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Australia needs a strategy that speaks for all its wine industry says Wine Business Solutions

Published:  24 February, 2015

The quickest way for the Australian wine industry to achieve the effective and lasting changes it seeks is to implement a strategy that does not just speak for the big corporations, but works for all levels, according to leading research body Wine Business Solutions.

In a hard hitting submission to the Australian Wine Grape Authority as it looks for industry responses to help it formulate a new five year business plan, the authoritative Wine Business Solutions believes any new strategy requires fresh thinking that takes in to account all aspects of the Australian wine industry.

Peter McAtamney, principal of Wine Business Solutions, that produces research papers on wine business trends not only in Australia but other key international markets, sets out the five key areas the AWGA needs to address. He writes:

1 Acknowledge that there is a problem.

There are still far too many people in high ranking positions within the Australian wine sector either denying that there is a problem or saying that they don't know what the problem is. The issues are clear, obvious, and should be well understood by anyone seeking to play a leadership role within the industry.

2 Stop claiming Australia makes "the best wine in the world".

No one that the AWGA is seeking to influence is going to give that statement any credence. Australia does make the best wines in the world across a range of styles, it can make the best wines in the world across a broader range of styles and it absolutely cannot and will not make the best wines in the world across other styles. We need to play to our strengths. We need to be constantly benchmarking and developing styles that can be globally competitive. We need to communicate that in a way that demonstrates self-knowledge in order to be taken seriously.

3 Restructure the WFA 

The national peak body's primary concern must be the long term sales and marketing strategy for the Australian wine brand. By subjugating this task to what is now the Australian Wine Grape Authority the Australian wine industry's peak organisation has been left rudderless for the last 15 years focused on policy and politics rather than developing a well-informed vision for a globally competitive wine industry.

The reason why New Zealand Winegrowers, the Austrian Wine Marketing Board and other national peak bodies are so much more successful is that their sales, marketing and long term country brand health strategies are forever at the forefront and the absolute focus of their energies.

4 Develop an "upside down" support model

The fastest growing and most profitable part of the market is and always has been the most premium. The Australian wine brand and its long term health will absolutely be determined from always getting the best quality wine in front of most appreciative and influential audience.

The Australian wine industry's biggest challenge is the structure of it. No other major wine producing country is so bottom heavy in terms of a small number of large companies' capacity to dominate the export offer. The WET rebate has exacerbated this situation through providing a disincentive to export. Markets and opportunity will constantly be evolving away from us unless the industry is united in somehow interrupting this.

Even at Savour which, in my view, was one of the best wine events globally in recent years, the cost of participation meant that big companies dominated and interstate wineries stayed away. This has to be turned on its head. There should be an objective, fair and open system whereby those wineries gaining the best international critical acclaim are subsidised to participate in the key image building events.

5 Provide education as to the best opportunities, the best paths to market and the best business operating models for the various wine business types.

This is a very complex business and without great clarity as to how play, wine industry participants risk getting in each other's way rather helping each other to succeed. Companies of all sizes lack deep understanding of their role, the role of different sized players and how to play as a team. That, in the end, is the real challenge and opportunity for the Australian wine industry's leadership.