After two decades of solid, profitable growth, Australian wine exports are now in reverse. Sales to November were down half a billion dollars, to $2.5 billion, compared to the same period a year before. The causes are complex and not easily fixed – and the decline may have been worse if the Australian dollar had not fallen by so much. At heart, other nations, including newer producers such as Argentina and South Afric, as well as traditional rivals such as France and Spain – have simply become more competitive faster than we have. Consumers in all our key export markets now have a much wider range of wines to choose from. And, the industry has decided to go up market – produce and sell more expensive wines, building on our reputation for cheap, fun and cheerful wines. But as anyone with a smidgin of marketing nous knows, it doesn't naturally follow that consumers will accept a premium product from a supplier that they see solely as competent as an entry-level producer.
The move up-market is probably the only viable path to renewed growth. But, that's squarely the area where entrenched suppliers have long standing, robust brands. And it's the market most affected by the global economic turmoil that's surely hurting the wine buying classes as much as any. And to go up market requires deeper and different marketing skills. To cap things off, Wine Australia, the Government body charged with developing overseas wine markets, is struggling.
The successful wineries remain those that get on planes, find reliable long term distributors in each target market, butter up wine writers and buyers, and follow through with competitive pricing and reliable delivery.
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