Fine Wines/Champagne and Spirits in France

PROSPECTS

Fine wines/champagne and spirits grows due to the “less but better” trend

Fine wines/champagne and spirits continued to see current value growth in all categories in 2019. Whilst growth was moderate for the largest category, fine wines, particularly fine champagne, it was more dynamic in luxury spirits, especially other luxury spirits, such as dark and white rum, English gin and vodka.

Strong growth for internet retailing despite the strength of grocery retailers

Alcoholic drinks distribution remained concentrated in 2019, with the off-trade channel accounting for by far the largest share of overall sales, due to a structural drop in the patronage of bars and restaurants over the years. However, the return of tourists to France was noticeable at the end of the review period, helping to avoid a strong decline in the on-trade share.

Further growth expected, although scrutiny of ingredients will increase

Current value sales of fine wines/champagne and spirits are predicted to continue to increase in the forecast period. Whilst the French have their preferences in alcoholic drinks, they also like to discover more sophisticated premium products, thereby consuming “less but better”.

COMPETITIVE LANDSCAPE

Groupe Pernod Ricard leads due to its wide product portfolio

The competitive landscape in fine wines/champagne and spirits is dominated by large players operating at international level. Pernod (Groupe Pernod Ricard) led in value terms in 2018, ahead of Vranken-Pommery and LVMH.

Wine e-commerce is fragmented and players diversify

Sales of wine via e-commerce are predicted to slow down in the forecast period, after recording remarkable double-digit growth in recent years. The weakening of the novelty effect, the trivialisation of sales models (subscription boxes, private sales) and the slowdown in the arrival of new market players explains this softening.

Players are adjusting to changing consumer tastes

Other luxury spirits saw by far the strongest current value growth within fine wines/champagne and spirits in 2019. This is partly because brands are successfully adapting to consumers’ changing tastes and driving sales growth through innovation.

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