So long, Champagne, it’s been good to know you
The wine business continues to do things no one expects, and the latest Champagne sales numbers are a striking indication of what’s going’s on.
This French wine service story is stunning in its conclusions: “Champagne was dominant 10 to 15 years ago, but the world has changed.”
The story, though written for the European market, is well worth reading because it documents the trend we’re been talking about here for several years (and not just because I’m trying to put together The Cheap Wine Book). Today, when consumers have a choice between two quality products, they’re more likely than ever to buy on price. Champagne exports declined 2.8 percent last year, while non-Champagne sparkling wine accounts for 70 percent of the European market.
In other words, we’re buying more cava and prosecco and so are the Europeans — and that it’s not Champagne doesn’t seem to bother us.This is shocking news, and especially for the Europeans. Their market never, ever worked that way.
This also demonstrates the continuing evolution of the wine market into two tiers – everyday wine drinkers, who are mostly ignored by the Winestream Media, and a much smaller, score-driven minority that still buys wine the old-fashioned way and is doted on by most of the wine world.
And how cheap are these wines? Cava costs €8 (US$11) or less in most European retailers, while prosecco ranges from €5 to €15 (about US$7-$20). Those of you who buy either in the States will note that’s pretty much what we pay for it. Call it the pricing power of the biggest multi-national wine companies (cava giant Freixenet’s annual production is about two-thirds of the entire Champagne region), and they’re more than willing to trade margin for market share – another theme we’ve discussed in detail here.