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Waitrose introduces 100 new lines to bolster premium position

Published:  12 October, 2018

“Functional booze is not our game. We need to tell a story,” says Pierpaolo Petrassi, head of buying, beers, wines and spirits at Waitrose.

Speaking to Harpers at Waitrose’s showcase tasting of it’s autumn and Christmas collection yesterday, Petrassi said that the company is staying true to its brand ethos and not buckling under the pressures of Brexit and competitors - no range reduction, no supplier cull, and showing 100 new lines with a focus on engaging customers, providing exclusivity and ‘selling the experience’.

“We are sticking to our core principles of offering a strong, and comprehensive range, and behaving like an independent within a retail setting,” added his colleague James Bone, buying manager for wines.

“We know that consumers are buying less, but better, so we are positioned to provide that experience, and our trajectory is to trade more on understanding of what will be a real treat for them, and less on fighting it out at the bottom of the pricing pile,” said Bone.

Waitrose continue to over-perform within the wine category, holding a market share of almost 9%, against its grocery average of 5%, and showing growth within the sector, according to both Kantar and IRI data. Within this, the supermarket’s slightly older and certainly more affluent customer base has led the team to analyse its customer profile, and as a result continue to focus on European wines, together with champagne and sparkling, where the company overtrades significantly in both sectors.

Waitrose also holds an impressive 19% share of the French wine market within grocery retail (IRI data), along with its 17% share of Champagne and sparkling wine.

“We understand our customer base and work within this to satisfy our customer needs, so at the moment we have a natural swing and over-performance in European wines. We want them to have an experience with the wine; it’s about selling the story, and providing the need and desire to shop with us,” said Petrassi.

The demographic base of their customers is also clearly illuminated by the strong performance of champagne and sparkling wine. Within a market where the average price point for champagne is £20, Waitrose commands a far higher retail of £30.

The tasting showcased a considerable number of premium wines, together with the introduction of a ‘limited’ range offer of small and exclusive parcels, ranging from £22.99 up to a Chateau Le Bon Pasteur 2006 at £69.00, which will be available in 40 of the 300 stores.

“It’s exciting; it’s all about churn and keeping our customers interested,” said Petrassi.

While Waitrose performs well at the higher price points, it is also keen to avoid the loss of customers who are looking for a great value, everyday wine, and has addressed this through a greater range of value for money wines.

Last year, the business introduced its ‘Blueprint’ selection, a range of 38 wines under a fairly discreet Waitrose label, ranged between £5.99 and £8.99 in price.

Innovation also comes in the form of an increased range of premium wine boxes and wine cans, the latter a strong focus in smaller format stores. Waitrose also vastly outperforms the market on organic food, and this ethos is now being translated into the wine aisles, with a focus on an increased presence of organic wines, such as the impressive Mauree d’Ione Organic Nero di Troia.

With a total of 360 stores, ranges are determined and segmented by Waitrose’s four fascias - core stores, Little Waitrose, Welcome Break and Shell franchises, with a premium overlay for London.

Waitrose Cellar has received a make-over, with the introduction of ‘On the QT’ selection - small parcels of premium wines, selected by buyer Xenia Irwin MW.

“We have a buying team with experience beyond any other retailer in the industry, who are passionate about their craft, and their job, and of course, about the regions for which they are responsible. It is that passion that we are now working on communicating to the customer, telling the stories, and selling the experience,” said Petrassi.

Spirits, beers and cider are also an increasingly important part of the drinks mix.

“We see the opportunity, and we have the right customer base, with which to achieve this. We are on a mission with craft beer, not just from UK, but from Eastern Europe and the US. Premium spirits are also vitally important to us. As well as gin, we are focussed on growing the premium sector in tequila, dark rum and malt whisky,” Petrassi added.

Waitrose command over 50% market share of gins over £28, and it continues to push this highly performing category.

Soft drinks are an addition to the BWS remit, with Waitrose focusing on the development of an increased range of ‘adult’ soft drinks, as Petrassi explained.

“Consumers are drinking less, and sometimes want a ‘grown up’ non-alcoholic drink. Therefore it made sense to move soft drinks to my portfolio as it’s a crossover area, so that we can treat this sector in a similar way, and assimilate it into our core offer. I predict a great deal of growth from this sector.”