Spain needs premium wine strategy

Spain must decide on how to push sales of premium and super-premium wine if it is to avoid being seen as a producer of cheap bulk wines, a leading Spanish wine producer has claimed.

Enrique Valero of Abadia Retuerta

Enrique Valero, the general manager of Abadia Retuerta, who also who sits on the executive committee of the the single vineyard classification Grandes Pagos de España, said the country was facing a big debate over its future direction. 

“There will be a debate with Rioja about which is the right model, and the best for Spain,” he told db. “The DO system has done very well for Rioja and sherry, but now we need to recover the premium and super-premium end, and it will be very interesting to see what will happen.”

“There is the potential for Spain if it can get the wine premium segment. We work hard at the premium end to get the personality and quality of the wine, and we need to keep going in that direction.”

He argued that there was  “too much bulk” wine being produced in Spain and this wasn’t helping the premium strategy or the perception of Spanish wine in the eyes of the consumer.

“We need to change consumption, but it starts with the buyer, and with controlling bulk and with controlling the image,” he said. “Improved communication is key.”

Valero has previously argued the Vino de Pago single vineyard classification was an important tool to show what Spain could do at the top end, and provided its members with the opportunity to set themselves apart from the crowd, and his comments came ahead of the first Grandes Pagos de España tasting in the UK, being held in London today.

The organisation was founded in 2003 and now represents 29 wineries of ‘particular character and quality’, which adhere to strict membership rules, whereby the producers must own their own vineyards, which should be located close to the winery to demonstrate a meaningful link with the terroir. As well as boosting international sales and raising the profile of premium Spanish wines, the organisation has a technical objective to help winemakers share innovation and skills to better their understand for terroir.

But Valero argued that the organisation had only now reached the necessary critical mass to extend its reach and, having started its communications 18 months ago, was starting to gain traction both inside and outside Spain.

“We have the key things to build confidence and we are starting to communication the working and the quality properly,” he said. “We need two or three years to transmit the concept, history and personality of our wines. It will happen step-by-step,” he told db.

Key markets include the USA, Switzerland, Norway, Germany and Mexico – and the UK is also in its list. Following its first trade tasting this week, it is planning to bring its sommelier programme, which was run in the USA this year, to the UK next year.

Abadia Retuerta lies outside the DO Ribera del Duero

Building UK sales

Valero’s own Bodega, Abadia Retuerta, which it situation just outside the borders of the DO Ribera del Duero  (although many of its vineyards lie within the border) launched in the UK with Enotria in March last year with a relatively small UK allocation and said it was beginning to gain both off-trade and on-trade distribution.

“We are confident with the UK but we do need to reposition the brand, having previously been successful in the UK with our cheaper proposition, Rivola. Since then we have repositioned for the premium end. It has involved a lot of changes but we are very confident and not obsessed with growing fast – we are selling everything we produce, so happy to consolidate that,” he said.

Around 40% of the company’s sales come from its international markets including Switzerland, the USA, Germany, Mexico and now the UK, with 20% from direct sales and wine tourism, based out of its Michelin-starred hotel on the estate, a former 12^th century monastery, Le Domaine and wine club in Madrid. This segment of the market has grown in the last six months, Valero said.

The winery is planning to release a new super premium range onto the market next year.