Constellation concentrates on incentives to drive value

31 May, 2007

New boss says its time to focus on customers interested in quality wines.

Constellation needs to shout louder about its premium wines and spend less time talking about promotions and spreadsheets, according to its new UK boss.

Troy Christensen - whose portfolio includes Hardys, Stowells and Kumala - said retailers and consumers needed to be given more incentive to focus on better wines in order to drive value in the UK market.

"Constellation has to put its hand up as someone who's been more 'suits and spreadsheets' in the past as opposed to our focusing on our wine capabilities, which is really too bad because our organisation does have more worldwide capabilities than any others," he said.

"The profitability of the UK is much less than a lot of the other international markets. But we do see long-term value in the UK.

"I'm not saying that the Hardys Crest proposition is going to go away tomorrow but we do need to work with the industry to work out how to get rational discounting back.

"There is a danger that if we don't get consumers educated and interested a big chunk of our business will slide to the lower end. It's not going to be easy. But we will have to focus on quality and be a bit smarter about how we do things.

"Some people like Tesco right now are focusing more on high-end. I think that's fairly innovative and you will see a lot of people following that. We're optimistic but it's not going to happen overnight."

Christensen hinted at new additions to the portfolio, including a possible South African stablemate for the ≠struggling Kumala.

"Kumala was an interesting product and did very well and lived through a very difficult time of rising prices," he said. "I think South Africa is still a big opportunity and someone needs to show a little bit of leadership there. We do want to take a leadership position beyond just milking Kumala. We need to be a little smarter, and better."

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