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Still, Sparkling and Fortified Wine - UK - October 2019

“The alcohol moderation trend poses a challenge for wine but lower/non-alcoholic variants are yet to realise their full potential. Developing more L/N/R versions with strong quality/craft emphasis should help to drive sales, particularly if coupled with marketing messages portraying these as a more interesting and sophisticated choice than soft drinks.”
- Alice Baker, Research Analyst

This report will look at the following areas:

  • Alcohol moderation trend presents a challenge and an opportunity
  • Appeal to consumers’ openness to experimentation
  • Offer further guidance in-store to secure sales and encourage trading up

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
        • Still wines
          • Sparkling wines
            • Fortified wines
              • Excluded from the Report
              • Executive Summary

                  • The market
                    • Inflation drives category growth over 2014-19
                      • Further inflation plus declining volume sales expected for 2019-24
                        • Figure 1: Total value sales of still, sparkling and fortified wine, 2014-24
                      • White wine off-trade sales lose momentum, while rosé sales decline
                        • Inflation rises faster in the on-trade in 2019
                          • Weather extremes of 2018-19 affect wine production in various countries
                            • A third of adults have limited their alcohol intake
                              • Companies and brands
                                • Mixed results for brands in the still wine category
                                  • Figure 2: Leading brands’ sales in the UK retail still wine market, by value, 2018/19*
                                • Freixenet and I Heart buck the negative trend in sparkling wine
                                  • Further activity in low/non-alcoholic, canned and English wines
                                    • Advertising spend on wine falls in 2018
                                      • Figure 3: Total above-the-line, online display and direct mail advertising expenditure on still, sparkling and fortified wine, 2015-19 (sorted by 2018)
                                    • The consumer
                                      • Seven in 10 adults drink wine
                                        • Figure 4: Usage frequency for wine, July 2019
                                      • Different wine types have different demographics
                                        • Figure 5: Purchase of wine, by type, July 2019
                                      • Consumers spend more on wine as a gift than for personal use
                                        • Figure 6: Spending on wine, by occasion, July 2019
                                      • Vintage, specific origin and UK-sourced wines attract interest
                                        • Figure 7: Attributes seen as worth paying more for wine, July 2019
                                      • Many wine drinkers are open to experimenting
                                        • Figure 8: Behaviours relating to wine, July 2019
                                      • Over half of wine users/buyers are in favour of nutritional labelling
                                        • Figure 9: Behaviours relating to wine, July 2019
                                      • What we think
                                      • Issues and Insights

                                        • Alcohol moderation trend presents a challenge and an opportunity
                                          • The facts
                                            • The implications
                                              • Appeal to consumers’ openness to experimentation
                                                • The facts
                                                  • The implications
                                                    • Offer further guidance in-store to secure sales and encourage trading up
                                                      • The facts
                                                        • The implications
                                                        • The Market – What You Need to Know

                                                          • Inflation drives category growth over 2014-19
                                                            • Further inflation plus declining volume sales expected for 2019-24
                                                              • White wine off-trade sales lose momentum, while rosé sales decline
                                                                • Inflation rises faster in the on-trade in 2019
                                                                  • Weather extremes of 2018-19 affect wine production in various countries
                                                                    • A third of adults have limited their alcohol intake
                                                                    • Market Size and Forecast

                                                                      • Inflation drives category growth over 2014-19
                                                                        • Figure 10: Total sales of still, sparkling and fortified wine, by value and volume, 2014-24
                                                                      • Inflation to mask volume sales decline over 2019-24
                                                                        • Ageing UK population to hinder volume sales growth
                                                                          • Alcohol moderation trend to erode sales, though opportunities remain for premium and L/N/R alcohol variants
                                                                            • Figure 11: Total value sales of still, sparkling and fortified wine, 2014-24
                                                                          • Forecast methodology
                                                                          • Market Segmentation

                                                                            • White wine continues to lead off-trade sales but loses momentum
                                                                              • Figure 12: Off-trade value and volume sales of still wine, by type, 2017-19
                                                                            • English variants buck the negative trend in fortified wine
                                                                              • Figure 13: Retail value and volume sales of fortified wine, by type, 2017-19
                                                                          • Channels to Market

                                                                            • Off-trade dominates sales in the wine category
                                                                              • Figure 14: UK value and volume sales of wine in the on- and off-trade, by type, 2017-19
                                                                            • Inflation runs faster in the on-trade in 2019…
                                                                              • …while volume decline is steeper
                                                                              • Market Drivers

