Unhealthy Competition

I’m all for a bit of healthy competition. And I do believe that more wine retail could be healthy.

Except. Except for the fact that we have a retail market firmly run by a duopoly. And – as is happening in South Australia – lobbying to allow liquor retail in supermarkets cannot exclude, by virtue of the application itself, the two majors. They are both staying exceedingly quiet on the matter for one simple reason: any way this pans out, they win.

So, the story is that a couple of independent retail groups have decided that they want to be able to sell wine. Not beer. Not spirits. Just wine. To ‘support’ the South Australian wine industry. Only the larger stores (over 400 square metres). And this will require a new licence category. Any retailer wishing to take advantage of this must satisfy the various licencing vagaries – that there is a need for a liquor retailer etc. So far, so good.

Except. Except that this does not just open the door to these two independent retail groups, but also to the two majors as well. So, potentially, BWS inside the local Woolies, and LiquorLand inside Coles. It hands Aldi just what they have been looking for on a silver platter. Sure. Convenient. Much like many other countries around the world. The overwhelming majority of stores which could satisfy the requirements are those belonging to the two majors. And once there is wine, the door to other liquor retail is already ajar. However, this has not occurred in markets like Victoria and the ACT where supermarket liquor was introduced so very long ago. Perhaps the majors have no interest in converting stores, or competing with the existent nearby floorspace..? At least for now.

And to limit ranging to SA wines would be exceedingly difficult from a legal standpoint. Particularly when many wines are made of multiregional fruit. Who stands as judge of what might be ranged? Is a Kiwi SB imported as bulk, and bottled in Adelaide by a local company one that might blur the lines enough? Because from a wine retailer’s point of view, why would you exclude the biggest selling category from your range, when doing so will actively damage your sales, and in all likelihood drive customers to the nearest competition?

And whilst I certainly don’t want endorse a protectionist stance, we have a number of awesome independent liquor retailers here in Adelaide. Who are likely to be the most heavily impacted by the appearance of ‘convenience licences’. Why go out of your way to find the quirky liquor store with limited parking options, when you could just grab a bottle along with the milk? Well, probably not you per se. If you are reading this, you likely seek out the fun independent bottleshops…

What if they were nudged out? To be replaced by more supermarket retail? We have the same number of people, with a slight growth in population, spending roughly the same dollars on wine. More stores means a dilution of revenue across those stores, and where declining liquor sales may well be offset by grocery sales, the retailer has a better shot at survival.

Where would we be then? As consumers, and as producers vying for what little shelf space there already is?

I am not saying this is a bad idea. Easy access to wine is a good thing. I am just not entirely sure that this has been properly thought through.

A couple from the UK said to me on the weekend that wine is different here. Here people care about what they are drinking. At home, it is just another 3 quid fifty spent at Tescos. No brand awareness. No care factor. This couple preferred our approach. They now think that wine is special, and worth research.

If it is approved, the majors could be first cab off the rank adapting their stores. And they will extend their reach. For those of us selling into the majors, that will be great…

If it is denied, they retain the position of biggest/most convenient/easiest. Market share either way rests where it does now.

So, how can we make it work? Without wrapping it up in red tape. Without making it a windfall for certain sectors only. With it being a smart option, and easy for independent retail to navigate and obtain.

And without the fights which are currently brewing over the issue…

If we are going down this path, let’s be smart about it.

So, where is everyone?

Most of us know that we spend much of our time preaching to the choir. We do it because the choir – to draw out a fairly limited metaphor – sing, respond, and engage. And that is just lovely…

But we might be missing the broader pool of actual consumers.

And it seems that the bigger players, the event organisers and so on, are following in our path.  The Cellar Door Wine Festival in Adelaide – fantastic event – appears to be relying on return business, and social media. Which is fine, but neglecting to promote and engage more consumers is a dangerous path which does not bode well for the longevity of the event.

And how many punters actually know about this mythical Aussie Wine Month? Apparently it is in its second year. There are events – fairly lacklustre, with little engagement on offer – and it is being promoted (and organised) by Wine Australia.

