What about Cava?

10 September, 2015

The past few years have seen Cava passed over like the ugly step-sister to Prosecco’s Cinderella, looking on while Italy’s flavour-of-the-decade fizz goes from strength to strength.

But retailers and some of the biggest brands in the market are seeing sales soar despite a slumping market — so can the Spanish sparkler change UK shoppers’ minds, clean up its image and take advantage of the new consumers being drawn into the market by the Prosecco craze?

Years of footfall-driving discounts have given Cava a cheap-but-not-so-cheerful image it doesn’t really deserve, as prices these days tend to be on a par with Prosecco, and with the same production methods as Champagne it should have a much more prestigious reputation.

The latest figures from IRI show Cava sales falling 11% to £19 million in the year to July 18, with volumes slumping 17% to 2 million litres, while Prosecco sales soared 72% to some £339 million and volumes grew 79% to 37 million litres.

As supermarkets slash their wine ranges, the Spanish sparkler could face a vicious circle of losing space to Prosecco, which would then get more interest because it had a bigger share of the market.

“Prosecco is getting more space and focus in store because it works so well on promotion,” says Toby Magill, head of beer, wine and spirits insights at IRI. “As it gets more popular retailers put more investment and effort in, and you can see the reverse happening with Cava.

“Prosecco is doing well at a crucial time. Tesco is cutting sparkling wine by 30% — if Cava bears the brunt of that and Prosecco comes out with more space than before, it will start riding the crest of recovery in the next year or so, with more space, fewer rivals on shelf and increased consumer business.”

He says Cava is falling in between two camps, not being cheap enough to compete with Prosecco on price on one hand and not having the marketing budgets and prestige of heavyweight Champagne players behind it on the other.

“Producers need to come back with some message through marketing about the benefits and plus points of Cava, such as that it is manufactured in exactly the same way as Champagne so is technically a better product than Prosecco, but I don’t think consumers know or understand that. There should be an operational message that Cava is a step up from Prosecco. Cava has got to make its benefits clear to shoppers and consumers and then take that message to retailers.”

He adds: “Having more shoppers in your market is always going to be a plus point. What is Cava going to do to target them and make sure it is on shelf to win them? If Cava is not going to change its game from where it is now, it is not going to be in a position to win shoppers over.”

CHALLENGES AHEAD

At this year’s London Wine Fair Félix Solís Avantis UK launched a sparkling Spanish wine made in Valdepeñas, under the name Provetto.

Managing director Richard Cochrane says: “The UK Nielsen statistics indicate the strength of growth of Prosecco and the challenges facing Cava, and in part that is why we have not invested in Cava. There are some premium niches within Cava doing really well, but that is clearly not reflected in the larger market.”

He believes the next 12 to 18 months will see Prosecco and Cava reach a balance, with the former’s growth slowing and the latter stopping shrinking.

Supplier Vintage Roots has gone as far as to change the appellation on its Cavas to DO Penedès.

Director Neil Palmer says: “The past few years haven’t been kind to Cava. Originally the drink of choice for those looking for a dry, sparkling option without opting for Champagne, Cava has suffered from a fall in price due to supermarkets looking to remain competitive by bringing in too many cheap and inferior options, and the growing trend for a less dry and more accessible sparkling option seeing a rise in sales of Prosecco.

"The lower prices have put Cava at risk of being seen as a low-quality product only suitable for mixing, especially in the eyes of the new generation of drinkers who see Prosecco as the go-to sparkling wine for all occasions.

“It is clear that Cava is in need of modernisation and rebranding, encouraging consumers to see the drink as an equally high-quality alternative to Prosecco. To combat poor sales, our Cavas are now marketed as DO Penedès, an appellation of quality Spanish sparkling wines requiring a vintage year on the label and a minimum of 15 months’ ageing.”