                                                                                • Various factors push up wine prices
                                                                                  • Increased duties drive wine price inflation in 2019
                                                                                    • Pound’s weakness drives category inflation over 2016-19…
                                                                                      • …while boosting exports of British wine
                                                                                        • Industry bodies voice fear of increased administrative costs post-Brexit
                                                                                          • Weather extremes of 2018-19 affect wine production in various countries
                                                                                            • Consumers’ financial health is crucial for the category
                                                                                              • Figure 15: CPI vs wage growth, January 2014-July 2019
                                                                                            • A third of adults have limited their alcohol intake
                                                                                              • Industry submits proposal for more detailed alcohol labelling
                                                                                                • Ageing UK population could affect various segments differently
                                                                                                  • Figure 16: Purchase of still and sparkling wine, by type, by age, August 2019
                                                                                              • Companies and Brands – What You Need to Know

                                                                                                • Mixed results for brands in the still wine category
                                                                                                  • Freixenet and I Heart buck the negative trend in sparkling wines
                                                                                                    • Further activity in low/non-alcoholic, canned and English wines
                                                                                                      • Advertising spend on wine falls in 2018
                                                                                                      • Market Share

                                                                                                        • Still wine category is highly fragmented
                                                                                                          • Figure 17: Leading brands’ sales and shares in the UK retail still wine market, by value and volume, 2016/17-2018/19
                                                                                                        • Own-label continues to lead still wine sales
                                                                                                          • Yellow Tail boosted by increased advertising support…
                                                                                                            • …taking sales from Echo Falls and Blossom Hill
                                                                                                              • Freixenet bucks the negative trend in sparkling wine
                                                                                                                • I Heart gains from strengthened public profile after merger with Freixenet
                                                                                                                  • Figure 18: Leading brands’ sales and shares in the UK retail sparkling wine market, by value and volume, 2016/17-2018/19
                                                                                                                • Taittinger pushes forward in declining Champagne market
                                                                                                                  • Figure 19: Leading brands’ sales and shares in the UK retail Champagne market, by value and volume, 2016/17-2018/19
                                                                                                                • Buckfast’s rise drives growth in English fortified wine
                                                                                                                  • Buckfast retains volume sales in Scotland despite Minimum Unit Pricing
                                                                                                                    • Figure 20: Leading brands’ sales and shares in the UK retail fortified wine market, by value and volume, 2016/17-2018/19
                                                                                                                • Launch Activity and Innovation

                                                                                                                  • Further activity in low/non-alcoholic wines
                                                                                                                    • Freixenet promotes its non-alcoholic variants as a less sweet option
                                                                                                                      • Hardys emphasises that its de-alcoholised chardonnay retains the original’s flavour
                                                                                                                        • Lindeman’s extends into the low/non-alcoholic drinks sector
                                                                                                                          • Organic launch puts the focus on health
                                                                                                                            • Figure 21: Examples of non-alcoholic/alcohol-free wine launches, 2018-19
                                                                                                                          • Established and new companies launch low-calorie wines
                                                                                                                            • Pernod Ricard revives the Brancott Estate Flight series
                                                                                                                              • Figure 22: Examples of wine launches positioned as a healthier option, 2019
                                                                                                                            • Botanical sparkling wine blurs the boundaries with gin
                                                                                                                              • Further activity in canned wine
                                                                                                                                • New brand Nice emphasises its suitability for multiple occasions
                                                                                                                                  • Figure 23: Product from the Nice canned wine range, 2019
                                                                                                                                • Leading brands extend into canned wines
                                                                                                                                  • Larkin launches ‘super premium’ canned wine
                                                                                                                                    • New canned wines from Aldi heat up the competition for branded products
                                                                                                                                      • More English wines appear on the market
                                                                                                                                        • Chapel Down and Nyetimber extend their ranges
                                                                                                                                          • Blackbook launches ‘London-grown, London-made’ wine
                                                                                                                                            • Bluebell Vineyard makes its debut
                                                                                                                                              • Figure 24: Examples of English wine launches, 2019
                                                                                                                                            • Lyme Bay creates English wine for Morrisons
                                                                                                                                              • Hybrid products blur the boundaries with spirits
                                                                                                                                                • Blossom Hill blends wine with gin
                                                                                                                                                  • Echo Falls brings out spirit-wine fusions
                                                                                                                                                    • Figure 25: Example of Echo Falls Fusion range, 2019
                                                                                                                                                  • Environmental claims are a timely move
                                                                                                                                                    • Ocean conservation-supporting wine brand launches at Star Pubs & Bars
                                                                                                                                                      • Pernod Ricard unveils sustainability-focused Brancott Estate Living Land series
                                                                                                                                                        • Wye Valley Meadery pledges to protect the bees
                                                                                                                                                          • Figure 26: Examples of wine launches with environmental sustainability claims, 2019
                                                                                                                                                        • Celebrity partnerships continue
                                                                                                                                                          • Figure 27: Invivo Wines and Sarah Jessica Parker collaborate on white wine, 2019
                                                                                                                                                        • Cono Sur uses heat-sensitive label to encourage chilled red wine serves
                                                                                                                                                        • Advertising and Marketing Activity

