July 05: Despite the pandemic and the growing competition with Cava and Prosecco which sells over 500 million cases annually, Champagne sales in 2021 reached almost 320 million cases showing a 30% growth over 2020 and clocking a record value of €5,7 billion, remaining globally the largest selling sparkling wine, according to Charles Goemaere, Managing Director of Le Comité Interprofessionnel du vin de Champagne (CIVC), in an interview last week by Concours Mondial de Bruxelles (CMB). Subhash Arora reports on the secret of Champagne’s continues success and what the future hold for them
Champagne has not touched the record level of 338 million bottles achieved in 2007, though at €5.7 billion euros, it reached the highest revenue in 2021. The region saw its biggest fall in sales in 2020 in recent history. But it also saw the biggest rebound of 30% in 2021, which not only helped them wipe out the 2020 fall, but also exceed 2019 figures. Even 2022 has been off to a good start, across all their markets.
Cava, Prosecco, Californian sparklers and Crémant have had a major impact on the development of the global sparkling wine market over the last decade. Is this a challenge for Champagne? Charles Goemaere says, ‘we feel lucky to be a part of the most dynamic market segment in the world. The quality of sparkling wine is improving globally constantly. As market leaders, this incentivises us to do even better. We also need to continue to be visible for consumers in terms of image. More the people take to drinking sparkling wine, the broader the consumer audience we can draw on to continue to expand our sales.’
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Price point competition
The best price point of course, is the one that consumers are willing to pay, and that stems from the quality and image of the Champagne they want to buy, Charles tells CMB, ‘Value creation increases year-on-year and export growth has sustained. In 2017, exports exceeded 50% of total sales while it accounts for over 56% of Champagne sales now.
Strongest growth markets
The most significant markets which have grown the fastest and gained the most traction are the US and Australia. The Scandinavian countries are also growing very strongly. Apart from China and Singapore, which are still struggling with the pandemic, all export destinations are showing at least double-digit growth, compared with 2019.
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Loss of sales due to poor 2021 crop
With the reserve system in Champagne, with millions of bottles stored away for future years, the drop in current year production was well compensated and Champagne ensured continuity in market development. ‘Our system provided an extraordinary capacity for resilience for our entire industry’, says Charles.
The production has now become more erratic, with very good harvests alternating with more challenging years. This is occurring across the region and also between production areas. From a stylistic perspective, there is no problem in preserving the typicity and style of their bubbles because of the blending process which is unique and truly an art in this region.
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Organic wines and sustainability
Champagne growers across the entire industry are committed to a process of sustainable winegrowing, and going organic is one possible option. ‘Our Viticulture durable en Champagne certification, recognised by the Ministry of Agriculture, has been rolled out over more than 50% of acreage. Our goal is for 100% of acreage to be certified by 2030,’ affirms Charles.
Current market trends
The main trend is linked to Covid. Consumers have traded up, buying more special labels and vintage Champagnes, for example. This is extremely interesting because value is growing and one can see an opening for broadening the range of Champagnes available. Typically, Brut versions represented over 90% of volumes but other products – vintages, single-vineyard wines and specific labels are growing at a faster rate now.
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Success of Rosé sparkling wines
Rosé has always been popular in Champagne and has been growing for around twenty years. Rosés are blended, which produces Champagnes driven by freshness and fruit. These are extremely popular in the United States, in particular, the largest market for rosé Champagne.
Greatest challenges for Champagne
The first challenge is to continue to produce Champagne in a changing climate, and that is an issue that the entire Champagne wine industry has taken on board. ‘We are also extremely mindful not only of consumer expectations in terms of quality, but also social expectations which are now very high on the agenda. Despite the crisis, Champagne continues to have a place in the hearts of consumers around the world. It’s now our responsibility to be worthy of their interest,’ concludes Charles Goemaere.
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Click https://www.champagne.fr/en/homepage for details on Champagne marketing and laws.
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