The future of the wine industry

Donnerstag, 21. Dezember 2017 - 16:00

Crystal ball/Sanjay Acharya

What role will Amazon, cannabis, artificial intelligence and driverless cars play in the future of the wine industry? These and a long list of other questions form part of a major piece of ongoing research into the future of wine — its results will appear in this magazine and a book to be published early next year. 

With a statistically robust 1,285 responses from wine professionals in 59 countries, the study is already yielding insights. As the number of participants grows, it will become possible to make more detailed comparisons between attitudes in different countries.

So far, a number of findings are quite clear. Almost all of the participants (96%) expect to see the wine industry change over the next 25 years, but just under a quarter think that it will merely look “a little different”. Fewer than one in six professionals (17%) believe that the wine world of 2042 will look “very different”.

What are the big issues?
When it came to naming the factors that are going to have the greatest impact on the industry, the professionals were clear. Climate-change sceptics might now hold positions of authority in the US, but only 4% of the international wine industry is untroubled by the way in which changing weather conditions are going to affect their businesses, with nearly two-thirds (61%) expecting them to have “much more impact” than at present. The vast majority (86%) is also concerned by a growing shortage of water and more than three-quarters expect to see the introduction of “new forms of irrigation”. These will presumably be associated with the advanced analytical technology tools that more than a third (38%) think they will see in the vineyards.

At a time when winegrowers globally are struggling to employ vineyard workers, and automation is being introduced into a wide range of other forms of agriculture, only 27% of the participants see robots having “much more impact” on their industry over the next two and a half decades. Presumably, the remaining 73% have not watched video clips of the prototype robot-pruners that are already being tested in New Zealand and the US — or read reports of companies that are expecting their vineyards to be fully automated within five years.

More than one professional in five (21%) expects to see a major influence of “new and/or unfamiliar grape varieties and/or blends”, with even more (29%) looking to “new regions and/or styles”. When they were asked to name the varieties that would become more or less important over the next quarter of a century, the participants had fewer clear views.

However, it was striking that 29% and 27% respectively thought that Merlot and Cabernet Sauvignon would be less popular in the future. Zinfandel fared even worse, getting a thumbs down from a third of the participants. The only other grape to get this kind of negative score, perhaps predictably, was Gewürztraminer (32%).

The clear red winner — with votes from nearly two-thirds of the respondents in the predicted popularity stakes — was Pinot Noir. More than 18% expect this variety to be “much” more popular, ahead of Grenache with 12% and Tempranillo and Gamay with around 10%. Whether producers will follow a respondent’s suggestion that labels reveal Pinot Noir clone numbers remains to be seen.

Other red wine grapes to watch include Touriga Nacional, Nebbiolo, Sangiovese, Carignan, Cabernet Franc, Syrah and Barbera, all of which get “more” or “much more” popularity votes from at least 44% of the participants, compared with Cabernet Sauvignon’s 22% and Merlot’s 26%.

The survey offered fewer white options but provided similar results, with 24% of the participants expecting Pinot Gris/Grigio to lose at least some of its current popularity. One UK-based wine distributor who disagreed with this view, however, predicted “a rise in Pinot Gris [and] a fall in Pinot Grigio”. An Australian suggested that “the logical marketing to a consumer base already well engaged with Pinot Noir and Pinot Gris is to leverage the ‘P’ word and pivot towards Pinot Blanc/Bianco”. However, only 5% of the respondents expected this variety to gain traction, a little less than Viognier (6%) and significantly so than Grüner Veltliner and Albariño (9%). For another British distributor, this last variety will “be the new Pinot Grigio… [in] lower-alcohol versions.”

Sauvignon Blanc was another style whose star seemed set to fall, while Chardonnay will enjoy a revival of interest, thanks to its combination of consumer-appeal and (relatively) easy-to-grow nature. The variety that received the most votes — with 57% expecting a rise its popularity — was Riesling. A Canadian believed that both this grape and the Grenache would both be favoured because of their natural resistance to disease and drought. An Australian, however, noted that “Riesling is more of a prayer than maybe reality”.

When choosing these varieties, the respondents acknowledged the twin challenges facing any winegrower deciding what to plant: consumer popularity and the practical considerations of performance in the vineyard. As an American respondent bluntly stated: “Environmental changes will affect what grows well and what people can afford.”

A French respondent predicted that indigenous grapes [would] rise in popularity, led by winemakers planting them for practical reasons. A more pragmatic Australian, however, thought that future styles would be driven by regions with little or no tradition of wine production. “A move into less obvious/popular varietals… dependent on what varietals become successful in China and India.”

Recent visitors to both of these developing regions will have been struck by the popularity among viticulturists of Marselan, a Cabernet Sauvignon-Grenache cross developed in France in 1961. In China, Grace Vineyard’s 2015 Tasya’s Reserve Marselan 2015 from Shanxi recently won a top award in a major Asian competition, leading to suggestions that it might become a “a possible signature grape for China”. Judy Chan, president of Grace Vineyard, told “For years we have been looking for the most suitable variety in our vineyards. This award not only rewarded our efforts, but also encouraged us to keep on working with these varieties.” Chan’s enthusiasm for Marselan, however, is shared by only 2% of the survey respondents. 