                                                                                                                                                          • Advertising spend on wine falls in 2018
                                                                                                                                                            • Figure 28: Total above-the-line, online display and direct mail advertising expenditure on still, sparkling and fortified wine, 2015-19 (sorted by 2018)
                                                                                                                                                          • Retailers continue to dominate advertising spend on wine
                                                                                                                                                            • Figure 29: Total above-the-line, online display and direct mail advertising expenditure on still, sparkling and fortified wine, by advertiser, 2015-19 (sorted by 2018)
                                                                                                                                                          • Supermarkets push ‘quality for less’ message
                                                                                                                                                            • Lidl continues with price comparisons in Christmas advert for Champagne
                                                                                                                                                              • Asda promotes its Champagne as the perfect choice for Valentine’s Day
                                                                                                                                                                • M&S portrays its rosé wine as affordable indulgence
                                                                                                                                                                  • Yellow Tail focuses on occasions and friendship…
                                                                                                                                                                    • …and portrays its wines as a way to celebrate small achievements
                                                                                                                                                                      • Moët & Chandon portrayed as a must-have for life’s key moments
                                                                                                                                                                        • Other selected campaigns
                                                                                                                                                                          • Nyetimber tours the UK with a pop-up bar in a bus
                                                                                                                                                                            • Figure 30: Nyetimber bus outside National Theatre, London, 2019
                                                                                                                                                                          • I Heart pushes lifestyle associations in its first ever TV advert
                                                                                                                                                                            • Naked Wines sends out wine samples in eco-friendly bottles to attract new users
                                                                                                                                                                              • Nielsen Ad Intel coverage
                                                                                                                                                                              • The Consumer – What You Need to Know

                                                                                                                                                                                • Seven in 10 adults drink wine
                                                                                                                                                                                  • Different wine types have different demographics
                                                                                                                                                                                    • Consumers spend more on wine as a gift than for personal use
                                                                                                                                                                                      • Vintage, specific origin and UK-sourced wines attract interest
                                                                                                                                                                                        • Many wine drinkers are open to experimenting
                                                                                                                                                                                          • Over half of wine users/buyers are in favour of nutritional labelling
                                                                                                                                                                                          • Usage of Wine

                                                                                                                                                                                            • Seven in 10 adults drink wine
                                                                                                                                                                                              • Figure 31: Usage of wine, July 2019
                                                                                                                                                                                            • A third of adults drink wine once a week or more
                                                                                                                                                                                              • Figure 32: Usage frequency for wine, July 2019
                                                                                                                                                                                            • Younger and better-off consumers are the most frequent wine drinkers
                                                                                                                                                                                            • Purchase of Wines

                                                                                                                                                                                              • Seven in 10 adults buy wine
                                                                                                                                                                                                • Figure 33: Purchase of wine, by type, July 2019
                                                                                                                                                                                              • Buying of still white and red wine is highest among over-55s…
                                                                                                                                                                                                • …while rosé and sparkling wines are favoured by under-35s
                                                                                                                                                                                                  • Under-35s particularly value Champagne
                                                                                                                                                                                                    • Low and non-alcoholic wine remain niche
                                                                                                                                                                                                      • Figure 34: Purchase of wines, by strength, August 2019
                                                                                                                                                                                                    • Under-35s are the most likely to buy low/non-alcoholic wine
                                                                                                                                                                                                      • Need for companies to emphasise low/non-alcoholic wines’ quality credentials
                                                                                                                                                                                                        • Mixed drinks can help wine makers to tap into the alcohol moderation trend
                                                                                                                                                                                                        • Spending on Wine by Occasion

                                                                                                                                                                                                          • Consumers spend more on wine as a gift than for personal use
                                                                                                                                                                                                            • Figure 35: Spending on wine, by occasion, July 2019
                                                                                                                                                                                                          • Companies have various options to attract people willing to pay £15 or more for wine
                                                                                                                                                                                                          • Attributes Seen as Worth Paying More for Wine

