Brazil Country Manager, Rodrigo Lanari, and Director for Spain and South America, Juan Park, reflect on their recent seminar in Chile looking at how Brazil’s wine consumer is changing
Brazilian wine consumers have had a growing relationship with wine over the past few years. Although wine volume sales have been volatile (they fell by 14% in 2016, only to recover in 2017), data published by Ideal Consultoria in 2018 shows that imported wine consumption has noticeably grown since 2014 and now represents 1/3rd of the total wine market. In addition, Brazil is now the 26thmost attractive wine market in the world, according to the Wine Intelligence Global Compass Wine Market Attractiveness model. This ranking is partly due to the rise in the regular wine drinking population that is now comprised of 32 million adults who drink wine once a month – and 70% of this group drinks wine at least once every week. This is compared to 29.7 million adults who drank wine once a month in 2016.
As Brazil is obviously a very important market for wine imports, other countries, particularly those in South America with close proximity to the very large country (both in a geographical and potential wine market sense), need to pay close attention to this growing wine market.
On the 29th of May, key members of the wine industry in Chile gathered for Wine Intelligence’s seminar titled ‘The value of marketing and innovation on opportunities in the Brazilian market.’ Taking a close look at findings in the Wine Intelligence Brazil Landscapes 2019 report, Brazil Country Manager, Rodrigo Lanari, and Director for South America and Spain, Juan Park, discussed how those in the Chilean market can best reach regular wine consumers in Brazil.
Chile is among the top five wine exporters in the world, and accounts for 42% of the wine imported into Brazil. But despite this large market share, there is always the challenge of remaining the dominant country of origin and keeping a premium positioning within the eyes of consumers.
One trend that we are seeing globally is the idea of cognitive off-loading, where consumers typically remember less wine information, such as popular countries of origin, as they now have a readily-available reference device in the form of the internet / smartphone right in hand. Where once varietal and history of the winery may have been forefront at consumers mind, now 45% of South American consumers consider the appeal of the bottle and label to be important when buying wine – perhaps because this is a decision that can be made without extensive wine knowledge. The Wine Intelligence Global Wine Brand Power Index 2019 report also touched upon this theme as many brand power index scores fell within the last year due to lower brand recognition. (For more information on this topic, see the article Mindspace Deficit Alert.) Therefore, Chilean wine brands need to think about how to stick out in the minds of Brazilian consumers – and not just through wine knowledge.
This phenomenon can be seen most clearly amongst Millennial consumers, or those aged between 21-35 years old. Although these younger consumers account for 20% of the adult population and 16% of the regular wine drinking population in Brazil, they tend to be the least engaged in the category. Over the past 10 years, we have seen a shift in how these consumers engage with the wine category – most notably through a lower brand recall and more visual preferences. Interestingly, this cohort is now also split more evenly between the sexes.
But this lower brand recall can also mean there are more opportunities for more niche or specialised areas in the wine industry. For example, regular wine consumers surveyed in the Wine Intelligence Vinitrac® Brazil survey state they are more open to new varietals. Similarly, tracking data shows rising levels of consumer involvement in wine, shown by a growing proportion of respondents who say they ‘feel competent’ about wine, ‘like to take their time to purchase wine’ and consider wine to be ‘important’ to their lifestyles (31% in 2019 compared to 27% in 2017).
In addition to these highlights, the seminar also explored how Brazil is seeing a boom in rosé and sparkling wine as well as the regional differences amongst Brazilian consumers, which is extremely important in reaching the right target audience.
Overall, despite the economic recession and political turmoil happening in Brazil, the wine market in the country is showing a good degree of resiliency and is growing above the overall economy. Brazilian consumers might be engaging more with wine, but in a new way that accepts many new players due to their openminded attitudes and lowered brand recall. The Brazilian wine market is still considered to be emerging, and wine drinkers are very much in discovery mode – making it an interesting space for innovation and entrance of new products and wineries.
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