Despite the recession affecting the Champagne category, there is plenty of profit potential in offering customers fizz and fine wines. Michelle Perrett reports
Perhaps predictably the recession has had a massive impact on the Champagne category as companies have reined in expense accounts and bonuses, and being seen popping a Champagne cork or two is no longer de rigueur.
However, as with every cloud, the economic decline has had a positive effect elsewhere and Cava and Prosecco sales have flourished as people have traded down.
"The recession was when Prosecco and Cava sales came into their own," explains Julian Twaites, commercial wine manager for WaverleyTBS. "It brought a change in people's spending habits. Prosecco is the one wine that is really fighting the case for the sparkling category. It is less bubbly, like Champagne, and it is light with lots of flavour," he says.
"There are signs, though, that Champagne sales have returned to a gentle fizz in 2010. Champagne was the first product to come out of the recession and there are signs that it is picking up," he adds.
With sparkling wine currently the best performing category in the on-trade — ahead of beer and cider — offering a good selection on a bar menu provides a strong sales opportunity for licensees, especially in the run-up to the Christmas season.
The sparkling trend
The trend for drinking sparkling wines, however, can be attributed to more than just the recession.
Consumers are becoming a lot more discerning in their appreciation of wine and Champagnes are looking like a quality option. In addition, the sparkling-wine category has seen growth because of an increased range of products on offer, as well as an improvement in the quality.
Gail Gilbert, European sales and marketing director at Australian winery Brown Brothers, is con-vinced that this has encouraged more people to drink a range of sparkling wines for celebrations and events, rather than just the traditional Champagne.
She says: "There is a definite trend towards people drinking more sparkling wines, which can be attributed to the increased quality of the category and its price point. This has made sparkling wine more popular, particularly for celebrations throughout the year, because it adds a sense of occasion without being too costly."
And it is not just the standard sparkling wines that are seeing a surge in interest — the boom in rosé has helped develop healthy sales of pink sparkling wine, too.
ViVAS marketing manager Henry John believes that the rosé category has the potential for major growth for licensees.
"Rosé Champagne and sparkling rosé wines are experiencing a significant uplift in volume sales, benefitting from the halo effect of the buoyant rosé still-wine category," he says. "And it's these sparkling wines that can provide an opportunity to trade customers up and deliver greater cash margins."
Selling by the glass
Whether customers are regular Champagne drinkers or simply fancy a glass of sparkling in the run up to Christmas, licensees will be missing out on a massive driver if they don't sell sparkling wine by the glass, as it represents a way to bring new people into the category and also provides a good cash margin.
"Some pubs aren't well set up for serving wine by the glass, but really all you have to sell is the six glasses in a bottle per evening," Twaites says.
He believes licensees should increase sales of sparkling wines or Champagne by suggesting them as an aperitif or as a drink at the end of a meal. Offering the glass as an addition to the meal can guarantee a new sales opportunity for the licensee. "It is an extra sale rather than taking away from the main wine list," he says.
While there is a range of stopper products that can be used to store the wine once a bottle is open many licensees remain concerned about possible wastage.
First Drinks marketing controller for Champagne, Victor Lanson, believes this fear is unjustified and that as long as licensees offer a glass at the right price point they are guaranteed to make sales. "At normal selling prices, a venue would only need to sell half the bottle to make a profit," he adds.
Licensees could even consider promoting Champagne cocktails, offering a deal on the rest of the bottle or giving a glass to loyal customers to help shift bottles that have been opened.
Promoting your wines
Inevitably just opening a bottle and hoping it will sell isn't enough. Promoting wine and Champagne — especially in the run up to Christmas — is essential to drive sales.
Twaites advises licensees to use the back bar to promote the bottles on offer, show ice buckets with a display, make sure the bottles are refrigerated, use PoS cards to advertise the sparkling range and ensure the wine menu has a selection of Champagnes and other sparkling wines with a variety of price propositions.
"Prepare a card saying sparkling wine is available. And ask the question, 'Have you tried Prosecco?' or on your chalkboard you could write, 'Put some sparkle into your night with our Prosecco'," he says.
Lanson argues that licensees need to position Champagne and other sparkling wines as separate headings on the drinks menu. "Sales of sparkling wine are going up, but Champagne has stayed flat. People are not moving away from Champagne, but sparkling wine is now a new category that needs to be promoted by itself," he argues.
The wine menu is an essential driver of sales and simply making sure that the wine menus are on display can make a huge difference.
Pernod Ricard commercial director for wines Lee James advises: "Drive premium brand sparkling offerings by flagging them on the menu as the bartender's 'favourite'. Ensure menus are readily available on the bar and tables at all times.
"Feature an image of the drink and a consumer-friendly descriptor that will help people to feel confident that they will like their chosen drink."
Fizz and food
Matching wines with food is a great way to boost sales — but it doesn't have to stop at still wine. By matching Champagne or other sparkling wines to certain products on the menu, consumers are more likely to consider it as an option.
Pernod Ricard head of Champagne Jo Spencer, who is responsible for the GH Mumm and Perrier-Jouët brands, says capitalising on Champagne's food-matching capabilities is an important way to drive business.
GH Mumm has cultivated close ties with the world of gastronomy, such as its sponsorship of the London Restaurant Festival. Spencer advises licensees to consider offering rosé wines with light canapés on the bar over the Christmas period, to help drive sales and interest in the category.
Staff training can make a big difference to product margins. Staff who are able to create the perfect drink every time will make customers stay longer and encourage more repeat visits.
Training staff is difficult in a busy pub, but it is essential to drive sales in the category, says Victor Lanson of First Drinks. The company runs a School of Champagne for the on-trade, which is proving successful.
"We go through the different brands and we conduct tastings. We work with small on-trade partners as well to help them drive sales."
If you want to take advantage of repeat purchases in your pub then you really need to make sure that every customer who orders Champagne or sparkling wine receives the perfect serve at the right temperature.
WaverleyTBS's Julian Twaites says a common mistake is that pubs fail to serve the bottle of wine or glass at the right temperature.
"It is fundamental," he says. "Many people don't realise that just ice in a bucket won't surround the bottle and chill it enough. The bottle also needs water around it so it will cool in about 15 minutes.
"Even pouring out a glass needs to be perfect. You should open a bottle, pour a third of a glass and then fill it up."
Focusing on fine wines
Fine wine is a category that has weathered the recession surprisingly well. While wi