Lorenzo Biscontin
Last week, the most discussed and reported news related to the wine sector at a global level by specialized and non-specialized media was the forecast of a prolonged drop in consumption at a global level predicted by IWSR, the main international research institute specialized in alcoholic beverages.
According to IWSR, the reasons behind these forecasts can be summarized in 4 factors, all structural.
1. The spread of healthier lifestyles that lead to a reduction in the occasions of alcohol consumption and/or the consumption of low- or no-alcohol beverages. This trend is transgenerational, but more marked in the younger generations, Gen Z and Millenials, compared to Gen X and Baby Boomers.
2. Greater competition from other categories and/or brands of beverages that have caused the offer of products capable of satisfying the demands and stimulating the curiosity of consumers to explode. Here too, the trend is driven by younger generations and diminishes, but does not disappear, as people get older.
3. Lower interest in wine among younger generations, linked to changes in lifestyle that have reduced the time when wine is consumed during daily meals.
4. Desire for a better/higher alcohol consumption experience, which is linked to the concept of “drinking less, but better” and the reduction in consumer disposable income globally.
While the reduction in wine consumption globally is an unequivocal fact of the last 2 years, I only partially agree with the causes identified by IWSR, which in 2023 still predicted stable wine consumption until 2028.
I agree that the trend is due to long-term structural changes in people’s lifestyle that began decades ago (just think of the changes in meals structure).
However, I believe that the element of alcohol content in wine is largely overestimated because the decline in consumption over the last twenty years is due only to red wines and is concentrated in France, Italy, China and Spain.
It is true that red wines have on average a higher alcohol content than white and rosé wines, but the difference of about 2% does not seem to me to be enough to act as a such strong discriminant for consumers.
But is also true that the trend of decline in wines in France began in 1995, when attention to alcohol content was essentially zero, and by 2015 it had already led to a reduction of almost 50% in volume. The trend continued until 2022, when red wine consumption in France fell below 3 million hl, compared to 8 million in 1995.
In Italy the phenomenon began in 2007 and in Spain in 2009, also here therefore in years in which moderation in alcohol consumption was a marginal phenomenon.
The situation is different for China, which consumes almost exclusively red wine, whose collapse began in 2017 for mainly political-cultural reasons.
With this I do not mean to say that the phenomenon of moderation of alcohol consumption does not exist, but that the reduction of the alcohol content in red wines is not the definitive solution for the recovery of this category which is entirely responsible for the decline in wine consumption at global level.
I believe that the reasons are different and I would look for them starting from people’s perception and appreciation of the taste of red wines (in different styles and typologies).
Having made this long and necessary premise of defining the context, the key point is how to act in this situation. In fact, forecasts are not useful to make us happy if they go in a favorable direction and sad if they go in the opposite direction.
They are meant to give us the knowledge of the scenario we need to develop strategies to address it in order to reverse the negative trends that are expected.
This is not wishful thinking, it is a matter of proactivity in management. I saw it happen in the cured meats sector at the end of the 90s of the last century and in the spirits sector at the end of the 10s of this century, when these industries had to face drops in consumption due to changes in people’s lifestyles.
One thing is clear: the visions adopted in the past are not able to successfully address the scenario we have before us.
At Labhornet – Vinophila we have a project that is based on the change in vision of “wine” from a product category to a brand.
The industry must move from the current “product” approach to a “marketing” approach, in which product policy is one of the elements to be integrated and coordinated together with those of price, presence and perception (Editor’s note: I used my review of the 4Ps of marketing that I have been using since 2014, when I defined the concept of “total marketing”).
Because “wine” must be relaunched as a whole and to do so we need more marketing (the real one), not less.
With this vision we are building the tools to do so. Stay tuned.
