Port shines in declining fortified category

A new report from The Fladgate Partnership and UK agent Mentzendorff seeks to distance Port from other fortified wine categories based on its growth and increasingly healthy consumer base.

Andrew Hawes, managing director of Mentzendorff, argued that a tendency to set Port within more general negative commentary about the decline of the fortified category, “misses what is in fact a consistent and extremely positive trend in Port’s sales in the UK market, one that far more closely follows the growth patterns that this market has enjoyed for light wine and premium spirits over the past decade.”

To support this assertion, Hawes drew a comparison with 1995, when UK Port sales of around 500,000 cases saw the category lag behind the 2 million case sales enjoyed by British fortified wine, Sherry and vermouth.

“Sixteen years later and all these categories have experienced volume declines of 50% or more,” noted Hawes, “whilst Port now consistently sells in excess of 750,000 cases, having experienced quite the opposite trend with a sales increase in excess of 50%.”

Turning to a similarly positive story for value sales, Hawes predicted that if Port’s 50% increase from £50m to £75m continues, the category is set to overtake a declining Sherry market to become the UK’s largest fortified wine category by 2020.

UK volume sales of fortified wine

“Sixteen years later and all these categories have experienced volume declines of 50% or more,” noted Hawes, “whilst Port now consistently sells in excess of 750,000 cases, having experienced quite the opposite trend with a sales increase in excess of 50%.”

Turning to a similarly positive story for value sales, Hawes predicted that if Port’s 50% increase from £50m to £75m continues, the category is set to overtake a declining Sherry market to become the UK’s largest fortified wine category by 2020.

In his introduction to “The Re:Port”, Adrian Bridge, CEO of The Fladgate Partnership, stressed the distinction between “commodity” and “quality” Port as he acknowledged the widespread European decline in per capita alcohol consumption.

UK value sales of fortified wine

“Any business that relied on selling cheap alcohol to these consumers has suffered,” observed Bridge. “Port is no different to other major wine categories in this sense.”

2011 volume shipments of special category Port

While accepting that “total Port volumes are likely to decline,” Bridge insisted: “There is plenty of scope for growth in value.” In addition, he pointed to emerging markets, such as Brazil, who “are happy to pay for great quality Ports and will seek them out.”

In the UK, which Bridge highlighted as “the biggest quality Port market in the world”, he pointed to “the phenomenal growth of aged tawny sales” as a sign that consumers are expanding their Port repertoire, while new consumers are coming into the category.

Identifying the way to build further Port sales in the UK, Hawes suggested: “The key is to develop Port’s appeal in the 35-44 consumer age band and to continue to recruit new affluent consumers through innovation and an aspirational quality offering.”