Low alcohol and luxury
Whatever the varieties grown in the vineyard, a majority (56%) of the survey respondents expected low- and non-alcohol wines and multi-regional blends (55%) to gain market strength. Another strongly backed (57%) winner is “new styles of sparkling wine (not based on Champagne/Prosecco etc)”.

One in five professionals are looking forward to “natural” wines having “much more impact” on the market, while half as many as expect the same success for organic wines. Even more respondents (46%) expect to see a significant hike in sales of sustainable wine. As a respected producer from southern France noted: “Wine made to accredited social and environmental standards has to be the big-volume change as the big-volume distributors will be required to use the standards.” A British retailer offered a more down-to-earth verdict: “Commercial stuff that moves and sells and opens up new markets will bring change — Vin De France is already having an impact for instance. Organic and biodynamic may increase a little, but commercially it’ll make no difference.” 

It was perhaps a New Zealander who summed it up best, however: “Fashion-driven wine and wine product styles will come and go as they always do. The lower-alcohol trend will be more durable since it is driven by broader societal changes as will sustainable, organic and so on. Natural wine may not necessarily endure as a trend in itself but it signals a generational difference in the approach to wine.” 

To the likely dismay of some purists, ultra high price “luxury” wine is predicted to have a greater impact (50%) than the fine wine (43%) that has traditionally attracted investors. As a British importer said: “There is a huge amount of private wealth that is prepared to pay if the story and marketing is right — you only have to look to the fashion/accessory or jewellery industry.” As a French producer wrote, more population means more rich people, which means “more volume for ultra-iconic wines”.

Storm clouds ahead
Apart from low and non-alcohol wines, the competitors most feared by conventional wine producers go beyond the beers and spirits — both expected to have 37% more impact — with which they have traditionally sparred. Of greater concern are novel alcoholic (45%) and innovative non-alcoholic drinks (48%). Indeed, one in eight respondents see this latter category as a significant threat, compared to one in 13 for beer and spirits. The fact that a similar number are worried about cannabis may surprise readers in countries where consumption of this drug is still a crime. But observers of the US market are all too aware that, as it has been legalised in states like California, industry giants such as Constellation and Southern Glazer’s have openly flirted with the notion of commercialising it. Nearly 12% of the respondents to this survey firmly expect cannabis to challenge their industry.

The study does not offer much encouragement for wine critics. More than 40% of the respondents think their influence will wane, while only 4% expect it to grow significantly. This has to be compared with the 15% for wine educators, 12% for lifestyle writers, around 9% each for sommeliers and food writers and 8% for retail staff. If you really want to communicate with consumers in the future, you might be better advised to focus on professional Instagrammers (29%) or vloggers (video bloggers), (25%). Tourism (46%) and events (29%) are seen as hugely important, but the biggest focus will be on social media (49%).

As one of the most senior members of the UK wine trade noted: “I think any brand that can’t drive a social media presence or consumer engagement in that method will struggle. Some of the ‘experts’ are becoming tiresome and people would prefer a mommy vlogger tutorial on wine to the MW’s five-page report on Burgundy.”

Of course, the influence of both vloggers and MWs could be undermined by the growth in artificial intelligence algorithms that permit a consumer to be sent recommendations of wines they are most likely to enjoy, in the same way that Spotify tailors its music recommendations. More than 37% of the participants believe these will have “much more impact”, while 39% see geolocation (using consumers’ location for targeted marketing/ selling) enjoying a similar role.

How and where people will do their buying? Nearly everyone (90%) expects smartphones to be more important, with most (53%) thinking that these will have “much” more impact compared with just 6% for traditional bricks-and-mortar shops. Over a third of the respondents (38%) think there will be a lot more use of scan-and-buy technology that enables a consumer to point their phone at a label and click to make a purchase, while a similar number predict more direct-to-consumer sales by wineries. 

Unsurprisingly, online retailers will be major beneficiaries from the use of this kind of technology, with 34% expecting them to have a lot more impact on sales. But this figure is overshadowed by the 40% expectation for Amazon. As the head of online marketing for a major German producer said: “Amazon marketing is where it’s at. It is nearly impossible to get around it when marketing wines in the digital realm. A lot of marketers are currently shifting their Google Adwords budget to Amazon SEA. Google may remain the number one search engine but Amazon already ranks first when people are researching products and customer reviews. This trend will become more visible in the wine industry within the next five years.”

Finally, there are the driverless cars which 26% of the respondents expect to have a significant effect on their industry, because of their potential to make drink-drive laws irrelevant, along with the role these vehicles may play in wine tourism. But then, as a Canadian noted: “Driverless cars and vehicles may not even be adapted as most people are not fans of this technology. People like to drive.” He may be right, but there’s a lot of money betting against him.
Robert Joseph