Busy tasting, Tesco and Asda, and some comments on the market
It's peak tasting time at the moment in the UK wine calendar, and I've been busy at it. Yesterday spent a few hours tasting at Tesco's Autumn tasting. The Tesco tastings are held at County Hall, next to the London eye, and to get to the riverfront room used for these events you have to pass through labyrinthine wood-panelled, marble-rich corridoors.
The wines were pretty good. I'm always pleased when a retailer like this does good work, because most people buy their wines from supermarkets, and it's good that people are being given tasty wine to drink. Someone had a copy of Malcolm Gluck's new book, 'The Great Wine Swindle', so I had a quick flick through. It seems that Gluck is now putting the boot into the industry that has given him a very nice career, and he's accusing other people of conflicts of interest even though he got into trouble with his editor at the Guardian over the same issue. Odd behaviour. I want to encourage more people to drink wine, because it's good, it's wholesome, and it is pretty naturally made.
I was chatting to Tesco's Nick Juby, who revealed that since the beginning of the year 250 000 households in the UK have stopped buying wine. 'It's tough', he said. 'There's clear evidence that the customers are trading down. The retailers that are doing well are the discounters, and Morrisons and Asda'.
Today began with the 'Great Cape Wine Debate' (more on this later - very interesting event), and then Asda's press tasting. The offering from Asda was better than I was expecting, which sounds like I'm damning it with faint praise. But Asda have been buying well, and a number of their wines in the £3-£5 range were really good. It's great for the consumer that they can buy good, affordable wine.
There was quite a bit of discussion about selling wine below cost - something that Asda have been accused of with their 3 for £10 offers. Philippa Carr MW, who heads the Asda wine team, would (of course) not comment on whether they actually do this (commercially sensitive information). But she did point out that brand owners can't set prices (price fixing is illegal) and it is up to Asda what price they sell their wine for.
I haven't asked Pernod Ricard's wine people this (they are the large drinks company that own a number of brands, including Jacob's Creek), but I don't imagine they were too impressed to see Jacob's Creek involved in the 3 for £10 offer (my advice to punters is buy, buy, buy at this price - it's one of the best of the big brands and a serious bargain at £3.33 a bottle). Moves like this have the capacity to devalue brands in the eyes of consumers.
Normally, promotions are funded by the producer. But some supermarkets actually foot the bill when they want to use wine as a loss leader to get customers into the store. Brand-loyal consumers are very price-sensitive with wine. If they feel they are getting a great bargain on their wine, then they might not notice when the supermarkets make their profit on other items which consumers are not as price-sensitive about. And you can bet that the supermarkets know exactly which items are price-sensitive and which are not.
I think it's a shame when wine is sold below cost. It hurts the producers - both those whose brand is damaged, and also those who are not promoted and thus considered as too expensive by consumers. I'd love it if supermarkets could think of selling interesting wines from smaller producers (perhaps by having a selection of 'niche' wines that differs from store to store - they often aren't any more expensive than branded wines), but this will never happen in such an artificially devalued wine market.