When Hong Kong decided to become a fine wine hub and scrapped its duty, there were questions over whether this would prompt people to buy more wine, or simply consume more alcohol. So far the fine wine plan seems to be working – but Hong Kong still has logistical problems to overcome.
There’s no doubt about it – times are tough. In many companies, the accountants will be passing their ruler over expenses, thinking of things to cut from the budget – and if previous recessions are any guide, one of the first things to go will advertising. Yet this could be the worst mistake a wine company could make in the current environment.
When 60 Minutes aired a 1991 program on the ‘French paradox’, it kicked off a wine boom. The program suggested that rates of red wine consumption explained why France had lower rates of cardiac disease than the US, despite the French diet being higher in fat. The story also unleashed a flood of articles extolling the health-giving properties of wine.
The Languedoc-Rousillon region along the Mediterranean Sea in southern France is the world’s largest wine producing area, responsible for a third of France’s wine production. A new brand may bring the region together. It is also a region in trouble. One response has been to replace Coteaux de Languedoc with an expanded appellation in order to simplify things. Another is to try New World style branding...with a twist.
As the global wine trade becomes ever more corporatised and competitive, having skilled employees with an intimate knowledge of not just wine, but the wine business, becomes ever more important. Employers should take a closer look at what wine education is available.
According to Neil Hendry from Data monitor, 24.7bn litres of wine were consumed in 2007, almost four litres per man, woman and child on the planet. However, the dynamics are shifting.
If the latest consumer tracking study by California’s Wine Market Council is any indication, the U.S. wine industry is heading for a banner year. Not only did wine consumption reach an all-time high of 300m cases in 2007, but sales growth by value outstripped volume, indicating that American consumers are trading up.
Last year will be remembered by the wine industry as, among other things, the year of the Great Glass Shortage, when problems were reported from as far afield as South Africa, Argentina, and even Thailand.
Just before Christmas, Joris Snelten, managing director of DGS, one of Holland’s main importers, sent out a letter to his key customers, the multiple grocers and specialists. He told them that the world glass oligopoly had just confronted several of his main suppliers with severe price hikes, in some cases up to 50%.
Argentinia's wine industry has many advantages, from its geography to its low production costs. Seeing the potential, major investors have leapt in. While Argentinia still faces macro-economic issues, it seems investors' confidence has been justified.
