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Prestige Champagne fizzes as sub-£20 falls

Published:  29 August, 2019

Research has shown that Champagne is experiencing continued uplift at the premium end of the spectrum, with brands leading the category to a higher average price per bottle.

Earlier this month, Harpers reported that Champagne houses are increasingly making the to move separate out prestige cuvées from the struggling lower end – as in the case of Piper-Heidsieck and its top label Rare – by bottling and marketing them as totally separate entities.

Figures released by Wine Intelligence yesterday gives credence to the view that this has been a positive move for the category, which has suffered from discounted supermarket own brands in recent years.

“The evidence suggests a repositioning of Champagne in UK consumers’ minds,” confirmed Richard Halstead, COO of Wine Intelligence.

“In keeping with the drink-less-but-better trend, Champagne’s average price is climbing, assisted by a sharp decline in sub-£20 own-label Champagne volumes being sold in mainstream supermarkets.”

These two factors are closely linked, Halstead explained, as prestige Champagne brands are “gaining a greater share at the expense of own-label / less well-known brands” while the category as a whole is witnessing “significant increases in mean spend” across the on-and off-trades.

Between 2018 and 2019, average spend per bottle increased roughly £2 to £3 in both the off and on-trades, with upward movements from £21.88 to £23.74 and £32.56 to £35.88 respectively.

At the same time, Champagne is also starting to distance itself from the sub-£20 category.

While Prosecco and Cava appear to be settling between £9 and £11, the perception of what consumers expect to pay for a bottle of Champagne has moved from £15 to £20 in 2015 to £23 and £27 in 2019.

Interestingly, English sparkling has also seen a jump in what consumers are willing to pay, with the “sweet spot” for English fizz jumping to between £23 and £30 in 2019 (the same as Champagne) from £10 to £15 in 2017.

Wine Intelligence put this shift down to “growing awareness and understanding of the category”.

“Consumers are recognising the English sparkling category more as a legitimate alternative to Champagne, at comparable prices, though Champagne remains the first choice celebration product for many regular English sparkling consumers,” Halstead added.

He finished by tempering the optimism in the prestige UK sparkling category with a note on Brexit.

If the “highly uncertain and volatile” political climate in the UK leads to a “significant economic downturn” in the coming months, which seems increasingly likely, this could lead to a “short-run decline in discretionary spending”.

“This will inevitably hit sparkling wine volumes (which are already under pressure) and may also reverse the positive trade-up trend of recent years”, he said.

The research carried out by Wine Intelligence and the IWSR identified Moët & Chandon as the most powerful Champagne brand, with “very high awareness levels” among UK consumers.