Selling Chile

Promotional Feature sponsored by Morandé Wine Group

Published: 01 November, 2022

In a cash-strapped economic market, with the wine sector showing negative growth, Harpers and Angela Mount brought together a panel of retailers and experts to discuss innovation and premiumisation within the Chilean wine sector as it looks to appeal to a younger audience

The Panel:

Photography by: David Rowland www.davidrowland.photo

Spencer Hyman, partner and co-founder, Cocoa Runners / Ricardo Baettig, chief winemaker, Viña Morandé / Andrés Alvarado, export director for North America and Europe, Morandé Wine Group / Sarah Benson, wine buyer, Co-Op / Dror Nativ, wine buyer and manager, M&S / Neil Tully MW, founder and creative director, Amphora Design

Angela Mount, moderator, consultant, writer and judge

It’s an inescapable fact that younger consumers are drinking less wine, frequently moving to alternative drink sectors. What is the industry doing to address this issue and rebalance? The very ethos of marketing wine has changed in the past 20 years. Harpers partnered with forward-thinking Morandé Wine Group to discuss the issues and opportunities with leading retailers, together with insights from a branding expert and a pioneer from outside the wine world.

Morandé’s export director Andrés Alvarado and Viña Morandé chief winemaker Ricardo Baettig began by showcasing a range of their wines, highlighting their approach to innovation through provenance, terroir, new grape varietals, regionality and NPD (via a lower-alcohol wine, a wine offering a high concentration of polyphenols and a ‘winebeer’). Morandé’s aim is to produce wines with drinkability, with stories, illustrated by its Vinos del Valle Del Maule Terroir Wines Cinsault/Pais 2020, an unoaked, fruit-driven red, which showcases the Pais varietal. As Neil Tully MW of Amphora Design said: “It’s so important to have identity, this is a big statement about the quality of a local variety, and adds to the story.”

The discussion began with the current performance of Chilean wine in the retail sector. While the UK average retail price is £6.44 (Source Nielsen), Chile’s average price point sits below £6. However, the Co-op over-trades both in terms of price point and share, especially in white. Sarah Benson from the Co-op said: “We have seen like-for-like growth of 24% in Chilean white wine, driven by the Irresistible range, which has been supported both by meal-deal offers and virtual tastings for our members. We took out the market leader, and replaced seamlessly with our own offer.

“Trends are often formed in the on-trade. Now it’s our turn to drive stories, provenance, interest and diversity”
Sarah Benson, the Co-op

Our customers trust our brand.” At M&S, the over-performance is similar, according to wine buyer Dror Nativ: “Chile is growing ahead of total market. Our total Chilean range is up by 8% year on year, with white driving this at 34% growth, driven by the value offering, but also by shortages in New Zealand and Europe.”

Like Benson, he talks about the trust customers have in M&S’ brand: “Our focus is on offering the best quality at the best price. Our Classics range is showing 17% year-on-year growth in a declining market.” The innovative M&S Found range, while in its youth, is showing a seismic 160% uplift. “Customers trust us, they trust our choices.”

COMMUNICATING CHILE

The debate moved to communication, both in terms of provenance, and appealing to a younger audience. On the former, Cocoa Runners’ Spencer Hyman drew comparisons with the chocolate market. “In the UK, we spend as much on chocolate, as we do on books and recorded music combined – £5 billion. Chocolate is akin to wine, it has provenance, it has a story, it has flavour.”

He continued: “We are trading people up into craft chocolate because we talk about the story, we talk about provenance from all over the world. There is interest, people want to indulge at an affordable price. It’s about occasion – when do they eat chocolate, when do they indulge? It’s no different in wine, it’s how you communicate, how you switch from a ‘commodity’ perception to a message about flavour.”

At Morandé Wine Group, there is a huge programme of development and innovation in terms of viticulture and winemaking, from celebrating individual areas such as the lesser-known Malleco valley, to showcasing the local Pais.

According to Co-op research, country of origin is now only fi fth on the list of customer wine decisions, with style at the top. As such, the Co-op is undertaking new trials, especially focused on the urban and transient customer. Tully made a strong observation: “All too often producers are looking from the wrong end of the telescope; they don’t understand market needs before they position their products.”

In terms of attracting a younger audience, the panel agreed that it was all about engagement and making wine relevant, communicated in a way that demystifi es a complex and frequently daunting subject.

M&S wine ambassador Fred Sirieix focuses on occasion at value pricing as its key message, encouraging trust, both on TV and at point of sale. As a result, M&S has seen growth in the pre-family and family sector. Hyman picked up on this, suggesting: “We have DJs for music, and using the analogy, we need the equivalent of DJs for wine – make it relevant, make it cool, not stuffy.”

Staying with the younger audience, but also focusing on provenance, the key question is how to communicate this on shelf. Tully, an MW with a lifetime of work in wine branding and design, is clear on this: “There is limited space on shelf, customers spend little time in the wine aisle. Once the initial decision-making regarding colour, price and style has been made, it’s all about which bottles attract attention. We live in an amazingly visual world, particularly for the younger generation. They think differently. QR codes are more important, language is important; their brain processing is faster, so there needs to be immediate stimuli, and a consistent brand message.”

One of today’s most powerful global messages, at the heart of every retail strategy is sustainability. However, transferring this to messaging on a bottle of wine is less simple. As Nativ commented: “Organic is simple to communicate, sustainability is less so.”

Drawing comparisons with the chocolate market, Hyman interjected: “It takes 1,500 litres of water to produce one chocolate bar; with climate change and deforestation of the Amazon, how do we get that message out there?”

The debate continues from vineyard to bottle. In Tully’s view, to create a message on shelf that is meaningful, the real art in branding is being brave enough to leave things off, to keep the messaging simple and pure, without dumbing down.

Hyman agreed: “It comes down to communication; start with what you want to do, learn where and how habits are formed, and interpret how to get those messages to the consumer.”

Nativ summed up the evolving role of buying teams: “How can we break the mould? These days it’s not just about how we buy well, it’s about how we sell well.”

The final clarion call came from Benson: “Trends are often formed in the on-trade. Now it’s our turn to take the baton, and drive stories, provenance, interest and diversity.”

THE WINES

Wines available through Berkmann Wine Cellars, unless otherwise noted:

WHITE

» Bold WMN Low Alcohol (8% ) Sauvignon Blanc 2021 (Morandé Wine Group*)

» Morandé Estate Reserve Sauvignon Blanc 2022

» Morandé Gran Reserva Sauvignon Blanc 2021

» Vinos del Valle Del Maule Terroir Wines Semillon 2021

» Morandé Black Series Chardonnay 2020 (listed in Majestic and available through Morandé Wine Group*)

RED

» Origen Sur 2017 (Morandé Wine Group*)

» HAX Cabernet Sauvignon NV (Morandé Wine Group*)

» Vinos del Valle Del Maule Terroir Wines Cinsault Pais 2020