MARKET WATCH: HUP, HOLLAND, HUP!

by | Dec 1, 2016 | Business and Marketing

South African wine is well established in the Netherlands. What are the trends and new opportunities for growth?marketwatch_holland

South Africa currently holds the second position after France for the Netherlands’ wine market share in volume. Edo Heyns spoke to Sara Channell, Wines of South Africa market manager for the Netherlands, about growth opportunities in this small but affluent European country.

Dutch supermarkets – which represent around 80% of the sales – cater for more knowledgeable customers by offering authentic grape varieties from
interesting regions. This means they’re also starting to compete
with speciality wine shops. Nowadays you can find cultivars such as
Godello, Albarino, Mencia and Fiano on the supermarket shelves – something which until fairly recently was almost unimaginable.

Sales of organic wines are still limited at about 1%, but the category for organic products is growing. Despite the small market share it’s a crucial part of retailers’ portfolio. Ethical trade is still important. Last year the volume of Fairtrade wines was just over one million litres, but sales in the first half of 2016 have already grown by 16% compared with last year.

There’s a trend towards lighter-style wines with less oak. The new Cinsaut trend in South Africa could fit in nicely with this.

There has recently been a significant shift from volume to value in terms of export objectives. How is South Africa faring in terms of high-value premium wines?

Price is still the main trigger for consumers to buy a product and in the Netherlands most wine sales in the supermarkets are under €3,99.

Supermarkets – even the discounters – are now offering more premium products on the shelf. Cooking programmes are popular and a supermarket is a one-stop shop offering specialised ingredients to cater for home chefs.

South Africa’s image as a producer of premium wines has increased thanks to positive media coverage and the enthusiasm of opinion leaders and influential sommeliers. The country is known as a supplier of good price-quality ratio wines but there are notable opportunities for South African wines in the €6,00 to €9,95 price range, where we are under-represented.

There are no reliable sales figures available for the traditional sales channels in the Netherlands, but importers say there’s an increased interest in premium wines from South Africa and they’re adjusting their portfolios to meet this demand.

There’s a strong historical link between South Africa and the Netherlands and South African Tourism is active in promoting South Africa as a key tourist destination. At the moment about 120 000 Dutch tourists visit South Africa annually.

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