Wine in the United Kingdom

PROSPECTS

Sparkling wine sales continue to increase

Sparkling wine was again the most dynamic area in wine in 2018, driven by the boom in prosecco. However, growth rates are expected to decelerate, mainly due to uncertainty surrounding Brexit affecting import prices of Italian prosecco.

Wine in a challenging position as Brexit and increase in duty rates threatens the industry

The decision to leave the EU has generated inflationary pressure on wine prices. With the vast majority of wines in the UK being imported, making the country an import-heavy wine economy, since the Brexit referendum wine prices have increased substantially as a result of devaluation of the pound and a rise in import costs.

Changing consumer habits lead to rising demand for alternatives such as non/low alcohol, vegan and organic wines

Demand for low-alcohol wine is increasing as consumer attitudes towards alcohol are changing. The increasing number of adults drinking less or completely abstaining from alcohol, driven by health concerns, has led operators to innovate through their non/low alcohol wine offerings.

COMPETITIVE LANDSCAPE

Accolade Wines Ltd remains the leading company despite declining volumes

Accolade Wines Ltd continued to be the leading player in 2018, although its overall volume sales declined. Leading brands are facing fierce competition from private label taking their share, which, together with the inflationary pressures from Brexit depreciating the pound, have resulted in falling volume shares.

Competition intensifies as players innovate through quality, diversification and alcohol-free wine

Demand for low-alcohol wines at Tesco has reached record levels and the company is further innovating through a spinning cone method that takes away the alcohol from wine without affecting the quality. The hypermarket has launched five new non-alcoholic wines, based on the popularity of low-alcohol drinks and consumers seeking quality wine.

Drink specialist retailers find new ways to engage with consumers

In order to maximise their experience, wine specialists such as Davy's Wine House are investing in new ways to entice consumers by displaying in store enomatic machines containing a range of different wines and that allow consumers to try them for a small fee. This allows consumers, especially inexperienced wine drinkers, to learn more about wine and taste different varieties without having to commit to buying a bottle before trying it, potentially leading to a purchase.

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