The company, which is also doing well with its Proseccos, is focusing on its DO Penedès Brut Reserva sparkling on its Christmas list, and aims to encourage independents and specialist off-licences to stock premium brands you don’t see in supermarkets.

Palmer says: “There is certainly still demand for a dry, sparkling option and Cava is an ideal product for this market. We feel delisting Cava is not the way forward, but it is imperative to stock good quality options rather than the cheap and inferior wines that tend to be on offer in supermarkets. On top of this, point-of-sale education can be used to direct potential customers to Cava on shelf, highlighting the provenance and tasting notes and ensuring Cavas are not always overshadowed by more well-known Proseccos.”

Vilarnau is part of the González Byass portfolio and is mainly targeted at hotels and restaurants, but winemaker Eva Plazas Torné says high-quality Cavas can stand up to the Prosecco boom.

She says: “Prosecco, without wanting to sound disparaging, is more of an easy-drinking product that better suits being served as an aperitif as it doesn’t age on lees. Vilarnau Cava ages on lees for three to five years, so it is a sparkling wine with more harmony on the palate and on the nose. The ageing on lees allows us to work without residual sugar — high quality Prosecco has at least 20–25g of sugar per litre — so Cava is a better match with food.”

ESTABLISHED BRANDS

One advantage for Cava is that it does have big, established brands such as Codorníu and Freixenet, whereas Prosecco operates more like a private label.

IRI’s Magill says: “Prosecco is still quite fractured — there is no equivalent to the big cachet brands in Champagne, because it is operating at a relatively low price point.”

But even some of the biggest brands have suffered in Cava’s slump.

Freixenet managing director Damian Clarke says: “Cava is declining year on year, mainly driven by a reduced level of promotional activity and some loss of distribution. While these factors have also affected Freixenet as a brand, our value sales per distribution point have grown year on year.”

Even though there has been some switching from Spanish to Italian sparklers, Clarke sees Prosecco-driven growth in the sparkling wine market as an opportunity.

He says: “Cava is a well established and popular sparkling wine making up a quarter of the sparkling wine category. There is a difference in taste profile between Cava and Prosecco so delisting either may alienate a significant number of shoppers. Cava offers shoppers choice through a much broader range of styles, including rosé variants.”

Market leader Codorníu has seen sales grow 10% and volumes 9% in the year to June 20, according to Nielsen, and has won listings for its new premium Cuvée Barcelona in Sainsbury’s and Waitrose at £12.99. The brand’s average price point is £7.48.

Managing director Simon Bradbury says: “Obviously Prosecco has eaten into Spanish sparkling wine’s market share, but it has also dramatically increased the size of the sparkling wine market in the UK. We are now, more than ever before, a nation of sparkling wine drinkers, and that is something we can all benefit from.

“Cava is very close to the hearts of UK sparkling wine drinkers. Until recently it was the UK’s favourite sparkling wine, and had been for the past 10 years at least. There is no denying Prosecco’s success, but our feeling is that it is reaching its peak and consumers will always need an alternative. Retailers have to offer consumers a choice, so I am sure there is a bright future for Cava within the UK’s sparkling wine market.”

He adds: “My advice to retailers is don’t be short-sighted — consumers still need a choice and there has to be more than just Prosecco on offer. The Cava category in general and Codorníu in particular offer a better quality product, yet it sits at the same price point.

“Prosecco is a massive trend but Cava has proven staying power and is still a force to be reckoned with. It’s also important to consider that Cava offers strong global brands, such as Codorníu, that keep consumers coming back for repeat purchase while Prosecco has yet to develop any strong brands with this kind of pull in the UK market.”

Copestick Murray has just added a Cava to its successful international I Heart range, and launched last month with orders for more than 30,000 cases and national listings from the get-go.

Managing director Robin Copestick tells OLN: “Our customers think that I Heart could be the brand that breathes life back into the Cava category in the UK, and I am sure they are right. I am hoping for more than 200,000 cases in year one.”




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