First and foremost

FirstCape Vineyards, a collaboration between BrandPhoenix and some ambitious South African wine producers, was created to give UK consumers something they were missing. Fionnuala Synnott reports

Unlike Australia or California, South Africa has few strong brands in the UK. Even Kumala, which last year shifted as many as 2.8 million cases in this country, is more commonly associated with Australia than the Cape, as consumer groups have shown.

For Steve Barton, director of BrandPhoenix, this situation presented an opportunity, not a drawback. Therefore, in October 2002, he joined forces with the producers of De Wet Co-op, Goudini Cellars and Newton Johnson Wines from the Western Cape to form FirstCape Vineyards.

He explains, “If you want to build a successful brand, you have to be from a country that the consumer can relate to, but we found that South Africa had no lifestyle proposition in the UK. In the course of our market research, consumers rejected ethnic wine labels because Africa had no wine heritage. But you only have to look at brands such as Jacob’s Creek to see that provenance is crucial to success. Our research showed that the Cape had positive connotations for the majority of consumers, so we decided that FirstCape was the right name for a definitive South African wine brand.”

The real challenge for FirstCape Vineyards lay in creating a range of quality FirstCape wines at the £3.99 and £4.99 price points. Barton illustrates the strategy behind the pricing: “You have to  invest in the brand. This means pricing the product at £3.99 but being prepared to sell it at £2.99 on a short-term basis in order to allow potential customers a risk-free trial of the brand. Of course, the product has to be good quality if you are to entice the customer back at full price. This strategy has paid off, and our customers are looking to trade up within the hierarchy of the brand.”

BrandPhoenix’s philosophy on its owned brands is to be entirely consumer-led. When FirstCape Vineyards entered the UK market nearly four years ago, the joint venture introduced a core range of blends from South Africa retailing at £3.99. Within the first 18 months of appearing on supermarket shelves, FirstCape was ranked in the top-40 wine brands in the UK – good news for a product whose ambition is to become a top-10 brand. In June 2004, FirstCape went from being unranked to fourth-largest South African wine brand by volume, and it was the fastest-growing South African wine export to the UK.

Two years after FirstCape was launched, consumer demand for a more complex offering led to the introduction of the Limited Release range, which Barton describes as “a range of affordable, quality, easy-drinking wines”, retailing at £5.99.

At the time of going to press, the partnership was about to launch its First Selection range, which is priced at £7.99 and features a Shiraz Rosé, a Chardonnay and a Shiraz Cabernet. Barton says, “We’re on track to launch the First Selection range. Although there will be some exclusivity on style and packaging, this premium range will be stocked in the same supermarkets (Sainsbury’s, Tesco, Morrisons, Somerfield, Bargain Booze and Asda) as the £3.99 range because consumers are buying across a range of different retailers.” BrandPhoenix estimates that by the end of May, FirstCape sales will have grown to over half a million 9-litre cases. The firm aims to double this figure by the end of the year.

FirstCape Vineyards has ambitious plans to build on its success, which has seen its wine become the third-largest South African bottled brand in the UK off-trade in under four years.

So far, 2006 has been a busy year for FirstCape Vineyards. The Badsberg, Stettyn and Aan de Doorns co-ops have joined the partnership to help the brand meet its growing production needs. Last year, according to ACNielsen figures, FirstCape saw a 33% growth in volume as well as a 49% increase in value. (The average increase for both volume and value in the South African category was 1%).

The firm is also on track to roll out its FirstCape wines into all Thresher Local stores, increasing its distribution and consumer reach from 950 to 2,000 stores. “The firm’s relationship with Thresher has been hugely successful. In the eight months since the first bottle went on the shelf, FirstCape has become the second largest-selling South African wine
in 50% of the Thresher estate,” according to Barton.

BrandPhoenix favours unbranded, soft categories that allow it to have regular contact with the consumer. Barton says, “Nowadays, the market is led by what the consumer wants to buy, and consumers are polarising around familiar products such as Blossom Hill.” By raising consumer awareness of the quality, consistency and value for money to be had from South African wines, the South African partnership hopes to make FirstCape wine a familiar sight on supermarket shelves and to add a strong consumer-led brand to the category in the UK.  db  May 2006