The great wine dilemma
When it comes to wine should you offer big brands or go for smaller producers, asks Nigel Huddleston
One big decision for any pub with a free rein in buying wine is whether to go for big brands or stick to smaller producers with niche offerings. In the red corner, sits the pro-brand lobby, insisting that in the frantic and sometimes intimidating world of on-trade wine purchasing, less confident consumers will seek out the reassurance that a major brand offers.
Over in the blue corner, are the wine purists who think pubs shouldn't mimic the range available in supermarkets because (a) it gives them a point of difference, and (b) it affords the chance to offer more healthy margins, since consumers are less aware of how much they can buy the wine for in take-home.
Alexander Meaney, wine development manager at Harvey Miller Wine & Spirit Agencies, reflects the view of many smaller importers when he says of rosé wines: "I'm sure consumers would make a brand call on household names - pubs should not be listing these, but supporting smaller producers and introducing consumers to drier, fuller and more
complex styles."
The case for brands
As a counter, the pro-branders argue that consumers aren't bothered about paying more for a pint of beer in a pub than they do in an off-licence, so why should it matter when it comes to wine? It's easy to be swayed by the force of this argument, particularly when the on-trade constantly seems to be playing catch-up with the take-home market in wine.
Latest AC Nielsen figures, for the year to November, show the on-trade wine market up by 2% in value, to just under £3.5bn, but down by 4% in volume. This compares with a 6% off-trade value gain, and an increase of 4% in volume sales. Although on-trade margins are better, for every on-trade bottle sold, five are sold in shops, where brands are king.
Pernod Ricard, which owns brands including Jacob's Creek, Montana and Campo Viejo, says it has new research that shows wine consumers want to see more brands in pubs. Its survey also suggests that consumers will happily pay more for brands to keep the risk of getting a bad glass to a minimum.
Pernod Ricard commercial director Simon Thomas says: "We have found there is a significant role for recognised wine brands in the on-trade. A substantial number of consumers prefer to choose well-known brands whenever they can as a guide in what they see as a confusing category. This presents huge profit-earning potential for mainstream pubs."
But Andy Whiteman, licensee of wine pub the Nobody Inn at Doddiscombsleigh in Devon, argues that most people don't want to drink the same wines over and over again.
Passion for the product
"Variety is the spice of life really," he says. "If you've got the know-how, you don't need to sell brands. Pubs that have a passion for the product should be able to sell wines through their knowledge of wine.
"Branded wines are for supermarkets and we are able to give people a different wine-drinking experience. People will soon get fed up of drinking the same wines all the time."
Pernod Ricard says wine drinkers can be divided into three main types: brand dependants who seek reassurance in wine brands they know; social groupies who are more confident, though still brand-conscious and use premium products to display their status; and experimental enthusiasts who like to try different wines but still find well-known premium brands an acceptable choice.
The first two groups, in particular, buy mainly on colour, with grape variety, region or country of origin among the other deciding factors. Size of group, consensus on colour choice and time available to spend in an outlet also influence the nature of wine purchases.
Many consumers look for what Pernod Ricard calls "enablers" such as staff recommendations to help them decide what to buy.
Thomas says: "Offering consumer education, decision enablers and a selection of core brands that they already understand and trust, will translate into increased sales."
The company says it plans to use the results to launch "a number of on-trade wine initiatives", but as a starter it's pulled out four main tips for on-trade outlets (see box, left).
Ultimately, what the research shows is that there is no one-size-fits-all approach to wine. Like so much in the pub trade, the winning path comes down to sizing up your customers and what they want.
Pernod Ricard's four-step guide to wine success in pubs
1. Stock a range of recognised brands
The survey says: "Unfamiliar wine brands available solely in the on-trade fared badly in the research, since drinkers admitted to being left confused due to their unfamiliarity with the brands on offer. As a result, many ordered with little consideration for anything beyond colour."
2. Educate bar staff
The survey says: "Many consumers admitted they did not yet fully understand wine. Staff play a vital role in making the wine purchasing decision less daunting, so retailers should focus strongly on training to ensure staff have some basic knowledge about the wines they sell. Staff should also be encouraged to allow appropriate time for decisions to be made and offer free samples to increase reassurance."
3. Don't overlook fractionals
The survey says: "Fractionals [half, quarter and single serve-bottles] account for a significant share of wine sales and score well among less confident wine drinkers. They are ideal for pubs that don't sell enough wine to justify opening a whole bottle. They also allow less confident wine drinkers to experiment."
4. Provide signposts - menu pairings, back-bar displays and chalkboards
The survey says: "Consumers are accustomed to seeing and exploring wine in a non-pressured environment in the off-trade, so can often feel pressured into having to make a quick decision. Simple signposting is easy to implement and provides visual stimuli similar to the supermarket environment."
