This week’s topic is from the 2019 exam: How can the fortified wine category evolve to address current consumer trends?
So since this is a paper 4 question, we’re looking at questions about routes to market, marketing, etc. not at production per se. Consider the role of regional promotional bodies, external events, new categories like en Rama, possible use in cocktails, etc.
Kelli White Sabrina Lueck
This is a great topic and I don't have anything to contribute (yet). Do you have any good resources that I could read through? And one crazy idea to throw in the mix - fortified wines are often grown in warm regions, and need very little sulfur for stability. This is a category that can capitalize on the sustainability and health trends. These wines can easily be produced in an organic and low intervention way and can be promoted as such.
A few quick very disorganized thoughts:
- Offering complementary dry wines, both to diversify, but also to improve quality of the fortifieds themselves. I wrote a lot about that HERE in an article from last year. Remember, that in the Douro a given vineyard is only allowed to produce so much Port, so it makes a lot of sense from a financial perspective to make the best use of the excess grapes.
-Offer unfortified versions. Commandaria in the 2000s changed the category to allow for both unfortified and fortified versions, as a renegade group of young small producers wanted to created more elegant expressions in opposition to the fortified ones made by the larger beverage corporations.
-Even quirkier ideas have come up, like rosé Port, as pioneered with Croft Pink - trying to jump on the bandwagon of global rosé interest
-Cocktails are a super common strategy - with things like Porto tonics, and Rutherglen producers reaching out to mixologists
-Some producers might opt to leave their DOPs in attempt to separate themselves from poor quality images of several fortified wines, like Marco de Bartoli not labeling his wines as Marsala.
-Some producers have ventured into fortified wines to capture present interest in heritage styles and varieties. Examples would be Broc Cellars or Gypsy Canyon using old-vine Mission to recreate 18th and 19th century Angelica.
-I'd also point out the need for further education. Though we say people don't like sweet wines - several sweet wines do very well, like Moscato d'Asti and Sutter Home. Even among higher-end consumers, people still like sweet things - like Coca Cola. Large scale education initiatives for both the consumers and the trade could be helpful. For restaurants, for example, it offers an opportunity to share very interesting stories with guests, make one final wine sale when guests are unlikely to order another bottle, plus they'll keep much longer than dry wines, allowing for high-quality by-the-glass options.
I do think talking about still wines is outside the scope personally. The question asks about the category, which infers that the focus should remain on fortified wine. I think the it is important here to define what the current consumer trends are that are relevant to the category, which I see as enotourism (Port tasting rooms, massive cruise hub in Cadiz), interest in lower alcohol (negative) but also cocktails (fortified wine as a hard liquor substitute — Lustau has done a major push on this front in engaging bartenders), and the natural wine (en Rama makes sense here) and sustainability questions too are relevant. I do think education is important too, and there is a trend for consumers to know more via pairings etc. We did a lot of dinners for example as part of the Sherryfest programming.
I’ll see what I have in some of my files on this to refer you to.
I agree that table wines could be out of scope, unless you are using them to bring people into the region and thus introduce them to the category. In this context, it could make sense to include.
Some other quick ideas:
-Shifting beyond the current geography to what emerging regions (China?) might have a market and embrace the rituals of fortified wines
-Focusing on the restaurant channel instead of retail: staff eduction and support to help build avg. customer spend through Fortified wine at end of meal. Dessert replacement.
-Tourism focus is smart, but virtual tourism could be another broader path, bringing these distinctive regions and practices to life through AR or virtual tastings.
-Macro shift away from white tablecloth fine dining and towards a more casual version of serious cuisine in many major dining destinations such as Paris, New York, London
-Consumer shift to lower alcohol, restraint
-Pricing - makes it more challenging to bring younger consumers in so lower tier options such as Croft Pink or Graham's Six Grapes are critical
Interestingly enough, the US is the only major growth market for Port and Sherry in the last decade (Angola was with Port, but then the bottom fell out there Brasil is showing promise, but it has not been sustained yet). Overall Port exports are a straight line over that time. Overall Sherry exports are decline over that same time frame (with a MASSIVE downline over 30 years). Cognac looked like this 20 years ago, and then the best marketing campaign that money could buy fell in their lap: HIp-Hop, which spurred a major revival and pretty significant growth at the ultra-luxury end that we're still seeing today. Bartenders in aprons adding an ounce of Sherry to 10% of their cocktails have nothing on the power of a Pop-Culture marketing campaign.
