VSPT to go head-to-head with Concha in UK

Chilean wine company VSPT Wine Group is to take on market leader Concha Y Toro by launching a premium version of its global wine brand Gato Negro into the UK market.

Its new reserve line Gato Negro 9 Lives, which comprises a Cabernet Sauvignon and a Sauvignon Blanc from the Central Valley, is set to launch at the London Wine Fair. It has already won listings with one major UK supermarket for the Cabernet Sauvignon, which will hit shelves from June (RRP: £7.99), targeting the “sweet spot” in the mid-tier.

The flagship Gato Negro brand is currently worth around $60m, and sells around 2.4m cases per year, with markets in around 80 countries, but VSPT CEO Pedro Herane said there was a gap in the UK market for a brand. “We feel the company has a maturity and achieved a level where we have time and resource to explore how to close the gap,” he told db.  “What we have done is to work to understand what kind of brands, labels, wines and overall proposition will work in the UK.”

“More than volume, we want to have  a brand here – it is something we talk about a lot – ‘Don’t bring me volume, bring me brand equity’ – it’s that number that we want to see.”

The new 9 Lives sub-brand has already launched in Canada and is set to target the Nordic countries, including Sweden, Finland and Norway as well as the UK. Further line extensions – including a Chardonnay and a Merlot, are already being planned.

Sebastián Reitze, Brand Owner Retail Brands at Vina San Pedro admitted the main Gato Negro brand had previously “not appealed” to the UK markets and the company had incurred losses by not being conscious of pricing and margins. However he said VSPT was confident a more premium wine brand that was developed with the UK in mind would work better, aided by a more cautious, step-by-step approach.

“We are aware we haven’t been in the the UK with a good proposition and it was something we had on our agenda,” he said, adding that VSPT had put spent several years working on the development of the Gato Negro 9 Lives brand. It has worked with Wine Intelligence to develop branding and taste profile suitable for the UK consumers, as well as partnering with distributor Off-Piste Wines to find the best route to market.

“Our main focus is to do it right, with the right price, in a healthy, sustainable way,” Reitze said. “Our target is to raise awareness of the brand and we are doing a very tactical approach… targeting specific Chilean wine consumers and getting them to know our brand, with promotions with our first retailer around high volume dates at specific times of the year.”

The launch is supporting through “significant” above and below the line support behind the brand in order to “take on Accolade and CYT”, according to Paul Letheren of Off-Piste Wines.

“CYT has 8% of the market for Chile, so there is room and an opportunity for other suppliers,” he said.  “We are going up against CYT to give an alternative. The domination of big brands had meant [the Chilean category] is duller than it should be. Having an alternative brand will broaden the space and encourage people to buy from Chile (across the board).”

Off-Piste wines will be showcasing the range at the London Wine Fair next week.