SPARKLING WINE IN THE CANADIAN MARKET

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1 SPARKLING WINE IN THE CANADIAN MARKET July 2018 Report February Wine Intelligence 2018

2 Sparkling Wine Report overview The Sparkling Wine report includes: Report with the latest information regarding the Canadian sparkling wine market, supported by: Wine Intelligence Vinitrac Canada Wine Intelligence market experience Secondary sources Consumer focus groups 3 report credits Report price: GBP 1,500 USD 2,100 AUD 2,700 EUR 1,800 User-friendly data table with all the measures from Vinitrac Canada showing significances, cross tabbed with: Gender groups Age groups Household income Provinces Language types *All prices exclusive of VAT, GST, or relevant local sale taxes at the current rate 2

3 Contents page Management summary p. 5 Overview of the Canadian sparkling wine market p. 18 volume in Canada Per capita consumption of sparkling wine Demographics of sparkling wine drinkers in Canada consumers in Canada p. 23 Beverage repertoire Alcoholic beverage suitability: Off-premise Alcoholic beverage suitability: On-premise consumption behaviour and perception p. 30 Frequency of sparkling wine consumption awareness and consumption Gender distribution of drinkers by type of sparkling wine Age distribution of drinkers by type of sparkling wine type awareness type consumption type quality perception type value for money perception Imagery statements for sparkling wine types Purchase behaviours p. 45 Purchase locations Wine-buying channels Choice cues type formats at a restaurant alternative formats Typical off-premise spend (bottle) Typical on-premise spend (bottle) Typical on-premise spend (glass) attitudes and involvement p. 57 Attitudes towards sparkling wine involvement, value and expertise involvement by gender and age brand health p. 61 brand power brand awareness and purchase brand conversion brand consideration brand affinity brand recommendation Hot topic: new product development p. 75 Sparkling product type: added fruit flavours Sparkling product type: lower sugar Sparkling product type: lower calorie Sparkling product type: single-serve can Sparkling product type: lower alcohol (5-9%) Sparkling product type: non alcoholic Research methodology p. 83 3

4 Management summary Key takeaways 1. SPARKLING WINE CATEGORY IN GROWTH, WITH FURTHER POTENTIAL IN THE CANADIAN MARKET The compound annual growth rate of sparkling wine volume was 4% between 2013 and 2017, and has accelerated to 7% between 2016 and Currently, Canada ranks 18th in the global sparkling wine market in terms of volume, up from 19th in SPARKLING WINE REMAINS AN OCCASION-DRIVEN DRINK IN CANADA Despite its growth, sparkling wine is still largely considered primarily as a drink suitable for celebrations and special occasions in both the off- and on-premise 3. CONSUMPTION IS DRIVEN BY DOMESTIC SPARKLING WINE AND PROSECCO Consumption of sparkling wine is led by domestic sparkling (54%), followed by Prosecco (32%) 4. CONSUMERS PERCEIVE THAT CHAMPAGNE DELIVERS THE BEST QUALITY BUT POOR VALUE, WHILE SPARKLING WINES FROM THE US ARE BELIEVED TO OFFER POORER QUALITY AND VALUE Champagne from France holds a unique position with consumers who perceive this category as delivering quality but offering poor value for money, in line with perceptions in all major market 5. YELLOW TAIL, BABY DUCK AND MARTINI ARE POWERFUL SPARKLING BRANDS IN THE CANADIAN WINE MARKET Yellow Tail and Martini, with strong brand awareness and conversion, are the strongest sparkling wine brands market 4

