Wine Retailing - UK - June 2007

SUMMARY

Abstract

Wine drinking has grown strongly in popularity. Wine buffs are ever present, even gracing the screens at peak viewing times, yet the vast majority of the wine drinking public remains largely ignorant of their favourite tipple. This is not an issue if the consumer is to continue making purchase decisions based on price and brand. However, in order to make better choices about more premium wine, consumers need to be better informed.

TABLE OF CONTENTS

Table of Contents

• Issues in the Market
• Main themes
• Definitions
• Abbreviations
• Market in Brief
• Wine market growth slowing
• Brits are discount drinkers
• The great Australian Wine Lake
• What's happening with price
• Riding the wave of a strong economic climate
• It's a lifestyle thing
• Responsible drinking
• They may drink more, but they don't know more
• The potential for growth
• Not confused but possibly blinkered
• Its all in the name regardless of origin
• Quality a problem for major players
• How much consumers buy
• Who buys where
• Threshers thrashing around? But specialists can survive
• Virtual drinking on the increase
• The ethical consumer
• The future
• Industry Insight
• Key points:
• It's tough out there
• The future's pink and white
• A cast of hundreds but its not all white
• It's the real deal
• The new deal
• Magic numbers still exist
• Making it special everyday
• Brands have a role but know their place
• Choosing the winners
• Supermarket special
• Healthy drinking
• Binge drinking
• Direct to market
• Fairtrade flourishing
• Organic growth
• The future is going to be green
• Discounting still on the agenda
• Giving wine a profile
• Internal Market Environment
• Trends in wine drinking
  • Figure 1: Trends in bottled wine, wine in a box and champagne drinking and in-home consumption, 2002-06
  • Figure 2: Penetration of bottled wine drinking and in-home drinking of bottled wine, by gender, age, social grade and region, 2006
• Trends in country of origin
  • Figure 3: Trends in country or origin for bottled wine, 2002-06
• Trends in pricing
  • Figure 4: Trends in amount paid for bottled wine, 2002-06
• Discount drinking
  • Figure 5: Trends in the price of off-sales prices of alcoholic beverages relative to all items, 1996-2006
• Social and health issues
• Binge drinking
  • Figure 6: Per capita volume consumption of alcoholic drinks among the UK adult population (18+), by type, 2001-06
• UK Government action on binge drinking
• EU reform
• Diets and healthy eating
  • Figure 7: Agreement with statement 'I watch what I drink because of constant coverage in the media about 'health' issues', July 2006
  • Figure 8: Agreement with statement 'I usually try to order drinks that have fewer calories in them (eg wine rather than beer)', July 2006
• Health issues
• Seasonal peaks
• Conflict between premium wine and mass (retail) markets
• Are brands a barrier to premium sales?
• Eco, ethical, environmental
• Regulatory framework -- Excise duties
  • Figure 9: Trends in excise duty rates for beer, spirits and wine, 2000-06
• Channel-hopping factor fades
• Under-age drinking continues to be an issue
  • Figure 10: Percentages of supermarkets selling alcohol to minors, November/December 2005 and May/June 2006
• Broader Market Environment
• Economy
• PDI and consumer spending
  • Figure 11: Trends in PDI and consumer expenditure, 2002-12
• Employment
  • Figure 12: UK workforce and employment by gender, 2002-12
• Population trends
• Age of population
  • Figure 13: Trends in UK population by age, 2002-12
  • Figure 14: Average weekly expenditure on wines brought home (incl. fortified and sparkling wines), 2003/04 and 2005/06
• Affluence on the up
  • Figure 15: Forecast adult population trends, by socio-economic group, 2002-12
• Lifestyle trends
  • Figure 16: Agreement with lifestyle statements on drinking, 1996-2006
  • Figure 17: Agreement with the statement 'I enjoy entertaining people at home', 2001-05
• Market in Context
• Key points:
• Retail sales comparison
  • Figure 18: All sales at Food stores, non-specialised food stores and alcoholic drink stores, 2000-06
• Market for alcoholic drink
  • Figure 19: UK volume sales of alcoholic drinks, by type, 2001-06
  • Figure 20: UK value sales of alcoholic drinks, by type, 2001-06
• On and off-trade sales of wine
  • Figure 21: Consumer expenditure on still wine*, on- and off-trade, 2002-07
