The UK magazine The Drinks Business recently published their annual ‘Top 10 Best-Selling Wine Brands’ in the world.
10. Echo Falls – USA
9. Casillero de Diablo – Chile
8. Great Wall – China
7. Hardy’s – Australia
6. Sutter Home – USA
5. Robert Mondavi – USA
4. Changyu – China
3. Yellow Tail – Australia
2. Gallo Family – USA
1. Barefoot (also owned by E&JGallo)
Interestingly there are no European brands in the top 10. The top Spanish brand would probably be Campo Viejo, owned by Pernod Ricard or Bodegas Torres. The fact that the top brand are either from the US or Australia is a reflection of the nature and size of the wine companies. Gallo and Constellation Brands in the US and Accolade Wines, Casella Family Wines and Treasury Wine Estates in Australia, are 7 of the top 10 brands.
In Europe and notably here in Spain the wine business is very fragmented and there is a need to restructure the industry with consolidation wineries to create more efficient European companies to create brands to compete with the US and Australia. This will be very challenging and require a change of mentality towards meeting the needs of the markets.
What I found interesting about this report was not just the volume of bottles or sales these brands generate, but also how they are changing their strategies to cope with the impact of COVID 19, which is still to be full evaluated, falling global consumption, increased competition from other products and changing consumer trends.
Take Echo Falls, an American brand owned by and Australian company. This range of wines includes single varietals as well as wine based, 5,5%, fruit cocktails. It is considered an ‘accessible lifestyle brand’ for a younger market who are new to wine and don’t want to spend too much. The plan is to adapt and capture parte of the growing lower alcohol beverage sector.
Casillero del Diablo from Chile is without doubt one of the most powerful brand names in the world. They have a loyal and growing following, selling nearly 6m cases in 2019. In addition to sponsoring Manchester Utd, the brand owners are taking the brand into the high end spirits sector by including a Chilean Pisco label in their range.
Another reason why the Australian brands have done so well has been the huge sales they have had in China.
Hardy’s is a very popular brand that has been around for a long time. To adapt to changing trends they have launched a new ‘Foodies Range’ for the growing home gastronomic sector as well as a non-alcoholic wine, with de-alcoholised wine.
Going forward there is a clear divide between the wine companies focussed on lower priced products, where there is a greater need to generate new products continually and the companies who are investing to create brands at premium prices.
One of the great success stories in the last 20 years has been the Yellow Tail from Australia. One of the key elements to this success was that it became a joint ownership partnership between the producer and the US importer. This is another way for wineries to build sales by developing joint ventures which importers with good distribution networks.
The top two wine brands in the world are owned by E&J Gallo, the biggest wine company in the world. They both create brands and buy them, as is the case of Barefoot which was created by Barefoot Cellars and turned into a huge range of products by Gallo to be present in nearly every sector of the alcoholic beverage industry.
The wine business is going to get even harder for medium sized and smaller producers, but of course there will be many opportunities and success stories. It is important to learn from the leading brands. How they communicate their messages, how the ranges of wines are presented not just in terms of packaging but also all aspects of social media. No matter how big or small the winery is, knowing to communicate directly with your final customer is the key in the ‘new normal’