MARKETING BRANDBUILDER – Brand Extension

Felix Solis is taking on the Spanish wine laws to be allowed to apply its Viña Albali brand name to the wines of other regions – surely, something that would facilitate Spanish brand building as a whole, says Patrick Schmitt

Vina Albali may sell two million cases worldwide, and two million bottles in the UK alone, but it is still planning to expand its operations considerably. Aside from increased efforts to market the wine, Felix Solis, owner of the Valdepeñas-based brand, wants to extend production of Albali-labelled wines to new denominaciones in Spain. The problem, however, is that Spanish wine laws prevent them from doing this – you cannot have a branded DO Rioja, for example, with the same name as a wine from another region.

Nevertheless, Albali is fighting this stricture, as are other companies that want to apply their brand name in a number of regions.

Secret of success

It is through a commitment to branding that Viña Albali has managed to attain such a strong foothold, both in its domestic market, where it is the second largest retail brand, and in international markets. According to Felix Solis Ramos, international general manager of Felix Solis, “The main secret of the success of the brand is the price/quality relationship.” This has attracted the attention of consumers, awards judges and wine critics, all of whom have recognised Viña Albali’s value.

Nevertheless, the UK market in particular has changed significantly since Albali first appeared on a Sainsbury’s shelf more than 25 years ago, and this has made the brand owner’s job harder. “We saw that the English market was becoming very competitive,” says Solis, “with lots of competition coming from the New World, which was taking over from Spain. We needed to survive, and the only way to do that in the British market at the moment is to be a brand.

“In Spain there are lots of producers, lots of wine sellers, but the only way to survive is to have a brand and to build that you have to invest in distribution and above-the-line marketing.” This is why, five years ago, Felix Solis started supporting Albali with significant sums for above-the-line marketing, and the company now spends £400,000 on this, on Albali in the UK alone.

Advertising in recent times has focused on the Albali Reserva but, as Solis notes, “At the moment we plan to do a little bit of global advertising to create brand awareness of all the wines in the range – young to Gran Reserva.” He admits, however, there will be more emphasis on Gran Reserva in the UK, because it’s growing faster in this market. “The Reserva is £4.99 and the Gran Reserva is £6.49, but now the £6.49 segment is having more growth for us than £4.99, probably because the UK consumer is going a little bit more upmarket.”

Unsurprisingly, the Reserva does sell more overall than the more expensive Gran Reserva – double the amount in fact at 1m bottles compared to 500,000 – but the pricier wine “is much more profitable for us and our clients”, says Solis.

But to return to Albali’s planned long-term expansion, “Our view is to create a global brand,” says Solis, “and we want to use Viña Albali on wines from other DOs in Spain, not only Valdepeñas.” This means “fighting to have the right to use our asset, that is the brand, wherever we are present”. Solis is frustrated by laws which he sees as protectionist and anti-competitive. He believes it is a barrier to Spain’s attempts to build stronger brands which could help all Spanish wine in the global market.

But already, the Viña Albali way of thinking (if not the name) is being spread to other areas. For instance, Felix Solis built a winery in Ribera del Duero two years ago which is the largest in the region. As Solis says, “In the past, wines from this region were known for their high price – now we are trying to export from Ribera del Duero the philosophy we have at Viña Albali of having a good price/quality relationship, so now you can find Ribera del Duero in Sainsbury’s for less than £4. And it’s good quality – it’s ours.”

Expanding

Felix Solis has also started building a new winery in Rioja which will be finished by the end of this year and is producing wines in  Rueda and La Mancha. The aim of such coverage is, according to Solis, “to become a global supplier of Spanish wines so our clients don’t need to go to other suppliers from other DOs”.

© db April 2005