole Rosé was down £11 to £27 (before the 25% off deal) and had been entirely cleared out, as had the Heidsieck Brut, which had dropped by £9 to £23 a bottle.

Fizz from the Vranken Pommery group seems to be the only Champagne offering much in the way of a discount.

At the moment the other grocers seem all to be moving towards the Waitrose model of not discounting individual lines while there is a ‘25% off’ deal running.

However, it is anyone’s guess what might happen in the two months until Christmas, and if fears that prices have risen too much do heavily impact on sales over the festive period perhaps the discounting will strengthen.