• Strengths and Weaknesses in the Market
• Strengths
• Weaknesses
• Market Size and Forecast
• Key points:
• Wine expenditure in off-trade
  • Figure 22: Market size and forecast of still wine in the off-trade*, 2002-12
• Factors incorporated in the forecast
• Market trends
• The future
• Where They Buy Wine and How Much They Buy
• Key findings:
• How much wine do we buy?
  • Figure 23: Number of bottles of wine bought a month, March 2007
  • Figure 24: Number of bottles of wine bought a month, March 2007
• Where do consumers shop for wine?
  • Figure 25: Trends in primary store at which wine is purchased, March 2000, April 2002, May 2005 and March 2007
  • Figure 26: Primary and secondary shopping for wine, March 2007
  • Figure 27: Market positioning of outlets used for buying wine, by average age and affluence, March 2007
  • Figure 28: Outlets used for purchasing wine, by gender, age and socio-economic group, March 2007
  • Figure 29: Consumers buying wine from where they buy their groceries, by supermarket used, March 2007
  • Figure 30: Outlets used for purchasing wine, by gender, age and socio-economic group, March 2007
  • Figure 31: Number of bottles of wine bought a month, by outlets used for purchasing wine, March 2007
• Number of outlets used for wine buying
  • Figure 32: Number of outlets used for buying wine, by outlets used for buying wine, March 2007
• Where They Buy Wine and How Much They Buy -- Detailed Consumer Demographics
  • Figure 33: Number of bottles of wine bought a month, by lifestage, Mintel's Special Groups, working status, region, ACORN category, technology usage, Internet usage, newspaper readership, commercial TV viewing, TV received and supermarket used, March 2007
  • Figure 34: Outlets used for purchasing wine, by lifestage, Mintel's Special Groups, working status, region, ACORN category, technology usage, Internet usage, newspaper readership, commercial TV viewing, TV received and supermarket used, March 2007
  • Figure 35: Outlets used for purchasing wine, by lifestage, Mintel's Special Groups, working status, region, ACORN category, technology usage, Internet usage, newspaper readership, commercial TV viewing, TV received and supermarket used, March 2007
• Channels of Distribution
• Key points:
• Number of off-licences
  • Figure 59: Number of retail premises with off-licences, 1998-2004
  • Figure 60: Retail outlets licensed to sell alcohol in England and Wales, by type of premises, 2001-04
  • Figure 61: Number of enterprises of non-specialised food and drinks stores and specialised alcoholic and other beverages stores, UK, 2001-05
• Sales via on- and off-trade
  • Figure 62: UK volume sales of wine*, by distribution channel, 2001-06
• Retail Competitor Analysis
• Key points:
• Retail market shares
  • Figure 72: Estimated retail market shares of the wine market, 2003-07
• Retailer comparison
  • Figure 73: Comparison of wine retailers, 2007
• Future prospects
• Retailer Profiles
• Specialists
• Thresher Group
  • Figure 74: Thresher Group, financial performance, 2002-06
• Bargain Booze
  • Figure 75: Bargain Booze Ltd, financial performance, 2001-05
• Majestic Wine Warehouses
  • Figure 76: Majestic Wine, financial performance, 2002-06
• Oddbins
  • Figure 77: Oddbins, financial performance, 2002-05
• Wine Cellar
• Non-specialists
• Tesco
  • Figure 78: Tesco Plc, financial performance, 2002-07
• Sainsbury's
  • Figure 79: Sainsbury's Supermarkets, financial performance, 2003-07
• Asda Stores (Wal-Mart Europe)
  • Figure 80: Asda Stores Ltd, financial performance, 2001-05
• Morrisons
  • Figure 81: Wm. Morrison Group, financial performance, 2003-07
• Marks & Spencer
  • Figure 82: Marks & Spencer (food), financial performance, 2002-07
• Somerfield
  • Figure 83: Somerfield, financial performance, 2001-06
• Waitrose
  • Figure 84: Waitrose Ltd, financial performance, 2002-06
• Co-operative Group
  • Figure 85: Co-operative group (Food), financial performance, 2002-06
• Discount multiple retailers
• Aldi Stores Ltd (UK)
  • Figure 86: Aldi Stores Ltd (UK), financial performance, 2001-05
• Mail order and online sales
• Direct Wines Ltd
  • Figure 87: Direct Wines Ltd, financial performance, 202-06
• Retail Advertising and Promotion
• Key points:
  • Figure 88: Main media advertising expenditure on wine and sparking wine, by leading wine reatailers, 2002-06