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French wines set for success with advent of sophisticated consumers

Published:  21 January, 2014

The sophisticated drinker is the next dominant consumer, with French wines set to shine, according to a report from Wine Business Solutions.

Peter McAtamney, who runs the Australian consultancy which published Wine Paper 29, says that those wine countries that have positioned their brand as a "source of exciting wine experiences" will be the most successful in the coming years.

With that in mind, McAtamney believes France to be "the most well-endowed overall" and a "frightening prospect for competitors".

But he says that the outlook is poor for Australia, Chile and South Africa.

He cited France's connection to gastronomy which showcases wine as "an element in its own right rather than simply an accompaniment to a meal", as a major strength.

The Share of Listings Held by the Major Supplier Countries by Market - Source WBS research WBS research

Graph showing UK market shareGraph showing UK market shareSource: WBS researchThe Share of Listings Held by the Major Supplier Countries by Market - Source WBS research

Taking a closer look at the UK market, McAtamney predicts that "if we accept that London sets the trend in that market for the next 15 years or so and that Northern Ireland is perhaps 15 years behind, things look great for France and fairly sick for Australia, Chile and South Africa. Italy and Spain look solid although the pressure is on Italy to continue to innovate. Argentina and New Zealand are at a crossroads".

McAtamney states that industry structure is the major issue for Australian, South African and Chilean companies. "The harder the big companies push product into supermarkets, the faster branded product gets pushed off wine lists and the harder it becomes for those countries to change perceptions. Australia currently only exports 16% of its wine with a region on the label (other than SEA or home state branding). It's going to be very hard to change Australia's international reputation until that becomes at least 25%," he states.

McAtamney adds that the "very straightforward nature of Marlborough Sauvignon Blanc and Mendoza Malbec" will undo their countries' successes "if they fail to change their image and offer during the next five years or so".