Recent market headlines suggest that Prosecco has over-powered Champagne, with sales of the Italian newcomer growing at a significant pace well ahead of the French traditionalist. The knockers would say that Champagne has lost its sparkle.
However out of adversity often comes innovation. For a product like Champagne innovation takes years to develop. The next generation of Champagne will see it create a new direction enticing customers with a different sort of wines – less of the £10 supermarket wine, more of carefully crafted niche wines.
Recent Champagne shipments reported by the Comite Champagne show that the UK market retains its second position in market value but going backwards at 14.0%, whilst it still is number one in volume terms selling over 31M bottles.
The whole global market has had its second best year ever selling just 27€M of the record 2015, more than 150€M less than the last good economic peak of 2007. So overall Champagne is not in bad shape, but the UK is going through some structural change as far as the sector is concerned.
Supply is finely balanced with 350M bottles produced on average, having taken a hit of about 15% from implementing sustainable agriculture (agriculture durable), in itself a quality increasing initiative. However the global economy is fragile and whilst recently showing some signs of recovery, in general there is not much economic growth on offer to forecast strong volume increases.
So innovation is the best way in which Champagne is set to re-gas the sparkle in the next 10 years. More of the Grand Marques (major brands), Bollinger, Krug, Pol Roger, Moet et Chandon, Veuve Clicquot, Champagne Lanson are selecting different bespoke bottles to put their wares in. This is not a decision for the faint hearted. Having decided a new direction, identified the wines they then have to be filled into the desired glassware a full 3 years and often more ahead of market release. All the equipment used along the way including gyropallettes (the mechanical frames used to ‘riddle’ the wine as it ages) have to be adapted or changed as well as the labels, gift boxes and cartons. There is much to consider and a good deal of investment. The reward is the distinction gained in consumers minds that takes many years to build up and create.
It is reasonable to say that most of the innovation is coming from the Grand Marques. One of the examples is Champagne Lanson’s Green Label recent release, its first Organic Wine produced from organic and biodynamically grown grapes. It is presented in an eco-friendly lightweight bottle, with even its iconic Maltese cross changed to green. It is a classic blend of Pinot Noir, Pinot Meunier and Chardonnay and with just 8 grams of dosage it is the perfect classic Brut style of Champagne for the organic connoisseur.
As we understand the level of commitment that it takes to produce such a wine, then we can begin to appreciate the quality investment. The grapes for this wine were grown in a vineyard in the village of Verneuil, which was bought by Lanson in October 2010. The harvest for this release was in 2012. As dictated by the house style the wine is not subjected to the malolactic fermentation, which produces a more firm crisp style of Champagne targeted at the connoisseur. As befitting for Wimbledon fortnight Champagne Lanson ‘Green’ label will be served in the Scarfe’s bar of the Rosewood Hotel and which I have on good authority will be made into a cocktail call ‘Strawberry Queen’. So 7 years from start to launch – Champagne investment is a long term initiative. And that is not to declare success, merely a staging post along the way.
Of course innovation does come in shorter timescales, such as the ‘Wimbledon-themed’ yellow neoprene T-shirt cooler jackets sleeves that Champagne Lanson are presenting on the brands 20cl version. However these have less resonant long term value.
There is a greater investment in specific land with land prices reaching as high as 1.5M€ per hectare. There are 34,000 hectares of vineyard in Champagne with 319 designated crus or growths and grown by 19,000 vignerons. There are just 17 Grand Cru producing some of the best rated quality, so the value on this land is very high. However it is also becoming a focus on developing value to the brand equity, where consistent outstanding quality can be demonstrated and produced in precise small volumes.
Champagne certainly has not lost its appeal in the market for some of the prestige establishments. There are some restaurants and hotels where only Champagne will do and the Italian upstart is not listed at all. Champagne, Bollinger exclusively, is still the brand of choice for the James Bond franchise. In the hospitality sector there is still much value for Champagne, the only difference is that it has to be selective and differentiated. A little like the £10 Brut NV Champagne at the supermarket, there is decreasing value in the unknown entry level brand on a wine list. Every Champagne needs to make a statement to create value.
Champagne has not lost its sparkle. It is merely refining this most prestigious, tenacious and long lived sector, reinventing itself for a dynamic consumer base that is always wanting more value, more prestige, glamour and quality. The UK market will change its aspect in the next few years and we will see value, niche and high quality coming much more to the fore. The sparkle will effervesce once more.
Hospitality & Catering News, Wine & Drinks Editor