Fine Wines/Champagne and Spirits in Argentina

PROSPECTS

Complex economic situation necessitates the promotion of luxury alcoholic drinks

Argentina’s complicated economic context has placed limits on the extent to which the local population can afford to purchase fine wines/champagne and spirits. Thus, promotion has become a key factor in maintaining sales in the category, with reduced pricing strategies being seen in all categories in 2019.

Increasing public interest in wine favourable for sales of fine wines/champagne

As Argentinian consumers become increasingly interested in wine generally, more people are developing an affinity for the complete wine experience. This means more interest in wine tasting events and wine appreciation courses as fine wine is increasingly seen as the ideal complement to a luxurious lifestyle, something to be savoured and cherished, rather than a mere alcoholic drink.

Internet retailing becoming increasingly important for product distribution

With e-commerce gaining greater relevance in Argentina towards the end of the review period, internet retailing is likely to become an increasingly important distribution channel for fine wines/champagne and spirits during the forecast period. Among the main drivers of growth in online sales of fine wines/champagne and spirits is that lower prices are generally on offer on the internet.

COMPETITIVE LANDSCAPE

Ascendancy of Argentinian wine industry evident in success of Susana Balbo Wines

With international interest in Argentinian fine wines continuing to grow, numerous local players have benefited from increased international attention. Prominent among them is Susana Balbo Wines, an Argentinian winery that produces 96% of its wines for the export market, mainly the US, Brazil, Canada, the UK and Japan.

Luigi Bosca benefits from private equity investment

Another prestigious Argentinian winery which has recently received significant investment from L Catterton is the Luigi Bosca vineyard, owned by the Arizu family. In a similar arrangement to the Susana Balbo Wines deal mentioned above, the Luigi Bosca deal will see the Arizu family maintain overall control over the management of the vineyard and winery.

Johnnie Walker takes on sponsorship of polo tournaments

Diageo’s Scotch whisky brand Johnnie Walker, imported into Argentina by Peñaflor group, recently invested ARS12 million in becoming the main sponsor of the Abierto Argentino de Polo tournament (Argentinian Polo Open), one of the most important of the world’s annual international polo tournaments. This has involved the brand opening a bar named Johnnie Walker House and establishing its own cup competition within the framework of the tournament.

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