The 13th Wine Industry Outlook Conference, titled “Wine Australia: Flying the Flag”, was held at the Melbourne Exhibition Centre on Tuesday 27 November.
Top of the bill was a presentation from Dan Jago, Director of Beer, Wines and Spirits, Tesco Stores Ltd UK, entitled, “The UK market of the future”. As the single largest overseas buyer of Australian wine, Tesco’s retail strategy is of potentially critical importance to the Australian export industry.
Jago’s presentation revealed emerging trends in the UK retail environment and exposed what Tesco views as potential risks for wine retailing in the future. “For too long you’ve been saying ‘this is good because it’s Australian,’ you have to tell us why it’s different. I would really, really ask you to put the personality back into wine.”
“I would also urge you to make your wines lighter and more refreshing,” continued Jago. “Wines with 13 or 14 percent alcohol just aren’t exciting any more, and consumers are currently looking to the Old World for more refreshing wines.”
However he also saw considerable opportunities for Australian exports with regard to maintaining and gaining market share and profitability.
“As an industry, and as a retailer, we’re running too hot on promotions at the moment. You shorten the life of your brands by over-spiking them,” said Jago. “Let’s reduce promotional participation.”
Jago also spoke about market influences such as environmental issues and health and social responsibility and how they are impacting on wine sales.
“There shouldn’t be a company out there not thinking about climate change and the environment when they come to talk to us about their product,” he said
His final words of warning summed up the need for action in the Australian industry: “If you don’t change, others will change faster.”
Dan Jago joined Tesco in April 2006, from his role as joint Managing Director of Bibendum Wine Limited. Tesco now operates in 13 countries worldwide and has an annual turnover in excess of £47 billion (A$111 billion), of which the beers, wines and spirits sector represents approximately 7%. Tesco now stocks a range of 1100 wines, priced from £2 to £150 a bottle.
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