Why wine needs a global brand

on 12 May, 2014

Wine has managed to evolve thus far without the emergence of a global brand leader. it’s unusual in this respect, since widely distributed products tend to favour a dominant player. Coca- Cola, Levi’s, Ford, Apple: all of them are evolutionarily logical – inevitable, even.

Such a player has thus far evaded wine because of the reality of its production. It is a fragile liquid made from hundreds of different varieties, grown all around the world and harvested only once a year in hugely varying quantity and quality.

Of course, these are the exact reasons it becomes so compelling for the minority of consumers who are highly interested in it – but, for everyone else, it remains utterly bamboozling.

Take, for example, the world’s largest wine producer, Gallo. It makes something like 1% of the global total of wine every year. That may seem big to your average vigneron, but it’s peanuts compared to the big brands in beer, spirits and soft drinks – and besides, Gallo’s production is fragmented across many different labels, many of which are not Gallo-badged.

Hence the situation where a mature market such as the UK’s hosts thousands of micro-brands on its shelves. This is confusing for the consumer, difficult for producers to penetrate, and allows price to become the major tool for promotion.

Shrugging off the problem by blaming wine’s intrinsic nature is staid and disingenuous. The truth is that the wine trade is scared of a dominant brand – but it needn’t be. A global brand leader would make wine easier and more accessible without diminishing its great diversity and beauty. If anything, it would mop up the gallons of poorly made plonk that let the category down so often, while allowing the good stuff to reach its audience as normal. Carling hasn’t restricted the growth of craft beers; Ford Escorts don’t devalue Lamborghini Gallardos.

The problem of fragmented production is a challenge for wine – but it’s not impossible to overcome. What is required is a critical mass of production. preferably somewhere where costs are low, exporting is well-established and conditions are reliable for grape-growing.

China is an obvious candidate. Vineyard area has nearly doubled in the past decade, making it the fifth largest wine producer in 2012, according to the international organisation of Vine & Wine (oiV) – and it’s still growing. With the right business model, a Chinese brand could well establish itself as a global leader.

Doubtless, wine snobs would decry its unspecified origin, unidentified grapes and soft, ripe, fruity style. Everyone else would love it for the same reasons.

Good brands provide reassurance for the consumer without diminishing the fortunes of differentiated competitors. Moët & Chandon is the perfect example, providing an excellent Champagne experience to millions of consumers without compromising the diversity of the category.

Big brands evolve because they work. As wine continues to crawl out of the ocean, the birth of a dominant brand is not be feared, but to be welcomed.

ABOUT

Your window into the world of a drinks journalist - from cocktails competitions to financial results, we've got a view and we're not afraid to share it.

NEWSFEED

RSS
Click the RSS icon to grab our feed and follow the DIgestif blog via your news reader.

Site Search

Is blended Scotch overshadowed by single malt in retailers?

  • Yes
  • No
  • Don't know

Polls

Is blended Scotch overshadowed by single malt in retailers?

  • Yes
  • No
  • Don't know

Facebook

Twitter