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  Are French wines screwed?   Are French wines screwed?  Emilie Boyer King  
         
 
Are French wines screwed? Resting on the assumption that reputation is enough, the importance of marketing has been ignored by a large part of the French wine making industry. This, precisely, is France's weak spot.

Not following changes in consumer demand, French wine makers have missed out on a growing group of consumers who are looking for wines priced between €5 or €10 (US$6/12), which are reliable and easily recognizable. Instead the New World producers, which include Australia, the US, Chile and South Africa, are using aggressive marketing strategies to tap into this consumer niche. Their tools include strong brands, clear labeling and quality standardization. A survey commissioned last year by British drinks company Threshers Group confirms that a growing number of wine drinkers are looking for just that.

 
According to the study:
" — 85% of consumers are more likely to buy wine when they have been provided with clear information about it, either on the bottle or on the shelf.

— Almost one-quarter of consumers are seduced by imagery and make their purchase decision according to label design.

— 63% of consumers do not care what country the wine they choose originates from.

— Over one-third of consumers polled feel confused about which type of wine is best to buy. " (Research conducted in UK by Taylor Nelson Sofres.)

There are several factors that can explain France's failure to react to the changing market. First, France and the New World have different approaches to wine. "With the New World coming on the scene, there has been a shift within the industry from supply-based to demand-based marketing," said Franck Crouzet, from French drinks company, Castel Groupe. "These [New World] producers are definitely focused on what the consumers want, and use the most developed marketing techniques to achieve their goal."

Second, France has over 750 wine operators, many of which have limited funds, or are family run and continue to do business in the same way as they have for generations. Consequently, all too often minimum research or money is devoted to examining the changing market. In the New World, however, there are only a handful of operators -- generally large companies with substantial capital -- which dominate the market. In South Africa, for example, one company is responsible for distributing eighty percent of the country's entire wine production, while in Australia four companies distribute all of the country’s wines.

Then there is France's complicated wine classification system. The system of "appellations" for example, which includes over four hundred different categories, was created to bring out the individual characteristics of each region. But hundreds of different names for wines can become confusing to foreign consumers. "Everyone wants their village to have an 'appellation', and thinks that their micro climate is different from everyone else's," said Joëlle Brouard, head of the International Marketing for Wine and Spirits masters program at Dijon Business school in central France.

Wine drinkers may better gain their bearings with a brand name they recognize, and a type of grape they can identify, but with French wines one can choose between a Brouilly and a Saint-Amour, which are both Beaujolais wines from the same region and made from the one grape variety, Gamay. This intricate system results in incomprehensible labeling, especially for the consumer abroad.

 
All wines (worldwide) are required to have a certain amount of information on each bottle. Traditionally, this information was placed on the front label, and is still the case with many wines today. But it is quite an eyeful for a consumer browsing the shelf, and may not be altogether eye-catching. "The label is the first contact people have with the product on the shelf. It must therefore be simple and easy to understand but also reflect the particular personality of the brand," says Crouzet. For this reason, many wineries, especially in the New World, have decided to put the required data on the back label of the bottle. The front can then be used to attract the consumer with colors, an identifiable logo or attractive graphics (Australia’s Jacob's Creek for example).

Last but by no means least, comes cultural resistance. There is a tendency with many wine producers to think that France's reputation is enough in itself, and that marketing isn't necessary. "[In France], you have the cooperatives with the growers and their vision of the world which doesn't include marketing. When there is extra money, they prefer to spend it on machinery which works rather than on marketing which, to them, doesn't necessarily give obvious returns," says Brouard. To many, the idea of joining up with other producers under a common brand name goes against a tradition of emphasizing the individual vineyard or family tradition.

But change is slowly shaking up the vineyards. Some wine producers have anticipated the evolving market place. Earlier this year, Groupe Castel created a line especially for exporting. "We created the 'Castel' brand to counteract the rise of New World wines: we wanted to meet consumer demand, with simple and accessible wines," says Crouzet. The range brings together different table wines under the Castel brand name, which are divided into three separate categories according to taste: light, fruity wines, stronger, aromatic wines and richer and more complex wines; all of the bottles range in price from € 3 to 8 ($4/9).

Meanwhile, Vinival, a group of wine producers from the Loire Valley, has also created a special line called "Eat and Drink." Targeting a young clientele, the concept is to associate wines with the appropriate food. The "fish" wine, a sauvignon, has a brightly colored fish depicted on the bottle; other whites and reds are available for poultry and lamb.

Despite these initiatives, it may take a long time for many French winegrowers to understand that (with exception to wines in the higher price range), France's long-standing reputation is no longer enough. Patrick Hudelot, who produces organic wine in the back hills of Bourgogne, hired a marketing manager last year. He is one of very few winegrowers in his region to take such an initiative. "People think I am crazy. Can you imagine having a marketing department?” he asks. “People here have never seen this before. In France, there is a belief that you don't need to market your wine, that France's reputation is enough. And that way we are being left behind."

France has a long history of excellent wine production but that is not enough to quench thirst overseas. Like their New World counterparts, Patrick Hudelot, Vinival and Groupe Castel are starting to apply the strong brand and marketing strategy that are essential to keeping their country’s wine exports flowing.     

[13-Oct-2003]

 
  
  

Emilie Boyer King is a freelance journalist specializing in French topics for major dailies and magazines around the world. She lives in Paris where she previously worked for BusinessWeek, Bloomberg News and the International Herald Tribune.

     
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