The past five years has seen wine packaging undergo a revolution. As supermarkets become the main driving force in distribution, wine marketers have had to adapt and refine their packaging accordingly. For decades wine packaging design remained static and hardly changed. To remain relevant for consumers packaging needs to stay fresh and frequently has to be "re-freshed", or even totally rejuvenated.
So what's the future for wine packaging?
To attract the consumer’s attention the wine industry needs to design products that are worth talking about. Products with that "wow" factor. Does your packaging connect with the consumer and get them talking about your products? Simplicity will be the buzzword as consumers, overwhelmed by choices and starved for time, want to feel like the decision process was made easy for them. Savvy marketers will focus on traditional production methods and styles in order to reach increasingly segmented markets.
Here are three major trends that will impact on the wine industry:
1. Lifestyle conscious consumers are looking for healthy alternatives. Four out of the top ten bestselling soft drinks in America are low-calorie or low-caffeine. Beer manufacturers are trying to capitalise on the power of the purse by targeting women (who are the decision makers eighty percent of the time) with low-calorie products. Consumers regard the origin of their food as highly important, and they are prepared to pay a premium - if you give them a great experience.
2. Supermarkets are changing the industry's dynamics by driving manufacturers to consider more environmentally friendly options in their packaging materials. Wal-Mart unveiled their packaging scorecard last year with the aim of reducing packaging across its global supply chain five per cent by 2013. Retailers Asda and Tesco, in collaboration with British Glass, are encouraging wine importers to bulk import wine for bottling in lighter glass bottles manufactured in the United Kingdom.
3. Private labelling is a growing force and will become more so as retailers become better marketers. Private label wine sales account for nearly fifty percent of the UK market and sixty percent of German wine sales (
www.winebusiness.com). And according to ACNielsen data, private label brands sell at an average price point of fifteen percent lower than the average brand price, further eroding wine industry paper thin margins. Private label industry expert John Stanley says that the time for selling products has gone; it's now a brand issue. The question is whose brand will dominate, the suppliers’ or the retailers’? Private labels will continue to compete with brand leaders and if your brand is not a market leader then your market share is already under threat.
So perhaps it's time for wine industry players to consider what type of business they are really in - are you producing an agricultural commodity or are you a branded consumer goods company? And package accordingly.
Mike Carter (mike@veritasconsulting.co.za) is a supply chain and packaging consultant. Check out Mike’s blog: www.seriousaboutwine.co.za.