Think Again Spain

At the recent drinks business seminar in Spain, wine producers were urged to rethink their targeting of ageing consumers and to develop their USPs

Generic Promotion is never easy, as anyone who has ever been involved in it will readily admit. Having one boss has its issues but having upwards of 100 can lead to problems when it comes to creating a cohesive campaign to promote the wines of a particular country. Yet presenting a united front in any export market is imperative in building the foundations of generic success, and this is exactly what ICEX (The Institute for Spanish Export) and Wines from Spain UK were on a mission to explain to Spanish wine exporters from the Madrid and Barcelona areas earlier this summer.

Expert talks

As part of a joint venture with Wines from Spain in London to educate producers at source, the drinks business’s publisher and editorial director, Charlotte Hey, worked to bring together a panel of experts from the UK drinks industry to explain the intricacies of the UK wine market.

The two seminars, entitled Spanish Wines in the UK Market – How to Compete Successfully, were designed to expand upon current trends in the UK market from a generic, retail and agency point of view and give insights into the latest trends in design and packaging.

Hazel Murphy, former head of the Australian Wine Bureau in the UK and Europe, kicked off proceedings with her views on the importance of generic promotion in export markets. “It was clear to me that unless the wineries really worked together for the ‘cause’ of Australia and supported their importers and agents we would get nowhere,” explained Murphy. “In the beginning that had not always happened, believe me!

“Spain had such a great opportunity when I was starting, and Spain has another opportunity now,” she continued. “It will be more challenging, expensive and demanding but there is a feeling out there that Spain has something different to offer.”

The whole spectrum

Murphy believes that pricing is a big plus. “Spain has wines from the cheap right up the price and quality scale; there is the scale of production to supply the big retailers and find something niche for the on-trade; there is a point of difference with varietals and styles which is very important, and the re-emergence of Spain as a holiday destination, but this time more sophisticated, appealing to the wine drinking profile.”

Next on the platform was wine marketing guru Emma Chamberlain, marketing and innovation manager Europe for Percy Fox & Co. Her aim was to highlight current drinking trends among UK consumers and to give an insight into the pitfalls and potential successes if you are setting about building a brand.

Giving a snapshot of the market, Chamberlain explained that the British wine market currently stands at around 906 million litres and is worth £6,080m of which 755m litres and £3,813m is concentrated in the off-trade, and a further 151m litres (£2,267m) is in the on-trade. She went on to highlight the winners and losers from Spain, pointing out that the top four brands in the Spanish category could not really be considered as true Spanish brands, with real brand leaders Campo Viejo and Torres coming in at sixth and seventh in the brand charts in the UK.

Loyalists

The next part of her presentation turned its attention to Spanish wine drinkers, underlining the fact that, according to recent research, the average Spanish wine loyalist falls into the 55- 64 age bracket. “Spain needs to recruit some new consumers at the younger end of the market in order to promote and sustain growth in the future,” said Chamberlain. “Loyal Spanish consumers are more likely to have children over 18 and be men. When you consider that in the UK women are driving the wine buying, representing 69% of the wine buying population, and that the over 35’s drink 82% of all wine, Spain really needs to readdress who its target market really is.”

According to Chamberlain, “Just having a glass of wine has now replaced the great British cup of tea. The UK market is a crowded one. You are not just competing with the winery down the road, you are competing on the international market. As a result you need to decide who is your target market and find a ‘perceived’ gap in the market and develop a proposition against the gap.”

Abigail Barlow, marketing director of Barlow Doherty, was next to speak, giving her failsafe guide to the dos and don’ts of wine label design and packaging. Several years of experience in the UK wine business have given Barlow an in-depth insight into what works on shelf, both in a retail and on-trade outlet. “Today, margins are tight and increasingly the bottle design is the only thing that importers and brand owners have to really sell the product,” explained Doherty. “Shelf stand-out is increasingly important but gimmicky labels are no longer as popular as they were, say, four or five years ago. It is imperative that you do not design your label by committee; the message often gets diluted as a result.

 “Given the importance of design,” she added, “you must invest in the quality of the paper and of the printer you use. There is no point in spending months coming up with a great design and then cutting corners by using cheap paper or a printer that has no experience in the specialised business of label design,” she argued.

Last speaker to the stage was Alex Anson, trading director for the Thresher Group, charged with the task of explaining the complex structure and trends in the UK off-trade. Anson, a Spanish national himself, was not holding back the punches, passionately expounding the virtues of Spanish wines and the opportunities that are there to be grabbed by producers. He was realistic, however, echoing the words of Emma Chamberlain: “Spain lacks fighting brands in the UK market, and if the category is to grow, you as producers need to really concentrate your effort in developing a strong brand base and shifting your NPD focus to what the consumer is looking for.“

Anson continued, “It’s not as if the potential doesn’t exist for Spanish wines. You have the volume, you have the diversity, in producing regions and indigenous grape varieties. You have the image and fabulous top-end wines that are really in demand. What you need to do now is concentrate on promoting regions other than Rioja and promote those wines at above the £5 and £10 mark. Push your native grapes; Tempranillo and Garnacha are USPs that cannot be ignored and the consumer is looking for new things to try all the time.”

Following on from the presentations, questions flowed from producers in the audience who were eager to get more in-depth insight into the workings of the UK market. When questioned, each of the panel members was enthusiastic and optimistic about the potential for Spanish wines going forward. Emma Chamberlain summed up their feelings succinctly: “There is a chance for Spain to create some real growth. It’s not rocket science. I’m sorry to say there’s no magic formula but the opportunity for Spain definitely exists.”