UK wine market split in two

The UK wine market has split into two distinct tiers of consumers: those who splash out and those who are drawn to deep discounts, according to a new report.

Published by Wine Intelligence, the report, which takes the temperature of the UK wine market in 2014, found that while wine consumption remains in decline, consumers splashing out on “big nights in” are driving wines sales in the UK.

The study found that 40% of UK wine drinkers are now happy to spend over £8 on a bottle to drink at home for a special occasion, up from 29% a year ago.

At the same, 9% of consumers surveyed said they typically spend less than £4 on a bottle of wine at the supermarket, down from 14% a year ago.

Tesco remains out in front as the UK’s number one wine retailer, with 48% of regular wine drinkers having bought wine at the chain over the past six months.

In the last half of 2014, discount retailers like Aldi and Lidl have significantly expanded their consumer reach, with16% of wine drinkers buying wine at Aldi and 11% shopping for wine at Lidl.

According to Wine Intelligence, the discount chains are attracting older wine consumers committed to spending under £5 on wine to drink at home.

“We are seeing a fundamental realignment of the UK wine market into two separate and distinct segments, with very different drivers.

“On the one hand you have a growing group of consumers who are seeking quality and new experiences; on the other you have consumers who are unwilling or unable to trade up,” said WI’s chief operating officer, Richard Halstead.

“The higher spending segment are drinking less but spending more per bottle; while the lower spending segment are buying less because they are budget constrained and wine is something they are learning to live without,” he added.

The UK Wine Market Landscape Report 2014 uses Vinitrac data based on consumer research carried out among 1,001 UK consumers in August 2014.