Freixenet celebrates sparkling's success

04 April, 2014

Market analyst Nielsen hailed sparkling wine the star performer of the drinks industry after another set of impressive growth figures, and the leading supplier thinks the category will only continue to go from strength to strength.

Sparkling wine grew 8% in volume and 15% in value to £464 million (Nielsen, year to February 1). In the same period still wine, Champagne, spirits and fortified wine all lost volume.

Damian Clarke, managing director at Freixenet, told OLN: “The core of our business sits in probably the best place within BWS at the moment. It’s up 15% in the off-trade and that’s a long- term trend and it’s accelerating.

“Over the past 12 years sparkling wine has trebled in value. Of course there’s a duty element to that, but even stripping that aside there’s some great long-term growth. People see it as an affordable luxury in tough economic conditions.

“Penetration of sparkling wine lags so far behind still wine – and that’s not necessarily the same in other countries – so there’s an opportunity for people to come into drinking it, and drinking it on more occasions.

“Sparkling wine is currently around a tenth of the size of still wine – why couldn’t it be a third of the size? The sparkling wine category could easily double in size.”

Nielsen figures show that cava brand Freixenet is worth £34 million in the off-trade, ahead of closest competitor Martini, which supplies £23 million worth of Prosecco and Asti. “We are the clear leader and our core brand, Cordon Negro, has an rrp of £9.99, and the average price for still wine only recently broke the £5 barrier, so we offer a better margin,” said Clarke.

He believes retailers have a huge opportunity to boost profits by using creative POS to educate shoppers around the sparkling wine fixture.

Clarke said: “There are plenty of consumers that will buy sparkling wine but not Champagne. There is an image of formality to a Champagne occasion, whereas sparkling wine is an everyday celebration.

“There is an opportunity for all retailers to optimise their range and merchandising. Wine is generally quite confusing so anything that can be done to improve the shopper experience there would help.

“Well-known brands act as signposts, particularly in convenience, where the market has seen such strong growth.

“I think the retailer could look to be inspiring in terms of sparkling wine and showing shoppers how it can fit into their lifestyle. They should use education at the fixture about how sparkling can fit in more occasions.”

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