Boom time for Chile

27 June, 2008

The astonishing growth of Concha y Toro is putting Chile front of mind while Oyster Bay gets consumers to dig deeper in their pockets

In the wine sector, any brand achieving a sales uplift of 6% or above can pride themselves on a market-beating performance. Concha y Toro's 80.8% increase is, however you look at it, extraordinary.

"It has been a bit of a boom time," says sales director Simon Doyle. "It's mainly down to extended distribution in all sectors - grocery and specialist - and we've had a really concerted effort on the convenience side of things."

Concha y Toro is spearheading Chile's growth in the UK. "We have absolute focus," says Doyle. "We've got 28 people who are absolutely focused on making sure Chile works and there's no other distraction. I'm always very surprised that other Chilean suppliers don't have a dedicated UK office."

The brand is one of few big-sellers which regularly get some acclaim from wine critics. Doyle sees no mystery there. "Quality is the essence of it," he says. "It sounds a bit old-fashioned but it's one of the reasons our rate of sale is so good at full retail price." Casillero del Diablo has been merchandised with neck tags explaining to consumers that the 2007 vintage was superb for Chile, which is just the sort of marketing most trade commentators would applaud.

Doyle says: "The big push is on Casillero because that's where we see the future - it's our centre of gravity. It's one of the wine brands out there growing value and volume in tandem."

Constellation achieves a creditable hat-trick of brands in the list, led by the sparkling version of Hardys Crest (helped, no doubt, by some attractive deals in Tesco). It is, along with Codorníu and Lanson Champagne, one of three sparklers in the league table. Sparkling wine sales are generally outperforming the rest of the wine market. In the period we're looking at, they were ahead by 10%, compared with 8% for Champagne and 6% for light wines.

The UK's love affair with New Zealand Sauvignon Blanc shows no sign of abating, which is clearly great news for Delegat's Oyster Bay, number three in our chart. Although consumers seem prepared to abandon their supposed price fixation when it comes to Marlborough, Oyster Bay beats many of its less widely-distributed rivals for value and its 73.6% sales increase is its reward.

Canti from Italy and Berberana and Campo Viejo from Spain are demonstrating that there is still plenty of scope for European wine brands, but France is notably absent from this year's list.

Exchange rates won't have helped the causes of producers within the euro zone when dealing with UK retailers - which may also be the American excuse for registering just one wine brand in the fastest-growing chart. Another theory could be that the big Californian brands are reaching critical mass, if they have not done so already and, with distribution already vast in the UK off-trade, it may be unrealistic to expect any further advances.

Echo Falls has the potential to give Blossom Hill a real run for its money, however, and with consumer spending tightening it makes sense for ­Constellation to invest in this part of its portfolio.

It has announced a £5 million marketing campaign, targeting the "newbies" the brand is aimed at, encompassing TV advertising, an on-pack promotion, sampling at events, price promotions and POS support.

Investment from Foster's EMEA has certainly turned around the fortunes of Rosemount, which started to show signs of a revival last year after bottoming out in 2006. Perhaps the glory days may yet return.

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