The Oenophiliac

Bringing you stories from the world of wine and beer.

UK Champagne sales stagnate

Champagne sales in UK retail have suffered a decline in volume but rise in value over the Christmas and the New Year period compared to last year.

Nielsen MAT figures to the week ending 7 January show a 4% drop in the number of cases sold but a 1% increase in value, earned due to a 6% rise in the average price of a bottle of Champagne in the off-trade.

Speaking to db about Champagne volume sales in UK retail sector over Christmas, Andrew Hawes, managing director at Mentzendorff, importers for Bollinger and Ayala, commented, “The market is basically flat, so we are at the same place as last year, but via a different route.”

Referring to the last two months of 2010 – Champagne’s key sales period – Hawes said that heavy snow had dented sales during the comparable period last year, but deep and early discounting on supermarket exclusive labels had propped up the market.

“In 2010 we saw early activity on exclusive labels with half price deals, so £25 Champagne dropping to £12.50, which was the bottom of the market.”

During Christmas 2011 however, he said, “The bottom of the market has moved up substantially, and the equivalent half price deal has been £30 down to £14.99, which shows the impact of currency and availability on prices.”

Nevertheless, he recalled a highly competitive Champagne offer from the UK’s major multiples in late 2011 and stressed both the length of time and intensity of promotional activity over the latest Christmas period.

“Champagne was perhaps discounted more than we have ever seen in the supermarkets,” he stated.

Referring to the breadth and depth of offers, he added, “Considering the consumer was given an amazing opportunity to buy Champagne at low prices I am surprised there wasn’t a stampede.”

Continuing he said, “This indicated that they are being careful with their expenditure.”

On the other hand, he stressed that while Nielsen figures accurately capture the sales through the major multiples and Majestic, there is an under representation in the hard-to-track, but thriving, independent sector and mail order business.

Meanwhile he recorded “really exciting times” for Bollinger and premium Champagne brands in the London on-trade, as well as through bars and restaurants in other UK cities such as Leeds, Manchester and Edinburgh.

Speaking more generally about demand for still and sparkling wine in Britain he stated, “The UK is no longer going to be an easy source of volume but the value market is emerging again.”

Finally, he forecast a positive outlook for the year ahead, pointing out the potential impact of both the Queen’s Diamond Jubilee and the Olympics.

“I’m not suggesting we rely on them for business, but they will be mood lifters.”

Key figures (Champagne sales, UK off-trade, Nielsen MAT 07.01.12):

Down 4% in volume to 1.523m 9l cases

Up 1% in value to £322m

Up 6% in price per 75cl bottle to £18.14

Story by Patrick Schmitt

Courtesy of The Drinks Business

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This entry was posted on February 10, 2012 by in News. and tagged , , , , , .

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