Is Brexit being blamed for everything or is the wine industry that is in a mess?
March 23, 2017
Whether we agree or not, have voted in or out, Brexit is a result of democracy and we all need to accept it and try to get the best out of it, but lately Brexit is being blamed for everything, sometime rightly so, sometime no.
A couple of days ago I read on several newspapers and magazines that the general director of the Comité Interprofessionnel du Vin de Champagne (the CIVC), France's main champagne industry body, was presenting champagne 2016 sale results saying that champagne sales in the UK have shrank by 9% and was attributing the fall to Brexit.
While there is some true in their interpretation of the fall in sales, the pound has been hit very hard following Brexit, I dont think this the very reason of their problems, the whole UK wine industry is a state of mess, and Champagne is the epitome. One of the first lessons you learn when you enrol in a business school in the new venture creation course is to choose carefully your target market, you can’t aim at everyone, and this, I think, is the real reason behind Champagne’s decline in sales together with a market that offers plenty more alternatives. Pound drop and higher excise are affecting all wines, not just champagne.
Champagne for historic reasons has always been the British celebration drink, it was in an almost monopoly situation in the UK, and Champagne producers have enjoyed this status quo, however, in the last few years, following the arrival of Prosecco, the reaction of Champagne producers has been hastily and commercially wrong, instead of reminding wine drinkers why they loved champagne, they start slashing their prices, thinking that Prosecco would have been another meteor, would have gone in a couple of seasons, without considering that Prosecco will always be able to beat Champagne on price due to its lower production cost, and this is exactly what is happening, not only, but many more sparkling wines, Prosecco opened the market, are now entering the market contributing even more to Champagne’s sales decline.
I think that this is just the beginning for Champagne, unless the CIVC make a U turn on their strategy, the years to come will see more drinkers moving away from Champagne. Both, Champagne and Prosecco’s strategies are damaging their brands, I wrote about Prosecco on a previous post, however, Champagne is the one, that at the moment, is losing sales.
But Champagne is not the only loser, we, wine drinkers are the real losers, Champagne is selling less, but we are all drinking poorer wines. The whole UK wine market is in a mess and Brexit is just another excuse to give us even poorer wines.
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