Australia: Trade Talk

We asked: “What are the challenges facing Australia and how should it handle them?”

“Given the quantities of wine being produced by other countries globally, I can’t see us coming out of this quickly. This means that any offer you make has to be good value, no make what the price. It’s not simply a question of overdelivering any more; it’s how much you overdeliver. It’s all about survival of the fittest. The simple fact is that people who supply crap won’t survive.”
Michael Hope, winemaker/proprietor, Hope Estate

“The generic office really should try to do something on premium that will increase PR activity for those brands at the higher end. Consumers need more help to understand the provenance of Australian wine, how it is made and what the points of difference are. It’s difficult to see how premium Australian wines can grow market share in the UK at the moment, when the retailers are promoting so heavily to the mass market.”
Pamela Dunn, marketing manager, PLB Wines

“It’s a wonderful time. There’s so much good wine available at lower prices, it gives us a fabulous opportunity to get people to trade up. Australia has carved a wonderful, very concrete niche in the UK market between £4 and £6. That’s a strong position, but it will be hard to get consumers to make the leap to the higher price points. So while the conditions are good, it’s also frustrating. Perhaps the way out will be to use other varietals, like Pinot Noir or Viognier.”
Graham Cranswick-Smith, managing director, Kingston Wine Agencies

“Regionality is the key when it comes to Australia’s premium offer. The challenge is to get away from the boring Chardonnay and Shiraz varietal offer and create dual-varietal wines or blends with a point of difference, which would give the retailers something new to work with. Educating consumers is also vital to getting our premium message across. There’s nothing better than getting the consumer to taste the wine and to evaluate the quality differences for themselves.”
Paul Schaafsma, regional director, Europe/UK, McGuigan Simeon 

“We’ve been making wines in Australia for over 200 years, so the peaks and troughs are nothing new. The issues we are facing now are due to overexuberance in planting. I believe that this period will be seen as a a blip in our history. We have created multinational companies of repute, and that stands us in very good stead going forward.”
Geoffrey Wilkinson, CEO, Cumulus

“There is still work to do in terms of encouraging special occasion purchases of Australian wines (at £10-plus prices in retail and £30-plus in the on-trade). It is also vital that promotionally-led wines don’t dominate the fixture and that appropriate space is given on shelves and wine lists to innovative, quality-led wines.”
Andy Brown, general manager, Lion Nathan Wine Group UK & Europe

“Choice in the top-end category is endless, pricing is competitive, and it is a segment that has been historically dominated by the Old World. We are unlikely to change consumer buying habits in a single generation, but Australian wines continues to deliver well against our competitors, and this has been recognised in various UK and international wine shows. We believe Australian sales at the top end will continue to make good progress as wine quality continues to be recognised by the gatekeepers in the UK wine trade.”
Martin Strachan, managing director, Negociants UK

© db September 2006