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UK wine market is ‘toxic’
The trend for deep discounting in the race to the bottom has created a “toxic” UK wine market, according to one key merchant.
Speaking at a seminar during the London Wine Fair this week, Emma Shaw, head of commercial operations for Oddbins, said: “The UK market has been built around the race to the bottom with deep discounting. Before 2011, Oddbins was known for its special offers, which we sold at not fantastic margins. It’s a toxic approach.
“In our digital age if you pitch your wines at a deliberately higher price in order to discount them you are lying to the consumer and it can easily be tracked online. Also, you’re attracting promiscuous consumers who will only be with you for the discount.”
During the seminar, Shaw spoke of a less price led approach at Oddbins since 2011.
“We’ve moved away from 99p pricing as it was false. We also avoid deep discounting now. It was a scary conversation to have as we were worried about losing customers, which we did, but the discount hunters have stopped coming to us,” she said.
“Today, 60% of our customers didn’t shop with us before 2011 and we’re left with a far more loyal consumer base now as our prices remain consistent,” she added.
Shaw also highlighted how a large segment of wine retailers are failing to keep their existing consumers and are also failing to make new ones.
“The wine trade hasn’t talked to consumers properly. Wine descriptions have been dull and generic. Consumers don’t have a clue about high acidity and silky tannins. We need to think of new ways of talking to them.
“At Oddbins we’re taking a more humour-driven topical approach. The trade has failed to interact with consumers and we need to find a new and more interesting dialogue than price,” she said.
The race to the bottom is killing the business but the effort to support traditional ideas is, simply put, madness.
The wine industry can’t pretend to be selling anything that`s made in China, Chile or elsewhere as bulk and relabel it as ‘quality’ wine. The collectives of wine snobs can’t go on pretending that there’s such a thing as ‘terroir’ or ‘sense of place’ when the wine is no better than grape juice, fructose and food dye number 62.
Be one or the other. It’s too confusing for the average consumer.
Well said Emma, thank goodness some marketing intelligence is beginning to emerge, it would do the industry some good to see RPM re-introduced.
How about talking to consumers in a normal manner, not assuming they are this or that to start with. Despite the familiar protestations, most people are not stupid, and just want infomration so that they can make up their own mind. Education is key and always will be. We don;’t want to know what type of music this wine would be, or which sexy screen star this wine would be. That’s just BS.
Try treating people like you expect to be treated, with dignity and courtesy – it goes a long way.
Translating the passion of the passion of the winemaker, explaining the care, attention and provenance – thats what sells products. Like meat, cheese, vegetables, fish from sustainable sources. Nothing new – just wine needs to embrace consumers wish for knowledge communicated precisely and clearly using terms they understand.