Saying that sparkling wine sales are experiencing growth isn’t going to surprise anyone, these days. Overall consumption of every style of bubbly is growing three times faster than that of still wines. More precisely, sparkling wine sales are growing at a fast and steady pace, in volume as well as market value: up 5.6 percent and up 10.8 percent in 2015, respectively (according to the International Organisation of Wine and Vine).
The inaugural Bulles Expo, the first international wine fair exclusively devoted to sparkling wines, which took place on June 20 and 21 in Paris, looked at this category and its market from many different angles. With some 120 participating exhibitors, at this event organized by Vitisphere and GFA Events, diversity was the keyword in unprecedented fashion.
Champagne and Growth
At this conference sponsored by Nomacorc*, participants discussed market conditions and competition between countries. In other words, are Champagne and the various sparkling wines of the world actually on the same planet, when it comes to selling their wines, or are they aiming at different audiences?
“Worldwide, Champagne is 13 percent of overall sparkling sales, in terms of volume, but 40 percent in terms of value. And as far as value is concerned, there is still room for growth,” says Francis Declerck, a finance professor at ESSEC Business School in France. However, he points out, “Since 2007, when sales hit a peak of 337 million bottles, it’s more difficult to sell Champagne. The annual growth in volume of 2.5 percent per year, between 1980 and 2005, in line with GNP growth in the Western World, essentially stopped. Since then, the market has been more challenging, especially in France. France remains the first market for Champagne, buying 52 percent of the 312.5 million bottles sold last year. However, exports show the greatest growth, especially for the premium segments. In terms of value, exports represent 60 percent of sales, at 2.6 billion euros ($2.8 million). The fastest growth comes from Japan, where sales used to be around 1 million bottles, in the 2000s, and have now gone up to 9 million bottles.”
On a more general note, Declerck adds that, “Champagne is unique, but it has to deal with a number of competitors. Today, it’s quite easy to get good quality sparkling wines from a number of different sources.”
Maxime Blin, head of the eponymous Champagne Lounge and a member of the board of the Syndicat Général des Vignerons de la Champagne, an association of Champagne producers, concurs. “There is competition in the sparkling category in general, notably between Proseccos, Cavas, or French Crémant. However, Champagne is the locomotive of that category, and we are meant to stay at the top of the pyramid. Despite the growth of sparkling wines in general, it hasn’t been pushed out of that spot—which doesn’t mean we should be resting on our laurels. We have to work on our marketing and on the products to stay on top, as we have always done.”
Italy and the Rise of Prosecco
In Italy, the spectacular growth of Proseccos might be seen as a cause for concern. “However, Champagne still has a strong notoriety and remains a top product, even though younger drinkers are turning to Proseccos, which are simpler and less expensive,” says Claudia Nicoli, an Italian sommelier who was also Champagne Ambassador in 2006.
Prosecco’s success has to do with the product itself, Nicoli explains. “It’s fresh, floral and fruity, and easy to drink. It’s popular with young people—but not just them. It’s also used to make spritzes, a very popular cocktail style. And most important, its price is very low, because it’s also made using a simple process. It can be ready for market in as little as 40 days.” Production has also gone up rapidly, thanks to a strategy that encouraged growth in plantings. In 2015, nearly 400 million bottles were brought to market. “I don’t think Champagne should be scared of this competition, she says, because both products have very distinct styles and identities.”
Daisy Desroches, marketing manager for the Boisset Collection’s sparkling wines, sees French bubblies in the same light. “We are not competing with our Champenois neighbors, because we’re aiming at very different markets. On the other hand, our direct competition comes from Cavas and Proseccos, for certain categories of French sparkling wines—but not with Crémant de Bourgogne, which sits in a sort of middle range.” She adds, “The market for sparkling wines is doing quite well. They represent a significant part of our company’s overall business, notably with the Louis Bouillot brand. And it’s undergoing a healthy growth because it’s gradual. Our main challenge is to secure supply, so that we can face market demand, but we also need to try and foster new trends, to support our brand’s prestige and showcase our know-how.”
While English sparkling wines are seen as “interesting,” with a quality level that is more and more recognized, can they be seen as competing with Champagne? Conference panelists were unanimous and direct on that front: “We’re hearing a lot about them, but Champagne has nothing to fear. It’s a niche market—which, in fact, largely belongs to Champagne houses.”
And what about Germany?
Every rule has an exception, and in the world of sparkling wine, that exception is Germany. Consumption has been dropping, and the country lost its place as the first market in the world for bubbles. It now sits in third place, behind the USA and France. “This drop has been pretty constant,” says Claudia Haase, export manager for Schloss Proschwitz, a very old estate located near Dresden in Eastern Germany. “We’ve gone from 4.2 liters/year per person in 2012 to 3.9 liters/year in 2014. On the other hand, the average wholesale price has gone up a little, from 3.58 euros ($3.98) in 2011 to 3.78 euros ($4.19) in 2014.” Germans are gradually turning to Sekt B.A., a higher quality category labeled to show its specific regional provenance. She thinks this trend should continue, in a market where the average retail price is around 15 euros.
Generally speaking, the main sparkling wine producing countries are all aiming for the same large market, one where sparkling wines are often associated with celebrations and parties. However, the general consensus seems to be that in this growth market, there is room for everyone. Everyone can find their own segment and customers, according to their identity and specific character. As Maxime Blin points out: “Today’s Cava or Prosecco buyers are tomorrow’s Champagne buyers. That’s the gateway to the world of sparkling wine.” As Tony Verbicaro, conference moderator and editor-in-chief of La Champagne Viticole magazine, pointed out “each sparkling category can help the others.”
*François-Xavier Denis, Vinventions’ Vice President for Wine Marketing Solutions, present at the conference, took the opportunity to showcase Zest!, the company’s newest product and Nomacorc’s very first sparkling wine closure, Zest!