So I decided to ask some people. I asked wine trade, avid consumers, casual wine drinkers, and friends. No-one had heard of Aussie (cringe – I loathe that diminutive in this context, but that is purely personal…!) Wine Month. Not one. Apparently Max Allen mentioned it in an article. People asked me what it was about. Drinking Australian wine for the month. Umm. Ok. What about the other eleven months of the year?

And why is this a ‘thing’? Due to the state of the Australian dollar, we have access to some awesome imports at seriously approachable pricing. I suspect it is an attempt to pause the tsunami of New Zealand Sauv Blanc more than anything else. In fact, I more than suspect it. They told me as much when I queried this ‘event’ (?) on Twitter. Which is an and of itself a huge problem…

1. The Australian Government allows Kiwi producers to claim WET rebates on wine sold in Australia. If there is an issue with Kiwi SB, part of it is pricing. Get rid of the WET for non-Australian producers.

2. Basing what could be an uplifting campaign in the vaguely snarky ‘don’t drink that, drink ours’ approach is juvenile. And does no-one any favours.

3. Getting those non-wine drinkers drinking wine is what we all want. Some of them will experiment, and drink more local wines. This is a good thing.

4. People LIKE the style. There is absolutely no point telling them they shouldn’t, or that they should have a more sophisticated palate, because you know what? Their taste buds. Not yours. Not mine. They get to choose what they like.

5. Maybe a lesson can be learned here. NZSB did not just happen. The producers found something that was working, and targeted a sector of the market. This is called a success. They listened to the consumer, and became the biggest, fastest success in the wine industry in decades.

Now, I am not advocating for more simplistic wine styles. Lord knows the NZSB market has no need for my assistance in this matter. Frankly, I want more people drinking Riesling. And fiano. And savagnin. Chardonnay. Semillon. Gewurz. But we have a problem in that the wine market is endlessly confusing to the newbie. And we, as an industry, are not addressing this issue nor making it any easier.

And these events should be addressing this. And some do. But the grand majority are preaching to the choir, not those needing a conversion.

And yet. We have Rootstock, about to sweep into Sydney. The Summer of Riesling. The Rose Revolution. Crush, in the Adelaide Hills. The New Generation Hunter Valley hijinks. These engage and inspire. They have a sense of adventure and fun, rather than sitting on high telling people to drink *insert cause here* or else.

And they keep trying. Engaging is not a one time effort. It must be maintained. These festivals do not have a ring on the punter’s finger (sorry Beyonce). There are plenty of events. Plenty of drains on the consumer wallet. Why should they attend yours? And why should they keep coming back?

Your call, organisers. Do you want to engage, and reach the people you are ostensibly addressing? This requires more than just an idea. It requires attention. Follow through. And maybe ask some actual non-industry consumers what might actually engage them.

Because if we are reaching out to the NZSB quaffing consumer, maybe we should see what might pique their interest. Or if they even care. Because I dare say that being instructed to not drink their favourite tipple for the month is unlikely to make them terribly chirpy.

The idea could be brilliant. A concentrated effort, utilising (maybe?) bipartisan support from the majors. Some sort of support for restaurants and retailers jumping on board. Call on our innate pride as a nation. Celebrate the beauty of Australian wine, rather than whispering under our breath snide comments about what people are drinking and enjoying. Make it a call to arms. Laugh. Cry out in joy. Maybe, just maybe, we could have retailers helping: if you like XYZ sauv, try this from Tasmania…

Having a vague idea and popping it on a website is not a campaign. Which is possibly why so few people with whom I have discussed this have even heard of the majority of these events. Wine people. Wine drinkers. People who want to learn more about what they are drinking, but find the deluge of amorphous events as confusing as their bottleshop shelves. The wine-drinking consumer. Remember them?

This is not me ranting. This is me confused by the concepts themselves, and by the execution. I guess I am wondering where the consumer sits in these grand plans. Because we do not need much to make these plans brilliant…

A clear voice. A vibrant idea, with a plan to back it up. Talk the the public. Engage. Reach. And be positive.

And you might turn a few heads.

Oh, and by the way? We have a perfectly good wine calendar – thanks Tyson -so perhaps if we put every event in the one place, we could limit confusion. Which can only be a good thing.