Is ‘Premiumisation’ the best marketing strategy for the Riverland and other inland wine producing regions of Australia?
The COVID-19 pandemic has seen global wine consumption trend towards ‘popular wine’. Expensive ‘on premise’ wine sales have suffered as people enjoyed reasonably priced wines while isolated at home. Has ‘premiumisation’ resulted in the global wine consumer choosing an Australian popular wine over those from Argentina, Chile, and South America?
Over the previous two decades, the Riverland, by producing 56% of the state’s wine grapes, has underpinned the South Australia wine industry. Similarly, the inland wine regions now contribute more than 70% of the national crush annually.
Consequently, the Australian wine industry is dependent on these regions to fund relevant research and development as well as marketing through the mandatory volumetric levy system.
It seems illogical that the marketing strategy for Australian wine does not synchronise with the popular wine price point that underwrites the whole industry.
Logic suggests that, had the global wine consumer been fully aware of Australian ‘popular’ wine through strategic marketing programmes, the COVID-19 pandemic may have been an unexpected bonus.
More importantly though, increasing the value of Australian popular wine through strategic and relevant marketing needs to be a high priority. Unless the profitability of growing wine grapes in the inland regions is competitive, vineyards will be substituted with other irrigated agricultural crops such as almond, avocados and citrus. That progressively eliminates the funds that drive the industry.
Therefore, as we all know, “there is no point in closing the gate after the horse has bolted!”