                                                                                                                                                                                                            • Various options for companies to add value
                                                                                                                                                                                                              • Three in 10 would pay more for wine from a good vintage
                                                                                                                                                                                                                • Figure 36: Attributes seen as worth paying more for wine, July 2019
                                                                                                                                                                                                              • Under-25s are especially willing to pay more for award-winning wine
                                                                                                                                                                                                                • One in five would pay more for origin wine
                                                                                                                                                                                                                  • More women than men would pay more for wine from UK vineyards
                                                                                                                                                                                                                    • Focus on regional provenance should benefit producers of UK-sourced wines
                                                                                                                                                                                                                    • Behaviours Relating to Wine

                                                                                                                                                                                                                      • Many wine drinkers are open to experimenting
                                                                                                                                                                                                                        • Three quarters of drinkers like trying wines from countries they haven’t tried before
                                                                                                                                                                                                                          • Figure 37: Behaviours relating to wine, July 2019
                                                                                                                                                                                                                        • Less familiar sparkling wines appeal to 44% of users
                                                                                                                                                                                                                          • Time of year affects choice among half of wine drinkers
                                                                                                                                                                                                                            • Figure 38: Rosé wine launches highlighting a connection to summer, 2016-19
                                                                                                                                                                                                                          • Promoting chilled serves can help to boost interest in red wine in summer
                                                                                                                                                                                                                            • A third of wine users consider themselves to be connoisseurs
                                                                                                                                                                                                                              • Harness users’ sense of connoisseurship to boost sales
                                                                                                                                                                                                                              • Attitudes towards Wine

                                                                                                                                                                                                                                • Over half of wine users/buyers are in favour of nutritional labelling
                                                                                                                                                                                                                                  • Figure 39: Behaviours relating to wine, July 2019
                                                                                                                                                                                                                                • Red wine enjoys a health halo
                                                                                                                                                                                                                                  • Half of buyers find choice of wine in supermarkets overwhelming
                                                                                                                                                                                                                                    • Suggestions based on previous purchases should help to drive trial
                                                                                                                                                                                                                                      • Educate shoppers to help them feel more confident about wine
                                                                                                                                                                                                                                        • Reviews can help to guide choice
                                                                                                                                                                                                                                          • Opportunities to grow usage of canned wine
                                                                                                                                                                                                                                            • Build premium and quality associations to boost appeal of canned wine
                                                                                                                                                                                                                                              • Premium products in cans could be positioned as a ‘less but better’ option
                                                                                                                                                                                                                                                • Cans’ smaller format can be positioned as helping with portion control…
                                                                                                                                                                                                                                                  • …and as an ethical option
                                                                                                                                                                                                                                                  • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                                                                                                      • Abbreviations
                                                                                                                                                                                                                                                        • Consumer research methodology
                                                                                                                                                                                                                                                        • Appendix – Market Size and Forecast

                                                                                                                                                                                                                                                          • Forecast methodology
                                                                                                                                                                                                                                                              • Figure 40: Total volume sales of still, sparkling and fortified wine, 2014-24
                                                                                                                                                                                                                                                              • Figure 41: Forecast of UK sales of still, sparkling and fortified wine, by value, best- and worst-case, 2019-24
                                                                                                                                                                                                                                                              • Figure 42: Forecast of UK sales of still, sparkling and fortified wine, by volume, best- and worst-case, 2019-24
                                                                                                                                                                                                                                                          • Appendix – Market Segmentation

                                                                                                                                                                                                                                                              • Figure 43: Off-trade value and volume sales of sparkling wine (excluding Champagne), by type, 2017-19
                                                                                                                                                                                                                                                          • Appendix – Market Share

                                                                                                                                                                                                                                                              • Figure 44: Leading brand owners’ sales and shares in the UK retail still wine market, by value and volume, 2016/17-2018/19
                                                                                                                                                                                                                                                              • Figure 45: Leading brand owners’ sales and shares in the UK retail sparkling wine market, by value and volume, 2016/17-2018/19
                                                                                                                                                                                                                                                              • Figure 46: Leading brand owners’ sales and shares in the UK retail Champagne market, by value and volume, 2016/17-2018/19
                                                                                                                                                                                                                                                              • Figure 47: Leading brand owners’ sales and shares in the UK retail fortified wine market, by value and volume, 2016/17-2018/19
                                                                                                                                                                                                                                                          • Appendix – Purchase of Wines

                                                                                                                                                                                                                                                              • Figure 48: Purchase of wines, by broad type, July 2019
                                                                                                                                                                                                                                                              • Figure 49: Purchase of wines, by format, July 2019

                                                                                                                                                                                                                                                          Still, Sparkling and Fortified Wine - UK - October 2019

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