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New World will continue UK domination

New World brands are generating the most growth on the British high street – and the trend is set to continue well into next year.

And if New World growth continues, its brands will command over half of the British market in two years time, displacing own label wines, according to industry analyst AC Nielsen.

The company’s study shows that Australia, the US, South Africa and Chile had more of a share of the off-trade last year, while France and Germany saw a drop in sales.

Old World high street players have had to bow to New World opponents in recent years. Names such as Mouton Cadet, Black Tower, Blue Nun and Le Piat D’Or – all prevalent 16 years ago – have now given way to New World names like Jacobs Creek, E&J Gallo and Rosemount. As Nielsen puts it, ‘the market expanded willingly and the world changed.’

Speaking at the Wine Evolution 2002 conference in London, Nielsen spokesman Stewart A Blunt said that if the current trends continue, French may have to relinquish its top position on the high street. ‘Australia will still be vying with France for top spot on the high street next year,’ he said.

But, he warned, Australia should be careful of competitors such as Italy and Germany closing in. ‘With higher price points on Aussie wines continuing, the gap is closing at the top,’ Blunt said.

Light wine, which excludes Champagne, sparkling and fortified wine, was again the top selling alcoholic drink in the British off-trade last year, surpassing beer and spirits sales, according to Nielsen. One reason, Blunt noted, is that retailers are becoming better equipped to sell wine. ‘Stores are getting bigger, and they have a greater buying power in wine,’ he said.

The off-trade, encompassing supermarkets, independent retailers and co-ops, handled 65 million cases of wine last year while the on-trade, including restaurants, represented 15m cases. Supermarkets still dictated the bulk of high street retail with a 73% share of sales.

Written by Tom Chippendale6 February 2002

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