5 Research methodology: Sampling and quotas used for Vinitrac Canada The data for this study was collected in March 2017 and May 2018 Data was gathered via Wine Intelligence s Vinitrac online survey of all alcohol drinkers and sparkling wine drinkers in Canada: 1,011 drinkers of sparkling wine in Canada who have ever drunk sparkling wine in March ,000 Canadian drinkers of sparkling wine who have drunk sparkling wine at least once a year in the past 12 months in May 2018 Respondents meet the following requirements: Adult drinking age Permanent resident of the country Are aware of at least one sparkling wine types* Drink at least one type of sparkling wine at least once a year* In 2017, for the purpose of tracking, a subset of Canadian drinkers of sparkling wine who have drunk sparkling wine at least once a year (n=912) have been used Invalid respondents (those who sped through the survey or gave inconsistent answers to selected questions) were removed before analysis The survey was quota-based and post-weighted to be representative of Canadian alcohol drinkers and sparkling wine drinkers in terms of gender and age * = Methodology changes/new criteria in 2018 sparkling wave The distribution of the sample can be seen in the table below: Gender Age Region Canada Mar'17 May '18 n=912 n=1,000 Male 49% 46% Female 52% 54% Total 100% 100% % 11% % 23% % 23% % 15% % 13% 65 and over 19% 15% Total 100% 100% Ontario 41% 41% British Columbia 13% 13% Alberta 11% 11% Quebec 23% 25% Other Provinces 12% 11% Total 100% 100% Wine Intelligence, Vinitrac Canada, March '17, n=912 and May 2018, n=1,000 Canadian drinkers of sparkling wine who drink sparkling wine at least once a year 5

6 Research Methodology IWSR 2018 Measures from the IWSR correspond to actual wine consumption figures. This means sales into the trade (on + off trade) The IWSR visits each market each year. Discussions are held with key local experts in the market including importers, producers, grey market operators, duty free operators, and supermarket/hypermarket buyers. All volume data is given in thousand 9 Litre Cases In the breakdown by country of origin, IWSR includes (depending on the market and the size of the category) the following two categories: Other and International They are defined as followed: Other : category including wine blends (normally in bulk or bottled without specified country of origin) and wines from other countries with volumes too small to break out separately International : Category including wine brands that have wines from various countries The IWSR includes the following types of wine in its definition of wine : WINE = Definitions Still light wine + Sparkling (Champagne & other) + Fortified + Light aperitifs (vermouth ) + Other (rice wines...) Sub-categories 6

7 Research methodology Vinitrac How does Vinitrac work? 1) Defining the right samples: Wine Intelligence, with the support of global research companies (e.g. TNS, YouGov), regularly runs calibration studies in each market in order to define demographic specifications of the wine consumers and the size of the market (i.e. penetration of wine consumption) 2) Running the online survey: Invitations to participate in an online survey programmed by Wine Intelligence are then distributed to residents in each market Respondents are directed to a URL address, which provides access to the online survey Based on given criteria (e.g. age, beverage, frequency of wine consumption) respondents will either proceed or screen out of the survey Wine Intelligence monitors completed responses to build samples representative of the target markets wine drinking population based on the most recent calibration study 3) Cleaning the data: When a representative sample is logged, the survey is closed Wine Intelligence will then clean out all invalid data points (e.g. those who sped through the survey or gave inconsistent answers to selected questions) and weight the data in order to ensure representability 7

8 Research methodology Qualitative consumer focus groups Focus group methodology Focus groups were conducted with four groups of consumers in Canada from March to July 2018 Interviews followed a pre-determined discussion guide, and covered overall market trends including sparkling wine Focus groups are made up of respondents of mixed gender and age groups 8

9 REPORT PRICE: AUD 2,700 GBP 1,500 USD 2,100 EUR 1,800 3 Report Credits Format: 87-page PowerPoint (PDF) Purchase online: Contact us directly: If you have any questions, please contact your local Wine Intelligence office: AVIGNON Jean-Philippe Perrouty, Director, Wine Intelligence France T +33 (0) CAPE TOWN Dimitri Coutras, South Africa Country Manager T DELAWARE Erica Donoho, USA Country Manager T FRANKFURT Wilhelm Lerner, Associate Director/Germany Country Manager T +49 (0) LONDON Eleanor Hickey, Senior Business Manager T SAO PAULO Rodrigo Lanari, Brazil Country Manager T +55 (0) SYDNEY Ben Luker, Business Executive T +61 (0) TRIESTE Pierpaolo Penco, Italy Country Manager T VALLADOLID Juan Park, Director, South America and Iberia T in the Japanese Market 2017

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