27/4/15 The Spanish Wine Market: Where does it go? Ricardo Sellers-Rubio Index I. The Spanish wine industry Wine in figures: supply and demand II. Wine marketing in Spain III. Case study: Bodegas Enrique Mendoza 1
27/4/15 I. The Spanish wine industry Vinyards and wine production Wine Industry Wine Exports Domestic market Vinyards and wine production 54.378 Has. (MAGRAMA Nov 14) 41,6 mill. Hltrs. (MAGRAMA Nov 14) 2
27/4/15 Wine production (Mill. Hl.) 6 5 4 3 1 1 87 1 88 1 8 1 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 1 2 3 4 5 6 7 8 1 11 12 13 14 3 mill. Hltrs 4 mill. Hltrs Wine production From the 14 harvest: 51.1% will go to red and rose wines 48.% will go to white wines The most common grape types in Spain are: Airén (23.5% - W) Tempranillo (.% - R) Bobal (7.5% - R) Red Garnacha (R), Monastrell (R), Pardina (W), Macabeo (W) and Palomino (W). 3
27/4/15 Wine industry Firms: +4.5 wineries Sales: 6.465,3 mill. Eur. Employees: 24.51 pax. (INE 13) Wine industry It is estimated that about 4.5 wineries make still wines, sparkling wines and liqueur. For the most part, these are small businesses, family owned, while a great number of them are made up of agrarian co-operatives. It is also highly concentrated: 5 top companies together hold almost 28% of the market. 4
27/4/15 Major players in this sector: Freixenet J. García Carrión Codorníu Arco Wine Invest Group Grupo Domecq Bodegas Grupo Miguel Torres Félix Solís Avantis Grupo Faustino. Regulations Governing Wine in Spain: 5
27/4/15 Regulations Governing Wine in Spain: PDO: 67 Denomination of Origin (DO) 2 Qualified Denomination of Origin (DOCa) 7 Quality Wine with a Geographical Indication ( Vino de Calidad ) 14 Qualified Estate Wine ( Vino de Pago ) 41 PGI: Country wines ( Vino de la Tierra ) 6
27/4/15 Winery 1 P.G.I. Winery 2 Winery 3 Winery 4 P.D.O. MARKET Winery 5 Winery 7 Winery 6 P.D.O. Winery Winery 8 J. García Carrión: Pata Negra (PDO: Rioja, Rueda, Ribera del Duero, Valdepeñas and Cava) 7
27/4/15 Regulations Governing Wine in Spain: Wine of the year XXX Crianza Reserva Gran Reserva Cosechero Regulations Governing Wine in Spain: Crianza Reserva Gran Reserva Oak Containers Total Months (minimum) (max. 33 lts) White and Rosé 18 6 Red 24 6 White and Rosé 18 6 Red 36 12 White and Rosé 48 6 Red 6 18 Ageing 8
27/4/15 Wine exports Firms: 3.87 wineries Volume: 22,43 mill. Hl. Value: 2.518 mill. Eur. Price: 1,15 /l (AEAT 14) Wine exports (Mill. Hl.) Exports 25 2.548 mill. 15 1.244 mill. 1 5 1 8 1 7 8 1 8 8 1 1 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 2 3 4 5 6 7 8 1 1 1 1 2 13
27/4/15 Wine exports Europe: 1.755,5 mill. Eur. (6,7%) UE (1.567,1 mill. Eur.): Germany, UK and France. America: 431,7 mill. Eur. USA Asia: 212,8 mill. Eur. China Africa:,7 mill. Eur. Australia and NZ: 15,2 mill. Eur. Domestic market Value: 2.455,3 mill. Eur. Volume:,48 mill. Hl. Price: 2,5 /ltr. ±18 ltrs./person (MAGRAMA - 14) 1
1 8 1 7 8 1 8 8 1 1 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 2 3 4 5 6 7 8 1 1 1 1 2 13 1 8 1 7 8 1 8 8 1 1 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 2 3 4 5 6 7 8 1 1 1 1 2 13 27/4/15 Domestic market (Mill. Hl.) Domestic 15 1 2.455 mill. 5 Wine exports & Domestic market Exports 25 Domestic 2.548 mill. 15 1 2.455 mill. 5 11
27/4/15 Domestic market (by distribution channel) Home HORECA Direct 18 16 14 12 1 8 6 4 2 1 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 1 2 3 4 5 6 7 8 1 11 12 13 14 Domestic market The domestic consumption of wine in Spain shows worrying figures. It is estimated 18 litres per person per year. Why do the Spanish drink so little wine? 12
27/4/15 Reasons for not drinking wine I don t know about wine I don t understand the wine vocabulary Wine is expensive (specially in restaurants) My parents drink wine Wine is old fashioned Drinking wine is not cool Qualitative research (UA 13) II. Wine Marketing in Spain 13
27/4/15 Wine Marketing Success is NOT making great wine! It is making wine and selling it at a great profit. Paul Wagner (Balzac) PRODUCT PLACE Marketing Mix Strategy PROMOTION PRICE Bottle Red: 4,7 cts Bottle White: 4,15 cts 14
27/4/15 Wine Marketing: The product Intrinsic attributes: Organoleptic properties: Grape Alcohol volume Year Flavour Etc. Extrinsic attributes: Packaging Brand/Label Winery PDO Etc. LogisticDelivery Bottle Packaging Cork WINE Organoleptic Characteristics Grape Alcohol volume Year Flavour etc. PDO Services Promotion Winery Brand Label Back-Label Credit 15
27/4/15 Bodegas Bocopa (PDO Alicante) Bodegas Valduero: Sobresaliente (PDO Ribera del Duero) "con tan sólo 5 kilocalorías por copa "igual que una manzana "cuida tu salud desde dentro "con antioxidantes y aminoácidos naturales" 16
27/4/15 Wine Marketing: The packaging Celler del Roure: Setze Gallets (PDO Valencia) 5 euros / bottle of 75 ml 16 euros / pack (4 bricks of 75ml.) 17
27/4/15 Bodega San Ginés: Campos de Benítez (Without PDO) 18
27/4/15 Bodegas Protos (PDO Rueda) Bodegas Canopy (PDO Mentrida) 1
27/4/15 Azpilicueta (PDO Rioja) Wine Marketing: The brand/label 1. Clasical approach 2. Artisan/Natural approach 3. Modern approach Rouzet and Seguin (4)
27/4/15 Wine Marketing: The brand/label 1. Clasical approach. Wine Marketing: The brand/label 2. Artisan/Natural approach 21
27/4/15 Wine Marketing: The brand/label 3. Modern approach. Wine Marketing: The brand/label 3. Modern approach. 22
27/4/15 Wine Marketing: The brand/label 3. Modern approach. Bodega Matsu (Vintae Group) (PDO Toro) 23
27/4/15 24
27/4/15 Heretat de Cesilia: Lizana (PDO Alicante) +18% sales Cingles Blaus: Auri (PDO Montsant) 25
27/4/15 Cingles Blaus (PDO Montsant) 26
27/4/15 Beso de Vino (PDO Cariñena) 27
27/4/15 Wine Marketing: The brand/label When it tells a story 28
27/4/15 Wine Marketing: Branding 2
27/4/15 Berberana (PDO Rioja) La Rioja Alta (PDO Rioja) 3
27/4/15 Promotion 31
27/4/15 32
27/4/15 33
27/4/15 Diversification 34
27/4/15 Diversification Thank You!! Ricardo.Sellers@ua.es @mkalicante www.marketingandwine.com Ricardo Sellers-Rubio www.linkedin.com/pub/ricardosellers-rubio/65/848/7ab 35