China and Brasil may be the only way these categories survive, though, and is probably where they should be focused. While alcohol consumption in India continues to grow, no one can predict as to whether it can ever be a region that will prop up any foreign industry sector. Africa could be another option, but consumption in northern and western Africa will likely continue to decline as Islam grows there, and it remains to be seen whether central eastern Africa will ever develop enough to be a lands of consumption.
"-Focusing on the restaurant channel instead of retail: staff eduction and support to help build avg. customer spend through Fortified wine at end of meal. Dessert replacement."I'm skeptical about this. Sommeliers have largely done a horrible job at making this a thing, and its not without effort.
Do you have any specific data as to China and Brazil as target growth markets Jeremy Eubanks?
https://www.accurizemarketresearch.com/report/brazil-wine-markethttp://www.winesofportugal.com/us/press-room/statistics/export/https://www.winesa.com.br/site/2019/en/destaque/1962/wine+market+in+brazil+shows+growthhttps://www.drinks-today.com/wine/power-lists/brazils-wine-markethttps://www.thedrinksbusiness.com/2018/09/nunes-port-is-far-from-reaching-its-full-potential-in-asia/http://www.winesofportugal.info/pagina.php?codNode=135736https://www.viniportugal.pt/InternationalPromotionhttps://www.foodswinesfromspain.com/spanishfoodwine/global/wine/news/new-detail/efforts-to-boost-sherry-consumption-in-brazil-are-under-way.htmlHere are a few. Sherry's hard. it's just a downward spiral. I've found some graphs in articles that look like a stock market crash, but can't find any specific export data.
Some additional points to share on Sherry.
When I was at Prowein last year (2019), I was talking to Lorenzo Garcia-Iglesias of Bodegas Tradicion, and he said trying to capitalize on the cruise tourism traffic to their tasting rooms was the biggest challenge yet opportunity he sees to grow his sales. They currently receive 6000-8000 visitors a year, many from US, since they are near a port of call, and many people want to buy the wines at the tasting room and ship home, but they can’t.
I just went through some of my old files from when I produced Sherryfest in the US: Sherry exports have decreased steadily from 150 million to 30 million liters annually from 1979-2011 (Peter Liem Sherry, Manzanilla & Montilla) Sabrina Lueck, if you haven’t read Peter’s book on Sherry, he has great info on the market for the wines (decreasing though it may be). We had put the following SWOT together for the market for growing our event platform to promote Sherry with the support of bodegas and the Consejo Regulador which may provide some insights:
Some other things for you:
Fortified wine global market: https://www.globenewswire.com/news-release/2019/03/26/1768505/0/en/Fortified-Wine-Market-Global-Forecasts-2018-2023.html
Rise of white port: https://drinksint.com/news/fullstory.php/aid/7453/The_rise_of_white_port_wine.html
Port Wine Market report 2019: https://www.marketwatch.com/press-release/port-wine-market-report-over-all-growth-analysis-with-in-depth-facts-and-figures-during-years-2019-to-2023-2019-09-05
Forecasted growth in premium sherry sales: https://www.thedrinksbusiness.com/2017/03/premium-sherry-sales-tipped-to-grow-18-by-2021/
Port wine, an established product and a new market: https://www.sciencedirect.com/science/article/pii/S221297741830022X
Trends in fortified wine sales: https://www.guildsomm.com/public_content/features/articles/b/weblog/posts/fortified-wine-sales-trends-and-challenges-today
Strategies for selling dessert wines: https://daily.sevenfifty.com/5-strategies-for-selling-dessert-wines/
Pink Port (and its use in cocktails): https://www.drinks-today.com/wine/news/pink-new-styles-port
Repositioning of Marsala Vergine DOC (2017) https://www.researchgate.net/publication/319339158_Study_of_product_repositioning_for_the_Marsala_Vergine_DOC_wine
Madeira stats here: http://www.vinhomadeira.pt/statistics-234.aspx
Thank you for all the great articles. When I visited IVDP (Port & Douro Institute) last year, they told me how hard it was for the producers to approve rosé Port. Many of them were against it and the Institute saw it as a rising category. Now producers are happily blending Port into cocktails and selling Port-tonic on their tasting rooms (Porto Cruz as one example), to make Port more approachable for young consumers.
On another note, Sauternes is also struggling with sales and recently some producers have been accused of betraying their heritage by using it in cocktails to attract young drinkers. Count Alexandre de Lur Saluces (Yquem) is obviously against it. www.thetimes.co.uk/.../sauternes-cocktails-leave-sour-grapes-3x6g0tsk9
Chateau d'Yquem cocktail? Put a gold leaf float on it and count me in! I also legit want to have a Lafite kalimotxo at least once in my life.