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“The category is underdeveloped and there has been a lack of focus and investment from the supplier base“ |
Tom King Global Travel Retail General Manager Treasury Wine Estates |
Treasury Wine Estates (TWE) claims to have identified a US$1 billion opportunity to grow the wine category in global travel retail following shopper research it commissioned. It has called on the industry to take advantage of this opportunity by making wine “a destination category”.
In the research, conducted in conjunction with market analysts Counter Intelligence Retail (CIR), TWE talked to over 2,000 wine shoppers in 15 airports worldwide (including London Heathrow, Singapore Changi, Hong Kong International, Dubai International, Los Angeles and Melbourne) to better understand shopping motivations and how to drive wine category growth.
According to TWE, the results showed that although there are a high number of engaged wine shoppers in the channel, this interest is not being converted into sales.
The research found that while sales of wine represented 48% of overall alcohol sales in global domestic markets, the category accounted for just 21% of overall alcohol sales in GTR.
TWE concluded that if retailers and suppliers can work together to convert more domestic wine shoppers into travelling wine shoppers, there is an opportunity to grow category sales by +50% by 2019 , meaning a spend of US$3 billion a year compared to US$2 billion today.
As a result of these findings, Global Travel Retail has developed a new strategy which it will be sharing with its key retail partners, in its bid to take a lead role in driving category growth. The company proposes enabling this change through the implementation of four key strategic drivers:
Find your wine – Category navigation – the research found that 80% of wine shoppers do not plan their purchase and therefore are very open to positive influence at the fixture.
Know your wine – Category education – findings demonstrated that 60% of shoppers do not understand the different grape varieties and flavours, meaning there is huge opportunity to drive sales through education at point of purchase.
Love your wine – Brand engagement – results showed that one in four shoppers are motivated by in-store sampling.
Buy your wine – Optimising spend – findings highlighted that purchase drivers, such as gifting opportunities and exclusivity, positively influence shopper buying decisions.
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TWE Global Travel Retail General Manager Tom King said: “Since we established the dedicated Global Travel Retail team at TWE 18 months ago, our core strategic focus has been to find a way to drive growth in the wine category. The purpose of the CIR research was to better understand purchase motivations of shoppers. The category is underdeveloped and there has been a lack of focus and investment from the supplier base.
“We are therefore looking forward to sharing our insights with our retail partners in Cannes next week to create category solutions to deliver on this opportunity for growth. It will be a win-win situation for everyone as together we make wine a destination category.”
TWE will be exhibiting at TWFA World Exhibition for the first time next week (stand number: Bay Village, Bay 18). It will present the latest vintage of the Penfolds Collection, which launched globally last week, including the 2010 Penfolds Grange and 12 wines spanning five vintages (2010-2014).
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