Wine could benefit from ‘summer of celebration’

Wine operators and suppliers may be set to enjoy a release of demand for celebration and socialising as pubs, bars and restaurants return.

That was the view from a group of experts at a special session of this year’s digital London Wine Fair, focusing on the recovery of the On Premise after well over a year of disruption.

 

CGA’s research and insight director Charlie Mitchell set the scene for the event by outlining a solid first few weeks of outdoor-only trading. “There’s a pent-up demand that should play through to a positive next few months,” he said. “We could be in for something of a summer of celebration… people have been really missing our sector.”

 

He pointed out that, along with celebratory drinks like cocktails and shots, wine has performed well since hospitality reopened. CGA’s Drinks Recovery Tracker has shown strong sales of Champagne and sparkling wine in particular as consumers toast the return of drinking out.

 

Other guests on the panel reported high demand for celebratory wines. Pub operator Heath Ball said his venues’ outdoor spaces had been packed since reopening. “The demand is unprecedented… people are coming back and they’re spending heavily, especially on premium—the fine wine list is taking a beating.” He added: “People who have been working through lockdown have got a lot of disposable income. They just want to drink good wine, eat good food and have a good time.”

 

Ants Rixon, managing director of Enotria & Coe, agreed many consumers were trading up to premium options, and Master Sommelier and restaurateur Xavier Rousset said his Greenwich Kitchen venue had had its best week in seven years on the back of outdoor trading, with average spend up by 10% to 15%. “Everyone is letting go a bit,” he said.

 

CGA’s data shows that poor weather has dented drinks sales in the third week of reopening, but venues can expect another big boost when they resume trading from 17 May. Ants Dixon said Enotria & Co was working round the clock to resupply venues as they gear up for opening. “We’re really excited about the next couple of weeks… there are crazy volumes forecast.”

 

But businesses need more clarity from the government about the restrictions they will face from mid-May, said Heath Ball—and be ready to adapt quickly to changing conditions and fluctuating weather. “There’s no point in budgeting or planning too far ahead at the moment… you just have to be quick on your feet.”

 

The session discussed the many ways COVID-19 has changed the wine market and hospitality—including via a greater interest in digital menus. “There’s been a massive change in how consumers are ordering… a whole new path to purchase,” said Charlie Mitchell. Some elements like QR codes are here to stay, though operators pointed out that many customers still prefer paper menus and face-to-face ordering.

 

Big post-Covid-19 challenges for operators include staff shortages, especially in skilled roles, the panel agreed. CGA research shows the need to engage staff to attract and retain good talent, and Mitchell said: “We’re seeing shortages really coming back as a big concern across the sector.” Ball agreed: “There’s going to be a lot of operators struggling out there for staff… it’s going to be painful.”

 

The group also explored trends in wine styles. Xavier Rousset said there was increasing interest in English sparkling wine—“People are much more comfortable with it now”—as well as cocktails and hard seltzers. Heath Ball said Instagrammable machines for making frozen Margaritas and Espresso Martinis had been hugely popular among people drinking outside at his pubs. “We’re seeing a lot more people drinking cocktails… people want a bit of fun and theatre.”

 

You can watch a full replay of the London Wine Fair session here.

 

After a turbulent year for wine sales in restaurants, pubs and bars, CGA is offering a four-part series of reports setting out the fast-moving dynamics, highlighting some of the big issues that impacted the category in 2020. They reveal how people’s engagement with wine has changed, and how suppliers and operators in the sector can adapt. The Wine Insight Reports include expert analysis by Richard Siddle at The Buyer.

 

To learn more about CGA’s Wine Insight Reports, please contact Mark Newton at Mark.Newton@cgastrategy.com

 

For more information about CGA’s consumer research and insight into consumers returning to the On Premise, contact Charlie Mitchell at Charlie.Mitchell@cgastrategy.com

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